Q2 2024 KE Holdings Inc Earnings Call
Operator: Hello ladies and gentlemen, thank you for standing by for Ke Holdings Inc.'s second quarter 2024 earnings conference call. Please note that today's call, including the management's prepared remarks and question and answer session, will all be in English. Simultaneous interpretation in Chinese is available on a separate line for the duration of the call. To access the call in Chinese, you will need to dial the Chinese language line. At this time, all participants are in a listen-only mode.
Hello, Ladies and gentlemen, thank you for standing by for K E Holdings, Inc. Second quarter 'twenty 'twenty four earnings conference call.
Please note that todays call, including the management's prepared remarks and question and answer session will all be in English.
Simultaneous interpretation in Chinese is available on a separate line for the duration of the call.
To access the colon Chinese you will need to dial into the Chinese language line.
At this time, all participants are in listen only mode.
Operator: Today's conference call is being recorded. I'll now turn the call over to your host, Ms. Siting Li, IR Director of the company. Please go ahead, Ms. Siting Li.
Speaker Change: Today's conference call is being recorded I will now.
Speaker Change: I'll turn the call over to your host Ms sitting Li IR director of the company. Please go ahead switching.
Siting Li: Thank you, operator. Good evening and good morning, everyone. Welcome to KE Holdings Inc.'s Orbeca's second quarter 2024 earnings conference call. The company's financial and operating results were published in the press release earlier today and are posted on the company's IR website, investors.ke.com. On today's call, we have Mr. Stanley Peng, our co-founder, chairman, and chief executive officer, and Mr.
Speaker Change: Thank you operator, good evening and good morning, everyone. Welcome to pay your Holdings, Inc, or they cause second quarter 2024.
Siting Li: Mr. Peng will provide an overview of our strategies and business developments, and Mr. Xu will provide additional details on the company's financial results. Before we continue, I refer you to our safe harbor statement in our earnings press release. We should apply this caution to these calls as we will make forward-looking statements. Please also note that Faker's earnings press release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measures.
Speaker Change: The company's financial and operating results were published in the press release earlier today and are posted on the company's IR website methods don't hate us.
Speaker Change: On today's call we have Mr. Sally Pope co founder Chairman and Chief Executive Officer, and just how she our executive director and Chief Financial Officer.
Speaker Change: Well provide an overview of our strategy and business development and she will provide additional details on the company's financial results.
Siting Li: Please refer to the company's press release, which contains a reconciliation of the unaudited non-GAAP measures to comparable GAAP measures. Lastly, unless otherwise stated, all figures mentioned during this call are for R&D. Certain statistical and other information relating to the industry in which the company is engaged, to be mentioned in this call, has been obtained from various publicly available official or unofficial sources. Neither the company nor any of its representatives have independently verified such data, which may involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such information and estimates. For today's call, matchnames will use English as the main language.
Speaker Change: We continue I refer you to our two public you know earnings press release, which applies to this call as we will make forward looking statements. Please also note that because earnings press release and conference call include discussions I noticed that the GAAP financial information as well as a lot of the non-GAAP financial measures. Please refer to the company's press.
Speaker Change: With me, which contains a reconciliation.
Speaker Change: non-GAAP measures to comparable GAAP measures Lucky unless otherwise stated all figures mentioned during this call are in RMB.
Speaker Change: Physical and other information relating to the industry.
Speaker Change: The company engaged to be mentioned in the call.
Speaker Change: It seems some very publicly available official or unofficial resources.
Speaker Change: So the company nor any of these representatives have independently verified.
Which may involve a number of assumptions and limitations and you are cautioned not to.
Speaker Change: Do you wait to such information.
Speaker Change: For today's call Muslims will use English as the language is no that the Chinese cancellation for convenience, but its only and in case of any discrepancy match those statements in the original language will prevail.
Siting Li: Please note that the Chinese translation is for convenience purposes only, and in case of any discrepancy, matchname statements in their original language will prevail. With that, I will now turn the call over to our Chairman and CEO, Mr. Stanley Peng. Please go ahead, Stanley.
Speaker Change: With that I will now turn the call over to our chairman and CEO.
Speaker Change: Please go ahead Sir.
Speaker Change: Thank you Steve Hello, everyone. Thank you all for jewelry and pay for the second quarter. The inventory in 2020 earnings conference call.
Stanley Peng: Thank you, Siting. Hello, everyone. Thank you for joining BIC's second quarter and Interim 2024 Alliance Conference call. In the second quarter, we continue to outpace the broader market. Since the beginning of the year, we have made strategic efforts to boost growth, foster our ecosystem, and transform our business into a technology power when solving the essential services platform model. These efforts have paid off, and we have achieved high quality performance across the board, a set of supporting policies.
Speaker Change: In the quarter, we continue to outpace the broader market since the beginning of the year, we have made a strategic.
Speaker Change: Strategic efforts to boost group.
Speaker Change: First of all ecosystem and transformer business into a technology powered whereas drawbridge special Servicers people model.
Speaker Change: These efforts are paying off.
Speaker Change: We achieved high quality performance across the block the block.
Speaker Change: With all the parties policies booth.
Stanley Peng: Booster rated the overall market recovery in the second quarter, particularly the existing home market, especially in first-tier cities. We bonded sharply in May and June.
Richard: Boost to Richard.
Richard: All the market recovery in the second quarter.
Richard: Notably the <unk>.
Richard: Shifting from market is crucially important procure cities rebounded sharply in May and June.
Stanley Peng: Our home transaction business performed well within this sellable market environment, with both our existing and new home transactions surpassing the broader market's performance. More specifically, in May, the existing home transaction volume on Bitcoin's platform saw positive GTV growth compared to the previous year, and in June, growth surged by nearly 70% year-over-year. According to the estimated firm data disclosed by the housing bureaus and housing associations of the four first-tier cities, the total number of online... Restorated Transactions for Existing Homes Grouped by Around 16% year-over-year in the second quarter of 2024. For reference, while online risk-related transactions on Bitcoin's platform grew by 40% year-over-year.
Richard: The whole transaction business performed well within this favorable market environment.
Richard: With both existing and new home transactions, partially with the broader market performance.
Richard: Specifically in May.
It came from a transactional basis careful so called U see TV crews compared to the previous year.
Richard: In June Bruce surgeon by nearly 70% year over year.
Richard: According to the estimate from data gets closed.
Speaker Change: And our housing associations overflow first pure citrix.
Total number of online.
Mr. Richard: Mr. Richard transactions or is it to your home group out of room.
Speaker Change: 16% year over year in the second quarter of 2024.
Speaker Change: Why don't I address Gretchen transactions and because of this careful grew by 40% year over year.
Stanley Peng: For new home transactions, the contract contraction rate on Bitcoin's platform narrowed to 25% year-over-year in May from contract transaction value, and in June, GTV turned positive, with the contract transaction value growing over 12% year-over-year. For the second quarter, GTV over CRIC's top 100 real estate companies declined by 35% year-over-year, while GTV's contraction on Bitcoin's platform narrowed to 20%. The improvements in the second quarter this year were partly due to the warning efforts of the high base we saw in the fourth quarter.
Speaker Change: Our new home transactions the contract contraction right.
Speaker Change: Careful now 225% year over year, you made some contract transaction value.
Speaker Change: CTV true posture with the contraction is actually a very growing over time.
Speaker Change: Year over year for our second quarter, PPD, Lucy I see companies trying to release the company's decline.
Speaker Change: Three 5% year over year with the TV consumption because careful now.
20%.
Speaker Change: The improvement in the second quarter. This year were partially due to the efforts of the higher pace. We saw in the fourth quarter more importantly, go scientific and maintenance and perpetual rational initiatives focused on improving our performance against internal benchmark.
Stanley Peng: More importantly, our scientific management and proactive operational initiatives, focused on improving our performance against internal benchmarks, underpinned our ability to outperform in a relatively stable market. I'd like to share some details about our existing home business.
Speaker Change: And all the time.
Speaker Change: Our ability to cool.
Speaker Change: Relatively stable market.
Speaker Change: I'd like to share some color on lithium home business in 'twenty 'twenty four we how pleased more emphasize all operations is guilty lab store in agency networks.
Stanley Peng: In 2024, we have placed more emphasis on our operations in scaling up the store and agent network, enriching community outreach, and managing key housing projects to broaden our customer-based and homeless encouragement. Since the end of 2023, our platform has seen a net increase of over 2,400 active stores, or a 6% increase, and a net increase of over 40,000 active agents. As we expand our touchpoints, we are also putting more effort into high-quality hosting management.
Speaker Change: You're reaching community ultra rich managing key housing projects to broaden our customer base and home listing coverage.
Speaker Change: And all the 'twenty to 'twenty three I'm fearful I'm has seen a net increase.
Speaker Change: Over 2400 virtual stores.
A 6% increase.
Net increase along.
Speaker Change: Oh 48.
Speaker Change: Agents.
Speaker Change: Our touch points. We are also putting more effort into high 40, <unk> management concentrating on quality home listings and exploring different ways to tap into new media based on maturities for customer acquisition.
Stanley Peng: Concentrating on Quality Home Listings and Exploring Different Ways to Tap into New Media-Based Opportunities for Customer Acquisition and Conversion. All these initiatives have improved customer and home listing conversion rates. We also boost cooperation efficiency with efforts such as region-based co-governance communities and reinforce business conduct governance by preventing private Private Offline Deals, improving closed loop measurements on our platform.
Speaker Change: All of these initiatives have improved customer and holding lifting conversion rates. We also boost cooperation.
Speaker Change: Efficiency with the effort.
Speaker Change: The region base co governance committees.
Speaker Change: Andrew raised close business conduct governance.
Speaker Change: He can probably.
Andrew: Probably offline dealers.
Andrew: Improving close loop managements.
Andrew: Therefore.
Stanley Peng: On the new home business front, we doubled down on our effort to increase the number of cooperation projects and strengthen our sales conversion capabilities in terms of expanding our cooperation with more new home projects. We established an end-to-end monitoring process for all projects and focused on managing key housing projects and developers to improve the quality of new home-built projects. To improve sales conversions, we overhauled our sales process this year. Our approach to new home sales used to be a huge crowd strategy that focused more on properties than customers. This year, we are adopting a more precise approach driven by customer demands. In addition, we started monitoring and analyzing conversion data from our cooperation with upstream and downstream value chain partners on a daily basis.
Andrew: On the new home business front, we doubled down on our.
Andrew: Efforts to increase number of cooperation projects and is facing almost sales conversion capabilities in terms of what depending on cooperate.
Speaker Change: There's more new home purchase.
Speaker Change: It used to be dish and end to end monitoring process for our projects and our focus on managing key housing projects and given our first to improve the quality of the new home goods.
Speaker Change: To improve sales conversions.
Speaker Change: Our sales process this year.
Speaker Change: For new home sales used to be a huge crowd strategy.
Our focus is long properties than customers. This year, we are adopting a more.
Speaker Change: Precise approach driven by customer demand even in Houston, we started monitoring and analyzing conversion date from our cooperation with upstream and downstream value chain partners on the dairy baskets. We also delivered.
Stanley Peng: We also deliver impressive results in our non-home transaction business, including home renovation and furnishings and home rental services. Despite the challenging market, in the first half of the year, revenues from our home renovation and furnishings business and home rental services grew close to 60% and 177%, respectively, compared to a year ago, and gross margins continue to improve. In fact, this year, we intentionally slowed down a slow pace in the home renovation and furnishing business against the rapid growth in scale we achieved last year.
Impressive results you are now home transaction business.
Speaker Change: Generation under 40 shoes and home rental services.
Speaker Change: The challenging market in the first half of the year revenues from our home renovation and 40 shoes business and.
Speaker Change: Our home rental services grew close to 60% and a 177% respectively compared to a year ago and of course margins continuously improves.
Speaker Change: This year, we intentionally slowed down.
Speaker Change: A slow slowed our pace in the home renovation and inflation basis against the Rep. You boost your skill, we actually last year to give you a bit of contacts and exploring new business with a big organization building confidence in the business of that liability.
Stanley Peng: To give you a bit of context, when exploring new business within a big organization, building confidence in the business's viability and continuity is the first and most important challenge. That's why last year was all about accelerating our scale, where we succeeded without compromising quality or reputation, to prove that business was viable, making a crucial first step. However, if you run too fast, you risk sacrificing quality and losing customers' trust.
Speaker Change: Continued continually futility is the first and most important challenge that's why last year.
Speaker Change: Oh, I'm not asking a rating on a scale.
Speaker Change: We are succeeding without compromising corky our reputation is approved the business whether it's viable.
Mickey: Mickey a crucial first date.
Speaker Change: If you run too fast at risk sacrificing liquidity.
Speaker Change: Losing customers.
Stanley Peng: How to balance skill and quality and establish trust is the second challenge to developing new business, having confirmed the business's viability with last year's strong performance. We slow down this year to make sure we are going in the right way by creating the second and second critical changes. This year, we have been focused on two areas. First, we enhanced our capability to deliver comprehensive, well-thought-out, full service solutions. This includes improving our development of full-service, complete renovation products, our management capabilities with service providers, supply chains, and integrated delivery, as well as building the concrete boundary system infrastructure. Thank you.
Speaker Change: How to tell his skill and quality. These type it is true it is.
Speaker Change: Second a change to developing new business.
Speaker Change: Having confirmed the business its viability.
Speaker Change: Last year's strong performance.
Speaker Change: We slowed down this year to make sure we agreed in the right way by increasing the second accretive second crucial critical challenges.
Speaker Change: This year, we have been focused on two areas first.
Speaker Change: Oh capability to deliver comprehensive wisdom full service solutions.
Speaker Change: This includes improving our development on foodservice.
Speaker Change: Create renovation innovation printer.
Speaker Change: I imagine many capabilities with service providers strengthens and the integrated delivery.
Speaker Change: We are building the call, Chris Buendia system infrastructure, if I could.
Stanley Peng: We are ready and promoting the HomeSoft 2.5 system. We integrated the full-service capabilities we developed in Beijing into HomeSoft 2.5, which can handle up to 5,000 simultaneous construction orders. We also integrated the BEAM, SSC, Middle Office, and the Integrated Material Fulfillment Model.
Richard: Thank you Richard and to promote either home sauce to clarify system.
Speaker Change: We integrated this latest offer full service capabilities, we didn't give out in Beijing into holding stock $2, five which Kathryn dropped two five southern senior Tenuously construction owners, we all of a sudden intervention.
Speaker Change: Okay, So, let's see middle office, and the integrated material fulfillment model.
Stanley Peng: Our goal this year is to roll out these advanced capabilities nationwide through the Homesauce 2.5 system. This year, we continue ramping up our ability to connect new suppliers on our platform. The number of stores for our housing transaction services is steadily increasing, and the number of service providers for our new initiatives is also growing rapidly. Without this new supplier, our customers will face limited options, and our source capability could be constrained.
Speaker Change: Our goal this year is to lock this advanced capabilities nationwide sued the Horizonte two plus nine system.
Speaker Change: This year, we continue to ramp.
Speaker Change: Our ability to connect new supplies.
Speaker Change: Paul.
Paul: The number of stores for all the housing transaction services is steadily increase increasing and the number on the service provider for our new U shaped use is also growing rapidly.
Speaker Change: Without this new suppliers and customers.
Paul: With a face limited auctions.
Paul: And our services capability could it be constrained.
Stanley Peng: Expanding supply also inevitably forces us to consider how best to manage it, ensuring its quality and improvement. Our biggest challenge is to leverage certain rules to help these suppliers achieve better outcomes. We view these supplies on our platform as targets for transformation, not monetization. That is to say, once the supplies, including service providers, join our platform, we must enhance them. As a result, we are consistently investing in training four-store operators and implementing robust operations for home listing.
Speaker Change: He was opinion supplying also EBIT to police forces us to consider how to.
Paul: How best to mandate it.
Speaker Change: Ensuring the air quality improvement.
Clive: Biggest challenge here is to leverage certain rules to have this clients achieve better outcomes. We view this as Clive I was careful and targets for transformation not monetization lift to say where's the supplies, including service providers, John I'll Triple we might.
Speaker Change: Yeah.
Speaker Change: As a result, we are consistently investing in training for stores operators and implementing robust operations for home listings.
Stanley Peng: Customer Engagement and Our Ecosystem to Enhance Resource Conversion Efficiency. Regarding our new businesses, we have made significant efforts to reform the incentive mechanism for service providers through rule-based order dispatch and service provider rankings. By fostering a transparent and Binai Competitive Environment, we ensure resources are allocated more efficiently to the most capable talent. In the next era, customers will become more selective about services, allowing high-quality service providers to stand out, and service variance will decrease.
Speaker Change: Customer engagement in our legal system to enhance resources conversion efficiency regarding our new businesses, we have significant effort to reform before the incentive mechanism for service providers through rule based voter keeps pitch and a services provider.
Speaker Change: Keys.
Speaker Change: Right Oh, sorry.
Speaker Change: And it's benign.
Speaker Change: Comparatively environment.
Speaker Change: To show responses.
Speaker Change: Allocating more efficiency efficiently.
Speaker Change: Efficiently to the most comparable tenant.
Speaker Change: You'll never see your customers, who have become more snarky synergy about services.
I mean, how high quality of service for lenders to stand out and so it's <unk>.
Martinez: Martinez will decrease.
Stanley Peng: Customer needs will be more diverse, and new, more segmented needs will emerge. These two points guide our efforts to upgrade our products and services and deepen our operations. There remains tremendous potential for growth and efficiency improvement in both our relatively mature housing transaction services and our emerging business ventures. One solution is to focus on community-based businesses by leveraging in-depth community knowledge and understanding residents' profiles and their needs for home purchase, rental, and renovation.
Customers need there'll be more diverse and a new.
Martinez: More sentiment it needs really mirrors, just two points kind of our efforts to ablate, all products and services and the deepening our own operations.
Martinez: This remains a tremendous potential for growth and efficiency improvement in both of them are relatively mature housing transaction associates and all of them.
Emerging business adventures.
Speaker Change: Resolution is to focus on community based business by leveraging index community knowledge and understanding.
Speaker Change: You see the professors and as their needs for home purchase rental and renovation, we came off a broad package of products and our services.
Stanley Peng: We can offer more targeted products and services. This approach will lead to changes in customer acquisition channels, organizational structures, and supply chains, allowing us to differentiate ourselves from the traditional residential industry. More importantly, these changes will help us build trust in our low-frequency transaction industry. The key to community-based business is high service density. To that end, we launched more stores and organizational innovations in communities this year to increase supply. For example, in Shanghai, we added a number of community convenience service store stations affiliated with Lianjia stores, and other cities are replicating this model.
Speaker Change: Our approach will lead to change in customer acquisition channels.
Speaker Change: No theres no structures supply chairs, allowing us to differentiate ourselves from the traditional residential industry.
Speaker Change: More importantly, these changes will help us build a trust.
Speaker Change: Lower frequency transaction.
Speaker Change: History.
Speaker Change: The key to community based disease is high service intensity towards it and we launched a mall stores and organizational innovation as you communities. This year to include increased subprime for example, yes.
Speaker Change: Sure.
Speaker Change: How do you put a number on community convenience service stations.
Josh Dorf: Stations affiliated with leading Josh Dorf.
Josh Dorf: Other cities on replicating this model.
Stanley Peng: Additionally, we are integrating home renovation and rental services with eBay and Jazz stores. We have deployed home renovation expert agents in over 1,200 retail stores and are showcasing renovation techniques and hosting in-store designers in pilot stores. Our coverage of existing home listings in Shanghai grew from 76% last year to 87% in areas that we operate in. And revenues from our home renovation and our carefree rental business in Shanghai's Q2 grew by 63% and 140% year-over-year, respectively. In Chengdu, we piloted a strategy focusing on key housing projects for our home renovation and furnishing business. Our operational team has shifted back to intensive community engagement rather than dispersed services.
Josh Dorf: Additionally, we are integrating home renovation the rent with citizens with EBIT down stores.
Josh Dorf: We have deployed home renovation expert in.
Josh Dorf: In over 1200 gig to all stores.
Josh Dorf: Showcasing renovate innovation tiny purse and hosting install designers in pilot stores.
Josh Dorf: Courage or existing homeowners to Shanghai going from 76% last year to any 70% you are just going to be upgraded.
Josh Dorf: And the revenues from our home renovation.
Speaker Change: Jeffrey rental business you saw this Q2 grew by 16, 3%.
Speaker Change: 140%.
Speaker Change: Year over year discontinuity into the pilot the pilot onto our state.
Speaker Change: The strategy of focusing on key housing projects.
Speaker Change: Home renovation and insulation business our operational team.
Speaker Change: Shifting back to interact in Tennessee with community engagement, rather than dispersed services the annuity our community based services process and a production launch.
Tao Xu: We're building our community-based services process and a product launch. These pilot projects have demonstrated impressive improvements in conversion efficiency and productivity. In the second half of this year, the external micro environment will continue to pose many challenges to our business. Facing these challenges, our goal, our core goal has always been to build the capabilities that will keep the organization constantly moving forward, from when success to next. Over the past month, we have been fortunate to validate with minimal fail and error that our home renovation and furnishing model, as well as our rental business model, can drive growth near our organization.
Speaker Change: This is kind of projects have demonstrated impressive.
Speaker Change: We'll miss you and conversion efficiency and productivity.
Speaker Change: Second half over this year.
Speaker Change: He's turned to micro environment will continue to oppose many changes to our business.
Speaker Change: Faced with these challenges I'm coal on coal goal has always been to build a candidate is that it will keep the organization constantly moving forward from when success for <unk>.
Speaker Change: Next.
Speaker Change: Over the past months, we have been.
Fortunately to validate it.
Emma: Meet minimal shale Emma.
Speaker Change: On a whole new innovation in the finishing model as we realize our rental business model can drive gross.
Tao Xu: At the same time, a one-body business has shown further growth potential; through proactive marketing outreach, providing support for store owners and agents to achieve great success by integrating our new initiatives, we can drive even greater growth. In this context, our next step is to address issues related to the appropriate pace of each business and the balance between scale, quality, and efficiency. Thank you. Next, I would like to turn the call over to our CFO, Xi Tao, to review our second quarter 2024 financials. Thank you Stanley and thank you everyone for joining us.
Speaker Change: At the same time, when bought eight business and showing further growth potential.
Speaker Change: Through proactive marketing outreach, providing support support for stop nurse and Allied.
Speaker Change: To answer your question Sir.
Speaker Change: Integrating our new initiatives, we can drive even greater growth.
Speaker Change: In this context, our Nestor next then you to address issues you'd actually two of them are probe card appropriate high pace of each business and the balance which is scale.
Speaker Change: T and the efficiency.
Thank you next I would like to turn the call much more of a sample. She told her views on the second quarter 2020 for financials.
Speaker Change: Thank you Stephanie and thank all of our faults.
Tao Xu: Before we dive into our Q2 performance, I would like to briefly touch on some recent developments in the housing market. In the first half of the year, central and local authorities implemented easing policies intensively. This included further relaxing portrait reduction, lowering down the panoracial quota, and cutting the mortgage rate. The real estate financing condition mechanism was established and put into practice at an accelerated pace. The central bank launched refinancing tools to support local SOEs in aquarium-resistant commercial homes, facilitating the nationwide implementation of an old-fashioned housing-to-work program.
Speaker Change: Before I dive into our Q2 performance I would like to briefly touch on some updates in the housing market.
Oh yeah.
Central and the local authority.
Speaker Change: And easing policy intensively.
Speaker Change: But they're relaxing portrait restriction.
Speaker Change: And the ratio.
Speaker Change: Causing mortgage REIT.
Speaker Change: The royalty financing condition tiny establish and are putting into practice.
Speaker Change: Accelerated the pace.
Speaker Change: The Central Bank wants to do a lot of them too to support local athlete.
Speaker Change: Okay.
Speaker Change: So homes.
Speaker Change: 18th of National wide, you can tissue of old or new halting the way Oklahoma.
Tao Xu: In the fourth half of the year, the market showed a gradual recovery. Also, market performance was noted due to the 1990s as the beginning of the year. All these positive policies contributed to the market's greater improvement with the high-based effects from the early last year you called receiving. In Q2, the existing home market performed well, especially in 1st tier and some key 2nd tier cities where market activity notably improved. The new home market remains gradually subdued, even as its year-over-year decline narrows month-over-month in the future.
Speaker Change: In the first half of the monkeys showed up quite a bit of a problem.
Speaker Change: Well, it's a monkey performance was muted due to the 98 units.
Speaker Change: Yeah, Oh these Aussie policy could you dig into the market quite a prudent with a high base you've got it from early last year.
Speaker Change: C D.
In Q2, taking home market performed well, especially even fourth tier under some key second tier city well marquee that gives the multiple you put.
Speaker Change: The new home market it remains gradual abuse, even this year, albeit declining.
Speaker Change: Most of them all of them off in Q2.
Tao Xu: With the backdrop of an incremental rebound in market sentiment, we continue to uphold a market-neutral view and focus on improving our performance by continuously deepening operations, further empowering service providers and store owners, and promoting rapid growth of our new initiative. The combination of these efforts led to our excellent financial and operating results in this Q2. For Q2, the total PTV reached RMB839 billion, up 7.5% year-over-year; net revenues were RMB23.4 billion, representing a year-over-year increase of 19.9%; gross margin input increased by 0.5 percentage points year over year to 27.9% Gap Net Income, Rich was RMB 1.9 billion, rising by 46.2% year-over-year.
Speaker Change: With basketball.
Speaker Change: We bought a monkey sentiment, we continue to uphold the monkey mutual.
Speaker Change: Folks I'm pulling Oklahoma.
Speaker Change: Continuously deep deepening operation, but then.
Either the owner on the promoting lucky to close off all of these initiatives.
Speaker Change: The combination of this endeavor led to all of our financial and operating results you get to Q2.
Speaker Change: For Q2, the total TV reached RMB 859 billion.
Speaker Change: 075 percent year over year.
Speaker Change: That's the revenue was RMB 23 points located.
Speaker Change: Our year over year increase of 19 point of Microsoft.
Speaker Change: Gross margin improved by two five percentage points year over year to 27 point that says that.
Speaker Change: GAAP net income, which at one point I believe rising by 46, 2% year over year.
Tao Xu: Long got net income growth by 13.9% year-over-year to RMB 2.69 billion. Both revenue and non-Gap Income Exceeding Market Consensus, Moving to our home transaction services for Q2, as the overall market gradually recovers alongside our strong operational growth and strong network functions. The R8 team and the new home business both demonstrated outstanding performance. Revenue from existing home transactions reached RMB7.3 billion, up 14.3% year-over-year and 28.1% QoQ. PTV was only 570.7 billion, increasing 25% year-over-year and 25.9% quote-unquote. However, our TTV and radio go through it more closely and crucially, keeping our meditation capacity gradually stable.
Oh got Nike Com go by searching on Microsoft.
Speaker Change: To be coupons long beauty.
Speaker Change: Both revenue and non gotten call it city market consensus.
Speaker Change: Moving to our home construction services for Q2, and the overall market gradually recover alongside our small pushing will close in the coal network.
Speaker Change: Okay.
Speaker Change: All of these and other new homebuilding bolt demonstrated outstanding performance.
Speaker Change: Revenue from the home transaction reached RMB, seven 3 billion up 14, 3% year over year on the 28, 1% in Cordova cold.
Speaker Change: P T V.
Speaker Change: 500000 people attended.
Speaker Change: We're going to get 5% year over year on the 25, 49% cobalt culture.
Speaker Change: I'll repeat again, Ron will go through a well quote.
Speaker Change: It clears a little.
Speaker Change: Keeping all of my decision to do that he brought to the table.
Tao Xu: Year-over-year GDP growth, the path is running, primarily due to the adjustment in the commission rate of Beijing Lianjia, which started in the third quarter of 2023, affecting the commission rate for Easting Home. The contribution margin from these three home construction services reached 47.5%, climbing 1.9 percentage points year-over-year, under three percentage points, quote-unquote. The growth was mainly due to the stronger leverage from the new credit revenue, coupled with relatively stable fixed labor costs in terms of the new home transmission system.
Speaker Change: Yeah, I'll be interested to grow the PA, one primarily due to the darkness you look initially.
Ron: So the colt hub.
Speaker Change: Well if I can can you should wait before you can hold them.
Speaker Change: The contribution margin positive.
It reached 47.5% Colombian one nine percentage points year over year, almost three percentage points of cobalt culture.
Speaker Change: The growth was mainly due to the historical average bump that you quoted one coupled with the drugs at least they know labor costs.
Speaker Change: In terms of the new home construction activity.
Tao Xu: ZipBank market downturn will significantly outperform the market across multiple metrics. ZRSD shows that sales from the top 100 developers decreased by around 35% year-over-year, but it grew by about 38% quarter over quarter. Notably, sales in June dropped by approximately 22% year-over-year, with the year-over-year decline narrowing month-by-month.
Martin Donaldson: Martin Donaldson, we equally outperformed the monkey are called multiple metrics.
Speaker Change: Yeah. It does so without the pulp hungry with your Viper decreased by around 35% yoga.
Speaker Change: But the girl bye.
Speaker Change: Without COVID-19.
Speaker Change: Police itself.
<unk> dropped by approximately 22% year over year, but yeah. We have declined every month by month.
Tao Xu: Inc. Our new Home DTV reached RMB235.3 billion, built by only 20.2% year-over-year and rose by 55% sequentially in Q2, benefiting from the higher penetration of the developer self-channel by Gifford Corporation with D-Biden and the increase in collaborative progress, as well as the systematic improvements in our operational and sales capabilities. Yipaki Kyova, The amount of the contractual transaction volume from new home business increased 12% year-over-year in June, and this exceptional performance is in stark contrast to the index.
Speaker Change: In comparison.
Speaker Change: Our new home Tvs reached RMB 255.
Operator: Hello, ladies and gentlemen. Thank you for standing by for Ke Holdings Inc. 2nd quarter 2024 earnings conference call. Please note that today's call including the management's prepared remarks and question and answer session will all be in English. Simultaneous interpretation and Chinese is available on a separate line for the duration of the call. To access the call in Chinese, you will need to dial into the Chinese language line. At this time or participant, our enlistment only mode. Today's conference call is being recorded.
Speaker Change: <unk> bye.
Speaker Change: Hey, Paul and 2% year over year on the road by 55% sequentially in Q2.
Speaker Change #100: Repeating problems, a higher penetration of to give up without trying to.
Speaker Change #101: If our cooperation with the bankers and the equally collateral with you. Okay. That's a lot because it might take you all the operational and themselves.
Speaker Change #102: In particular.
Speaker Change #103: The months of the contract compression ball from your home button in case of chocolate that yeah. We are in June.
Speaker Change #104: This exceptional performance.
Siting Li: I'll now turn the call over to your host, Ms. Siting Li, IR Director of the company. Please go ahead, sitting. Thank you, operator. Good evening and good morning, everyone. Welcome to Ke Holdings Inc, or they could 2nd quarter 2024 earnings conference call. The company's financial and operating results were published in the press release earlier today, and I posted on the company IR website, MSX.K.com.
Speaker Change #104: Hum.
Speaker Change #105: You betcha.
Tao Xu: Run from the new home content service, declined by 8.8% year-over-year to RMB7.9 billion, while increasing 61.4% quarter-over-quarter. ELVF's sequential revenue growth outpaced ELVF GTV growth. Once again, demonstrating our strong and steady monetization capabilities in your home construction. The contribution margin for the new home transaction services recovered to 25 percent, falling by 2.2 percentage points year-over-year, mainly due to the strategic increase in variable commission under our strategy this year to improve our ecosystem.
Speaker Change #106: Revenue from the new home concerns.
Speaker Change #107: Declined by 8.8% year over year to RMB, seven 9 billion, while increasing one 4% global cold.
Speaker Change #107: Year over year, the sequential revenue growth outpaced yeah, it'll be a T. T V go.
Speaker Change #107: Again, demonstrating our strong and steady.
Siting Peng: On today's call, we have Ms. Siting Peng, our co-founder, chairman, and chief executive officer.
Speaker Change #107: Competitors in new home construction.
Speaker Change #107: The contribution margin for the new home construction services. The color that you can get 5% falling by two two percentage points year over year, mainly due to the strategic equally Embargoed Commission, although all of our strategies this year to equal our ecosystem.
Unknown Executive: And this is how she, our executive director and chief financial officer. Ms. Peng will provide an overview of our strategies and business development and Mr. Shu will provide additional details on the company's financial results.
Unknown Executive: Before we continue, I refer you to our two pop-up statements. In our earnings press release, we should apply to these calls as we will make forward the constituents. These also know that they cause earnings press release, and these conference calls include discussions of unnoticed gas financial information as well as unnoticed non-gas financial matters. Please refer to the company's press release, which contains a reconciliation of the unnoticed non-gas measure to comparable gas measures. Lastly, unless otherwise stated, all figures mentioned during this call are in R&B.
Tao Xu: New Home Contribution Margin grows sequentially by 2.8% points as we gain more leverage from the relatively stable fixed labor costs and higher revenue. In Q2, the commission income percentage for my SoE developers rose by 55%, and the proportion of commissioning advanced projects maintained at a relatively high level at 49%. Revenues from the home renovation and furniture, home rental services, emerging, and operating services grew by 85.3% year-over-year increase, reaching 34.7% of total running, 13 12.2 percentage points from the same period in 2023. Our home renovation and furniture business maintained steady growth. In Q2, contracted cells reached RMB4.2 billion, up 22.3% year-over-year.
Speaker Change #107: New home Companys Martin go sequentially by two eight points.
Speaker Change #107: And the more language.
Speaker Change #108: The bulk of the call.
Speaker Change #108: Oh hi.
Ron: Hi, Ron.
Speaker Change #110: In Q2, the commission Com homepage on my so when you get out to those by 55%.
Speaker Change #110: The propulsion.
Speaker Change #110: In Gabon project maintained at a relatively high level of 14, 9%.
Speaker Change #110: Revenue from the home renovation and furniture home rental services emerging I'm objectivity girl by 85%.
Unknown Executive: Certain statistical and other information relating to the industry in which the companies engaged to the mentioned in this call has been obtained from various publicly available official or unnoticed resources. These are the company, nor any of its representatives has independently verified such data, which may involve a number of assumptions and limitations, and your caution not to give undue weight to such information and estimates.
Speaker Change #110: Year over year in Q2, reaching 74, 7% of total run.
Speaker Change #110: June 12 climbed two percentage point bump of things deteriorate, even to get to the suite.
Speaker Change #110: Our homeland, Alicia and a bunch of business maintained a steady growth in Q2.
Speaker Change #111: I have yourself, a great find people come to bid opportunity to plus 8% year over year.
Tao Xu: Revenue reached RMB4 billion, rising by 53.9% year-over-year. The revenue growth rate outpaced that of the competitive side, largely due to input delivery efficiency. The contribution market for the home renovation and furniture business was 31.6%, up 1.7 percentage points year-over-year and 0.7 percentage points per crucial. This was mainly due to the improvements in the gross margins of our retail vendors; the contracted sales of furniture and home furnishings retail, which are outside of our home renovation package, reached around RMB 1.2 billion, accounting for around 29% of total contract sales, improving by 3.5 percentage points from the same period in 2023.
Speaker Change #111: Revenue reached RMB 4 billion rising by 53, 9% in the year over year.
Unknown Executive: For today's call, measurements will use English as the many language. Please note that the Chinese translation is for a convenient strategy only, and in case of any discrepancy, measurement statements in their original language will prevail.
Ron: Ron will go through it all paid that's all still comping themselves largely due to the input.
Speaker Change #112: You should see.
Speaker Change #113: The contribution margin of home renovation punch a button.
Siting Peng: With that, I will now turn the call over to our chairman, CEO, Mr. Senipun. Please go ahead, Senipun. Thank you, Steve. Hello, everyone. Thank you for Joe R&B, for the second quarter of the interim 2024 audience conference call.
Speaker Change #114: One 2%.
Ron: One seven points year over year, and the general 0.7 points sequentially.
Speaker Change #115: This was mainly due to the improvement in the goes market of all of our retail business.
Siting Peng: In the second quarter, we continue to outer pace the broader market since the beginning of the year, we have met strategic efforts to boost growth, foster our ecosystem and transformer or business, into a technology power, once all we stand shows us as a platform model. These efforts have paid off, and we achieved high-quality performance across the block. I set out to party policies. Both were rated the old market recovery in a second quarter.
Speaker Change #116: So, Kentucky south of the furniture and home decor.
Speaker Change #116: Each of which are outside of our home resolution packaging reached around RMB, one 2 billion in future.
Speaker Change #116: Accounting for around 29%.
Speaker Change #116: Hotel complex yourselves, improving by three 5%.
Paul: It's Paul.
Paul: Same period of 2020 suite.
Tao Xu: Our home rental services continue to grow at an accelerated pace. EQ2, a thriving rich RMB 3.2 billion, up 167.1% year-over-year, mainly due to the rapid growth in the number of rental units under management by Angel. In Q2, the number of units managed by our home-run facility exceeded 310,000, to particulate the number of the rental units managed by Carefree Rent reached around 300,000, compared with around 1 This contribution margin held steady at 5.8% from the previous quarter.
Paul: Our home run facilities.
Paul: To grow at an accelerated pace.
Speaker Change #117: In Q2, that's why new relic RMB, three 2 billion <unk> hundred 57, 1% year over year, mainly due to the rack equal number until you need all the amendments.
Siting Peng: Notably, the existing home market is especially in fourth tier cities. We found it sharply in May and June. Our home transaction business performed well within this favorable market environment, with both our existing and new home transactions passing the broader market's performance. More specifically, in May, existing home transaction of biggest platform saw a positive GTV growth compared to the previous year. And in June, growth surged by nearly 70% year over year. According to the estimated from data disclosed by the housing bureaus and housing associations of the four first tier cities.
Speaker Change #117: I know Q2, the number of units managed by all the home rental cars, It's city 310000.
Speaker Change #117: The fixed the number of the rental units managed by past where you'd want.
Speaker Change #117: Which run 300000.
Speaker Change #117: Compared with the 120000.
Speaker Change #117: Same period last year.
Speaker Change #118: That's the contribution margin held steady at five 8% from the previous cogent.
Tao Xu: In Q2, our net earnings from emerging and other services increased by 57.8% year-over-year to RMB874 million. Next, let's move on to our other costs and expenses in Q2. Our stock holdings remained stable year-over-year at RMB681 million. Other costs increased by 18.6% year-over-year to RMB511 million, primarily due to higher taxes and the surcharge and the basic maintenance cost for the rental services.
Speaker Change #118: In Q2 on that when you look at the.
Speaker Change #118: <unk> with Citigroup.
Speaker Change #118: By 57, 8% year over year to RMB 874 million.
Speaker Change #118: That's more than all the other kaufman.
Siting Peng: The total number of online restorative transactions for existing homes grew by around 16% year over year in a second quarter of 2024. For reference, one online restorative transactions on biggest platform grew by 40% year over year. For new home transactions, the contract contraction rate on biggest platform narrow to 25% year over year in May from contract transaction value. And in June, GTV turned positive with the contract transaction rate growing over 12% year over year.
True.
Speaker Change #118: Although cost remain stable year over year and of course, all the culture like RMB 681 million.
Speaker Change #118: Lots of Paul you quit by 18, 6% year over year to RMB 511, many.
Speaker Change #119: Well my rate due to the higher taxes under the third party.
Basically the maintenance cost for the rental services.
Tao Xu: Sequentially, it rose by 34.8%, mainly due to the increase in taxes and surcharges and the professional service fee. Gross profit rose by 22% year-over-year to RMB6.5 billion. Gross margin came in at 27.9%, up 0.5 percentage point year over year. The primary reason for the uplift was from the higher proportion of the revenue and the increased contribution margin year-over-year in non-housing transaction services. After call
Speaker Change #119: It goes by so people plus 8%, mainly due to the equate to Texas.
Speaker Change #119: As a professional service fee.
Speaker Change #119: Gross profit rose by 22% year over year to RMB six 5 billion.
Speaker Change #120: Gross margin came in at 27, 9%.
Siting Peng: For a second quarter, GTV or CRIC's top 100 realistic companies declined by 35% year over year while GTV contraction of big platform narrow to 20%. The improvements in a second quarter this year will partly due to the warning efforts of the high base we saw in the fourth quarter. More importantly, our scientific measurements and proactive operational initiatives focused on improving our performance against internal benchmarking.
Speaker Change #120: 0.5 point year over year.
Speaker Change #121: The primary reason for the off peak or the phone with a higher proportion of the revenue.
Speaker Change #122: Contribution margin year over year young Holton.
Speaker Change #122: This business.
Speaker Change #123: Also call Oh, so lucky they say.
Tao Xu: Also, we are giving a speech. All of which gave us more leverage and partially offset the decline in our new home contribution market yield. Quarter over quarter, gross margin rose by 2.7 percentage points, largely driven by a sequential improvement in the new home contribution margin and an increase in its revenue share, combined with overall revenue growth and Sibyls.com to further amplify the leveraging effect. In Q2, our gas operating expenses totaled RMB4.5 billion, up 5.6% year-over-year and 9.5% sequentially. GMA expenses were relatively stable both year-over-year and sequentially at RMB 2.1 billion.
Speaker Change #123: All of which gives us more leverage on the possibly old stuff that he taught you all the new home market yoga.
Speaker Change #124: Oh total quota close.
Speaker Change #124: Close to market. It goes by two seven percentage points, largely driven by the sequential improvement.
Siting Peng: On the time our ability to outperform in the relatively stable market, I like to share some color on our existing home business. In 2024, we have placed more emphasized on our operations in scaling up store and agency networks. E-reaching community outreach and managing key housing projects to broaden our customer base and home listing coverage. Since end of 2023, our platform has seen a net increase over 2,400 actual stores or a 6% increase and a net increase over 40,000 actual ages.
Speaker Change #124: New home country, the smelter and then equally eats and value share.
Speaker Change #124: Find the words over revenue growth.
Speaker Change #125: And it's just people Stockholm to support keep wanting to luxury fashion.
Speaker Change #126: In Q2, Oh gosh, we can think that totaled RMB four 5 billion up five 6% year over year at nine 5% sequentially.
Speaker Change #127: G&A was.
Speaker Change #127: But it is stable both year over year.
Speaker Change #128: Central to RMB, two Paul on bidding.
Tao Xu: Sales and market expenses grew by 14.1% year-over-year and 15.9% quota-of-quota to RMB 1.9 billion. As we invest in the rapid dysfunction of our home renovation and furniture expenses, increasing associated sales and market expenses on R&D Services for R&D 500 and 500, rising by 6.2% year-over-year and 8% sequentially, mainly due to the increased arm expenses in our home construction business, in terms of popularity. Gathering time for more questions. Total guarantee to be linked.
Speaker Change #129: And the market thinks it.
Speaker Change #130: Well by four people want to say year over year and up 15, 9% of cobalt culture to RMB, one pardon my baby, that's where you buy it.
Speaker Change #131: As a function of all the home then we shouldn't have a bunch of things is.
Speaker Change #132: Increasing associated with sales and marketing expenses.
Siting Peng: As we expand our touch points, we are also putting more effort into high quality testing management, concentrating on quality home listings and exploring different ways to tap into new media based opportunities for customer acquisition and conversion. All these initiatives have improved customer and home listing conversion rates. We also booked cooperation efficiency with the efforts such as region-based cold governance community, and the real force. Business conducts governance, preventing private or flight deals, improving close loop measurements on our platform.
Speaker Change #132: R&D expenses were RMB 500 to five minutes.
Speaker Change #132: Rising by six 2% year over year.
Speaker Change #132: 8% sequentially.
Speaker Change #133: Mainly due to the increase I think that you know a home that's actually good news.
Speaker Change #134: In terms of the pathetic.
Speaker Change #134: Got it home from accretion totaled RMB 2 billion in Q2.
Tao Xu: 86.4% year-over-year; that follows the gap income from the operation of RMB11.9 million in the first quarter, which increased substantially. GAC's operating margin was 8.6%, an increase of 3.1% and 8.6% points from Q2 2023 and Q1 2024, respectively. Non-Gap Income from Opposition; Total volume is 2.8 billion, climbing 31% from the same period last year and 193% quota of COVI Nangkak Operating Market reached the 12th percent, up 1 and 6.2 percentage points from Q2 2023 and Q1 2024, respectively.
Eight people right.
Speaker Change #134: 0.4% year over year.
Speaker Change #134: This follows the GAAP income funds, all pushing up on 11.9 million pets culture.
Speaker Change #134: Which includes the substantially close the old culture.
Speaker Change #134: Operating margin was eight 6%.
Speaker Change #135: You put up a 3.186 percentage points from Q2, because you take the three and the Q1 digital youthful respectively.
Siting Peng: On the new home business front, we double down on our efforts to increase number of cooperation projects and strengthen our sales conversion capabilities. In terms of the pending cooperation with more new home projects, we established an end-to-end monitoring process for all projects and a focus on managing key housing projects and developers to improve the quality of new home projects. To improve sales conversions, we overhauled our sales process this year. Our approach to new home sales used to be a huge cross-ledging that focused more on properties than customers.
non-GAAP income from operations.
Speaker Change #136: It's a long beach Hooper Apd.
Speaker Change #136: London, 31% from the same period last year, and the Hunter and that's deepens that culture.
Speaker Change #137: <unk> got a weak market reached the chocolate set up one point.
Speaker Change #137: One two percentage points from the Q2, it's a little history under Q1 tended to do four respectively.
Tao Xu: The rising operating market was mainly due to our remarkable operating leverage which lowered the operating expenses ratio. That net income totaled RMB 1.9 billion yuan, showing a 46.2% improvement year-over-year and 339.8% growth. Non-cash net income reached RMB2.3 billion, up 13.9% year-over-year and 93.5% QoT.
Speaker Change #137: The rising or breaking market was mainly due to all of the remarkable operating leverage which lowered.
Felicia: Thank you Felicia.
Felicia: Net income totaled RMB, one nine in Q2, showing a 46% year over year under 359, 8% gold up culture.
Siting Peng: This year, we are adopting a more precise approach driven by customer demands. In addition, we started monitoring and analyzing conversion day from our cooperation with upstream and downstream value chain partners on a daily basis. We also delivered in-practic results.
Felicia: non-GAAP net income reached RMB, two 7 billion up 13.9% year over year, the 93, 5% of all cold.
Tao Xu: Moving to our cash flow and the balance sheet, we realize a net operating cash inflow of RMB4.8 billion in Q2. New Home DSO was 45 days in Q2, a testament to our effective risk management. I'm thinking
Speaker Change #139: Moving to our cash flow and the balance sheet.
Speaker Change #140: We realize that not all become passionate people all bonds and $4 8 billion in Q2.
Speaker Change #141: You won't be I thought 45 days in Q2, a testament to our banking with amendments.
Siting Peng: Here, our non-home transaction business, our home renovation and the furnishings, and our home rental services. It's pie that changed the market. In the first half of the year, we're all new from our home renovation and furnishings, business, and the home rental services go close to 60 percent and are 177 percent respectively compared to a year ago, and of course, margins continue to improve. In fact, this year, we intentionally slow down a slow, slow out pace in a home renovation and the we achieved last year. To give you a bit of context, brings pouring new business within the big organization.
Paul.
Tao Xu: Approximately, there are over 100 million allocated to share your purchase during your. Overall, our Q2 results showcased our strong execution and ability to outperform the market in a stable market environment. Both our existing and new home business significantly exceeded market expectations. Moreover, our platform's overall monetization capability has remained stable, with notable improvements in the monetization of new homes.
Speaker Change #141: Approximately 100 million allocated to share repurchase during two true.
Speaker Change #141: Our total cash liquidity remain at a high level of RMB 75, five it rich.
Speaker Change #142: Our crude customers.
Speaker Change #143: It's people.
Overall, our Q2 results showcased all the strong execution and the ability to outperform the market you have stable market environment.
Speaker Change #144: Almost all of them.
Speaker Change #144: New home deliveries.
Speaker Change #145: Houston City, the monkeys deprecation.
Speaker Change #145: Moreover, our payphone, although it might be a decent hypothetically how do remain stable with multiple improvements you can make decision new home.
Siting Peng: Building confidence in the business's viability and the continuing continue is the first and most important challenge. That's why last year was all about accelerating our scale, where we are succeeded without compromising quality of reputation. This proved the business was viable, making a crucial first day. However, if you run too fast, your risk, sacrificing quality and losing customers trust, how to balance scale and quality and its type of business trust is a second challenge to developing new business. Having confirmed the business's viability with the last year's strong performance, with slow down is a year to make sure we are going in a right way by aggregating the second of critical changes.
Tao Xu: We also saw a significant refund in the contribution margin of our co-op business, moving past the one-time effect of last year's high baseline in the first quarter. Additionally, our non-housing content services are roughly based on the. Both our home renovation and furniture and the rental business continue to achieve record highs in skill and revenue. We maintain our commitment to cost efficiency and refine operational metrics. Despite double-digit revenue growth, our gap operating expenses have remained nearly flat, both sequentially and year-over-year, leading to a substantial recovery with a probability. With our robust cash reserves, we will continue to increase shareholders' returns through active share buyback, further optimizing capital allocation and enhancing capital operation efficiency, sharing the benefits of our development with you guys. As of today, we have repurchased around US$480 million worth of shares, which accounts for about 2.7% of the company's total share outstanding at the end of 2023.
Speaker Change #145: We also saw a significant rebound.
Martin Donaldson: Martin above a cold this.
Speaker Change #146: Moving past the onetime effect of lost theaters, hi, it's that culture.
Speaker Change #146: Additionally, although not hoping for that services are rapidly.
Speaker Change #147: Both our home demolition function under the rental business continued to achieve record highs.
Speaker Change #147: Underground.
Speaker Change #148: Women tend to all of our commitment to cost efficiency I think we found the obesity Matthews.
Speaker Change #148: Despite double digit revenue growth.
Speaker Change #149: With that operator since it hasn't been amended nearly flat both sequentially and year over year, leading to a substantial recovery is a possibility.
Speaker Change #149: With all of the robot and we will continue to increase shareholder return.
Speaker Change #150: Rescue share buy backs.
Speaker Change #151: Optimizing capital allocation and how.
Speaker Change #152: How do you think that people are pushing fishing.
Siting Peng: This year, we have been focused on two areas. First, we enhanced our capability to deliver competency, went on, full service solutions. This includes improving our development of four-service, complete renovation products, our management capabilities with service providers, supply chains, and the integrative delivery, as well as building the concrete boundary system infrastructure.
Speaker Change #153: <unk> showed the benefits of all the key vitamins lets you busters.
Speaker Change #153: To date we've.
Speaker Change #153: The repurchase the wrong.
Speaker Change #153: 180 million worth of shares which caused the policies to 7%.
Speaker Change #154: Also Congress total shell, Cindy and opportunity to this week.
Tao Xu: We have consistently delivered our promise to reward shareholders. Since the launch of our share repurchase program in September 2022, we have repurchased around US$1.39 billion worth of shares as of today, which accounts for about 7.5% of the country's total share of CNB before the program began. Today, we are pleased to announce that our board has approved the expansion of the Existing Share Repurchase Program. The amortization has been equated from US$2 billion to US$3 billion.
Speaker Change #155: We have consistently delivered Oh pardon me to reward shareholders.
Since the launch of our share repurchase program in September they didn't do too well.
Siting Peng: Thank you. We are iterative and promoting the home-sus 2.5 system. We integrate the one-stop four-service capabilities we develop in Beijing, into home-sus 2.5, which can handle up to 5,000 simultaneously construction orders. We also integrate the BIM, SLC, middle office, and the integrative material for filming the model. Our goal this year is to roll out this advanced capabilities nationwide through the home-sus 2.5 system. This year we continue to wrap up our ability to connect new supplies on our platform.
Speaker Change #155: We'd probably be portraits of long U S. Dollar 1.3 like that it works off the sure I'd love to say, which accounts for about seven 5% of the coffee total share outstanding before the program began.
Speaker Change #156: Today, we're pleased to announce that all our board has approved and used.
Speaker Change #157: I'm sure after that used to do share repurchase program.
Speaker Change #158: So application has been equally from U S dollar kidney chugach bothers to repeat it.
Tao Xu: With the program now extended until August 34th, 2025, going forward, we will continue to reward our shareholders who have grown with us and share the value created by the company. As our business becomes more diverse and expands in scale, we will continue to fortify our fundamental capabilities while actively and efficiently investing in our infrastructure. Our financial strategy remains committed to a prudent approach and focus on investing in areas that can generate key business outputs at long-term value for Home Consulting Services. As we expand our store network, agent and store productivity will remain our key evaluation metrics.
Speaker Change #159: Portland Mountain, indeed, often default tended to be spot.
Speaker Change #160: Going forward, we will continue to work all the shareholders, who have grown with us shocked embedded crazy that that's com.
Siting Peng: The number of stores for our housing transaction services is steadily increasing and the number of service providers for our new usage is also growing rapidly. Without this new suppliers, our customers will face limited options and our service capability could be constrained. The spending supply also inevitably forces us to consider how best to manage it, ensuring their quality and improvements. Our biggest challenge is to leverage certain rules to have this supply as huge better outcomes.
Speaker Change #161: That's all we're fixing the problems that works on these bonds and scale.
Speaker Change #162: What about continuing to occupy all of the fundamental type of entities, well accurately and efficiently, but you know all that infrastructure.
Often it's glad that remains committed to a prudent approach on folks tell me about the Iraq.
Speaker Change #163: In order to keep it all goes into the lungs and body.
Speaker Change #164: For home services, that's what we found out was gonna have worked H N and stuff on the Q E mail the key valuation metrics.
Tao Xu: We also amplify the operational and financial capability empowerment and training for our platform partners to strengthen our middle to back office in business and finance. Through our new initiative, we have built up middle to back office digitalization ability across the board to further improve the automation rate of our financial processes, as well as our data analysis and processing capabilities. Democrany, We have set higher requirements for contribution margins and other core financial indicators to advance the long-term steady and strong development of our business. Our risk threshold control measures have remained strongly in place.
Speaker Change #164: Well, so often finds all bushnell and the financials hypothetically pollens.
Speaker Change #165: The training for our platform partner.
Speaker Change #165: Strengthen our needle through back office.
Siting Peng: We view these supplies on our platform as targets for transformation, not monetization. Let's to say once the supply is including service providers, join our platform, we must enhance them. As a result, we are consistently investing in training for stores, operators, and implementing robust operations for home listings, customer engagement, and our ecosystem to enhance resources conversion efficiency. Regarding our new businesses, we have met a significant effort to reinforce the incentive mechanism for service providers through robust order dispatch and service provider rankings.
Speaker Change #165: We'll find out.
All the new initiatives. We have are built off of me going to back off the pizza like dish up entity okay.
Speaker Change #165: Was that all just to flip it equals automation rates of all of the financial process. That's why it's all about data analyses.
Speaker Change #165: But at this time.
Speaker Change #165: Simultaneously.
First the higher requirement will come to this market and often called the natural cadence with our bonds. The longterm studies Sonko vitamins itself off.
Speaker Change #166: I'll reemphasize hold control matter, the amendments don't Tonight and pace.
Tao Xu: This ensures that the seeds we plant today will blossom so that we can share the rich fruits with our loyal shareholders. This concludes my prepared remarks for today. Operator, we are now ready to take questions. Thank you. Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2.
Speaker Change #167: This ensured the seeds, we planted day well blessing those out but we can share the major foods with all our loyal shareholders.
Speaker Change #168: This concludes my prepared remarks for today, operator, right now ready to take questions. Thank you.
Siting Peng: By fostering our transparent and benign competitive environment, we ensure resources are located more efficiently to the most capable talent. In the next era, customers will become more selective about our services, allowing high quality service providers to stand up and service variants will decrease. Customers needs will be more diverse and new. More segmented needs will immerse. These two points guide our efforts to upgrade our products and services, and the deepening our operations.
Speaker Change #169: Thank you.
Speaker Change #170: If you wish to ask a question. Please press star one on your telephone and wait for your name to Vietnam.
Speaker Change #171: If you wish to cancel your request please press star two.
Operator: If you're on a speakerphone, please pick up the handset to ask your question. As a reminder, we only accept questions on the English language line. For the benefit of all participants on today's call, please limit yourself to one question. And if you have additional questions, you can re-enter the question. If you're going to ask the question in Chinese, please follow with an English translation. Your first question comes from Harry Chen with Citigroup. Please go ahead.
Speaker Change #171: If you're on a speakerphone. Please pick up the handset to ask you a question as a reminder, we only accept questions on the English language line for the benefit of all participants on today's call. Please limit yourself to one question and if you have additional questions you can reenter the queue.
Speaker Change #171: If you're going to ask the question in Chinese please follow up with an English translation.
Speaker Change #171: Your first question comes from Henry Chien with Citigroup. Please go ahead.
Harry Chen: First of all, congratulations to the company for achieving such an excellent result in the second quarter. My question is also about the policy and the deal. As we can see, there have been a lot of policies introduced in the second quarter, especially after May 17th. I would like to ask Guan Yiteng to share with us what changes have taken place in the real estate market. We can see that the performance of the new house and the second-hand house has continued to diversify, and what are the post-productive trends of the policy? And what kind of judgment do we have for the second half of the year? So I will translate it quickly.
Siting Peng: This remains tremendous potential for growth and efficiency improvement in both our relatively mature housing transaction sources and our emerging business ventures. More targeted products and services. These are approach related to change in customer acquisition channels, our national structures and supply chains, allowing us to differentiate ourselves from the traditional residential industry. More importantly, these chain changes will help us build trust in our low frequency transaction industry.
So as <unk> gone through that occupancy does somebody you showed that you got.
Speaker Change #172: Oh, the Linky I'm. So glad you think so hot dog that I'm not sure I got.
Speaker Change #173: Based on towards that you'd like to touch wood, because you still mission for Hudson.
Speaker Change #174: Got it seems like that that's not exactly.
Speaker Change #174: Yeah. Dan This is about combo, it's also something that should go down.
Speaker Change #175: It goes up you tend to host you there.
Speaker Change #174: Sure.
Johnny: Determined through a shop on insulin Johnny on shipment.
Johnny: So it goes beyond that you've got public.
Speaker Change #177: Well congratulations.
Harry Chen: Congratulations, company, for quite a solid second quarter result. And also, thank management for taking my question. So with lots of supportive poverty policies rolled out since the second quarter, especially after May 17th, what changes have occurred in the real estate market? Do new home and existing home markets show divergent performance? How sustainable are transactions after these policies? And what is your view on the transaction outlook in the second half of this year? Thank you. Thank you, Harry. Let me ask you a question.
Speaker Change #177: Painful quite a story.
Quarterly about and also thanks for taking my question. So we can knock off supportive publicly part no doubt second quarter, especially after may 17th what changes have occurred in the real estate market do new home and existing home markets showed that bucket how.
Speaker Change #178: How sustainable are transaction. After these policies and what is your view on kind of extra outlook in the second half of this year. Thank you.
Siting Peng: The key to community-based business is high service density. To that end, we launched more stores and organizational innovations in communities this year to improve increased supply. For example, in Shanghai, we added a number of community convenience service store stations, affiliated with lean stores, and other cities are replicating this model. Additionally, we are integrating home, renovation and rental services with lean stores. We have deployed home renovation expert agents in over 1,000 to 2,000 major stores and are showcasing renovation technicals and hosting install designers in pilot stores.
Stanley Peng: In Q2, the housing market saw steady month-by-month improvement, with an actual boost to in-home transaction volume since the new policy introduced on May 17, which is not related to home prices, also saw a narrow decline in June. Although the new home market has yet to show any non-signal improvement, the year-over-year sales decline in Q2 narrowed month by month. The significant market downturn in Q1 due to the high base and system factor has gradually faded, and market transactions continue to shift from new homes to new homes.
Speaker Change #179: I think as hiring.
Speaker Change #180: Let me answer your question in Q2.
Speaker Change #181: Hudson MX cadence, so that a month by month improvement, whereas our actual two home transaction model to the new.
Speaker Change #181: Policy introduce on May 17.
Speaker Change #181: On the multiple agencies two home prices also so a narrower decline in June.
The new home market has yet to show any non seasonal improvement to year over year yourself kind of in Q2 and narrowed our mountains.
Speaker Change #181: The significant market downturn in Q1 due to the high end based on the seasonal factor.
Speaker Change #181: Gradually faded.
Marquee transactions continue to shape, the problem new homes and homes.
Siting Peng: Our coverage of existing home listing in Shanghai grows from 76% last year to 87% in areas that we operate in and around us from our home renovation and our carefree rental business in Shanghai is Q2, grow by 63% and 140% year-over-year. In Chengdu, we piloted our strategy focusing on key housing projects for our home renovation and furnishing business. Our operational team shifted back to intern in terms of community engagement rather than its first services, rebuilding our community-based services process and our product logic. This pilot pilot projects how demonstrated impressive improvements in conversion efficiency and productivity.
Stanley Peng: The proportion of national GTV from distinct home transactions increased from around 40% of total GTV last year to approximately 44% in the first half of this year. Let me further elaborate on the policy relaxation continuing in the first half of the year, particularly after the inventory reduction policy cycle began, particularly the May 17th policy package focused on reducing the housing boom. Revitalizing existing homes under relaxing mortgage conditions, with high-tier cities continuously relaxing purchase restrictions. Regarding scene call marking, Transition volumes in Q2 show notable recovery.
Speaker Change #182: The propulsion of National P. T V from these team hometown Tesco has increased from around 40% of total could you be last year.
Speaker Change #182: Approximately 44% since the first half of this year.
Speaker Change #182: Let me elaborate with a policy relaxation continuing into the first half of the year, particularly often injury reduction policy cycle began.
Speaker Change #182: So it may 17 policy package.
Speaker Change #183: Just on reducing the housing industry.
Speaker Change #183: By being existing homes on the relaxing mortgage condition, whereas the high tier cities continuously relaxing perfect restrictions.
Speaker Change #183: According to your home market.
Stanley Peng: Volumes on paper platforms in May and June increased month by month, outperforming the typical seasonal trend. The number of transactions in June reached the highest level of the same period since 2020. This rebound was especially strong in the first-tier cities, stimulated by fewer purchase restrictions and relaxed mortgage conditions since the end of May. In June, transaction volumes in Tier 1 cities on Baker's platform were 46% higher than in April and increased 132% year-over-year, especially in Shanghai.
Speaker Change #184: Symbolic in Q2 show multiple Republic volumes on paper platform in May and June increased month by month.
Speaker Change #185: Performance chemical systems.
Speaker Change #186: The Nonvolatile transaction you June reached the highest level of sustained periods genes Kensington Youtube.
Siting Peng: In a second half of this year, the external micro-environments will continue to oppose many changes to our business. Face the release changes, our core goal has always been to build activities that will keep the organization constantly moving forward from one success to the next. Over the past month, we have been fortunate to validate with minimal fail and error that our home renovation and the furnishing model as well as our rental business model can drive growth in our organization.
Speaker Change #187: 10 to 20.
Speaker Change #188: Let's be bombed was especially strong in the first tier cities.
Speaker Change #188: Stimulated by fewer protracted restriction under relax mortgage condition to the end of May.
In June consistent volumes in tier one cities on take or pay for more 46% higher theatrical.
Speaker Change #188: <unk> hundred 62% year over year.
Stanley Peng: In Shanghai, we saw an increase of nearly 80% from April to June due to the extensive policy easing, reaching the highest peak we have seen since early 2021, and for Tier 2 and Tier 3 cities. However, due to the prior rounds of policy relaxation, the impact and the market response to this latest round of policy was relatively limited.
Speaker Change #189: Especially in Shanghai, Shanghai, we so.
Speaker Change #189: Yeah, Chris opened 80% from April to June due to the policy easing machines, a highest peak would.
Siting Peng: At the same time, a web-body business has shown for the growth potential. So, for our Q-markly review, outreach, providing support for stall owners and agents to achieve great success. Integrating our new initiatives, we can drive even greater growth in this context. Our next step is to address issues related to the appropriate, appropriate pay of each business. And the balance between scale, quality, and efficiency.
Speaker Change #190: I have seen since the early two they can you walk.
Speaker Change #191: On the pool chair to them because of the city's future.
Siting Peng: Thank you.
Speaker Change #191: Private rounds of possibly relaxation the impact on the monkey in response to what you said makes it runs a policy what's left to be immediate.
Stanley Peng: Regarding the transaction structure, the demand for home upgrade continues leading the market, especially in the first-tier cities, where they make up 60-80% of transactions. One of the notable features of this market recovery is the increase in the proportion of home buying with the rising demand in key cities. Bolling Housing Price Decline, The ratio of housing prices to income has significantly improved, with a lower down payment ratio and mortgage rate. Housing affordability has substantially increased.
Speaker Change #192: Regarding the transaction structure the demand for the home off great to continue leading the market, especially in the first tier cities weren't in Macau for CP to 80 per self transactions.
Speaker Change #193: A notable feature of it.
Speaker Change #193: Market recovery, that's a increase in the proportion of the home buying with Rocky Mountain in key cities.
Unknown Executive: Next, I would like to turn the call over to our staff for the review of the second quarter of 2024 financials. Thank you. Thank you, Stanley.
Speaker Change #193: Barring housing price declines.
Speaker Change #194: The ratio of the Hudson passes two incomes has significantly improved with lower dose dependent we show in the mortgage REIT Hudson fault Becky has substantially increased.
Unknown Executive: And thank you, everyone, for joining us. Before we dive into our future performance, I would like to briefly touch on some updates into how to market. In the first half of the year, the central and the local authorities implemented the easing policy intensively. This included further relaxing purchase restrictions, lowering down payment ratios, and the cutting mortgage rate. The real estate financing condition mechanism was established, and the fitting to practice as an accelerated pace.
Stanley Peng: And the relaxed purchase restriction, in turn, attracts more first-time buyers to the market. For example, in Shanghai, the proportion of non-local buyers increased from nearly 30% to nearly 40% in June. And the number of buyers who are single increased by 60 percentage points. This policy has significantly stimulated demand relief within the Turkish demography. On home prices, we are also seeing a positive sign despite the ongoing price decline in the home market, according to Baker Research Institute. The pace of month-over-month declines in national existing home prices slowed in June, narrowing to negative 1.2% from negative 1.7% in June.
Speaker Change #195: The relax the purchase restriction in turn attracts more first time buyers to the market for example in Shanghai the propulsion of non local buyer inquiries, if I'm, the only 30% junior and at 40% in June.
Speaker Change #195: The buyers who are single increased by six percentage points.
Speaker Change #195: This policy has a 64.
Speaker Change #196: The excuse me the ATV demand wasn't.
Speaker Change #196: It wasn't the type of demographic.
Unknown Executive: The central bank launched the Rilandin II to support local SOEs, being acquiring existing commercial homes, facilitating the national-wide incantations of old-following housing through web programs. In the first half of the year, the market showed a gradual recovery. Also, market performance was noted due to the sustainability as beginning of the year. All these positive policies contributed to the market's gradual improvement with the high-based effects from the early last year you called receiving.
Speaker Change #197: Home prices. We are also seen as a policy as fun. Despite the uncle your price declines you're seeing home monkeys are.
Speaker Change #198: According to pay for research.
Speaker Change #198: The pace of muscle and multi client maximum existing home prices slowed in June now you.
Speaker Change #199: 291, 2% something that'd be one 7%.
Stanley Peng: The practice also stabilized in K1 city. Housing prices in Beijing and Shanghai increased by 0.4% and 1.2% month-over-month, respectively, in June, and we'll also slightly improve the secondary city. Sellers also became more rational about lowering prices. The proportion of homeowners rushing to sell at significantly reduced prices decreased by 8% from March to June.
Speaker Change #199: Practice also stabilize in tier one cities housing.
Speaker Change #199: Housing prices in Beijing, Shanghai increased by 0.4%, one 2% month over month, respectively.
Unknown Executive: In 2002, the single market performed well, especially in first year and some key second-tier cities, where market activity notably improved. The new home market has remained gradual, subdued, even as its year-over-the-client narrow month-over-month in-culture. With that drop of an incremental rebound in market sentiment, we continue to uphold the market mutual view and the focus on improving our performance by continuously deep-depending operations, further empowering service providers, understood owners, and promoting rapidly the growth of our new initiatives.
Speaker Change #199: Each of them and there were also slightly improved in second tier cities.
Speaker Change #199: Saturday those will become more rational about the lowering prices.
Speaker Change #200: Portions of homeowners rushing to sell lots of Skus can do it using prices decreased by 8% bumped the marks to juice.
Stanley Peng: However, most potential buyers are still in a wait-and-see mood. Many hope for further price declines before entering the market. This is a significant difference from the market response to the previous policy round in the second half of 2023. All those that you think the home market has become more..., there hasn't been a sharp drop in the housing price. This addresses two things. Firstly, in high-tier cities.
Speaker Change #201: However, most of the potential buyers are still you know we tend to see more.
Many are hope to further price declines before on hitting the market.
Speaker Change #201: This market is a significant difference bumped the market response to the previous policy wrong in the second half opportunity can be sweet.
Unknown Executive: The combination of these endeavors led to our action in the financial and operating results in the Q2. For Q2, the total TQV rates are on the 839 billion, half 7.5 percent year-over-year. That's why news are on the 23.4 billion. The percentage of year-over-year increase of 19.9 percent. First market, input by 3.5 percentage points year-over-year to 27.9 percent. Gas net income rich on the 1.9 billion, rising by 46.2 percent year-over-year. Non-gath net income grow by 3.9 percent year-over-year to R&B 2.69 billion.
Speaker Change #202: That you think home market has become more active.
Speaker Change #202: Zara Hudson to being a sharp drop in housing prices.
This suggests hussein.
Speaker Change #202: Firstly high.
Speaker Change #202: High tier cities.
Stanley Peng: Abundant demand, coupled with the input of ability and the lowering of buying costs, is driving buyers out of their wait-and-see approach and into active participation, which in turn sustains local housing prices. Secondly, the effectiveness of these policies has been validated to some extent, given the cumulative impact of the re-relaxed policies over the past two to three years on your whole market. The year-over-year decline in new home sales narrowed month-by-month in this Q2, but it did not improve much overall.
Speaker Change #202: A bump in demand coupled with improved affordability and at the low end buying cost it's driving buyers. Although it was a wait and see approach on the into the active participation.
Speaker Change #203: Switching to sustain local housing prices.
So you find people policies Hudson, but they need and to some extent given the cumulative impact of surgery, we relaxed the policies over the past two to three years.
Speaker Change #204: Your home market.
Unknown Executive: Both run new and non-gath income exceeding market conditions. Moong to our home transaction services for Q2, as all our market gradually recovered, alongside our strong operational growth and the stock network's function disease, all its team and the new home business both demonstrated outstanding performance. When you're from the home transaction rich on the 7.3 base, a 14.3 percent year over year, and the 28.1 percent code over code. PTV was around 570 percent better, increasing to the 5 percent year over year, and the 25.9 percent code over code.
Speaker Change #205: Yeah, we had a decline in your home himself narrows the month by month in just Q2, but nothing particularly improved overall.
Stanley Peng: DRIC indicates that the top 100 developers sold by 42% year-over-year in the first half, narrowing to negative 22% in June. Several factors are affecting the recovery of the new home market. Number one, new parts, using homes have a higher price of taxes than the new home. That is no longer the case.
Speaker Change #206: I C E. D case, that's the top hundred Goodbye for itself grew by 42% year over year into first half.
Speaker Change #206: Narrowing to negative 22% in June.
Several factors I'll be meeting with the recovery of the new home market number one is the past.
Speaker Change #206: You're seeing home hub.
Speaker Change #206: It's a higher price of tax and the new home side.
Stanley Peng: The price advantage of new homes diminished. Number two, pre-sold housing supply couldn't meet demand in the immediate housing need. Number three, the readily available supply of the larger and more luxury new homes did not align with what home buyers with the rising demand in the first tier cities were looking for. Number four, the surprising flood of nearly new homes means the new homes from a few years ago that are now entering the single market.
Speaker Change #206: Definitely no longer pays the price advantage of new home communities.
Number two pre sold the housing supply to meet demand immediate housing needs.
Speaker Change #206: Right.
Unknown Executive: Our PTV and the runway growth rate were close then, the crucial thing keeping our magicians at a better graduate level. Year over PTV growth, the power that run from the margin due to the adjustment in the commission rate of the junior jobs, we're starting the third quarter of television industry, a 15 commission rate for each new home. The contribution margin from the three home transaction services, rich 47.5 percent, clan being 1.9 percentage points year over year, and the three percentage points code over code.
Speaker Change #206: The resume available to pilot with the larger and the more luxury new home enough along with what the home buyers with the right demand in the first tier cities and we're looking for.
Speaker Change #207: Number four.
Speaker Change #207: Five new plants most of the year, you know what a new homes.
Speaker Change #208: Whether it means the new home from a few years ago that are now entering into the existing home market.
Stanley Peng: They are meeting more of the current market demand, giving a close match to the new homes but with the advantage of ready availability and lower prices. With all of these factors at play, more positive forces are needed for the stabilization and recovery of New Hong Kong. Starting from July, the volume of existing home transactions declined due to the combined effect of the policy impact, waiting, and seasonal summer factors; the take back of the policy last about two months in Foster City.
Speaker Change #208: Meeting more of the current market demand keeping a close match to the new homes upper with the bone Pedro too right.
Speaker Change #208: Right.
Speaker Change #208: T and the lower prices.
Speaker Change #208: All of these factors at play.
Speaker Change #208: Policy forces are needed for the stabilization and recovery of the new home market.
Unknown Executive: The growth was managed due to the strong leverage from the E-credit running coupled with a relatively stable fixed labor cost. In terms of the new home transaction services, this vast market downturn weighs significantly out to form the market across multiple metrics. There are issues that sell from the top 100 developers, decreased by around 35 percent year over year in terms of the eight percent code over code. Not fully, selfie June dropped by approximately 22.000 year over year, where the year over year declined narrowing months by month.
Speaker Change #208: Regarding the outlook for the second half of the year studying.
Speaker Change #208: Starting from July so bolting on these new home production declined due to the combined impact of the policy impact waiting and see things some effectors.
Speaker Change #208: In fact, there was a policy lost about two months.
Speaker Change #209: Joe C T.
Stanley Peng: The transaction volume in July remained about 5% higher in April, while we are aware there was still significant growth. In the last week of July, the transaction volume was over 30% higher compared to the same period last year. In July, the Yixing Home Price continued to drop.
Speaker Change #209: Accomplishing voting Geelong remained up all the 5% higher in April well year over year. So it will do significant crows.
Speaker Change #209: The last week of July so transaction volume was over 30% higher compared to the same period last year.
Unknown Executive: In comparison, our new home PTV rich R&B, 235.3 billion, built by only 24.2 percent year over year, and the growth by 55 percent, the crucial link due to, benefiting from the higher penetration of the developers of China, different cooperation with developers, and the increase of collaborative projects, as well as the systematic improvements in our operational and sales capabilities. In particular, the amount of the contract's transaction volume from new home Britain, increase the top percent year over year in terms, and this exceptional performance that can start contrast with the industry.
Speaker Change #210: Dry you're seeing home prices continue to a job well.
Stanley Peng: While the monthly amount decline in the post-deal city narrows compared to the period before the policy implementation, for the second half of the year, as the higher base effect diminished, the ethical market is decided to remain stable. Transaction volumes in fourth-tier cities are likely stabilized after a spike-like recovery, providing some support for prices as well. However, expectations for further price drops and the bearish cultural sentiment may still constrain the market recovery to some extent.
Speaker Change #211: Well its a month on month decline the first tier cities compared to deteriorate before the policy implementation.
Speaker Change #211: But the second half of the year, that's a higher base effect diminish the home market is expected to remain stable.
Speaker Change #211: That's from volumes, even fourth tier cities are likely keep alive after a spike like recovery, providing some support for the prices as well.
Speaker Change #212: These are patients before the fourth or perhaps drop and the banners cultures sentiment may skew constrains in Banca due probably to some extent.
Speaker Change #213: Policy change wealthier key vertical in shaping market trends funky amongst that bogie singles the Portuguese restriction on the optimization of the housing demand about half.
Operator: Policy change will be a key variable in shaping market trends. On the demand side, more easing of the purchase and use restriction and the optimization of housing demand will help. On the supply side, additional measures to support developers and reduce unit rates will help accelerate market stabilization. Thank you. Thank you. Your next question comes from Thomas Chong with Jeff. Please go ahead.
Unknown Executive: R&B from a new home customer service declined by 8.8 percent year over year, to R&B 7.9 billion, while increasing 6.1.4 percent code over code. Year over year, the sequential R&B growth outpaced year over year PTV growth. Not again, demonstrating our strong and steady monetization capabilities in new home transactions. The contribution margin for the new home transaction services recovered to 25 percent, falling by 2.2 percent each point year over year. Many due to the strategic increase in environmental pollution under our strategy this year, to improve our e-coded.
Speaker Change #214: Well, that's the pie five additional measures to support demand for undergrad humans doing well how about Saturday monkey stabilization. Thank you.
Speaker Change #213: Yes.
Speaker Change #213: Yeah.
Speaker Change #213: Thank you. Your next question comes from Thomas Chong with Jefferies. Please go ahead.
Thomas Chong: Good evening. Thank you for accepting my question. My question is about real estate. In the current situation, how can our real estate business do better than the industry? And what is the alpha of our real estate business? How does the currency exchange rate perform in this process?
Speaker Change #215: Well I somehow sits at one eight times.
Speaker Change #216: Well the ones you want anything bombed out that balance and Oh, sorry that a woman with.
Speaker Change #215: Okay.
Speaker Change #217: Yeah, Yeah, I'll hold my medicine found it yet with that.
Unknown Executive: New Home Composition Martin, co-secretary by 2.8% with points, as we gain a more leverage from the relatively stable fixed level cost, and the higher revenue. Include to the commissioning cost percentage from the early developers, rose by 55% and the proportion of commissioning the wrongs project, maintained at a relatively high level at 49%. Renewable from the home renovation and furniture, home rental services, emerging on other services, grow by 85.3% year-over-year in-culture, reaching 34.7% of total revenue, 13.2% percentage points from the same period in 2023.
Speaker Change #218: Oh, yes, it's all about.
Speaker Change #218: I Hope you all do exactly what portion of it all.
Thomas Chong: Thanks, management, for taking my question. My question is about our new home business. Can management comment on why our new home business is doing better than the industry? Can we also comment on the alpha of new homes and the trend in the monetization rate? Thank you. Thank you, Thomas.
Speaker Change #219: Oh that is management Politicking. My question. My question is about all of your home business can management comment about why are you.
Speaker Change #220: He is doing better than the industry.
Speaker Change #221: We also comment about the alpha hopefully your home and the trend I bought them on the price it could meet.
Speaker Change #222: Thank you.
Speaker Change #223: I think I was telling us in the first half of all the new home business continue to stick with you outperformed the industry.
Stanley Peng: In the first half of the year, our new home business continued to significantly outperform in investment. Supported by our robust operational and execution capability, our housing transaction business continues to achieve our target of outperforming the market and consistently generates In Q2, our New Home PTV reached RMB235.3 billion, down 20% year-over-year, but was up 55% year-over-year. PTV of CRLC's Top 100 Road Developers, due by 35% year-over-year, in June, our new home country, volume increased by 12% year over year compared with the industry's 22% drop, notably outpacing the market. In addition, our revenue in Q2 surpassed our GTV. This indicates, first, that we have not compromised our monetization, or the ability to gain a monthly share. On the contrary, our stable monetization capacity has been validated.
Speaker Change #224: The pocket Balboa, goalpost are operational and execution capability our housing company.
Speaker Change #224: To achieve all the Turkey outperformed the monkey and consistently generate alpha.
Unknown Executive: Our home renovation and furniture fitness maintain a steady growth. In Q2, contract itself reached on before 0.2.2, up to 22.3% year-over-year, revenue reached on before bidding, rising by 53.9% year-over-year, the revenue growth rate outpaced that of the contract itself largely due to the improved delivery efficiency. The constitute from market for the home renovation and furniture fitness were the 31.2% up 1.7% percentage points year-over-year, and the 0.7% percentage points decreasing. This was made due to the improvements in the growth margins of our retail business.
Speaker Change #225: In Q2, a new home Ptv rich RMB 235, close to meet any bounce in get to say year over year, but whats a fifth.
Speaker Change #226: <unk> 55 per cent Cordova culture.
Speaker Change #227: P. T V C. R. I C pulse hundreds of road to get benefits grew by 55% year over year in Q2.
Speaker Change #226: June <unk>.
Speaker Change #226: New home contracts.
Speaker Change #228: Morning, even close to that 12% year over year compare with the industry took a 2% drop notably outpacing the market.
Speaker Change #226: In addition, all of them.
Rodney: Rodney you can choose a path that would G T V.
Rodney: T K.
Rodney: That's all.
Speaker Change #230: We have not compromised ballroom in fishing.
Speaker Change #230: Our capability to gain market share.
Unknown Executive: The contract itself of the furniture and home furniture retail, which are outside of our home renovation package reached around R&B 1.2 per year in Q2, accounting for around the 29% of total contract itself, improving by 3.5% percentage points from the same period of 2023. Our home renovations continued to grow at an accelerated pace. In Q2, the revenue rates on B3.2, up to 167.1% year-over-year, many due to the rapid growth in the number of rental units on the management.
Humphrey almost stable markets Asia Pac Becky hopping validated.
Stanley Peng: Second, you have a buyer's market. By helping downstream agents, we'll spread the incentive for new home sales and facilitate more efficient flow-through in the current market. The certainty of our business momentum stems primarily from our channel service coverage function and enhancement of the sales throughput in terms of the cooperation with the real estate company. The relationship between brokerage channels and developers is setting the stage for a new and mutually beneficial model. Historically, brokerage channels and developers had a more competitive relationship. However, the new home market has become a bearish market.
Speaker Change #231: Second you know a buyer's market by helping bound student agent, that's a tax incentive for new home sales that facilitate the more efficiency.
And so part of the monkey.
Speaker Change #232: The sudden she all Walmart business momentum stems, primarily from our China service coverage dysfunction in the U S.
Speaker Change #232: The South east.
Speaker Change #233: In terms of the call push them, but they really coffee's third with interest rate between broker channel like your bathroom are setting the stage for a new I mean, a mutual beneficial module.
Unknown Executive: By the end of Q2, the number of units managed by our home rentability exceeded 310,000. The fixed rates, the number of the rental units managed by a carefree rent reached around 300,000 compared with around 120,000 in the same period last year. The contribution margin has a setting at 5.8% from the previous quarter. In Q2, our net revenue from emergency and office services increased by 57.8% year-over-year, 2R&B, 870.4%. Next, let's move on to our other costs when we spend it in Q2.
Speaker Change #234: So call it broker channels and give out that had the most positive relationship. However, that's a new home market becomes a past monkeys setting home has been more challenging on the top of me I'll have Bob changes substantially.
Stanley Peng: Setting up home has been more challenging, and customer needs have changed substantially. The role of the cell channel in the industry transitioned from simply making deals to providing deep insights into customer needs and collaborating with developers to address new home buyers' pain points. Riding this trend, we have been advancing our race and evaluating the depth and breadth of our partnership with top-tier developers.
Speaker Change #235: Oh, that's a channel.
Speaker Change #235: She transitioned from just simply mix with U two providing deep insights into the knee and collaborating with the bathroom to attract new homebuyers pain pumps.
Speaker Change #235: But I think that trend, we're happy at the bumping our reach.
Speaker Change #236: You bet, 18th the dates and the Braves up all the partnership with top tier developers. This year, we're floating spunky the courage of the coal state only biotech on the high quality imaging road copies.
Stanley Peng: This year, we further expanded the coverage of the core state-owned developers and high-quality leading real estate companies by Remaking Chinese with Innovative New Home Services. At the end of Q2, we doubled the number of developers we have a strategic collaboration with to 25 from 13 in Q2 last year. The sales from our strategic partners' developers accounted for 26% of our total new home GDP in June, 11 percentage points higher than the same period last year.
Unknown Executive: Our stock costs remain stable year-over-year and cost over-coated at R&B 681. Our cost increased by 18.6% year-over-year to R&B 511.1%. From our rate due to the higher taxes and the third cost and the basic maintenance costs for the rental services. The crucial is that it rose by 34.8%, managing the increase in the taxes and the third cost and the professional service fee. First profit goes by 22% year over 2.5 billion. First margin came in at 27.9% at 0.5% point year over The primary reason for the profit was to fund the higher proportion of the revenue and the increase of the contribution margin year over year in non-cultivated services business.
Speaker Change #237: The meetings on me.
Basically a meal home services.
At the end of Q2, we thought the number of tobacco, we have strategically collaboration to since you've bought from 13 in Q2 last year.
Speaker Change #238: The sales from our strategic partners the background a clunky before it can be six myself, our total new home Kids Reading June.
Speaker Change #239: 11 percentage points higher than the same period last year.
Stanley Peng: In June, the number of our cooperative new home projects accounted for 62% of all new home projects across cities where we operate, excluding Beijing and Shanghai, compared with 49% in the same period last year. Regarding our vote itself...
Speaker Change #239: In June the number of volatile.
Speaker Change #239: With your new home poke, a clunky to four 2% of old New home protests are called cities, where we operate as cooking baking in the shop compelled with a 49% in the same period last year.
Regarding our book itself soup Betsy's.
Unknown Executive: Our so-called are also relatively fixed, all of which gain a small average and partially offset the decline in our new home contribution margin year over year. Coach Overcorder goes margin rose by 2.3% point, largely driven by a sequential improvement in the new home contribution margin and the increase in revenue share. Combined with all revenue growth and the stable store cost to support the amplified leverage in fact. In Q2, our gas origin census totaled R&B 4.5 billion, up 5.6% year over year under 9.5% sequential.
Stanley Peng: Previously, we relied on a labor-intensive approach. But this year, empowered by technology tools, we strengthened the refund operation and promoted the conversion of a potential new home customer from the existing home market. Please continue reposting New Home South 2.0.
Speaker Change #239: Previously we you know maybe 10 same approach this year in part by the technology too.
Speaker Change #239: We strengthened the refining operation.
Speaker Change #239: Promoting the conversion of a potential new home customer from the eastern coal market.
Speaker Change #239: Continually pushed into new home sales to <unk>.
Stanley Peng: In terms of the manpower, the number of new home agents on our platform notably increased this year. This year, we expanded the role of the comprehensive agent, which means more agents can engage in both new and existing home business new products. For example, the number of new home agents in Zhengzhou 4Q2 was around three times what it was during the same period last year.
Speaker Change #240: In terms of the manpower the number of the new home agents on our platform and ultimately increase this year was supposed to go up a comprehensive agents suicides mohicans hanging engage in both U C.
Speaker Change #241: Home, but you probably know.
Speaker Change #241: For example, the number of the new home agent.
Speaker Change #241: For Q2 was around the three times than what you'll need to same period last year.
Unknown Executive: GMA census were relatively stable, both year over year and sequential rate at R&B 2.1 billion. Tells in the market census grow by 14.1% year over year under 15.9% quarter of quarter to R&B 1.9 billion. At the university, the Internet has been regulated in the function of our home renovations and function census, increasing associated with sales and marketing census. Our R&B census will R&B 5.5 billion, rising by 6.3% year over year and 8% sequential.
Operator: Incentivized by more competitive commission rates and the improved timely delivery of pre-served homes, agents have increased the willingness to engage in new home sales. Technology-wise, we further iterate our potential customer products to help agents better identify high potential new home buyers who are likely to make new near-term purchases while uncovering the potential new home buyers from the existing new home customers, accelerating new home customer transaction efficiency. In Q2, potential new home customers identified by this product accounted for around 5% of our overall new home sales, contributing about 70% of the new home sales.
Speaker Change #241: In terms of lost by multiple parties for Nishu rates, obviously, Newport timely delivery of pizza at home agent of inquiries the willingness to engage in new home sales.
Speaker Change #241: As long as you was with floods and iterate, our potential customer forgot to help agents better identifying high potential new homebuyers, who are likely to make a new young temperatures.
Speaker Change #242: Well uncovering potential new homebuyer.
Speaker Change #242: Compromise.
Speaker Change #243: We can go home complements transaction efficiency.
Unknown Executive: Related to the increase, R&B census in our home construction business. In terms of the prosperity, gas income from oppression totaled R&B 2 billion in Q2 are 84.4% year over year that follows the gas income from the oppression of R&B 11.9 million is the first quarter, which includes substantially cultural culture. Gas operating margin was 8.6% a increase of 3.1 and 8.6% from Q2 2023 and Q1 2024 respectively. R&B income from oppressions totaled R&B 2.8 billion.
Speaker Change #244: In Q2, potentially new home customer I can default I just pulled out a punky two for a long SAP yourself all the overall new home sales.
Speaker Change #244: Thinking about the 70% of the new home sales.
Operator: Additionally, through our innovative service solution, like the change of the old home to a new one, worry-free repayment, worry-free renovation, and the home rental offering during the housing replacement, we address diverse client needs surrounding new home challenges, improving the efficiency of the new home sales loop. Thank you. Thank you. Your next question comes from Eddy Wang with Morgan Stanley. Please go ahead.
Speaker Change #245: Additionally, Sarawak Malaysian survey solution like the Chin, Oh, Oh homes, when you want worry free opinions lastly, the innovation on the.
Speaker Change #245: The home rental often go into Hudson. Good placement, we don't try to diagnose chronic knee thrombin, new home tenders, improving the efficiency of the new home sells through.
Speaker Change #245: Okay.
Speaker Change #245: Thank you. Your next question comes from Eddy Wang with Morgan Stanley. Please go ahead.
Unknown Executive: R&B 31% from the same period last year and 193% quarter of culture. R&B of rich margin reached the chart of 1.6.2% from the Q2 2023 and Q1 2024 respectively. The rising of rich margin was mainly due to our remarkable operating leverage, which lowers operating census duration. Gas income totaled R&B 1.9 billion in Q2 showing a 46.2% poorment year over year and 39.8% quarter of culture. Now gas income reached R&B 2.3 billion up 13.9% year over year and the 93.5% quarter of culture.
Eddy Wang: Hey, Stanley Tiger tank I'm sure a J. So once you went in a hallway here Oh, she's shopping are challenging.
Eddy Wang: Stanley, Tao, and Siting, thank you for accepting my question. I would like to congratulate you on your strong performance. My question is about the growth strategy for the first track. I would like to ask, if we look at the pros and cons, what are the key points of our growth? What is the feedback from the front end?
Speaker Change #247: Oh, well the ones you said Glen you take on the East side, though syndrome. So did so assessing ways that just for a group what kind of lift jackups salient jaw summit's endorse on that drilling depths MBS or somebody got whole more Chandler Shaw tender and the final question somebody on the outside.
Eddy Wang: In a relatively stable business, where is our main innovation? Thank you for taking my question. My question is regarding the growth strategy of our home transaction service. What's the emphasis on Lianjia and Lenglianjia respectively?
Speaker Change #248: Take Oh sounds good I hope you all went to Natasha Diamond we ought to go talk to you about the fan out yet, but what you end up buying a shot. Thank you for taking my question. My question is regarding the growth strategy of Iowa.
Speaker Change #249: Home transaction service, what's the emphasize Dan John and Dan Chard, respectively, and how is the feedback from basketball I've also far and what's the.
Stanley Peng: And how's the feedback from the store level so far? And what's the innovation in the cities where our business is quite stable? Thank you. Thank you, Eddy.
Unknown Executive: Moving to our cash flow and the balance sheet, we realize that not-of-reaching cash inflow of on the 4.8 billion in-culture. Your home capital was 45 days in-culture, attachment to our effective risk management. On top of, our personal data was 100 million allocated to share your purchase during-culture. Our total cash liquidity remained at a higher level of R&B 75.5 which has accrued customer deposits payable. Our key to result showcased our strong execution and ability to outperform the market with stable market environment.
Speaker Change #250: Innovate chips in the cities, where our opinions are quite stable.
Speaker Change #249: Yes.
Speaker Change #251: I think I did.
Stanley Peng: This year, our core strategy for the home construction business is promoting growth and building a harmonious ecosystem. In the first half of this year, we achieved notable results in scaling connected stores and exploring innovative models. In terms of scaling our agent and store network, by the end of Q2, the total number of active Nanglianjia stores on our platform increased to 38,900, and the number of active Nanglianjia agents rose to 308,000, up by 6% and 2.8%, respectively, compared to the end of 2023.
Speaker Change #252: It's either all or close to graduate school or home, Kentucky button is promoting closed end up building a harmonious ecosystem.
Speaker Change #253: In the first half of this year, we achieved notable results in skinny cannot install somebody's borrowing 18 models.
Speaker Change #253: In terms of the skinny all the agent that is still in that work.
Speaker Change #253: End of Q2.
Speaker Change #253: Total number of active monthly adjustables are powerful in close to 58009.
Speaker Change #254: 900, and its a number of I can money its agent goes too so he hundreds thousand 8000.
Unknown Executive: Both our existing and the new home business significantly exceeded market expectations. Moreover, our time-forms, overall market conditions have remained stable with multiple improvements in the market conditions new home. We're also so significantly found with the contribution market of our core business, more impact of the one-time effect of last year's high baseline infrastructure. Additionally, our non-housing content services are roughly based on this. Both our home renovation and the furniture and the rental business continue to achieve record highs, new skills and revenue.
Speaker Change #254: 308000.
Speaker Change #254: By 6% on the two 8% respectively.
Speaker Change #254: Yeah.
Speaker Change #254: Tended to industry.
Stanley Peng: In the first half of this year, we added 48 new major brands. During this period, over 6,500 new stores were signed on our platform, averaging around 1,200 new signings per month, with a six-month retention rate of 93% for these new stores. For the only connected stores, we provided a fee discount, installment prize, and other support for those brands. We also aided their operations with experienced stone owners and tailor-made integration plans. In terms of efficiency, three months after signing up, the productivity of agents in the new stores connected since last September reached over 80% of the productivity of the agent in the new store on the platform. Additionally, we help stores in some key cities enhance efficiency through refund operations, such as property inventory checks. Kaohsiung Home Lifting Corp. Verification under review.
Speaker Change #254: In the first half of this year.
Speaker Change #254: The 48, new major brands.
Speaker Change #254: Yes, it's Peter it almost 2500, new stores was funded with our platform.
Speaker Change #254: The region alone totaled 200, and you spending per month.
Speaker Change #254: With a six month retention rate of 93% or just new stores.
Speaker Change #255: Well the only connect stores were provided the fetus calls.
Unknown Executive: We maintain our commitment to cost efficiency and the refund additional management. Despite double digits of revenue growth, our gap operating services have remained nearly flat both scripturally and the year over year, leading to a substantial recovery with a profitability. With our low-pass cash reserves, we are welcoming to a increase shareholder returns to active share buybacks. Both are optimizing capital allocation and the enhancing capital operation efficiency, share sharing the benefits of our development with investors.
Brian: Installment plans another support for those Brian.
Eddie: It was the Eddie they're all Christians, whereas generally don't own us entertainer maintenance crews you cut.
Speaker Change #258: In terms of efficiencies three months after sending out the productivity of each of these are new store cannot be this thing's got September reached over 80% of our kids eat off the agent ease of use and install on playful.
Speaker Change #259: Additionally, we're hub stores in some key cities and enhanced efficiency so refined operations.
Speaker Change #259: As a puppy inventory checks.
Unknown Executive: As of today, we had a repurchased run, your $480 million worth of shares reached accounts about 2.7% of the company's photo share outstanding as end of 2023. We have consistently delivered our company to reward share holders. Since the launch of our share repurchased progress in September 2022, we have repurchased the run your $1.39 billion worth of the share as of today, which accounts for about 7.5% of the company's photo share of 30 before the program begins.
Speaker Change #260: Car T homeless and focusing clarification on to reboot.
Stanley Peng: This was also aided by technology-driven tools, including our AI housing matching and smart home listing maintenance system. We're also seeing good returns from the investment in our stores. The new stores sent in Q4 last year have achieved a positive ROI as of June this year. Four new stores opened in Q1 this year. The net grand contribution in the first half of the year has already covered the estimated expenses to continue the scaling of our Agenda Store Network as well as the 7G, diversifying our business from the housing transaction to one-stop residential services, and help place higher and more urgent demands on our platform ecosystem. This year, we further extended the coverage of the Regional Co-Governance Council to 74 cities by the end of Q2.
Speaker Change #260: This will also aided by a technology driven tools, including all AI housing Matchy tomorrow homeless mezzanine as a system.
Speaker Change #260: We're also seeing good returns of problems in Boston that installed function.
Speaker Change #261: The new starts in Q4 last year, how about the positive ROI as of June this year.
Speaker Change #262: All new stores opened in Q1 this year, so not granular contribution the first half will see us already covers I made it expenses.
Speaker Change #263: The continued scaling of our Ethernet network that's about seven.
Speaker Change #264: Diversifying our business its problems are holding transaction to one stop rich central services.
Unknown Executive: Today, we are pleased to announce that our goal has approved the expansion of the existing share repurchased progress. The amount of tuition has been increased from your $2.3 billion to your $3 billion. With the program now extended until August 24, 2025. Going forward, we will continue to reward our shareholders who have grown with the share of the value created by the best companies. As our investments become more diverse and expand in scale, we will continue to also file our fundamental categories who are actively and efficiently Our financial strategy remains committed to approving the approach on the focus on investing in error that can generate the key business outcomes and the long-term value.
Speaker Change #264: Place to hire on the mol urgency amongst our platform ecosystem.
Speaker Change #264: This year, we've closed the 10 year the coverage of the regional coal covenants console to 74 cities by the end of Q2.
Stanley Peng: By working with like-minded service providers, we gather valuable projections for its rating platform rules, granting more power to store owners and agents in terms of their fitness, and for the government and the folks in healthy industry competition. With Lianjia as a testing ground for our platform, we have explored a series of innovations in the agent store model to facilitate our transformation to one-stop residential services, focusing on improving agents' income in Jiazhou's largest model. In the first half of the year, around 51% of stores had more than 18 agents, an increase of 5.4 percentage points from last year. Consequently, the attrition rate for the NCR agent decreased to under 4%.
Speaker Change #265: We're working with like many of the service providers with either better protection, but it's linking pay for news.
Speaker Change #266: Quoting more power to still on us and the agency in terms of the fitness.
Speaker Change #266: I don't for the governance and a healthy competition.
Speaker Change #267: But yeah, that's attaching Guangdong praful, we have as broad a serious opening Alicia ease the agents don't model to a pathetic page I'll return transmission to one stop richest digital services.
Unknown Executive: For home transactions services, as we found our stone air work, agents of productivity will remain our key evaluation metrics. We also amplified the operational and financial capability requirements and the training for our platform partner to strengthen our middle-to-back office and take into finance. Our new initiatives will have a built-up middle-to-back office digitalization ability across the board to further improve the automation rate of our financial process as well as our data analysis and the processing capabilities.
Speaker Change #266: Okay.
Speaker Change #268: He just E com in June.
<unk> goes out the largest DAU modal.
That's the first half of the year around the fifth one for self install the modem 18 agents.
Speaker Change #268: The increase of five four percentage points from last year.
Speaker Change #268: Consequently, the attrition rate to 40 enjoy eating equally to under 4%.
Stanley Peng: This exercise was also the result of Lin Jia's strategic approach to the large-scale model. Alongside the large-scale model, we are implementing various store formats to better serve demand in different community settings. Shanghai Lianjia, for instance, is brought a different style, specifically by leveraging low cost convenience stores. That's a whoosh.
Speaker Change #268: Just the.
Speaker Change #268: Two suffice it was also the result of these strategic approach on the law is still modal.
Speaker Change #269: Alongside the logical model, while implementing to vigorously stole four months, so bankers soap ski mountain in keeping the committee said you.
Unknown Executive: The maintenance lay, we have set the higher requirements for contribution margin and also called the natural indicators for the balance, the long-term steady and the strong development of our countries. Our risk to threshold control measures remains don't remain in place. This ensures the fees we plan today, well-plastic, those that we can share the rich foods with our loyal shareholders.
Speaker Change #270: Shot in Joplin instance, sprawl that keeping the store types.
Speaker Change #270: Specifically.
Speaker Change #271: And low cost kaminski convenient so that's a boost.
Speaker Change #272: Foster investment on the part D coverage shot into increased user surveys density band of Q2, our recovery rate. So it's a homeless youth alopecia eyeglass Shanghai increased to 87% from 76% during the same period last year.
Stanley Peng: Fast Investment and Targeted Coverage; Shanghai Linjia Inquisition is the service center. By the end of Q2, our recovery rate of the home listing in the operational area in Shanghai increased to 87% from 76% during the same period. Simultaneously, we established flagship stores with more home-related elements.
Unknown Executive: This concludes my proprietary remarks for today.
Unknown Executive: I'll be there, but I know I need to take questions. Thank you.
Speaker Change #273: The leukemia space, whereas stablish, the flagship stores with the Mone hundred and they keep the elements.
Operator: If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speaker phone, please pick up the handset to ask your question. As a reminder, we only accept questions on the English language line. For the benefit of all participants on today's call, please limit yourself to one question. If you have additional questions, you can re-enter the queue.
Stanley Peng: Becoming Gateways for One-Stop Residential Services, In addition, we are exploring higher frequency community connections by brand crossover line stores. Among our ventures, we have longed to start with agents who have home renovation expertise and designers competent in the display of the renovation process and techniques. This approach promotes early customer acquisition for our home renovation business and forges closer ties with the community. Regarding talent development, Yanjia has segmented recruitment into three key areas, including college graduates.
Speaker Change #274: Common gateways or one stop residential services, yeah, you should.
Speaker Change #275: Volume higher frequency community connections that Brian crossover lines stores.
Among all of our ventures.
Speaker Change #276: The loan to store staff with the agents, who have a home than originally expertise.
Dennis: Dennis compete he decides to pay off the reservation process on the technique.
Dennis: Just to postpone most early customer acquisition for all the homes I noticed in fitness under Fogies closer tie with the community.
Operator: If you're going to ask the question in Chinese, please follow with an English translation.
Harry Chen: Your first question comes from Harry Chen with City Group. Please go ahead. [inaudible] are multiplied to its new home prices, also so a narrow decline in June. Although the new home market has yet to show the main non-signal improvement, the year-over itself decline in June to a narrowed month by month. The significantly market downturn in June 1 due to the high base and the system factor as a gradual growth rate. Market transactions continue to shift from new homes to new homes.
Speaker Change #278: Regarding the tendency vitamins Intel has just said the monkey is equivalent to three key areas, including college graduates call center professionals and its immediate I suppose.
Stanley Peng: Call Center Professionals, and the Committee on... We offer a variety of programs to support newcomers through their initial growth period, helping to build a high-quality team of service professionals. Moving on to Storm Antimony's leadership, as a cornerstone of our One Body, Three Wings strategy. Dianjia has also written out a leadership program for store operators designed to train well-rounded management talent specializing in residential services and promote the long-term career development for the service providers. Thank you. Thank you. Your next question comes from Timothy Zhao with Goldman Sachs. Please go ahead.
Speaker Change #279: We're all for a variety of programs to support new commerce, So it's a mutual growth period.
Speaker Change #279: Helping to build a high quality of the service professionals.
Speaker Change #280: Moving on to storm acumen and leadership.
Speaker Change #280: That's a cornerstone of our one body sweet win strategy.
Speaker Change #281: He is a hug also oversaw the leadership profile post all breakthrough Thunder Chew.
Speaker Change #281: To train well run through the management talent.
Speaker Change #282: New residential services and the poor.
Speaker Change #282: Remote with long term corrupt environment.
Service providers. Thank you.
Speaker Change #282: [laughter].
Timothy Zhao: Great. Thank you for taking my question and congrats on the very robust result. And my question is on your non-home transaction business, including home renovation and furnishing as well as the home rental business. I'm pretty glad to see that the contribution margin of both... May I ask, on home renovation, what are the key operating focuses for this year and what is the progress so far? And on the home rental business, could you share some color on how we should look at the unique economics of this business and what the key drivers behind the profitability improvement are? Thank you, Timothy.
Speaker Change #282: Your next question comes from Timothy Zhao with Goldman Sachs. Please go ahead.
Great thinking back a lot for taking my question and congrats on the very robust result, my question is on your non home consumption and that's including the home renovation and furnishing that's why I asked the home rental goodness and pretty glad to see that the country be smart enough to both Ben is extended.
Speaker Change #283: Call it or.
If I may ask a home renovation what I imagine are on key operating focus is for this year and what is the progress so far and on the home rental business could you share some color on how we should look at.
Speaker Change #284: Off this base.
Speaker Change #285: What is the key drivers behind the profitability improvement. Thank you.
Speaker Change #284: Yeah.
Stanley Peng: Let me answer your first question regarding home renovation. Our home renovation business reached over RMB10 billion in revenue last year, with a standout performance in leading cities that validated our business capability and model. This year, we are shifting our focus on building important infrastructure and capabilities. This includes upgrading our digitalized fundamental capability and the reinvesting process based on our home-style system, as well as optimizing our construction delivery and custom furniture delivery capability. We don't think digitalization is the archery of our entire home renovation business.
Kinsey: Central Kinsey, let me out there.
Harry Chen: The proportion of national GTV from this new home transaction has increased from around 40% of total GTV last year to approximately 44% in the first half of this year. Now let me further elaborate, for the policy relaxation, continue in the first half of this year, particularly after the injury reduction policy cycle began. Particularly, the May 17 policy package focused on reducing the housing injury, reviving its income on the relaxing mortgage conditions, where the higher the city is continuously relaxing purchase restrictions.
Speaker Change #287: The first question regarding the home renovation or home renovation definitely rich over RMB 10 billion off the run in the last year with the outperformance in the major cities.
Speaker Change #288: By the gateway to all of our pets are apathetic intermodal.
This year, we are shifting our focus on duty policy the infrastructure on the benches.
Speaker Change #288: Include upgrading our digital lives that fundamental capability other green lighting process based on all the Homestar system.
Speaker Change #289: That's alive optimizing our constant toxin delivery on the customized finish if he didn't really type of entity.
Speaker Change #290: We don't see.
Harry Chen: Regarding the income market, protest volume in the future will show multiple recovery. Volumes on paper platforms in May and June increase month by month, also performing the typical seasonal trends. The number of transactions in June risked the highest level of the same period since 2022, but since 2020, this rebound was especially strong in the first year cities, stimulated by fewer purchase restrictions and the relaxed mortgage conditions since the end of May.
Speaker Change #290: Utilization at the.
Our tree all borrowings had a home renovation business.
Stanley Peng: Let's connect service providers and enable all home renovation activity to run smoothly on our continually refined and standardized process. Implementing Middle Office Digitalization through our Homestart system. We have upgraded the system to version 2.5 this year and are promoting it nationwide. So far, it has been successfully adopted in Beijing, Shanghai, and Chengdu. HomeSoft covers five major sectors. Customers Solvency. Central Control Systems, Construction Delivery Systems, and the Supply Chain Systems. Compared to previous versions, HomeSoft 2.5 mainly upgrades two modules.
Speaker Change #290: That's a nice service providers and enable own homeland at least 52 events, mostly on the Oliver continually refine done and spend their lives pulls us.
Speaker Change #291: Implementing need often teachers locations through all the Homestar system wave how pay through agents. It system to version 2.5 this year.
Speaker Change #292: Promoting its a national wide. So far has been successfully adopt in Beijing Shanghai Chengdu.
Harry Chen: In June, protest volume in Kirwan cities is on bigger platforms, more 56% higher than in Apple, and it increased 132% year-to-year, especially in Shanghai. Shanghai was so increase of nearly 80% from actual to June due to the expensive policy easing, reaching the highest peak will have seen since the early 2021. On the full tier 2 and tier 3 cities due to the priority rounds of policy relaxation, the impact and the market response to this increase the round of policy will drastically be limited.
Speaker Change #293: Home soft covers five major sectors customers.
Speaker Change #294: Hudson Nacelle system.
Speaker Change #294: To control system construction delivery system on the supply chain system.
Speaker Change #295: That's a previous conversion.
Speaker Change #295: <unk> 2.5, Minneapolis two modules.
Stanley Peng: The BIM Shared Service Center Mid-Office Module and the Integrated Material Fulfillment Module. Among them, the BIM Shareship Center mid-office module can automatically generate price codes for the renovation based on the standardized construction drawing from BIM, thereby improving designer efficiency and reducing error rates. All design and construction data will be stored in the middle of the system for future iterations.
Speaker Change #295: The beam shared service center it would be the oldest mobile integrated the material to them in the motive.
The beam chefs of defense I mean, I'll say small deal.
Speaker Change #296: Automatically generate price codes for the renovations based on the standardized construction drawing from B sorry.
Speaker Change #296: Thereby improving the center efficiency and reducing aggregates.
Harry Chen: Regarding the transaction structure that the amount for the home market continues leading to market, especially in the first tier cities, where they make up 60 to 80% of the transactions. While a notable feature of this market occurs is the increase in the proportion of home buying with the regulatory amount in key cities, but in housing price decline, the ratio of the housing prices to incomes has significantly improved. With lower down the payment ratio and the mortgage rate, housing volatility has substantially increased.
Speaker Change #296: Okay.
Speaker Change #296: Certain data will be stored in the middle of assistant for future iteration.
Stanley Peng: In terms of the material fulfillment integration, we have promoted the standardization of the product data and achieved online unified scheduling for various main material categories to increase the certainty of material delivery. Regarding the improvement of our delivery capability, we shortened the delivery timeline and implemented the proactive mechanism of construction delivery. This year, with the high-order dispatch efficiency and streamlined construction process, we reduced the construction timeline, to combine the construction period for basic construction and the main material from around 111 days last year to around 100 days in this Q2.
Speaker Change #297: In terms of the mature fulfillment integration, we have promoted the decentralization of the product and.
Speaker Change #297: And the truth online you'll need by the scheduling or virus men material categories to increase the certainty of material deliveries.
Speaker Change #297: Regarding to improving our delivery capability, we shortened the delivery time lines on that.
Speaker Change #297: The proactive maintenance after construction delivery.
Harry Chen: Under the relaxed purchase restriction, in turn attract the most first-time buyers to the market, for example in Shanghai, the proportion of non-local buyers increased from nearly 30% to nearly 30% in June, and the buyers who are single increased by 6% this point. The policy has significantly stimulated the amount of relief within the target demographic. On home prices, we are also seeing the positive funds despite the ongoing price decline in the single market, according to Baker Reserve Institute, the pace of muscle mass decline in national existing home prices flowed in June, now in to negative 1.2% from the negative 1.7% in May.
Speaker Change #297: This year with the high older dispatch efficiency and streamline the construction process.
Speaker Change #297: The construction timelines.
Speaker Change #298: So combined constructing cheerleader for basic construction and then maybe.
Speaker Change #299: What's your old refused the former 111 days last year to around 100 days you just Q2.
Speaker Change #299: We also implemented proactive mechanism so that extra wide right.
Stanley Peng: We also implemented proactive maintenance service nationwide. We now provide free maintenance and repair to customers' homes on the 5th and 22nd, the month after the construction. To address common issues like war crimes, our goal is to detect and repair them early.
Speaker Change #300: We now provide the free month, my undergrad parents, who are customers at home.
Speaker Change #301: And a second to just taken.
Speaker Change #301: The month after the construction.
Speaker Change #302: So we're trying to pull me issue.
Speaker Change #302: Cracks, although at least to the pack and they're really parents and burden.
Stanley Peng: In addition, our upsells team has grown from over 200 at the end of last year to more than 400 people by June this year. And we plan to keep responding, will also substantially enhance our capability in customized furniture delivery. By setting relevant standards and enhancing training, we improved the success rate of one-time installation to around 80% in the first half of. The home renovation process is complex; it involves a wide range of personnel and diverse products. Transforming the industry cannot be accomplished through a single breakthrough.
Speaker Change #303: In addition, our Upsells team has grown from over 200 at the end of last year to more than 400 people at June this year.
Harry Chen: Practice also stabilizes in care facilities, housing prices in Beijing and Shanghai, increased by 0.4% and 1.2% of muscle mass, respectively. In June, and we also slightly improve the second care cities. Several also become more rational about lowering prices, the proportions of homeowners rushing to sell at the significant reducing prices decreased by 8% from the market to June. However, most of the potential buyers are feeling a weight-and-the-see mood, many are hoped to further price decline before entering the market.
Speaker Change #303: We plan to keep these fungi.
Speaker Change #304: We also substantially you haven't had the ability you can customize the furniture delivery.
Speaker Change #305: I think he'd rather than standard I think Hudson between rate and improved the success rate of four one times installation so around 80% in the first half of this year.
Speaker Change #306: The home renovation process is complex.
Speaker Change #307: Most of wild with a range of of personnel and not that were hurt us.
Speaker Change #308: Because for me the industry cannot be accomplished through a single brick suite.
Stanley Peng: It requires continuous development of various capabilities across middleware digitalization, product delivery, and product development. In the long run, this endeavor will eventually bring about high-quality change. Regarding the second question for our rental business, in Q2, rental income from the Baker Rental Service reached RMB 3.19 billion, increasing by 167% year-over-year and 21% QOQ. This growth came from the rapidly increasing number of home units that were managed and operated. Under our carefree rent module, we are managing over 300,000 units by the end of Q2, compared with over 240,000 that are quoted and over 120,000 at the same time last year. The number of units managed on one of our centralized long-term apartments has reached over 14,000 by the end of Q2, compared to over 7,000 in the same period last year.
Crowds continuous environmental forbearance capability across to meet all these get to flattish and particularly on the protective vitamins.
Harry Chen: This market is significantly different from the market response to the first policy round in the second half of 2023. Although city single market has become more active, there has been a sharp drop in the housing prices. This suggests two things. Firstly, in high care cities, the banking demand coupled with the input of ability and lowering buying costs with driving buyers out of their weight-and-see approach and into the active and participation, which in turn sustains local housing prices.
Speaker Change #309: The long run this endeavor will eventually bring up parts high quality change.
Speaker Change #310: Regarding second pricing for our written business in Q2, rather than from the Big car rental service.
John: Great John.
John: 3.1 night betting you.
Speaker Change #312: Increasing by 167% year over year on the 21% caught up a cold.
Speaker Change #313: This growth came from the rapidly increasing number of home units that they would manage it and operate.
Harry Chen: Secondly, the effecting of these policies has been validating to some extent, giving the cumulative impact of the relaxed policies over the past two to three years. In the home market, the year-over decline in your home sells narrow amounts by mouth in this queue too, but did not particularly input overall. There are the indicates that the top hundred developers sell by 42% year-over in the first half. Narrowing to negative 22% in June, several factors are limiting the recovery of the new home market.
Speaker Change #314: On top of apparently he runs a module.
Speaker Change #314: Managing over 300000, a unit ended Q2.
Speaker Change #314: Comparable with over 240000, that's quota.
Speaker Change #314: Over 120000 at the same time last year.
Speaker Change #315: The number of unique message at all involved with centralized the lungs and apartment had.
Speaker Change #315: Reached over 14000 dip at the end of Q2 compared to over 70000 in the same period of last year.
Stanley Peng: In terms of our capital rent model, we improved our business unit economy. We provided service offerings to address tenants' major pain points, such as home maintenance and rental change, to enhance our service quality, while providing timely and high-quality response to tenant issues. This led to a roughly 20% decline in customer complaints in June compared to the beginning of the year.
Speaker Change #315: Income so far we're carefully events model, we improved our business unit economy.
Speaker Change #316: We provide the service offering towards class tenants major pinpoint such as the whole month and this and the rental change between Python our service quality.
Harry Chen: Number one, means the past. You think home has a higher price impact than the new home. That is no longer the case, the price advantage of new home remains niche. Number two, pre-sold housing supply couldn't demand in immediate housing needs. Number three, the revenue available supply over the larger and the more luxury new home in northern land was worth home buyers with the right to demand. Number four, the supply new flags of nearly new homes.
Speaker Change #317: Well for Whiting timely and high quality response to attendance issue.
Speaker Change #318: So is that true or Rafi chintzy per cent decline in customer complaints in June compared to the beginning of the year.
Stanley Peng: We meaningfully improve leasing efficiency and cut vacancy costs through the following efforts. Number one, on the product front, we have been consistently expanding the coverage of our new product model since last year, which incurs no vacancy period. Its share increased about 60% in Q2 from Q1, reaching 26%, to effectively reduce the vacancy cost and enhance our resilience against the rental price change. The population of this type of product module will continue to increase in the future.
Speaker Change #319: We meaningfully improved the leasing efficiency on the costs because it costs. So it's a floating effort number one.
To put our phones, we have been consistently spongy to college of all of our new home moved at all when you put that module since last year, which increased in the period.
Harry Chen: Where means the new home from a few years ago that are now entering into the single market. There are meeting more of the current market demand, giving close match to the new homes, but with the advantage of the ready availability and the lower prices. With all of these factors at play, more positive forces are needed for the stabilization and the recovery of the new home market.
Speaker Change #320: It sure an increase above the 60% pardon me true truth, I'm sure reaching 26%.
Speaker Change #320: This effectively reduced the vacancy costs.
Speaker Change #320: Albert.
Speaker Change #321: Route resilience against the rental price.
Speaker Change #321: Changes.
Speaker Change #321: The population.
Unknown Executive: The police are all looking for the second half of the year, starting from July, the boarding of the new home complexion decline due to the combined effect of the policy impact, waiting and seasonal summer factors. The effect of the policy lasts about two months. In first year's cities, the congestion volume in July remains about the 5% higher in April, while here there was still significant growth. In last week of July, the transaction volume was over 30% higher compared to the same period last year.
Often these type of part out module will continue to increase into future number two.
Stanley Peng: Number two, the success rate of first-time rentals after the commencement of our property management contract increased from 82.2% in Q1 to 86.6% in Q2, and the amortized compensation cost per unit also decreased.
Speaker Change #321: The success rate of the first time rentals of the <unk>.
Speaker Change #322: <unk> of all our property management company increased from 82, 2% in Q1 to 86, 6% in Q2.
And it's amortize the compensation cost per unit also decreased.
Speaker Change #323: Almost three.
Stanley Peng: As we advance our carefree rent model, our operational focus has shifted from first-time rentals to re-renting the same property. Focusing on leasing, renewal, and pre-sale rates, our business process is divided into different stages with proactive intervention before the lease. This increased the turnover rate of the re-rented property from 3.1% in Q1 to 3.9% in Q2. Additionally, the time required to rent out a property for the second time decreased from 9.8 days at the end of Q1 to 7.5 days at the end of Q2, accelerating the rental efficiency while lowering the vacancy cost.
That's really the balance although Kathleen rat model, our operational focus has shifted from the first time in rentals to be renting the same property.
Unknown Executive: In July, its income price continued to drop, while the month-on-month decline in the posterior city narrowed compared to the period before the policy implementation. For the second half of the year, at the higher-based despite diminishing, the single market is decided to remain stable. The transaction volume in fourth-year cities are likely stabilized after a spike-like recovery, providing some support for the prices as well. However, the expectations for the fourth-year price drop and the virus culture sentiment may still concern the market recovery to some extent.
Speaker Change #323: Focusing on leasing renewal on the pre salt reads our business processes.
Speaker Change #323: Into the different stage, where it's acute intervention before.
Speaker Change #324: I see.
Andy: Andy just increase the turnover rate of the rent at the property from three 1% in Q1, two or three 9% in Q3.
Andy: Under the time required to a gun sounds a property what's the second time decreased from 98 days at the end of Q1 275 days at the end of Q2, a set of routines are run through efficiency, while lowering the vacancy costs.
Unknown Executive: The policy change will be a key variable in shaping market trends, on demand factors, more meaning of the purchase, use, use, and optimization of the housing demand will help. While the supply-side additional measures to support developers and reduce your inventory will help accelerate the market's generalization.
Stanley Peng: Number four, we also build up the venture capability through the dedicated position and improve productivity. We have strengthened the dedicated venture agent, nurturing stable rental channels by leveraging top performing agents with strong movement and capability in carefully run. We also established a dedicated team of commanders for more talent to run to. Accuracy, achieving greater efficiency, efficiency, utilization, and targeted rental of the key list while reducing the vacancy rate.
Andy: Number four.
Speaker Change #326: We also built up their eventual capability, so sort of a dedicated to positions and to improve the productivity.
Unknown Executive: Thank you.
Speaker Change #326: We have strengthened the dedicated.
Speaker Change #327: Virtual agent nurturing.
Naturally staples into channels that language pulp perform agent with a strong commitment unkept hypothetically you carefully rats.
Speaker Change #328: We also establish authenticate to tee off what commanders Pall mall tenants at rental.
Lindsey: Okay Lindsey.
Lindsey: Treating the greater efficiency in pitches fleet utilization and targeted rental off the kidneys teams well with using the vacancy rates.
Stanley Peng: The productivity of our commanders in facilitating ranking out improved from an average of 8.8 units per month at the end of Q1 to 10.2 units per month at the end of Q2. Thanks for the proportion of the combined rental. Occupancy by Dedicated Rental Agent and Account Manager went to 60%, an increase of 6% from Q1. Beijing also achieved breakeven in the first half of the year through managerial accounting on the city level. By the end of June, the number of units managed by Capital Run in Beijing reached nearly 76,000, with an occupancy rate of 98.2%.
Lindsey: Productivity of our commenters implicit taking Russian drinking out improve from an average of $8 eight units per month.
Thomas Chong: Your next question comes from Thomas Chong with Jeffries. Please go ahead. [inaudible] In the first half of the year, our new home business continued to a significant output from the industry. The policy by our robust operational and execution of availability, our housing transfer investments continued to achieve our target of the output from the market and the consistently generate alpha. In Q2, our new home PTV reached R&B 235 post-repelling down 20% year of year, but was of 55% cost over culture.
Lindsey: End of Q1 to 10.2 units per month at the end of Q2.
Speaker Change #330: In Q2, the proportion of the coupons are going to.
Speaker Change #331: Occupancy by educating through rental ages, and they'll come manager go to 60%.
Speaker Change #331: The increase over six percentage points from Q1.
Speaker Change #332: Beijing also achieved breakeven in the first half of the year and mentor hunky onto a city level.
Speaker Change #333: The June number of Union management that the cat food revenue Beachy rich nearly 76000 with our occupancy rate, but 98, 2% despite getting off a number of our properties, although 90 minutes.
Stanley Peng: Despite the scaling up of the number of properties of the management, which has led to a firm leading various companies, such as the World Trade Corporation in Beijing. This has substantially increased our confidence in the business. Thank you. Thank you. We are now approaching the end of the conference call. I will now turn the call over to your speaker host today, Ms. Siting Li, for closing remarks. Thank you once again for joining us today.
Speaker Change #334: Which has led to a fault beating of various cost well.
Speaker Change #335: Well chip cookies in Beijing.
Thomas Chong: PTV of CRRC's top 100 road developers built by 35% year of year in Q2. In June, our new home congress present more increase by 12% year of year compared with the industry, 22% drop, notably outpacing the market. In addition, our revenue in the future is a part of our GTV.
Speaker Change #336: This has substantially increased our confidence in the business. Thank you.
Stanley Peng: If you have any further questions, please feel free to contact the Big Hearth Investor Relations team through the contact information provided on our website. This concludes today's call, and we look forward to speaking with you again next quarter. Thank you and goodbye.,,,,,,,, Thank you for watching! [inaudible] [music] [inaudible] Xiaodan Zhang, Xiaodan Zhang, Xiaodan Zhang, Xiaodan Zhang [inaudible] www.facebook.com.au
Speaker Change #337: Thank you we are now approaching the end of the conference call I will now turn the call over to your speaker host today, Ms sitting Lee for closing remarks.
Speaker Change #336: Yeah.
Speaker Change #337: Thank you once again.
Speaker Change #337: Today.
Unknown Executive: This is the unique case. First, that's our, that we have not compromised our monetization capability to get much shares. On the contrary, our stable monetization capacity has been validated. Second, your buyer's market by helping downstream agents, especially sent you for new home cells, has facilitated more efficient efficiency, fell through into current market. The certainty of our business momentum stands primarily from our channel service coverage function, and enhance the sales through capabilities.
Speaker Change #339: There's a question please feel free to contact me.
Speaker Change #340: The contact information provided on our website. This concludes today's call and we look forward to speaking with you again next quarter. Thank you and goodbye.
Speaker Change #340: Okay.
Speaker Change #340: Yeah.
Speaker Change #340: [noise].
Unknown Executive: In terms of the cooperation with the real estate companies, the relationship between broken channel and developer are setting the stage for a new and new mutual beneficial model. The totally broken channels and the developer has a more competitive relationship. However, as the new home market becomes a buyer's market, setting home has been more challenging, and the customers have changes substantially. The role of the cell channel in the industry, transition from the supply makes the deal to providing data inside into the customer and collaborating with developers to address new home buyers 10 points.
Speaker Change #340: Yeah.
Speaker Change #341: Uh huh.
Speaker Change #341: [noise].
Unknown Executive: Right in this trend, we have been advancing our reach and evaluating the dates and the breaks of our partnership with top-tier developers. This year, we've also founded the coverage of the core state-owned developers and the high-quality leading real estate companies. By the meetings that are made with innovating new home services, by the end of Q2, we doubled the number of developers that we have strategically collaboration to 25 from 30 in Q2 last year.
Unknown Executive: The sales from our strategic partners, the developers, accountied for 26% of our total new home-dictionary in June. 11% is important, higher than the same period of last year. In June, the number of our core-graded new home projects accountied for 62% of old new home projects across cities, where we operate, excluding Beijing and Shanghai, compared with 49% in the same period of last year. Regarding our bulked sales took place. Previously, we were a labor intensive approach, but this year, we powered by the technology too, restrained the refund operation, and promoted the conversion of a potential new home customer from the single market.
Speaker Change #341: Okay.
Speaker Change #341: Okay.
Speaker Change #341: [music].
Unknown Executive: We continually boosting the new home sales too. In terms of the manpower, the number of new home agents on our platform, not the increase. This year, we founded the role of the comprehensive agent. Those are the more agents that engage in both new and existing home business in parallel. For example, the number of new home agents in Zhengzhou for Q2 was around three times than was during the same period, last year.
Speaker Change #341: Okay.
Speaker Change #341: [music].
Speaker Change #341: Okay.
Speaker Change #341: [music].
Yeah.
Speaker Change #341: Yeah.
Speaker Change #341: <unk>.
Unknown Executive: We thank you last by more competitive position rates and the improved timing delivery of pre-subhome agents have increased the willingness to engage in new home sales. Technology wise, we thought it would rate our potential customer product to have agents better, identify high potential new home buyers who are likely to make new news and purchase. While uncovering potential new home buyers from new home customers, I say rating new home customers' transaction efficiency.
Speaker Change #341: Uh huh.
Yeah.
Speaker Change #341: Yeah.
Speaker Change #341: [music].
Speaker Change #341: Yeah.
Speaker Change #341: [music].
Speaker Change #341:
Unknown Executive: In future, potential new home customers identified by this product are counted for around 3% of our overall new home sales, contributing about 30% of the new home sales. Additionally, through our innovative service solution, like the change of new home to new one, worry free repayments, worry renovations, and the home rental offering during the housing replacement. We are trying to balance client needs, driving new home customers, improving the efficiency of the new home sales group.
Yeah.
Speaker Change #341: Yeah.
Speaker Change #341: Okay.
Speaker Change #341: Okay.
Eddy Wang: Thank you. Your next question comes from Eddie Wang with Morgan Stanley. Please go ahead. Thank you for taking my question. My question is regarding the growth strategy of our home transaction service. What's the emphasis on Lianja and Lianja respectively? And how's the feedback from the store level so far? And what's the innovative in these cities where our business is quite stable?
Speaker Change #341: [noise].
Unknown Executive: Thank you. Thank you, Eddie. This year, our cost-resistant home transaction business promoting growth and building harmonious ecosystem. In the first half of this year, we have achieved notable results in scaling connected stores and its growing innovative models. In terms of scaling our agent on a store network, by end of Q2, the total number of active non-linear just stores are harmful, increased to 38,900, and the number of active non-linear agent goes to 388,000.
Unknown Executive: This is 388,000, up by 6%, and the 2.8% respectively, compared to the end of 2020. This is the first half of this year, where added 48 new major brands deals with clearing over 6,500 new stores, or sandwiched with our petrol. I've reached around 1,200 new standing per month, where there are six months of retention rate of 93% for this new stall. For the newly-connected stalls, we've provided a fee discount, installing clients, another support for those clients.
Unknown Executive: We also added their operations with the experience store owners and tailor-made integration clients. In terms of efficiency, three months after signing out, the productivity of agencies and new stalls, connected to since last September, reached over 80% of the productivity of the agency, easily installed on platform. Additionally, we have stores in some key cities in terms of efficiency through refund operations, such as a property inventory checks, quality home listing focusing, verification and reviewing.
Unknown Executive: This will also added by technology-driven tools, including our AI housing matching, and SMART home listing maintenance assistance. We've also seen goods returns from the maximum new stalls function. The new stalls and new queue for last year have achieved a positive ROI as of June this year. For new stalls, open new queue 1 this year, their net-grinding contribution in the first half of the year has already covered as I've made a dispensation.
Unknown Executive: To continue the scaling of our agent-stone network, as well as the development, diversifying our business from the housing transaction to one-stop residential services, how placed higher and the more urgent amounts of our platform ecosystem. This year, we've also extended the coverage of the regional co-covenants council to 74 cities by end of Q2. By working with like-minded service providers, we've added valuable suggestions for its written platform rules, granting more power to store owners and agents in terms of their fitness, and for the government and the fostering health industry competition.
Unknown Executive: With the end-家, as the touching ground of our platform, we have stored a series of innovations in the agent-stone model to facilitate our transformation to one-stop residential services. Forcing our improving agent's income, the end-家 goes out large to model. At first half of the year, around 51% of the stalls had a more than 18 agents, a increase of 5.4% percentage points from last year. Passively, the increased 40-in-家 agent decreased to under 4%. This success was also the result of the India Strategic approach on the largest-stone model.
Unknown Executive: Alongside the large-stone model, while implementing the various store formats to better self-demand in different committee settings, Shanghai and California stands to explore the different store types to facilitate by leveraging low-cost, community-convenient stores that are full-time. First, the investment and the target coverage, Shanghai Intia Inquiry is the service density, the end of Q2, our coverage rate of the home listing in the official area in Shanghai increased to 87% from 76% during the same period last year.
Unknown Executive: Demontaneously, we established the flagship stores with the most home related elements, becoming gateways for one store for special services. In addition, we are exploring higher frequency community connections by brand-class over-line stores. Among our ventures, we have a lot of store staff with agents who have a home renovation expertise and standards to meet the vital display of the renovation process and the technique. This approach promotes early customer acquisition for our home renovation business, and for this closer time with the community.
Unknown Executive: Regarding the challenge development, Intia has segmented the recruitment to three key areas, including college graduates, co-effective professionals, and community experts. We offer a variety of programs to support newcomers through the mutual growth period, helping to build a high quality of the service professionals.
Unknown Executive: Moving on to store management leadership. As a cornerstone of our one-body three-win strategy, Intia has also rolled out a leadership program for store operator design to train well-rounded management talent, specializing in residential services, and to promote the long-term career development for the service providers.
Timothy Jowell: Thank you. Your next question comes from Timothy Jowell with Goldman Sachs. Please go ahead. Great. Thank you for taking my question and congrats on the very robust result. My question is on your non-home transaction business, including the home renovation and furnishing as well as the home rental business, and I'm pretty glad to see that the contribution margin of the both business extended year in a certain quarter. So may I ask on home renovation what management key operating focuses for this year, and what is the progress so far. And on the home rental business, could you share some color on how we should look at the economics of this business and what is the key drivers behind the profitability improvement?
Unknown Executive: Thank you. Thank you, Timothy. Let me answer your first question regarding the home renovation. Our home renovation business reached over on the 10 billion of the rental last year, with the standard performance in leading cities that have allocated our business capability and the model. This year, we are shifting our focus on building policy infrastructure and capabilities. This includes upgrading our digitalized fundamental capability and the re-investing process based on our home process, as well as optimizing our construction delivery and customize the furniture delivery capability.
Unknown Executive: Mid-auticalization is the archery of our entire home renovation business. It connects service providers and enable own home renovation and 50 to run smoothly on the other continually refined and standardized process. Implementing mid-office digitalization throughout our home site system will have iterated the system to version 2.5 this year, and are promoting its nationwide. So far, it has been successfully adopted in Beijing, Shanghai and Chengdu. Home SaaS covers five major sectors, customer cell system, central control system, construction delivery system, and supply chain system.
Unknown Executive: Compared to previous versions, home SaaS 2.5, many upgrades to modules. The beam shared 6-centre mid-office module and integrated the material of the film and the module. Among them, the beam shared 6-centre mid-office module can automatically generate price codes for the renovation based on the stylized construction drawing from beam, thereby improving the standard efficiency and reducing error rates. Home SaaS and the construction data will be stored in the middle of the system for future iteration.
Unknown Executive: In terms of the material fulfillment integration, we have promoted the standardization of the product data and the achieved online unified scheduling for various main material categories to increase the certainty of material delivery. Regarding the improving our delivery capability, we shorten the delivery timelines and the acts to proactive maintenance of the construction delivery. This year, with the high-order dispatch, efficiency, and student construction process, we reduce the construction timelines. To combine the construction period for basic construction and the main material reduced from around 11 days last year to around 100 days in this Q2.
Unknown Executive: We also implemented proactive maintenance service natural wipes. We now provide the free maintenance and the repair to customers at the fifth and the second, the month after the construction. To address the common issue like wall cracks, our goal is to detect and repair them earlier. In addition, our upsell team has grown from over 200% end of last year to more than 400 people by June this year, and we plan to keep responding.
Unknown Executive: We also substantially enhance our capability in customer minds to furniture delivery. By setting relevant of standard and enhancing training, we improve the success rate of one-time installation to around 80% in the first half of this year. The home renovation process is complex. It involves a wild range of personnel and the diverse products. Conforming the industry can now be accomplished through a single-brick suit. It requires continuous development of a various capability across middle-aged digitalization, project delivery and product development.
Unknown Executive: In the long run, this endeavor will eventually bring about a high-quality change. Regarding the second question for our revenue business, in-culture, revenue from the fake rental service, rate charm be 3.19 billion, increasing by 167 percent year a year, and 21 percent of a quarter. This growth can form directly increasing number of home units that will manage it and operate. Under our carefully-run module, we are managing over 300,000 units by end-of-culture, compared with over 240,000 at-culture, and over 100,000 to 20,000 at the same time last year.
Unknown Executive: The number of units that manage it on while the centralized long-term apartment has reached over 42,000 by the end-of-culture, compared to over 7,000 in the same period last year. In-culture, our carefully-run module, we improve our business' union economy. We provide the service often to address tenant's major pinpoint, such as the home maintenance and the rental change to enhance our service quality. We are providing timely and high-quality response to tenant issues. This led to a roughly 20 percent decline in customer complaints, in June, compared to the beginning of the year.
Unknown Executive: We are meaningful to improve the leading efficiency and the current vacancy costs. So, the following efforts, number one, on the part of funds, we have been consistently funding the coverage of our new home module, our new part of the module last year, rich increase, no big period. This share increased about 6 percent upon in-culture to 1, reaching to the 6 percent. This effectively reduced the vacancy costs, and then enhanced our resilience against the rental price change.
Unknown Executive: The preparation of this type of product module will continue to increase in the future. Number two, the success rate of the first time rentals of the commencement of our property management, the concrete increase from 82.2 percent in Q1 to 86.6 percent in Q2. And the amount, and the amount has the compensation cost for union also decreased. Number three, as we are the ones our carefully-run module, our operational focus has a shift from the first time rentals to re-runting the same property.
Unknown Executive: Boxing our missing renewal and the pre-sell raise, our business process is divided into the different stage, where the proactive intervention before that is missing the ending. This increase the turnover rate of the re-run to the property from 3.1 percent in Q1 to 3.9 percent in Q2. Under the time required to grant out a proxy, was the second time decreased from 9.8 days as end of Q1 to 7.5 days as end of Q2, accelerating the rental efficiency while lowering the vacancy cost.
Unknown Executive: Number four, we also build up the rental capacity, so through the dedicated positions and input the productivity. We have strengthened the dedicated rental agent, nurturing stable rental channels by leverage top-performing agents with strong movement and capacity in carefully ranked. We also establish a dedicated team of our commanders for more tenant rental occupancy, achieving the greater efficiency invested lead, utilization, and targeted rental of the key listings while reducing the vacancy rates. The productivity of our commanders in facilitating running out you prove from average of 8.8 units per month as end of Q1 to 10.2 units per month as end of Q2.
Unknown Executive: In Q2, the proportion of the combined rental occupancy by dedicated rental agents and the commoners go to 6%. The increase of a 6% point from Q1. Beijing also achieved the previous first half of year by a manager accounting on the city level. By end of June, the number of units managed by the calculated rental Beijing rich nearly 76,000, with an occupancy rate of 98.2%. Despite the scaling up, the number of properties of the management, which has led to a firm leading of worse cost. We are achieving Beijing.
Unknown Executive: This has substantially increased our confidence in the business.
Unknown Executive: Thank you.
Siting Li: We are now approaching the end of the conference call. I will now turn the call over to your speaker host.
Siting Li: Today, Ms. Siddling Lee, for closing remarks. Thank you once again for joining us today. If you have any further questions, please feel free to contact because you met the relations team. There were the contact information provided on our website.
Siting Li: These concludes this call and we look forward to speaking with you again next quarter. Thank you and goodbye. [inaudible]