Dear investors and analyst friend, good evening. Thank you for attending 2026 interim result conference at S.F. Holding Co.. Now all participants are listen-only mode. The meeting's only be served for the invited investors, and we're also going to provide you the slides, audio, and the written records for only internal use, but not be disclosed publicly. S.F. Holding Co. has not authorized any media or reprint relevant content of this meeting. Any unauthorized reproduction or forwarding will be infringement. S.F. Holding Co. reserves the rights to pursue legal liabilities. We would like to urge you, the market is risky, investment requires caution. Right before the meeting gets started, we'd like to remind you, after the prepared remarks, we're going to have the Q&A session, please. Ladies and gentlemen, thank you very much. Thanks for joining us for S.F. Holding Co. H1 investor presentation. I'm happy to share and introduce our team with you. The management team attending this conference including Mr. Huang Sihai, the Chief Operating Officer, Mr. Geng Yankun, the Chief Marketing Officer and Chief Technology Officer, Mr. He Jie, and the Chief Financial Officer. We're going to have the earnings and business highlights first, and then we're going to have the technology application, and then Alex to walk you through the financial overview. Then the management team will join us for the Q&A session, please. Good evening, all the analysts and investors. Before I walk you through our result, I'd like to thank all of our investors for your longstanding attention and support for S.F. Holding Co.. In H1 of 2026, faced with a complex and volatile internal experiment and in pursuit of the sustainable and healthy operations, our strategy centered on two core themes. Resilience for the long term and AI-driven innovation. First of all, in China, regarding the resilience for long term, by moving from product operation to deep scenario cultivation, by extending from the consumer side to industrial side environment, we continue to deepen our competitive mode and consolidate our core business. In international market, we assess opportunity arising from the enterprises supply chain upgrades and the global expansion, penetrating from single customer touchpoints into industrial upstream and downstream, helping Chinese enterprises accelerate overseas expansion from long-term growth. On soft side, especially the software, AI deliver end-to-end enablement, of course, as logistics operation and drive revenue growth, efficiency gain, and cost reduction. On the hardware side, we're rolling out carbon-neutral smart equipment at scale, including the automatic warehousing, unmanned transportation, keeping us at the industrial forefront. In terms of the business, our product volume grew by 0.2% against the high prior year base, revenue exceeding CNY 155.5 billion, up by 5.9%. In H1 of this year, we keep advancing our second growth curve. Breaking down, express logistics revenue grew by 3.2%, where supply and internal revenue grew by 50.6%. Organic supply chain and incremental growth as much as 47%. On profit side, last year result included roughly CNY 600 million one-off gain from the deconsolidation of the SF REIT, recreating a high comparison base. Profit attributable to the owners of the company after deducting the non-recurring gains and losses better reflects underlying operating performance. In H1 of this year, the number reached CNY 5 billion, up 9.3%. Besides buybacks, we are also going to continue to improve the dividend payout ratio. Alex, we are going to elaborate on this point further. I am sure many of you are concerned about the impact of the rising oil price in H1 of this year. I would like to emphasize oil price fluctuation is a short-term headwind, where operational optimization and lean management are the directions the company is consistently pursuing over long term. In H1 of this year, profit lifting program, lean management, and the scalability initiative, together with a net effect of the AI application, each generated hundreds of millions of the level positive increase contribution, offsetting earnings pressure brought by the high oil price. Profit attributable to the owner of the company after deducting non-recurring gains grew by 9%, which demonstrates S.F. operational resilience amid external disruptions. After years of the development, S.F. domestic business continues to hold industrial leading position, forming a solid foundation with continued ebony mode. At the same time, we actively seize opportunities from the enterprise's global expansion, accelerating the momentum of our supply chain and international second growth engine. End-to-end AI enabling also across the logistic operation started to deliver tangible results. I will walk you step by step. Look at our revenue structure. S.F. domestic business maintains steady growth. Cold chain and pharmaceuticals was affected by weather, with reduced yield in some fresh foods. Meanwhile, both revenue share and the worldwide growth rate of the supply chain international expand further. I will provide you detailed review of the performance by segment. Let's talk about the time definite express. The revenue grew 0.2% in H1 of this year. Taking into account the courier pickup intensity and the value-based operation, if we believe the delivery intensity is too high, it's going to impact on the quality of the service. That's the reason we proactively adjusted our strategy on certain rate and parcel at the end of last year. Nevertheless, prime time definite express revenues still outpaced GDP growth. Drawing on the long-accumulated scale leadership, S.F. competes beyond the speed. We understand customer needs in depth and keep cultivating niche production side and consumer side use case to further deepen our moat in the prime track. Let me just give you two cases. Both cases are supporting CNY 100 million in H1. The first one is concert. We served 780 concerts in H1 of this year, providing not only luggage and merchandise storage for audience, but also marketing interactions that deliver emotional value. The second one is exhibition. We help exhibitors ship samples and exhibit extending service across a full moving and move-out circle. In H1 of this year, we moved and served more than 2,000 exhibitions, many single event revenue exceeding CNY 1 billion. Going forward, we will continue to enrich customer touchpoints and strengthen multi-channel cooperation with culture and tourism groups and event organizers. The economy express revenue grew by 7.5% in H1 of this year. Our core strategy is to optimize business mix and the revenue side and refine tiered operation on cost side. In terms of the volume, the two-year compound growth rate was 15%, outperforming the industrial 12%, demonstrating resilient volume growth. Building on this, we kept advancing profit lifting program, raised the share of the high-value customer, and delivered a 6% growth in parcel ASP. Together with intra-city on-demand delivery, we promoted last mile network segmentation for e-commerce parcel to realize precise matching between products and resources. The centralized e-commerce parcel pickup rate rose from 8% last year to 30% in H1 of this year. Centralized pickup parcel achieving a unit cost saving of CNY 0.2 per parcel. Let's talk about freight. Freight revenue grew by 12.6% on year-over-year basis. Building on the scale leadership, combined shipment volume across S.F. Express due network increased by 9%. We strengthened our sales force and targeted the industrial large item market, captured the incremental growth. In H1 of this year, industrial large item above 100 kg accounted for more than 55% of the total freight volume. Volume grew by 20% on the enlarged base. At the same time, we strengthened our strategic partnership with Dequin. In June, average daily integrated freight volume with Dequin exceed 2,100 pounds, up by 58%. Through synergy across the three networks, our freight business has built an LTL network combining scale and differentiated service competitiveness. Gross profit per kilogram improved significantly and further enhanced profitability. For SF Intra-city, the on-demand delivery, you may refer to separate disclosure from SF Intra-city for more details. I'm not going to elaborate on this. Supply chain international revenue grew by 50.6%. Organic revenue excluding KLN reached 47% on year-over-year basis. Accelerated from 32% in 2025, our second growth curve has entered into a phase of broad-based acceleration driving by two pillars. First of all, international express cross-border e-commerce logistics grew by 60%. For B and international express, we made further breakthroughs in the heavy cargo segment, such as the transportation of the robotic lawn mower. On the C end, we continue to cultivate high-value individual shipments. In cross-border e-commerce logistics, we maintain leading positions on key lines including China, U.K., China, France. As tariff and regulatory requirement tighten, SF end-to-end compliance capacity win many customer preference. Secondly, international supply chain deliver standout performance with revenue growth by 155%. We focus on chain leader enterprises, dig into full scenario clients' demand, extend service across upstream and downstream. We also target local key industries. For example, headquarter-oriented economy, K-beauty, and telecom high tech in South Korea. High precision equipment, transportation demand for AI industrial chains in Singapore and Malaysia. Going forward, we will extend from single product to end-to-end solution and strive to become a preferred logistic partner for Chinese enterprises for global expansion. I have two case to share with you. The first case features our long-term partnership with a global leading high-tech customer. We first engaged the clients in 2011 with finished goods sales logistics via express delivery. In 2018, we jointly built automatic benchmark warehouse for its global finished products business. In 2020, we expanded into procurement logistics. In 2022, we supported its global expansion strategy with overseas integrated warehousing distribution. In 2024, we deployed the live site warehouse operation at its production site. Over the years of collaboration, our system include TMS has been integrated with client system to realize end-to-end connectivity. This year, we also built LRP, lead logistics provider model, to orchestrate digital intelligent supply chain service for this customer. We have grown alongside with the customer, evolving from a domestic express vendor into strategic partner, helping the clients to grow global resilience. Over the past 10 years, logistic revenue entrusted by SF increased by fivefold. Express delivery dominate revenue in early days. Nowadays, supply chain international accounted for roughly 70%. International business currently only take a single-digit share, it grow by 30% year-over-year, signaling ample upside from the global expansion opportunities. The second case is that what we support a leading 3C company for its production capacity expansion in Vietnam. The customer has nearly 300 upstream supplier. Under the private model, supplier must handle delivery on their own, result in the fragmented cargo status and the ETA information. End-to-end visibility for cross-border flow was limited, and flexible resources adoption was required amid volatile production demand. S.F. delivered a suite of the tailored solution. We have onboarded more than 80 upstream suppliers for this client, updating unified pickup, consolidating, and the transportation. By integrating the customer's system, we implemented a single code full chain traceability for China/Vietnam cross-border logistics to achieve the full route visibility across port, transit, and in-house workflow. By deploying self-operated central house and fleet near major production base, we took over the customer's VMI warehouse operation, and hub-based transfer business. Now, we have connected full chain workflow covering raw materials, production, finished goods, sales, cross-border logistics, and multi-category warehousing for this customer. We have freed up over 4,500 square meters for the nine-side warehouse space, substantially cutting material turn runtime. Logistics revenue contributed by this customer was grown by 200% this year. In the near future, we'll refer the extending to the service of the customer's downstream partners, upgrade in-factory logistics fulfillment, leveraging the unmanned technologies. Our capacities to deliver end-to-end cross-border logistics service is underpinned by forward-looking global resources deployment. The two slides going to be skipped by me. However, as we are providing end-to-end solution, this actually has everything to do with our resources. As of the end of June, our total overseas warehouse footprint exceed 2.75 million square meters. Cargo throughput at Ezhou Huahu Airport ranks third among global logistics players cargo hubs, highlighting evident scale effect driven by the airport-oriented industrial cluster. Let me also talk about our operational foundation. We have deployed smart equipment at scale across every operational link. In digital and intelligent warehousing, we deployed ACR robots and AMR robots. Warehouse operation are empowered by capacities including AI quality inspection and wave planning. We have built multiple industrial benchmark warehouse covering food, oil, apparel, beauty, and the 3C sector, helping customer cut inventory cost by 10%-20%. On sorting and transit, we accelerated the construction of the cargo trader transfer center. Upper body humanoid robots and robot arms been deployed for small parcel feeding and large pilot, letting around 2,400 AGVs being used. Sorting operation efficiency has been grown by 7.4%. We pursue green development with 5,400 NEVs and more than 1,400 autopilot trucks being put into operation. Light-duty and heavy-duty unmanned trucks also been deployed in park cargo transfer, as well as line haul and short-haul transportation. For last mile pickup and delivery, couriers being regarded as our core competitive assets. We have launched six major benefit program. For first line staff, unmanned vehicle delivery robots and courier AI assistant improve the work efficiency, reduce the labor intensity. For example, unmanned vehicle can save each courier 1.5 working hours per day, cutting the repeated trips back to the service outlets. Going forward, we were keeping spearheading the application of the cutting-edge intelligent technology within logistics scenarios, improving extreme experience to our customer. Let me welcome Yankun Geng to walk you through the technological side. Thank you. Hello, everyone. AI technology is being rapidly deployed in all industries. I believe you want to know how S.F. is using AI. S.F. operates highly complex logistics scenarios with diversified product portfolio, facing strict requirements for precise time-definite fulfillment, and we boast world-class operation research algorithm across our in-house developed Fengzhi LLM and FengYu LLM, with substantial untapped value from the full chain AI enablement, as Sihai mentioned. From the top-level design, targeting end-to-end enterprise-wide intelligence, we have built the AI agent cluster up. More than 10 core AI agents plus dozens of the business application agents with initial realization of the agent-to-agent collaboration. We also built an enterprise-grade AI application platform to foster employee-driven AI innovation. The total number of the deployed AI agent grew from 5,000 by the end of 2005 to more than 50,000 now. Let me just talk about how we use AI for revenue expansion and cost reduction. The first case illustrates revenue growth driven by synergy between customer agent and the sales agent. Five sub-agent clusters work in coordination under the customer agent. Opportunity sub-agent automatically mines potential business leads, leverages internal, external market signal. For example, identify enterprises with global expansion intent or spotting expansion cooperation opportunity from public event data. After lead identification, leads are graded and categorized into the sales agent, and we are going to sell those number to frontline sales and outlet managers. Meanwhile, AI auto-generates a pre-visit on one page and the sales script. Massive volume leads are going to be screened while AI outbound calling. AI sales agent can also send contract-related message to escalate the human representatives. Further, quality, profitability, and risk sub-agents continue to monitor service quality, pricing, reasonability, and realize closed-loop management. In H1, leads dispatched by the system achieved a 67% follow-up rate and a 6% conversion rate for frontline team. AI outbound call registered around 40% answer rate, 8% contract signing rate. Created initial revenue of CNY 1.6 billion in incremental way. The business upside will unlock more opportunities in the near future. The second case, showcases cost reduction potential unlocked by collaborations between planning agent and the fulfillment agent. Taking ground transportation as an example, the planning agent delivers volume forecasting, route, and resources planning, post-event optimization. After receiving the route requirement, the fulfillment agent performs automatic vehicle scheduling and dynamic resources dispatching. Supported by the AI agents, the network-wide route re-optimization for peak holidays to be shortened by three days to six point five hours. Automatic scheduling covers more than 98% of the network line-haul and short-haul routes. Execution rate of the AI dispatching instruction exceeds 90%. Response time is being further optimized. Network-wide fleet load diagnosis automatically reviewed the next business day, greatly improving self-operating the fleet utilization. Parcel quality agent safeguards end-to-end fulfillment. Fengyun Vision large language model across the whole network delivers second-level conclusion for the individual parcel exception diagnosis. Year-over-year improvement is being identified. Now, enabled by planning fulfillment agents, tangible cost saving has already been seen in H1 of ACM. Let me welcome Alex to talk about financials. Okay, thanks, Yankun. Dear investors, good evening. Just now, Sihai has already given an overview of our interim result. Here, I will focus on the company's second quarter performance. Q2 2026 brought both opportunities and challenges for S.F. Holding. We kept advancing lean operations, the profit lifting program, and AI-driven efficiency gain, which partially offset short-term disruptions from the higher oil price and delivered possible growth. Earned profit attributable to the owners of the company after deducting the non-reoccurring gains and losses. Against geopolitical volatility, supply chain and international business further demonstrate its value and growth potential. Second growth curve accelerated on the broad-based front. In Q2, parcel volume reached 4.1 billion, down by 3.7% year-over-year due to the high baseline last year. Along with our proactive product optimization to focus on value-based operation, revenue hit CNY 81.4 billion, grow by 5.7%. GP margin reached CNY 10.7 billion, up by 6%. The GP margin rate was 30.2%, improved by 0.04%. Affected by the high base from the deconsolidation of the Sea rates in the prior year, profit attributable to the owners of the company fell 50.1%, reaching CNY 3 billion. Excluding SF REIT one-off gain, it grow 2.3% on year-over-year basis. Adjusted net profit, which better reflects its underlying performance, stood at CNY 2.7 billion, up by 3.1%, with adjusted net margin of 3.3. Where in terms of the gross profit in H1, gross profit was CNY 20.9 billion, up by 7.7%. Gross margin rate stood at 30.4%, grow by 0.2 percentage point. Facing the moderating domestic industrial growth and complex global landscape, the company kept executing several core initiatives. On the revenue side, we adhere to the value-based operation. We deepen diverse scenario demand, including industrial production, corporate global expansion, continue to optimize product mix to drive high-quality revenue growth. On the cost side, we advanced operating model optimization, integrating high-quality resources such as SF Intra-city on-demand delivery, improved precise matching between resources and product, and build a more flexible fulfillment network. Meanwhile, we accelerated the large-scale rollout of AI technology and smart equipment. Rich use case and business data feedback into algorithm iteration to raise operation accuracy of the intelligent hardware. This will unlock the full-length digital intelligence potential for cost reduction and efficiency gain, and reinforce our profitability resilience. Let me talk about cost for sure. The company pursued lean management and kept delivering structural cost optimization. Breakdown by cost category can be seen in the following way. Labor cost to revenue ratio down by 1.4 percentage point on year-over-year basis. On one side, we proactively optimize business mix, control the share of the low-margin e-commerce parcel, while carrying the high labor intensity. On the other side, intelligent and unmanned technology eased the workforce burden and lifted the operating efficiency, enabling the colleagues to devote more energy to high-value customer-facing work. The second point, transportation cost to revenue ratio rose 1.9 percentage point on year-over-year basis, mainly driven by the external headwinds of the higher oil price in Q2. In parallel, we scaled up direct ground trunk routes and aided international flight frequency to strengthen our network competitiveness. At the same time, we accelerated the deployment of NEVs, autonomous driving, and unmanned vehicles, and leveraged the digital intelligent tools to optimize network planning and improve the operational efficiency. The third point, other operating cost to revenue ratio down by 0.7 percentage point. Guided by the mid and the long-term strategy, we increased investment in strategic resources, including the sorting center automation, last mile touchpoints, and overseas warehouse. We also refined resources deployment governance to boost the asset utilization rate. In terms of the expenses ratio, as you can see here, the general expense to revenue ratio edged up by 0.1 percentage point, mainly attributable to the headcount expansion for overseas business rollout in Q1. Guided by the lean operation and the technology empowerment, we pushed the organizational flattening. G&A ratios being effectively declined in Q2. For sales expense, sales team are incentivized by the high-value business expansion KPIs, accelerating new staff onboarding, keeping S&M expense to revenue ratio flat year-over-year. Powered by AI algorithm, R&D efficiency kept improving, with R&D expense to revenue ratio down by 0.1 percentage point. Meanwhile, the lower average outstanding borrowings reduced interest expense, driving the finance expense to revenue ratio down by 0.2 percentage point. Taking all those factors considered, total four major expenses ratio down by 0.2 percentage point in H1 of this year. Let's also talk about the capital structure. In H1 of 2026, asset liability ratio of the company stood at 50%, modest increase versus the end of 2025. From the bridge bank loans taken from the GT strategy equity subscription, excluding this bridge loan impact, the asset liability ratio would be dropped to 48.5%, which is very healthy. On cash flow, cash flow from operating activity, OCF, reached CNY 11.2 billion, down by 14%. This was jointly driven by the shift timing of the operational recipients and the payment due to business mix change as well as tax payment. To consolidate the long-term core competitiveness, we strictly control return on investment and kept increasing forward-looking investment in sorting hub automation, smart equipment, NEVs. Automatic hardware is expected to be continued to lift operational efficiency and accuracy. NEVs will gradually reduce our residence on the fossil fuel. As a result, CapEx in H1 was CNY 6.1 billion, improved year-over-year. Well, let's also talk about the shareholder returns. S.F. attach greater priority to shareholder returns. As you have already seen, we ramped up share purchase since last year. We just fully completed a CNY 6 billion A-share repurchase plan for consolidation. Where sitting was double at the end of March. Those repurchase share would be canceled afterwards. Under the inaugural Hong Kong dollar 500 million H share repurchase program launched at ACM, HKD 230 million has already been utilized as at end of July. On dividends, to reward the shareholders and based upon our solid confidence in future development, we lifted the 2026 interim payout ratio from 40%- 45% this year. The expected interim cash dividends amounts to CNY 2.5 billion, up by 8%. Furthermore, I think you probably see from our announcement, we propose to revise the 2024 to 2028 five-year shareholder return plan, targeting full year payout ratio of 45% for fiscal year 2026, rising to 50% for fiscal year 2027, and no less than 50% for financial year 2028. Going forward, S.F. will honor our commitment to the share operating gains with the shareholders, keep executing shareholder return initiative to thank our shareholders for your long-term support. This conclude our prepared remarks. I will hand over to Gan Ling, please. Thank you, Alex. Now let's move into the Q&A session. Please help us to read out how we're going to raise a question. Ladies and gentlemen, if you'd like to raise a question, please press star and one. For people joining through the webcast, please help to leave your question in the chat box, or you can press the hand up button to raise your question in voice. Ladies and gentlemen, if you would like to raise a question, please press star key and then number one. For online participants, you can ask your question in text in the live room interaction panels, or you can click on the hands up button to raise your question in voice. Coming next, let's welcome the audience whose number ended with 8343. Please identify yourself. Thank you. Hello, everyone. My name is Liu Gangxian from CICC Transportation. I have a question. Congratulate on the company for such a good performance in the volatile external environment. Especially, I see that the gross profit and also the net profit, I also see stable growth. My question is regarding the time-definite parcel, especially the prime time-definite parcel in H1 of this year, still going to see a very nice growth. How does the company look into H2 of this year, would like to plan to tap into the growth of the potential prime time-definite express, and how does the company view full year growth? Hello? Let me help to answer the question. Our time-definite express business leads the industry in scale. Its revenue market share ratio is already rising to 66% last year. On this basis, our prime time-definite express still achieved a revenue growth of 5.3%, outpacing the 4.7% GDP growth. Our competitive mode kept deepening, demonstrating the growth resilience. The growth are still stemmed primarily from the two levers, including scenario expansion and service upgrades. Regarding deepening the scenario expansion, we continue to push for scenario express growth, shifting from passively taking order to proactively creating demand. I was talking to my team all the time. We secure positionings in the core channel. For culture and tourism scenario, besides the concept I mentioned in the prepared remarks, S.F. Holding Co. has also aligned with China's multi-tier policies to boost the culture and the tourism industry. Because different provinces and cities are promoting culture and the tourism industry, we adopt a three-layer strategy, broad coverage, specialized execution, and a broad-based impact. We widely deployed outlets at airport, high-speed rail station, hotels, and the scenic spots. I think on your business trip, you may see many of our outlets over there. At the same time, we also focus on six categories of the partners, including China Tourism Group, airlines and OTAs, and the sports and performing arts organizations. For example, we launched the East Travel Duty Free Luggage project with China Eastern Airlines, with luggage shipments surpassing close to 20,000 orders in H1 of this year. Our strategic cooperation with China Tourism Group covers 60 scenic spots nationwide. In H2, we continue to expand into various culture and tourism sub-scenarios to consolidate our leading position. At the same time, we are also deeply cultivating channels like residential communities, campuses, and CBDs, intensifying the touch points such as community stations, university outlets, and on-site presence at the landmark office building. We are also exploring emerging business such as the gifting scenarios and the circular economy. In addition, we continue to strengthen our penetration into industrial zones, leveraging high time-definite transportation capacities to take on the accelerated shipments for factory raw material replenishment, spare parts, and precision samples, ensuring our customers' production lines run continuously and efficiently. Well secondly, we continue to upgrade our service capacity. Effective from August 8, S.F. time-definite express product system underwent another comprehensive upgrade. We are introducing a diversified product matrix, for example, SF Same Day Delivery, next morning, and next day delivery, redefining product and service standards through the certainty of our time-definite capacities. We also extend our late delivery compensation service nationwide, covering all three time-definite products, so that the speed has a benchmark. Punctuality has a guarantee, among which SF Same Day Delivery leverage optimal resources, and making sure the delivery could be done with as fast as four hours, covering more than 300 cities near airports and high-speed rail stations across Mainland China. Continue to iterate on benchmark for prime time-definite express and enhancing customer experience. I hope you can try our product because you are going to get a compensation if any delay happens. We hope by leveraging this service commitment, we can also support the whole industry to achieve the higher efficiency and better service, really compete on the service. Looking ahead to H2, the current micro landscape still remain divergent. GDP growth mainly driven by export and domestic retail sales is kept at a moderate pace against the high business base in the same period of last year. Number three, draw on the multi-scenario penetration and iteration of the prime time-definite express. We hope we will be confident in driving healthy growth of our time-definite business piece. Thank you. I hope that in the near future, we will be able to enjoy the quality service from S.F. Thank you. Now, let's welcome the second question. The phone number ended with 8663. Please identify yourself. Thank you. My name is Shen Xiaofeng, coming from Huatai Securities. I have a question regarding the industrial transformation. The company continued advanced industry-specific transformation. How the new recruited salesperson performed? Are there any assessment metrics? Will you increase the team size? If yes, what will be your target head count? How much revenue and profit can it contribute? Thank you. Thank you. I am Yankun Geng. Let me just help to respond to the sales question. The salespeople recruited last year, after more than one year, integration has already been deeply embedded into our business line, create value for our industrial specific transformation. At the end of June of this year, the sales team already stabilized at around 4,000 people, among which industrial sales focus on the customized supply chain solution for major clients. Industrial zone sales cultivated incremental growth, and also they well invested the cross-border business, like the customer clearance and the declaration, overseas warehouse, the sales team, and also continue to refine the tiered customer management, delivering specialized and precise empowerment. Efficiency of the team continue to improve. The average time for new hires being close to their first order shortened from 73 days- 61 days. At the same time, we have upgraded our assessment system and last place elimination mechanism, guiding the sales to focus on long-term value across dimensions. For example, in customer profitability, payment collections cycle, and in H1 of this year, S.F. organic supply chain incremental revenue accelerated to 47%, where supply chain service revenue in sub-segment like electronics component, telecommunication equipment, and consumer electronics grow from 27%- 53%. Under the vigorous assessment mechanism, the size of the company's sales team will have some dynamic changes in line with the pace of the business development. Following the principle of the selective recruitment, we're going to focus on strengthening our industrial zone sales and the international sales capacity. We're also applying strict assessment based upon the co-efficiency metrics and profit per capita to improve the sales team's input and output ratio. Thank you. Thank you. Which can actually boost my confidence and understanding your sales team much better. I really hope that you are going to have a good business and with a wonderful scorecard. Thank you. Coming next, let's welcome the next investor. The phone number ended with 2317. Hello, everyone. I'm Taoying Fan from Bank of America. Supply chain and international revenue growth was very strong in H1 of this year. How much do international express, international freight forwarding, cross-border e-commerce logistics, and integrated supply chain each contribute? What about the profitability? We would like to understand the mid and the long-term strategy and financial targets. Thank you. Thank you. I'm Sihai. Let me help to respond to the question. Against a complex and volatile international backdrop, the supply chain and international business show healthy growth momentum in H1. The total segment revenue reached CNY 39.6 billion, up by 16%. Within that, organic growth, excluding KLN, accelerated further, up by 47%. Breaking down that CNY 39.6 billion revenue, KLN business as international freight forwarding contribute 60% of the revenue. Domestic supply chain license such as SF, DHL, and DSC contribute 40%. International supply chain business contribute 10%. International express and cross-border e-commerce logistics for another 10%. Regarding segment profitability, with a strategic transformation of Kerry Express (Thailand) taking hold, the losses continue to narrow down and the segment continued advanced lean operations and contributed to unlock the synergies with business such as KLN and DSC, and turning a loss to a profit year-over-year in H1. Profitability improved by nearly CNY 40 million. Over the mid and long term, we are committed to become the global logistic partners for companies to going global. We're going to work on three things. First of all, capacity building. Centered on our Ezhou Huahu Airport air cargo hub, we are intensifying the route in key markets such Europe, Southeast Asia, Japan, and South Korea, expanding the express air-to-air transit coverage, leverage GMS single permit access to six countries in south and the TIR cross-border direct access to Eurasia continent and the north. On the basis of our current 2.75 million square meter of the overseas warehouse, we will continue to expand and extend our operating capacity to multi-categories. For example, the temperature and humidity-controlled storage, building efficient and coordinated global backbone logistics network. Second point, how the products go for global expansion. On the merchant side, we also expand dedicated international outlays in speciality industrial belts to ensure goods can be loaded onto flights quickly. On the channel side, building our cooperation with leading platforms. We are developing brand, independent website, and local overseas e-commerce channel. As cross-border regulation and tariff policy growing increasingly stringent, non-compliant logistics providers being cleaned out, as you can see from the media. Where for the company joined on our full chain compliant fulfillment capacity, we're confident we can continue to gain market share. My third point, our capacity global expansion. We were deeply engaged with chain leader customers, coordinating and managing their upstream and downstream logistics needs, helping those companies to upgrade their supply chain system, optimizing inventory cost, and improve the capital turnover efficiency. At the same time, we are confident to accelerate the build-out of its international supply chain control tower, integrating the management of the operating quality control risk, and using digitalization to empower the scale expansion and the lean management of the cross-border supply chain. The president once said S.F. Holding Co. is going to shift from the cost of the product transportation to support our customer to reduce their inventories and reduce their overall manufacturing cost. In sum, we believe revenue contribution from supply chain international business will continue to rise with a healthier structure, and profitability will gradually unlock. Thank you. We hope S.F. Holding Co. has a better business. Coming next, let's welcome the next investor whose phone number ended with 5819, please. Hello, everyone. Good evening. I'm Du from Changjiang Securities. I have a question for the management team. Would you mind to give us a few guidance? We are pleased to see the company further enhance shareholder returns. The oil price has also been cut down somewhat recently, and I surely believe it's going to be a positive impact on your cost. Can the management team update me on the latest guidance for the full year and outlook? For example, CapEx. What will be the full year CapEx for 2026? Whether you are going to adjust your investment cadence. Considering your earnings, the oil price, and CapEx, whether your free cash flow is going to perform for this year? Is it possible for the management team to also share with us your guidance and outlook for the full year performance to see if there's any updates? Thank you. I'm Alex. Let me help to respond to the question. First of all, as you are asking about the CapEx, free cash flow, and full-year performance guidance. On CapEx, in H1 of 2026, the company asset CapEx was CNY 6.1 billion, accounted for 3.9% of our overall revenue, increased compared with last year, mainly related to the pace of the investment. To strengthen our long-term competitiveness and with an eye on the long-term structural cost reduction, we have already made some front load investment focused on the site renovation, equipment, and intelligent equipment upgrades. Along with our business volume increase, we actually acquired more transportation related hardwares, including the aircraft engines and NEVs. Yankun was also talking about AI application in the prepared remarks. That's the reason the CapEx slightly increased compared with the same period of 2025. But one thing we'd like to guarantee is that every CapEx we're going to bring a reasonable return. For the full year, for the overall CapEx, compared with what we forecasted by the beginning of this year, I was talking about CNY 12 billion by the beginning of this year. But we would like to maintain this forecast, still CNY 12 billion for CapEx. In real execution, you may also want to know more about the CapEx allocation. I think I have already mentioned that in where we're going to use our CapEx. Let's talk about the cash flow. In H1 of this year, our free cash flow was around CNY 5 billion. Personally speaking, I believe it's a very healthy one. Well, regarding the capital allocation, we need to balance the company's long-term sustainable development with the returning value to the shareholders. As we introduced in the prepared remarks, the 2026 interim dividend payout ratio has been improved from 40% last year to 45% of this year, increased by 8%. We also plan to set the full year annual dividend payout ratio to be 45%, and even rising to 50% for 2027, and no less than 50% for 2028. I think this fully demonstrate management's firm confidence into our future operating fundamentals and cash flow stability. I think I did a quick calculation just now. In H1 of 2026, A share plus H share repurchase totaled CNY 4.37 billion, together with proposed interim dividend, CNY 2.5 billion. Altogether, that was CNY 6.87 billion, equivalent to 125% of the first half profit attributable to the owners of the company, which truly demonstrate our confidence in managing the cash flow. Well, looking into the second half of 2026 or even the full year, I think my teammate has already shared with you. On the domestic market, we will continue to dig deep into diversified consumer subs and R&D. We are also going to support on the 2B enterprises transformation and upgrading, keep on deepening our competitive moat. On the international side, we will firmly seize opportunities for Chinese companies and brands, as well as their capacity to going global. This is indeed a real opportunity to us. We need to accelerate the development of our second growth curve business. At the same time, I think you may see from the report, we have accelerated the development of the business indeed, which is truly encouraging. I truly believe this group's momentum going to be sustained. In addition, we are going to accelerate the deployment of intelligent equipment in the AI application, converting our technical strengths into long-term operating returns. Overall speaking, in H2 of this year, the external environment still carry multiple uncertainties. But at the same time, as you may notice, the oil price, compared with the track record, still kept at a very high level. Those are the uncertainties we already identify in the market. However, the company will remain steadfast in our operating strategy, continue with lean management, and strive to deliver a solid revenue and profit for H2 of this year. Thank you. Thank you. Thanks for adding. Hope the company could continue to maintain a healthy and good development, bring more returns to the shareholders. Thank you. Okay, good. Coming next, let's welcome the next investor whose phone number ended with 3134, please. Hello, everyone. I am Kwan Peijing from Guohai Securities. I have a question regarding technology and AI of S.F. Holding Co. Traditionally speaking, we believe S.F. Holding Co. is actually an excellent tech logistics company. You do have a very strong underlying data along with the complex business scenario. If AI has been widely adopted, I think S.F. Holding Co. would be the first one to benefit from the technology trend. Just now, Yankun was talking about your investment in AI. I surely notice your investment in technology and AI is actually leading the industry, so I would like to ask you, are there any future development plan in AI and technology investment? How do you view the future benefits that technology and AI will bring? Thank you. Regarding this question, I am Yankun, please allow me to respond to the question. AI has been developed till today, the core rivals in AI including scenario data, algorithm, and computing power. Computing power is easiest to obtain. However, use case or we call scenario and the data are coming from the long-term accumulation on algorithm and the model. In 2024, we have already launched our self-developed logistics vertical large language model, including Fengzhi and Fengyu, enabling intelligent decision-making, one-sentence order placement, automatic summary of the customer service record, and route planning and packaging optimization, making AI both logistics savvy and S.F. savvy. In the era of accelerated AI adoption, I think our core competitiveness rely with our complex scenario plus data and the self-developed model, a barrier that is difficult to be copied by other competitors. Building on all those strengths, last year, we have already completed the deployment from a single point AI scenario. We have already rolled out 5,000 AI agents covering marketing, route planning, parcel fulfillment, customer service, and international business. In 2026, we further encourage company-wide co-creation with number of the agents growing from around or even reach 50,000 in H1 of this year. So in 2026, contribution of the AI benefit would be released. However, we believe in the near future, agent application would ultimately free people from the business workflow. You can see through the past information reform, we distill the human experience into our system. Through deployment of AI agent, we achieve AI-assisted work that can provide recommendations. But it is still a human who are ultimately clicking on the confirm button. What we are trying to do is to AI driving both decision-making and execution. Human just intervene when exceptions happens. We are iterating and upgrading AI agent cluster op, connecting and coordinating the dispatching capacity across agents so that AI can operate a scale and at a higher quality to assist and free the work of S.F. people, allowing everyone to step away from the tedious tasks and think about high-value questions. In the ideal future state, AI will support the complete operational business loop, where S.F. people were responsible only to setting goals and monitoring the system. Let me just give you an example. Sorting center operation in the near future. The system manage the site, equipment, and personnel, and a person only needs to glance at the data dashboard each morning to confirm the system is running normally. In short, S.F. will continue to lead the application of the cutting-edge technology in logistics sector and keeping increasing our AI investment. Our goal at the current stage is to have agent handling 80% of the routine decision, where human beings only need to handle the 20% of exceptional case. Look ahead to 2027, AI will offer substantial incremental potential across both revenue growth and cost reduction. Thank you. Okay, great. Thank you. We really look forward to S.F. can continue to lead the industry for technology and for logistics technology and AI. Next, the investor whose phone number ended with 3815, please. Hello, everyone. Hello, management team. My name is Hushi. I just have one question to the management team. I come from CITIC. I would like to ask you, has the adjustment of the customer and product mix for Economy Express largely been completed? How do you view parcel volume growth in H2 of this year? With industry growth slowed down, what cost reduction measures does the company have to address the impact of the idle capacity on profits? Thank you. I am Sihai. Please allow me to respond to the question. Since launching our profit lifting program last year, we have been continuously to optimize product and customer mix in rising the share of the high-value business, while lifting the Economy Express parcel ASP by 6% in H2 of this year. Considering the high baseline in Q3 last year, it will create some pressure on the overall growth, but we expect the effective recovery in Q4. It is worth mentioning, we will adhere to value-based operation, continue to improve the revenue quality through reasonable pricing, maximize optimization rather than simply pursue scale. While improving the revenue quality, we will enhance Economy Express profitability through the means such as tiered last mile network operation. I notice the industrial growth being slowed down, but returning to the fundamentals of the running the business, what we need to solve is how to manage the cost. We will continue to refine our service. We firmly believe our costs are being engineered by design lies in the application of new technology, transformation of the model, achieving efficiency gain, and cost reduction through structured restructuring. In translate, we continue to invest in automatic equipment, for example, like robotic arms and AGV, coupled with human machine collaboration model to improve efficiency. At the same time, advancing sorting center consolidation to build a cargo trolley transfer center to improve the line haul route and improve the parcel throughput efficiency. Recently, I visited a few centers, and I find out efficiency is being greatly improved, but further room could be used to improve the efficiency, especially in Q4. I personally provided many suggestions to my colleagues on-site. In transportation, to cope with oil price volatilities, we will accelerate the replacement with EVs. We are piloting the integrated solar storage charging projects to reduce energy cost. We will also use unmanned light truck on broader base to improve the in-park cargo transfer and short-haul cost. Regarding the supplier ecosystem building and the round trip bilateral route matching, those would be something we are going to continue to carry on, with good achievements being made in H1 of this year. For last mile delivery, we will use unmanned vehicles to save the couriers' round trip time and drive precise matching between resources and products. For example, in the pickup stage, we continue to roll out the centralized e-commerce parcel pickup model, renovating last mile outlets, and coordinate external resources for SF Intra-city on-demand delivery, conducting one to two centralized pickup a day in merchant-dense areas, reducing fulfillment cost while safeguarding the C end customer experience. In addition, Yankun just explained, we have deployed a corresponding AI agent across the full link operation chain, which will generate even greater incremental potential for cost reduction in the future. Overall speaking, we will unwavering stick to the value-based operation and structural cost reduction and technology empowerment as our key lever. Continue to build a flexible, efficient, and healthy, profitable logistics network. Thank you. Very clear. Thank you very much. I wish the company an ever-growing business. Thank you. Due to time reason, ladies and gentlemen, we are going to have the last question for the day. Let's welcome the investor whose phone number ended with 0500, please. Hello, everyone. Thanks for the question opportunity. I'm Steve from Goldman Sachs. I have a question regarding J&T cooperation. The company's strategic equity investment in J&T has been completed. The cooperation has been implemented between the two sides so far. What plans are there for the future? When will this transaction into quantifiable contributions in terms of the revenue, cost, and synergy, and capital returns? Thank you. Okay, thank you. Thanks for Steve. I'm Alex. Let me respond to the question. As many of you may notice, we completed the strategic equity investment transaction with J&T in early June. Against the backdrop of the strategic complementaries and deep synergy, the both sides have carried out a range of the cooperations with implemented projects. You know that from the very beginning of this year, we have already expanding our scope of the cooperation. Now, the implemented cooperation projects covering 40 countries. For example, in e-commerce last mile delivery in H1 of this year, we newly aided corporations in regions such as Indonesia and Vietnam, leveraging J&T's efficient last mile network to help us further improve fulfillment efficiency. In customer clearance, both sides are jointly building customers clearance capacities in regions like Middle East, Mexico, and Central and South America, improving clearance time, and optimizing the clearance cost. In new product development, we have jointly developed a Malaysian to China cross-border personal shipping product with J&T, as well as domestic shipping service within the Philippines. Those are being conducted continuously, one after another. In supply chain, leveraging SF's cross-border ground transportation capabilities, we provide J&T with Thailand to Laos cross-border ground fulfillment services. Domestically leveraging the last mile stations and parcel lockers with the SF system, we help J&T improve their last mile pickup and delivery efficiency. The rates of the corporation and the depths of the corporation has been continually expanded. Going forward, we adhere to the cooperation strategy of orderly regional development with priority focus on last mile stage. Regionally, you see that in each region, we're going to have a tailor-made practice, and we're also going to give priority focus on the last mile delivery. Steve, in your question, you also asked about how S.F. Holding Co. been working with J&T. You can see that SF has appointed a non-executive director to J&T board. Both me and Sihai was engaged in the mechanism to have the strategic discussions and also have the day-to-day liaison team in place. As regarding the scale of the cooperation, as J&T recently announced the related party transaction, which was expected to increase in H2 of this year. In addition, following the delivery completion in June, we were also entitled to a share of the J&T annual net profit in proportion to our shareholding, which will recognize investment income accordingly. Going forward, we will look forward to deepen our cooperation with J&T. Okay, thank you. Very clear response. Hope the company can continue to improve your business, especially international business. Okay, great. Okay, ladies and gentlemen, here comes to the end of our investor presentation. Thanks for joining us for this event. All the materials and the slides would be available and be allowed for download at our IR website. I would like to remind all the analysts attending this conference, before we have the official website to make the official announcement, please don't forward or make the information public. If you have any question, please contact me or the IR team of the company. Thank you very much. Good evening.