We will begin the online earnings call of President Chain Store Corporation, PCSC. On the call with us is the IR team of PCSC. They will first give us an update, followed by a Q&A session. The IR team, the floor is yours. Good afternoon, dear investors. First, a brief update on PCSC's operations. In the first half of 2023, PCSC's consolidated revenue rose by 10.3%, driven primarily by contributions from 7-Eleven Taiwan, 7-Eleven Philippines, Starbucks, and other businesses. Notably, 7-Eleven Taiwan delivered a high single-digit growth. The consolidated gross margin also improved by 0.48% from the previous year, resulting in a 13.9% uptick in consolidated operating profit. Consolidated net profit after tax surged by 16.4%, thanks to increased interest income from the US dollar interest rate hikes. Both consolidated operating profit and net profit after tax have now surpassed pre-pandemic levels. Zooming in on 7-Eleven Taiwan, its revenue growth for the first half of the year was in the high single digits. This growth can be attributed to the consistent expansion of stores and increase in per store daily sales, or PSD sales for short. In 2023, PSD sales reached pre-pandemic levels. The primary growth drivers included fresh food, CITY CAFE, beverages, among other categories. Furthermore, there has been a continual rise in the gross margin, leading to increased operating profits year-over-year. Moving on to our subsidiaries, 7-Eleven Philippines has showed significant growth momentum. Other subsidiaries such as COSMED and Starbucks have also been showing growing profits. That was an update. Thank you. The IR team will now start the Q&A session. Feel free to raise questions. Okay, here we have collected some questions. The first question comes from an institutional investor. Based on your store expansion plans, when do you anticipate reaching a saturation point in the number of stores? As of the end of August, we operate 6,779 stores, reflecting a net addition of 148 stores so far this year. We project a net increase of between 200 and 300 stores by the end of this year. Going forward, our expansion targets will be set in response to shifts in market demand. We're seeing changes in Taiwan's demographics, an aging population, and a rise in smaller households. Consumers are seeking out stores that are close to them, convenient, and that offer a comprehensive range of goods and services. Convenience stores cater precisely to these needs. As a result, our stores have evolved into lifestyle service platforms. To align with diverse consumer needs, we have introduced a variety of store formats and product lineups tailored to different business areas and lifestyles. By integrating digital services, we aim to cater to the everyday needs of our consumers. Given the shifting market landscape, there's a rising demand for convenience stores. In response to this trend, we have ramped up our expansion efforts under the strategies that I just mentioned. This is to capture a larger market share. This will ensure that PCSC solidifies its leadership position in the post-pandemic era. Second question. Your competitors are grappling with challenges in attracting franchisees due to labor shortages and the need for larger store spaces. Are you encountering similar obstacles? With larger store spaces come increased rents. How are you assisting franchisees in managing the financial pressures tied to a store expansion and in addressing labor shortages? Thank you for your question. Challenges such as an aging population and a shrinking labor force affect all sectors in Taiwan. To navigate these challenges, we are bolstering our distinctive offerings in areas like fresh food, coffee, and commission revenues, aiming to enhance our per store daily sales and boost gross margins. This strategy mitigates the impact of rising external costs. Additionally, by promoting multi-store ownership among our franchisees, we aim to elevate overall profits for them and make more efficient use of manpower. The percentage of franchisee-owned stores continue to grow steadily this year. We are also investing in labor-saving equipment and cutting-edge technologies like smart vending machines, automated coffee dispensers, and self-checkout stations. By leveraging these technological advancements, we aim to minimize manual labor, thus improving both the turnover and operational efficiency of our stores. Thank you very much for your answers. Thank you for the answer. Third question: Has there been a shift in PSD sales growth target for this year? What's the outlook for PSD sales next year? At PCSC, we drive the growth of PSD sales through key business strategies every year. PSD sales this year has returned to the pre-pandemic level, and we expect it to maintain steady growth moving forward. Thank you. Thank you. Another question. Post-pandemic, how is foot traffic returning to the stores? Any notable changes in the average selling price per customer? What about for the remainder of the year and into next year? I'll take this one. After the pandemic, the growth of PSD sales in 2023 is primarily fueled by an influx of visitors as consumers return to brick-and-mortar stores, with foot traffic projected to see sustainable recovery. The growing popularity of non-cash transactions is a secular trend, which, together with our membership program, can further drive ASP growth. Additionally, adjustments in product mix are expected to further increase our ASP. Thank you. Thank you for the answer. Another question. At the start of the year, the Legislative Yuan approved the Tobacco Harm Prevention Act, which paves the way for heated tobacco products to be potentially sold in convenience stores. What is the company's perspective on the implications of this move? In line with the guidelines set forth by the regulatory authorities, our convenience stores will continue to stock products based on consumer demand. Thank you. Next question. What is the group's strategy concerning e-commerce? Are there investments in logistics on the rise? In terms of our e-commerce strategy, at PCSC, we boast superb locations and an extensive logistics infrastructure. We've been actively promoting e-services, especially e-commerce store pickup. We have achieved great results. This year, we started to collaborate with external e-commerce platforms, solidifying our role as a key pillar in the logistics and distribution of these platforms. Additionally, we are also growing our own platforms, offering comprehensive end-to-end services. This approach not only guarantees top-tier delivery services but also capitalizes on the synergy within our group. When people pick up parcels in our stores, they often generate additional spending. We expect growth momentum in this area to continue. Within our group, we have many e-commerce ventures, such as 7-Eleven, iPreorder, iOPEN Mall, and our subsidiaries such as books.com.tw, COSMED, among others. Digital services have a profound impact on the lives of younger generations. Therefore, it's paramount for every business to be equipped with a robust e-commerce framework. For 7-Eleven Taiwan, our emphasis lies in integrating our existing infrastructure and our stores across Taiwan with online shopping platforms. Take our newly developed services, iPreorder and iGroup-buying, for example. Our franchisees can utilize their expertise to suggest the most appropriate online products to their customers. We actively encourage online orders with in-store pickups to leverage the OMO effect. Given that our online selections, which include appliances, cosmetics, electronics, are distinct from the in-store offerings, this actually creates additional revenue streams. That was an overview of our e-commerce strategy and initiatives. The second part of the question was about investment on logistics. Every year, we're putting money into improving our logistics infrastructure. Recently, we've been working on integration projects within our group. We are setting up new distribution centers in Northern, Central, and Southern Taiwan. They should be up and running in a few years. We are diving deep into making our logistics better, from getting the right people on the job to bring in some cool automation tech, to expanding our storage spaces, to trying out green logistics methods. All of this is aimed at making sure we can deliver more efficiently and set ourselves up for solid growth down the line. Thank you for the answer. Here is another question. With capital expenditure higher this year and next, can we expect dividend payouts to keep growing? At PCSC, we take comprehensive stock of our need for capital, our future profitability, and of course, our shareholders are hoping for. This year, we are paying out a cash dividend of TWD 9 per share. We aim to keep this payout ratio consistent. PCSC also enjoys healthy cash flows. Every year, we have capital expenditures on new stores, upping our digital game, integrating logistics, and as well as long-term deployments, such as mergers and acquisitions. Our policy is to consistently pay out cash dividends. It's our long-term dividend policy. Thank you. Next question, about X-STORE. What are the daily foot traffic and revenue at X-STORE Stores? What is your outlook for these metrics in the mid to long term? Right now, we already operate seven unmanned stores. The initiative behind these X-STORE Stores is primarily forward-looking. We recognize that it takes time for consumers to get used to shopping at these stores. We are consistently testing and optimizing the technology and systems integral to these stores. Given anticipated manpower challenges, we are proactive in sourcing innovations for our regular stores. For instance, last year, we introduced the new XPOS system with a self-checkout feature. This has been implemented across all our locations to enhance efficiency during peak hours. Thank you. Next question, regarding Carrefour, what are your future strategies and long-term profit objectives? Thank you for your question. Carrefour Taiwan and 7-Eleven both enjoy significant scale in its respective area of business. Together, we foresee ample opportunities to reach consumers and offer better services and greater choices. We completed the merger and acquisition in June. Since PCSC already has a very comprehensive logistics network, at this initial stage, we will support Carrefour in terms of delivery and other support services to further boost its operational efficiency. Historically, Carrefour has consistently posted steady profits, and its model of supermarket business has seen continual growth. Post-pandemic, as consumers come back to physical stores, we anticipate a sustained positive trajectory for Carrefour's performance. Thank you, and thank you, IR team, for the answer. Next question, what's the revenue and store count at 7-Eleven Philippines? How do you envision the growth trajectory for 7-Eleven in the Philippines, both in terms of store count and operations over the mid to long term? Thank you for your question. Yes, indeed. Post-pandemic, 7-Eleven Philippines has further solidified its position in the market. As it stands in the first half of 2023, there are 3,538 7-Eleven stores in the Philippines. We anticipate a net addition of over 300 stores within the year. Given our strong market presence and comprehensive infrastructure in the region, we've been able to establish stores across the archipelago, and our store expansion is now at the rate of the pre-pandemic level. Additionally, we are drawing insights from counterparts in Southeast Asia with similar economic climates and demographics. Our medium-term goal is to reach 5,000 stores. We aim to achieve this milestone in the coming years, further distancing ourselves from competitors. Beyond store expansion, our strategy also emphasizes diversifying our product range, including fresh food and coffee, while also enhancing service offerings to boost commission income. With these continuous improvements, 7-Eleven Philippines is positioned to be a significant growth driver for PCSC. Thank you. Thank you for the answer. Next question is also on 7-Eleven Philippines. How significant is the commission income to the overall revenue there? Looking ahead, what are your growth strategies? Does the Philippines have a comparable logistics infrastructure to ensure commission income can have a similar impact on total revenue as we see in Taiwan? Okay. Currently, 7-Eleven Philippines' commission income as a percentage of total revenue is in the low single digits. With the stored value business being the predominant contributor at this time. Given the ongoing development of the country's infrastructure and occasional network instability, the local e-commerce landscape is still in its infancy. Having said that, with a dense network of 7-Eleven stores and an advanced logistics system that places our stores in close proximity to residential areas, we have a strategic advantage for e-commerce in-store pickup. As the Philippines evolves to adopt an ecosystem similar to Taiwan's, we expect 7-Eleven Philippines is well-positioned to capitalize on this trend and business opportunity. Thank you. Another question. With water and electricity costs being a major concern for 7-Eleven Philippines, how is the company planning to manage this? Of course, our top strategy is boosting PSD sales and to leverage economies of scale with store expansion. That will give us a better profit margin. Now, the utility costs in the Philippines have been rising sharply because of infrastructure changes. We believe the situation will improve with time. Lately, we've been expanding beyond just Metro Manila. We are reaching out to residential areas and even nearby islands such as Visayas and Mindanao. Costs, especially rents in these places, aren't as high as in city centers, so that's helping balancing things out a little bit. Thank you.