Ladies and gentlemen, welcome to Puyi Inc.'s Fiscal Year 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following management prepared remarks, there will be a question and answer session. For your information, today's conference call is being recorded. This conference call is also being broadcasted live over the internet and will be available for replay purposes on the company's website. I would like to turn the meeting over to your first speaker today, is Jing He, Puyi's General Manager of Financial Reporting Department. Thank you. Please go ahead. Thanks, operator. Good evening. Welcome to our earnings conference call for the fiscal year 2023. Our annual report on Form 20-F has been uploaded to the website of U.S. Securities and Exchange Commission earlier today, and it's also available on our IR website. Before we continue, please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. The accuracy of these statements may be impacted by a number of risks and uncertainties that could cause your-- our actual results to differ materially from those projected or anticipated. Such risks and uncertainties include, but not limited to, those outlined in our filings with the SEC, including our 20-F. We do not undertake any obligation to update these forward-looking statements, except as required under the applicable law. Joining us today are our Chairman of the Board and Chief Executive Officer, Mr. Yong Ren, and Chief Financial Officer, Mr. Anlin Hu. Mr. Ren will first walk you through our business and financial conditions of the fiscal year 2023, and then together with Mr. Hu, he will answer your questions after the prepared remarks. Now I will turn the call over to Mr. Ren. Good evening, everyone. Welcome to our 2023 fiscal year earnings conference call. Here with me is our Chief Financial Officer, Mr. Anlin Hu. First of all, I will give you an overview of our financial and operational convictions for the fiscal year 2023. Then I will discuss briefly our business outlook for the future. Finally, we will have a question and answer section to answer any questions you may have. Now, let me present an overview of our operational results and business initiatives in the fiscal year 2023. In the fiscal year 2023, influenced by various factors such as strict control measures due to the COVID-19 pandemic in late 2022, the trade tension between U.S. and China, and the geopolitical conflicts, the economic situation has been complex and challenging. The capital market has shown a volatile trend, resulting in a lack of investor confidence and relatively weak overall investment sentiment. Against this backdrop, our management team has adhered to the principle of prudent management in the fiscal year 2023. On the one hand, we focused on our core business and rigorously developed institutional private business, with transaction value of our public raised fund products contributed by institutional clients exceeding RMB 5 billion, representing a year-on-year growth of approximately 266%. On the other hand, we explored the demands of high net worth clients and expanded family office business by promoting insurance premium trust products. As of June 30, 2023, we had assisted an aggregate of 366 affluent family clients to set up trust accounts with entrusted assets of RMB 4.1 billion through our trust consulting service. Furthermore, we continuously work on reducing costs and increasing efficiency, while enhancing professional skills by providing internal training. In the fiscal year 2023, we were able to reduce our operating cost by 34% compared to the previous year, and our operating loss also reduced by 28% as well. ...本财年公司的主要经营状况及举措汇报如下。 Our main business operations and strategy during the fiscal year 2023 are reported as follows: 一、聚焦净值化基金业务，基金零售主业，加强突破探索。 Firstly, we focus on our core business of distributing market-oriented funds to individual investors and strengthen our professionalism to meet individual investors' needs. 一方面，长期陪伴，与投资者共同走过迷雾。 On the one hand, by accompanying investors through the uncertainties, we aim to strengthen long-term relationships with them. 自2023年1月开始，中国进入后疫情时代，但期待中的经济报复性上涨并未如期而至，随之而来的是疲软的经济和资本市场表现，投资者信心受挫。 Since January 2023, China has entered a post-pacademic era, but the expected economic revenge rise did not come as expected, followed by a poor economic and capital market performance, which has affected investor confidence. 为此，公司坚持进行长期投资主义教育，安抚客户投资情绪，同时引进外部投顾服务机构，加强对公募基金组合投资的产品分析，力求在疲软的市场表现下减少产品波动，稳定客户投资情绪。我们很高兴地看到，在投顾业务开展后，得到了广大客户的信任和好评。截止2023年6月，绝大多数持有组合产品的客户愿意购买我们的投顾服务，这将给我们带来新的营收增长点。 To address this issue, we adhere to investment education of long-term investment mechanism, boost our clients' investment sentiment. At the same time, collaborating with outside professionals, we introduce our investment advisory service to our clients to improve analysis of our fund product portfolios, to reduce product volatility under the current weak market performance, and to stabilize our clients' investment sentiment. We are pleased to see that after carrying out this initiative, we have gained trust and faith of our clients. As of June 30th, 2023, most of our clients who hold portfolio products were willing to purchase our investment advisory service, which could bring us new source of revenue growth. 另一方面，丰富基金产品货架，实施产品营销的精准投放。 On the other hand, we have enriched our fund product lineup and implemented precise marketing strategies. 我们深刻地认识到，提升自身投研能力，提供更多的基金产品，以满足投资者的不同需求的重要性。 We deeply understood the importance of enhancing our own investment research capabilities and providing more fund products to meet the diverse needs of investors. 在公募基金产品方面，一方面，我们进一步扩大了公募产品的合作范围，本财年合作公募基金公司从89家上升到103家，上架公募基金产品数量达到7,646只，基本覆盖了市场上绝大部分的产品。另一方面，依照市场客户需求，我们新增了2款基金组合产品，分别是设立止盈目标的目标盈产品和定期、不定额智能定投的产品。这2款差异化针对性的产品贴合了部分客户的需求。通过以新品带新增，一定程度上稳住了存量规模的下滑。 In terms of public raised fund products, we further expanded our public raised fund product portfolios by increasing the number of public fund companies we source products from, which increased from 89 as of June 30th, 2022, to 103 as of June 30th, 2023, including a total of approximately 7,646 public raised fund products. In addition, we added two new fund product portfolios according to the needs of clients in the market, including the automatic redemption product, a target yield product which automatically redeems when reaching the target profit rate, and a smart regular investment product, a smart product which periodically advises investors to contribute different amounts of investments based on the current market condition. Through the new products bring in new investment strategy, these two differentiated and customized products meet the needs of clients and stabilize the balance of public raised fund products. 在私募基金产品方面，进一步提升了私募产品策略的丰富度，特别是公司根据市场需求，适时推出可转债及商品期货策略，在震荡行情中可以为客户捕捉收益机会。 Regarding privately raised fund products, we have further enhanced the diversity of our private fund strategies, particularly by timely launching convertible bonds and commodity futures strategies based on market demand. These strategies can capture profit opportunity for clients in volatile market conditions. ...升级机构业务平台建设，实现突破，破局与增长。 Secondly, we upgraded the institutional transaction platform based on our core transaction system to achieve breakthrough and growth of institutional business. 机构投资者具有资金规模大、投资稳健、平台粘性高等特点，获得机构投资者的青睐，对公募基金业务下一步的发展具有重要作用。本期我们加大对机构业务平台的投入，实现了机构业务多方面的升级。我们相信，机构业务平台的升级与建设，将很快为公募基金机构业务的增长带来回报。 Institutional investors possess characteristics such as large capital size, stable investment, and high platform stickiness. Gaining favor from institutional investors plays an important role in the next phase of the development for our company's public raised fund business. In the fiscal year 2023, we have increased investment in the transaction platform designed for institutional investors based on our core system, and have attracted a number of institutional investors. We believe that the upgrade and construction of the institutional transaction platform will soon bring returns to the growth of the public raised fund business. 本财年，公司的机构业务已成功破局，实现了对银行、保险、证券、期货和信托等主流金融行业机构客户的全覆盖。本财年实现机构业务公募销售规模超过人民币50亿元。 In the fiscal year 2023, our institutional business in the financial institution market achieved a breakthrough. We currently have institutional clients covering most types of financial institutions, including banks, insurance companies, security companies, future companies, and trust companies. In the fiscal year 2023, the transaction value of public raised fund products contributed by institutional clients exceeded RMB 5 billion. 三、 大力发展保险金信托等家办业务，信托受理件数再创新高。 Thirdly, we will vigorously develop our family office business by promoting insurance premium trust products, and the number of completed trust consulting service projects reached a new record high. As of June 30th, 2023, the company had cumulatively entrusted 366 trust orders, with cumulative trust assets exceeding CNY 4.1 billion. At the same time, the company has fully established a series of service systems for high net worth clients, including tax, legal, education, and overseas asset allocation. We believe the company's capabilities in serving high net worth clients will continue to improve, creating greater value for clients and achieving more stable and sustainable development. As of June 30th, 2023, we had assisted an aggregate of 366 of affluent family clients to set up trust accounts with entrusted assets exceeding RMB 4.1 billion for our trust consulting service. At the same time, we have diversified and will continue to diversify our service offerings for our high net worth clients through establishing cooperation with education service providers, tax firms, law firms, healthcare service providers, and other professional firms. We believe that through our comprehensive service offering, our capability in serving high net worth clients will continue to improve, creating greater value for clients and achieving a more stable and sustainable development. 是，IT系统自主可控，精益求精，助力核心业务发展。 Fourth, we developed a self-developed IT infrastructure to assist in the continuous improvement of our core business. 本财年，我们集中资源，以助力重点业务发展为核心，聚焦普益基金平台、机构业务系统和家办业务系统建设，以及核心系统自研的稳步推进。 In the fiscal year 2023, we have concentrated our resource on supporting the development of our core business. We have placed emphasis on upgrading the Puyi Fund app, institutional transaction platform, family office business, internal system, and our core transaction system. 第一，普益基金平台围绕一站式综合头部服务平台理念目标，以数字化、智能化完善现有平台体系，完成了智能投顾系统升级，使投顾与陪伴深度融合到客户全生命周期中。 For the Puyi Fund app, we further improve it as a full-scale online transaction processing service platform. We successfully upgraded its intelligent investment advisory system through digitalization and artificial intelligence, integrating companionship and advisor service to the client's entire investment life cycle. 第二，机构业务系统。本财年上线了一年同系统，实现与机构金融机构系统对接，助力金融机构客户的开拓与发展，同时对机构系统功能进行了优化与迭代，进一步提升了服务水平。 In terms of institutional transaction platform, we have launched a smart port system to connect with other financial institution systems to support the development and expansion of our financial institutional clients. We have also optimized and integrated the functionality of the institutional transaction platform, further enhancing our service level. ... 第三，家办业务系统，重点完成了三个部分工作。一 是打通了与信托公司系统对接，实现与信托公司资料流转信息化，进一步提升信托流程效率。二是强化了数字化建设，开放其他自主系统，实现实时查看信托进程的状态。三是 对家办系统进行整体优化与完善，更好地助力家办业务发展。 For our family office business internal system, we have of course, focused on three key aspects. We have integrated our IT infrastructure to connect with other trust company systems and their information network, achieving information flow digitalization and improving trust process efficiency. And we have strengthened our digitalization construction by opening self-service channels and allowing our financial advisors real-time tracking of trust progress and status. Lastly, we have overall optimized and improved our family office business internal system to better support the development of our family office business. 第四，我们对智研系统功能进行了替代与迭代，替换与迭代。基于智研系统扩展现有功能体系，包括支付系统、投顾系统等。 Last, in terms of core transaction system, we have replaced and integrate the functionality by expanding the existing functional system, such as adding payment systems and investment advisory systems. 五，深度优化组织及费用管理，降本效果显著。 Fifth, we deeply optimize our organization and expense management, achieving a significant cost reduction. 首先，营销费用管控方面，在目前外部经营环境并未完全好转，公司尚未实现盈利的大背景下，本财年已将公募基金组合账户的营销费用从按新增账户数进行奖励调整为按照新增投资额进行奖励。 In terms of marketing expense control, considering the current external operating environment and the company's yet to achieve profitability, we have changed our marketing initiative for publicly raised fund products portfolio from stimulating the growth of new accounts to stimulating the growth of new investments. 其次，在架构方面，对长期亏损且业务较少的一家子公司和多家分公司进行了剥离和退出，配合实施人员优化与精简。截止2023年6月30日，员工数量同比下降约48%，总部经营面积同比下降约40%，分公司经营面积同比下降约60%。 In terms of organizational structure, we divested our one subsidiary and closed several branch office with long term losses and minimal business activity. In conjunction with personnel optimization. As of June 30th, 2023, the number of employees decreased by approximately 48% compared to that on June 30th, 2022. While the office area of the headquarters decreased by approximately 40%, and the office area of the branch office decreased by approximately 60%. 综上，本财年我们已极大减轻公司的管理压力和资源消耗，实现运营成本同比下降34%。 In all, during the fiscal year 2023, we have significantly alleviate resource consumption, resulting in a 43.4% year-on-year decrease in operating costs. 二，接下来是本次发布会的第二部分内容，我们将简单介绍公司本财年的财务情况。 Next, I will briefly discuss the financial condition of our company in the fiscal year 2023. 本财年总营业收入为人民币1.1亿元，比去年同期人民币1.9亿元减少39.4%。按各业务线情况如下。 Our net revenue for the fiscal year 2023 were CNY 114.4 million, $15.8 million, with a decrease of 39.4% year-on-year as compared to CNY 188.7 million in the fiscal year 2022. Now next turn to each individual business line. 一，首先是财富管理业务。 First, for our wealth management service. 本财年财富管理营业收入为 CNY 95,013,000，比去年同期 CNY 170,000,000 减少 44.6%。 Net revenues generated from our wealth management service decreased year on year by 44.6% from RMB 171.5 million in the fiscal year 2022 to RMB 95 million, $13.1 million. 其中，本财年私募基金产品收入为人民币2,574万元，比去年同期人民币6,160.3万元减少58.2%，减少主因为...... 是因为，一，投资者受市场波动的影响，对净值化私募基金产品赎回观望的意愿增大。因此，报告期内，我们的私募基金产品销售规模及存量规模都有所减少，导致佣金收入含管理费的减少。二，本财年私募基金浮动业绩报酬为人民币182.5万元，较去年同期人民币305.2万元减少了40.2%。 Net revenues generated from distribution of privately raised fund products decreased year-over-year by 58.2% from RMB 61.6 million in the fiscal year 2022 to RMB 25.7 million, $3.6 million in the fiscal year 2023. The decrease was primarily due to, first, the investors' negative sentiments for privately raised fund products and other high-risk products, and with investors' willingness to redeem funds has increased due to market volatility. Therefore, during the reporting period, both the transaction value and outstanding balance of our privately raised fund products have decreased, resulting in a decrease in commission income, including management fees. Second, the performance-based income of CNY 1.8 million, $0.3 million in the fiscal year 2023 as compared to CNY 3.1 million in the fiscal year 2022, representing a year-on-year 40.2% decrease. 二，接下来是资产管理业务。本财年资产管理营业收入为人民币198.3万元，比去年同期人民币589万元减少了66.3%。减少主要是因为我们主动管理的FOF基金，在报告期内取得了人民币9.6万元的浮动业绩报酬，较去年同期人民币241.4万元减少了96%。 Second, for our asset management service, net revenue generated from asset management service in the fiscal year 2023 was RMB two million, $0.3 million, representing a 66.3% year-on-year decrease from RMB 5.9 million in the fiscal year 2022. The decrease was primarily due to a 96% decrease in performance-based fees generated by our actively managed fund of funds from RMB 2.4 million in the fiscal year 2022, and to RMB 96,000, $13,000 in the fiscal year 2023. 3. 最后是其他收入。本财年其他服务收入为 CNY 1,744.4 万元，比去年同期为 CNY 1,131 万元，增加 54.2%。增加主要是因为信托咨询业务和保险咨询业务的增加。 Last, for our other service, revenue from other service in the fiscal year 2023 was RMB 17.4 million, $2.4 million, increased by 54.2% year-on-year from RMB 11.3 million in the fiscal year 2022. The increase was mainly attributed to the growth in trust consulting service and insurance service. 三，第三部分，我们将讲，简单讲述公司未来的规划与展望。 Last but not the least, let's elaborate on our strategy, plans, and outlooks for the future. 在当前大环境不好的背景下，公司将通过管理层的努力及全体员工的奋斗，以保持持续发展。尽管面临挑战，但也存在政策利好和稳定资本市场等因素，为公司提供了光明的长期前景。如2023年7月，中央政治局会议、国务院常务会议相继表态，要活跃资本市场，提升投资的信心。八月份，各大部门联合发布，发出多条利好消息，包括财政部宣布的印花税减半征收，证监会发布的收紧IPO，严控大股东减持行为，降低融资保证金等。公司将紧跟国家政策，未来重点做好以下几项工作。 Against the backdrop of the current unfavorable environment, we will strive for sustainable development through the efforts of management and all employees. Despite facing challenges, there are also factors such as favorable policies that provide us with bright long-term prospects. For example, in July 2023, the 2023 July Politburo meeting and the State Council executive meeting make consecutive statements to increase the capital market and boost investor confidence. Then in August, multiple positive news were released, including the announcement by the Ministry of Finance to halve the stamp duty, the announcement by the China Securities Regulatory Commission to slow down the pace of IPOs in China and control the reduction of shareholdings for large shareholders, and encourage margin financing. We will closely follow the national policies and focus on the following key areas in the future. ...一，进一步丰富产品货架，抓住时机，趁势发展。 First, to further enrich the product portfolio to seize opportunities for development. 公募基金组合是公司的核心主营业务，其具备稳健性和透明度。我们相信，公募基金组合将成为追求稳定收益客户所需的理财产品。在利率下行，传统保险年金业类产品提供3.5利率已经成为历史的当下，广大的投资者，尤其是中产投资者，急于寻找风险低、收益稳定的有效替代方案。公司适时利用自身投研能力及长期积累的公募基金产品池，构建了一款收益为4.5的组合产品，已在2023年9月上线。公司预测，该产品能迎合投资者的迫切需求，成为公司维系并拓展客户群体的有效工具。展望未来，随着金融市场的发展和客户对稳定收益的需求不断增加，公募基金组合类产品在第三方基金销售公司的业务中将继续扮演重要角色。 The distribution of public raised fund product portfolios is our core and main business, characterized by public raised fund products, stability, and transparency. We believe that public raised fund product portfolios will become the preferred financial products for clients seeking stable returns. As bank interest rates decline and the traditional insurance annuity products, which have 3.5% annual compound interest rate, becomes history, investors, particularly middle-class investors, are more inclined to products with lower volatility or more pronounced returns. Timely utilizing our own research and investment capabilities, along with the long-term accumulation of diversified public raised fund products, we have developed a portfolio product with an expected yield of 4.5%, which has been launched in September 2023. We believe that this product will meet the urgent needs of investors and can serve as an effective tool to maintain and expand our client base. Looking ahead, as the financial market continues to develop and the demand of investors for stable returns increase, the publicly raised fund product portfolios will become and continue to play an important role in the business of third-party fund distribution companies like us. 另一方面，公司将继续更新私募基金产品货架，对产品进行优胜劣汰，引入具备超额回报及特色头部私募管理者，丰富权益投资策略，提升获取超额回报的能力。 On the other hand, we will continue to upgrade the offering of privately raised fund products and replace the old products with the new exceptional and distinctive fund products, enriching our equity investment strategies and enhancing the generation of excess returns for our clients. 诚然，最近公募基金公司陆续降低认购费及管理费的现实，对公司未来收入有所影响。但长远来说，公司将认真聆听客户的需求，通过持续优化产品策略，提供专业的投资服务，并推出更多稳健型产品，给予客户稳稳的幸福，同时也保住公司的基盘，并实现客户群体的持续增长，让公司稳稳地发展。 Indeed, the recent reduction in subscription and management fees by public raised fund companies has had an impact on our future revenue. However, in the long run, we will listen carefully to the needs of our clients, continuously optimize our product strategies, provide professional investment services, and launch more stable products to provide clients with a sense of stability and well-being. At the same time, this will help to maintain our foundation and achieve continuous growth in our client base, ensuring steady development of our company. 二，强化大客户思维，及积极开源，大力拓展机构业务。 Second, to strengthen the mindset of serving large institutional clients and actively expand institutional business. 随着金融市场的不断发展，机构客户业务对于第三方基金销售公司来说具有巨大的潜力。特别是银行及保险公司作为客户，其体量庞大，且在金融领域有着广泛的影响力，将成为公司重要的合作伙伴。未来，公司将强化大客户思维，深度绑定重点合作机构，以专属团队进行维护，联合投研力量，普益加办等共同赋能机构客户，深耕银行与保险行业，达成多维度深层次的战略合作，提升在重点机构客户中的业务规模，稳住机构业务的基本盘。 With the continuous development of the financial market, the institutional business holds tremendous potential for third-party fund distribution companies like us. In particular, banks and insurance companies as clients, possess significant scale and extensive influence in the financial sector, making them to be the important partners for our company. In the future, we will strengthen the mindset of serving large institutional clients, establish deep partnership with key institutional clients, and then assign dedicated teams for institutional clients maintenance.... Through the cooperation with outside investment research teams, professionals of Puyi Family Office Department and other resource, we expect to empower our institutional clients, deepen our presence in the banking and insurance industry to achieve multidimensional and profound strategic cooperation, expand business scale with key institutional clients, and to stabilize the foundation of our institutional business. Third, to continuously optimize our IT system to support the development of our core business. In the future, we will, based on business development needs and with a focus on serving financial advisors, concentrate on the digitalization and intelligence construction of core business operations. Key aspects include: For our core transaction system, we will work on effectively allocate software resources and systematically advance our self-developed process, and place emphasis on payment routing system. This includes connecting with multiple banks through direct channels, thus maximizing efforts to reduce the payment fees and enhance the user experience. For our Puyi Fund App, we will sharpen its digitalization and intelligence construction, enhance online operational capabilities, improve the asset allocation and research and recommendation system, and increase user stickiness and activity, driving fund transaction value and daily outstanding balance to grow. For our institutional transaction platform, we will fully support the development of institutional business by improving platform functionality based on the needs of our institutional clients. Building upon our self-developed cost transaction system, we will co-construct a platform that supports various business developments, including facilitating the transaction of private raised fund products for institutional clients. Last, for our iFinancial Planner app, we will continuously enhance the involvement and management of financial advisors. On the one hand, we will gradually establish a financial advisor membership management system to optimize the financial advisors' experience and increase their loyalty. On the other hand, we will develop data visualization capability to track and analyze fund transaction data, thereby better supporting the financial advisors their fund sales business. Based on the long-term positive outlook for China's economic development and the government's favorable policies towards the capital market, we believe that there will be sustainable benefits for the wealth management industry in the future. We will lead all our partners to respect risk, fear no challenges, work together with unity and determination, operate in compliance, and deliver high quality service. That ends with today's prepared remarks. Now we are open for questions. Operator, please. Thank you. We will now begin the question and answer session. To ask a question, please press star one one and wait for your name to be announced. If you'd like to cancel your request, please press star one one again. Once again, to ask a question, please press star one one and wait for your name to be announced. As a reminder, to ask a question, please press star one one and wait for your name to be announced. There are currently no questions on the line. I would like to hand the call back to management for closing. Thank you very much for attending today's conference call. If you have any questions, please feel free to contact us anytime. Thank you, and we have no other comments. Thank you. Operator? Certainly. Thank you. The conference has now concluded. Thank you.