Ladies and gentlemen, thank you for standing by and welcome to MINISO's earnings conference call for the December quarter of 2023. At this time, all participants are in a listen-only mode. After the management prepares remarks, we will conduct a question-and-answer section. Before joining this section, please mark your name and institution, and be kindly noted that this event is being recorded. We have announced our quarterly financial result earlier today. An earnings release is now available on our investor relations website at ir.miniso.com. Joining us today are our Founder and CEO, Mr. Jack Ye, and our CFO, Mr. Eason Zhang. Before we continue, I would like to refer you to the Safe Harbor statement in our earnings press release, which also applies to this call as we will be marking forward-looking statements. Please also know that we will discuss non-IFRS financial measures today, which we have explained and reconciled to the most comparable measures reported under the International Financial Reporting Standard. Recording in progress. In the company's earnings release and filings with the U.S. SEC and Hong Kong Stock Exchange. The currency unit is Chinese yuan, unless otherwise stated. In addition, we have prepared a PowerPoint presentation for today's call, which contains financial and operational information for this quarter. If you are using Zoom meetings, you should be seeing it right now. You can also revisit it on our IR website later. Now, I would like to hand over the conference to Mr. Ye and Ms. Alice Li from MINISO IR team to translate the interview. Please go ahead, sir. [Foreign language] Hello, everyone, and welcome to MINISO Group December quarter 2023's earnings call. Our overall performance once again reached new highs during this quarter. We cap off the year of 2023 with brilliant outcomes. Total revenue hit CNY 3.84 billion and set a new record once again, increasing by 54% year over year. Gross margin growth to 43.1%, with an increase of 3.1 percentage points compared to the same period in 2022. Adjusted net profit exceeds CNY 660 million, breaking our record once again. Adjusted net profit margin reached 17.2%. Excluding the foreign exchange impacts, adjusted net profit margin reached 17.4%, which set a new record as well. For calendar year 2023, total revenue reached CNY 13.8 billion, with a year-over-year increase of around 40%. Gross margin reached 41.2%, with an increase of 6.3 percentage points. Adjusted net profit margin reached CNY 2.36 billion, representing an increase of around 110% year-over-year. [Foreign language] 2023 marks a year full of new records for MINISO. We continuously report new highs in every aspect of our operations. We firstly exceeded CNY 3 billion in revenue for the June quarter this year, and hopefully we can break through ourselves by reaching CNY 4 billion, CNY 5 billion, or even higher in the future. Total store counts exceed 6,000 in the Q3. Our gross margin also achieved breakthroughs again and again, reflecting the success of our IP strategy and brand upgrade strategy. Our net profit margin also keeps climbing, which was the reward of our asset-light models and the efforts in controlling expenses. [Foreign language] By all these financial metrics of MINISO's, I was always thinking how to outperform our past achievements. I fully agreed and resonated with Warren Buffett's words: "Although I am already in my 90s, I truly do feel like tap dancing to work every morning, simply because of our immense love for my work. I love running MINISO and feel great happiness without tiredness every day. For me, there is no job in the world with more fun than running MINISO. Moreover, my journey is not solitary, rather it is fostered by the strength of a powerful team within our company. We understand and appreciate each other very much, and fight for the same goal." In the year of 2023, we were thrilled to see that much more investors showed up in our shareholder list. I would like to express my sincere gratitude to our shareholders and hopefully deliver more value of our business operation with a long-term perspective. [Foreign language] Despite the uncertainties in our global expansion, globalization is a process of responding to challenge as they arise. It is about riding the waves instead of seeking the definitely certain shore. For the calendar year 2023, our overseas revenue contributed 34% of the total revenue. Having entered into 110 overseas markets so far, we present as a globally operated enterprise. We are committed to fully diversifying the business layout of MINISO to increase our risk-resistance capabilities. [Foreign language] Now I will walk you through business updates for our three major segments: MINISO China, MINISO Overseas, and TOP TOY. [Foreign language] Let's start with MINISO China. Offline sales increased by 66% year-over-year, compared with an increase of 8% in domestic retail sales of consumer goods. According to National Bureau of Statistics of China, on a comparable basis, same-store sales increased by around 32% year-over-year. [Foreign language] During 2023, GMV of MINISO offline stores in China enjoyed a year-over-year increase of about 40%, powered by over a 25% increase in the same-store sales. Entering 2024, GMV of MINISO offline stores in China increased by nearly 13% during the first two months, albeit a high base of last year because of a pandemic demand, and the same-store sales was over 95% of the same period last year. The best recovery rate demonstrating the resilience of MINISO as always. In February, 1,369 stores, or one-third of MINISO stores in China, refreshed their sales records. In addition, same-store sales during Chinese Spring Festival increased by around 10%, setting a solid foundation for growth in the Q1 of 2024. We will keep tracking this trend, staying alert, and taking positive measures to cope with the macro headwinds. [Foreign language] Regarding store opening in China, we opened 124 net new stores in China during December quarter, 70% of which were located in the first and second-tier cities. For the year of 2023, we opened 601 net new stores in China. [Foreign language] We value both speed and quality in our growth of store numbers. Meanwhile, we will steadily optimize and healthy and comprehensive global MINISO store network. Consequently, we will pay more attention to store location, more actively establish MINISO store metrics, and conduct a more efficient store expansion and store network distribution. [Foreign language] We also pay attention to enhance our store UE. As we implement flagship store strategy, newly opened stores of 2023 were 14% larger than the average, while their sales were 30% higher than the average. Meanwhile, the closure rate of MINISO stores in China in 2023 was around 4%, representing a historical low. In 2024, we expect to open 350-450 new stores on a net basis in China, focusing on high-quality growth and lean operations. [Foreign language] Moving on to our progress on the international front, firstly, overseas revenue was about CNY 1.5 billion, another historical high. The 51% year-over-year growth of revenue exceeded our most optimistic expectations. Notably, revenue from directly operated markets increased around 90% and has increased by more than 80% for three consecutive quarters, contributing over 50% of overseas revenue for the first time. For the year of 2023, overseas revenue increased around 47% year-over-year, including an 83% increase in directly operated markets and 24% increase in distributors' markets. [Foreign language] GMV of overseas markets increased 38% year-over-year, primarily due to a 76% increase in the directly operated markets and a 27% increase in distributor markets. Major markets maintain strong momentums, including a 110% increase in North America, followed by Europe, which is another key market in the next five years, achieving a 70% increase in this quarter, and a 14% increase in Latin America, a 21% increase in Asia excluding China. For the year of 2023, we witnessed a 120% increase in North America, a 70% increase in Europe, a 50% increase in Latin America, and a 26% increase in Asia excluding China. [Foreign language] Thirdly。 [Foreign language] Thirdly, MINISO sales in overseas markets during December quarter increased by 90% year-over-year, including a 39% increase in directly operated markets and a 30% increase in distributors' markets. In terms of major overseas markets such as North America, they experienced a 49% increase. We also witnessed a 23% increase in Latin America and a 12% increase in Asia countries excluding China. For 2023, same-store sales in overseas markets increased by 26%, including a 45% increase in directly operated markets and a 22% increase in distributors' markets. Later overseas markets such as North America, it experienced a 75% increase, and we also witnessed a 34% increase in Latin America and an 80% increase in Asia excluding China. [Foreign language] Opened 174 new stores on a net basis in overseas markets in the Q4, achieving a new record since 2019. For the years of 2023, we opened 372 new stores on a net basis, in line with our guidance. In 2024, we expect to open 550-650 net new stores in overseas markets, with the majority in Asia excluding China and Latin America, followed by Europe and North America. [Foreign language] In January, we hosted MINISO 2024 Investor Day and shared development strategy for the next five years with the investors from a long-term perspective. We brought up our mission of Life is for Fun and our vision to become the world's number one IP design retail group with three strategies: product innovation with IP design, affordability, and globalization. [Foreign language] From product innovation perspective, we will uphold our IP strategy and support and focus our efforts in strategy categories. We are committed to satisfying the demand driven by interest consumption for the worldwide consumer by placing emphasis on affordability of IP products. We adopt dual-engine practice on super IP strategy. On one hand, we continuously collaborate with global top IPs. On the other hand, we will focus on incorporate self-designed IPs and generate unique brand advantage. I have confidence that the IP market is of great potential. We witnessed a fast growth in IP product sales contribution in overseas markets from the previous quarters. The IP product sales contribution of the year of 2023 already exceeds 40%. [Foreign language] While developing strategic categories is an important measure in product innovation as well, strategic categories represented by blind boxes, disposable products for traveling, plush toys, fragrance, and perfumes increased about 70% in sales year-over-year. [Foreign language] Buying affordable products to consumers in MINISO's Core Value for the whole time. During 2023, I have become more confident than ever with our advantage in supply chain and IP design after traveling a lot in our overseas market. In 2024, we will speed up establishment in global supply chain and strengthen our collaboration with global suppliers of good quality in order to improve product delivery and anti-risk capability of supply chains. These measures will help us in maintaining our competitive advantage in terms of cost saving in our future operations. Nowadays, there are about 24% overseas suppliers, around 1,400 global suppliers that we have worked with, including cosmetic suppliers from Korea, toy suppliers from Vietnam, textile suppliers from India, skincare products from Europe, and snacks and toys suppliers from North America. We now have stable and long-term collaborations with all these suppliers of the above-mentioned categories. [Foreign language] Globalization can be demonstrated in the following three aspects. The first one is to optimize globalization of our store network. Recently, we developed our focus and support to European markets. The newly opened Oxford Street Store and Camden Store in London have set new sales records of all European stores. Moving forward, we expect to see more stores like these open in Europe, which will be one of our key markets for our growth. The second one is product globalization. Differentiation in global products will be the engine for store UE improvement. We will focus on strategic categories and carry out customized R&D of products according to local conditions, providing our customers with popular products of MINISO features, local usage experience, and sense of aesthetic. The third one is talent globalization. As of December 31st, 2023, the percentage of overseas employees exceeds 50%, which demonstrates our results in globalization. We will continue to exert efforts in talent pool establishments to better cope with overseas developments of high speed and potential. [Foreign language] Let's move on to TOP TOY. Quarterly revenue achieved a 90% year-over-year increase, with a quarter-over-quarter increase of 26% and a year-over-year increase of 31%. [Foreign language] Moving forward in 2024, TOP TOY will run into two key strategies, which are speeding up in-store expansion and optimizing its margin profile. In 2024, we will actively expand the layout of TOP TOY's store network, aiming to establish recognizable and distinctive brand store networks. [Foreign language] Continued profitability. On one hand, TOP TOY will continue to increase the contribution of self-developed products actively. On the other hand, it will conduct a stricter control on costs and expenses, improve sales forecast capability, conduct reasonable manufacturing arrangements and inventory management, and conduct lean reform in supply chains. We expect that TOP TOY will continue to improve its market shares and enhance its role in TOP TOY markets. [Foreign language] The year of 2024 will be the start of our development strategy for the next five years and the year for all of us to fight and thrive. We embrace challenges and opportunities with great hearts by emphasizing on products innovation, affordability, globalization strategy, and sticking to result orientation, long-term means, and the belief in victories. [Foreign language] We will now turn the call over to Eason for a review of our financial performance in December quarter of 2023. Thank you, Jack. Hello everyone, thank you again for joining us today. I will walk you through our financial results for the December quarter. Please note that all numbers are in CNY terms unless otherwise noted. Now, I'll also refer to some non-IFRS measures which have excluded share-based compensation expenses. Revenue was CNY 3.84 billion, representing an increase of 54% year-over-year. Revenue from China was CNY 2.35 billion, up 56% year-over-year. The increase was driven by, number one, a growth of 63% in revenue from MINISO's offline stores, and number two, a growth of 9% from TOP TOY. The 63% year-over-year growth of MINISO offline business from China was the result of a 17% growth in average store count and a 39% growth in per-store sales. The 90% year-over-year growth of TOP TOY was the result of a 19% growth in average store count and nearly 60% growth in per-store revenue. Revenue from overseas markets was CNY 1.49 billion, up 51% year-over-year, driven by an increase of 16% in store count and a growth of 31% in per-store sales. Revenue from distributed markets was around CNY 723 million, increased by 26% year-over-year. Revenue from directly operated markets was around CNY 771 million, an increase of around 86% year-over-year, accounting for over 50% of our overseas revenue as compared to 42% in the same period of last year. Gross profit in this quarter was CNY 1.66 billion, up 66% year-over-year. Gross margin was 43.1%, increasing by about 3.1 percentage points in the same period of 2022. The year-over-year increase was mainly due to two reasons. Firstly, we witnessed high gross margin in overseas markets contributed by product optimization and higher revenue contribution from directly operated overseas markets. Secondly, we also witnessed higher gross margin of MINISO and TOP TOY brands due to a shift in product mix toward more profitable products. SG&A expenses as a percentage of revenue was around 23%, about one percentage point up from 22% in the same quarter of 2022. Selling and distribution expense were around CNY 701 million, increasing by about 71% year-over-year. There are three reasons. Number one, increased personnel-related expenses, logistics expenses, and IP licensing expenses in relation to the growth of the company's business. Number two, increased depreciation expense of the right of use assets in relation to directly operated stores. Number three, increased promotion and advertising expenses, mainly in connection with brand upgrade and the opening of new stores in overseas markets. G&A expenses were CNY 186 million, representing a year-over-year increase of about 32%, driven by increased personnel-related expense in relation to the growth of our business. Turning to profitability. Operating profit in this quarter was CNY 765 million, an increase of 71% year-over-year. Operating margin was nearly 20%, compared to 18% in the same quarter of 2022. Adjusted net profit in this quarter was CNY 660 million, increasing by 77% year-over-year. Adjusted net margin was 17.2%, compared to 15% in the same period last year and 16.9% in the previous quarter. Excluding FX impacts, adjusted net margin in this quarter would be 17.4%, another new record in this quarter. Turning to cash position. As of December 31st, 2023, we had a strong cash position of CNY 6.9 billion. Free cash flow for CY23 is about CNY 1.97 billion, up 115% year-over-year. Return on equity, or ROE, is about 28% for CY23, compared to 15% in 2022, thanks to higher net margin and improved asset turnover. In the longer term, we are confident to increase gross margin steadily by leveraging our core capabilities in IP product development, supply chain integration, and globalization. We also optimize our expense structure and pursue a sustainable margin profile. Our board approved a cash dividend of approximately CNY 650 million in this quarter, about 50% of our adjusted net profit during the second half of 2023. Since we became a public company in 2020, we have retained about CNY 2.8 billion in cash to our shareholders, accounting for about 50% of our adjusted net income from 2019 to 2023. Our capital allocation strategy in the future will continue to balance growth and our commitment to bringing stable and forceful returns to our shareholders. Thank you, and this concludes our prepared remarks. Operator, we are ready to take questions. Thanks. The first line is coming from Goldman Sachs, Eason Zhang. Please go ahead. [Foreign language] So I have three questions for the management. For the first one, MINISO domestic business, can you share with us the GMV per store or same store sales trend post the holiday? And given we had high base last year, so how should we think about the same store GMV per store trend into 2024? And second question about the overseas operation. It's good to see management talk about the global supply chain strategy, but can you share with a small caller about the localization sourcing or some diversification of the sourcing from the non-China market? And thirdly, for the overseas market, we have very strong performance in the U.S. and Latin America, etc. And so is there any strategy we can discuss to improve our personal performance for those markets lagging behind, like in Asia markets? Thank you. [Foreign language] Thank you, Michelle. This is Jack. I will answer your first question. For the domestic sales trend, so the first two months in this year in China we see total GMV increase by about 30%, and our goal is to reach about 15% year-over-year growth for the whole quarter. For same-store sales, for the first two months we have recovered to about 95% of last year, and we still see room of improvement in the whole quarter. So let's wait and see what will happen in March. And usually the months after CNY is a low season for our China business, so for this year it will still happen, it will still be the case. But what's positive on this is we have seen the months' trend for this March is a little bit lower than last year. That means we have seen a stronger post-CNY months this year. For same-store sales growth, yes, this will be one of our key focuses in our operations in China. So in addition to lean operations, we still have three directions. The first is to improve our productivity in innovation and the development. Productivity power is one of our core capabilities. We currently estimate that we can fine-tune our product structure to improve our sales, especially for the instant consumption-based products. We are going to improve their sales contribution, and it will benefit our same-store sales, including blind boxes, plush toys, and other IP-related products. The second direction is to improve our channels. We now notice that for the nearly 4,000 MINISO stores in China, we still have some structural opportunities. For example, two-thirds of our domestic stores are within 100-200 square meters at this moment, and its first-store sales is obviously lower than our standard store of about 200-300 square meters and our flagship store of 300-500 square meters. So since this year we will begin to upgrade some of these smaller stores, increase its area, and improve its sales. And the third direction is to improve our brand awareness. Including, number one, we will continue all of our brand upgrades. We want to open a batch of new stores with higher performance, with better image, and better operations. And number two, meanwhile, we plan to build MINISO's own store metrics. Now we are trying different directions, including MINISO IP Land, MINISO GO, and various store types. And now all of these are in pipeline. Thank you. [Foreign language] Okay, Michelle, for the second question, here's our initial thoughts. Our thinking of this issue has always been consistent, that is, from a longer-term perspective, we are always optimistic about our prospects in the North American market, in the European market, and so on, especially the North American market. So for these questions, I think as a business owner, as an entrepreneur, we should think big, think long, think longer. So first of all, we are in the consumer sector, so not in a sensitive industry. Secondly, we have always believed that if there is any trade friction, because all of the American offline retailers, they rely on Chinese supplies so much that. So this will be an industry-wide implication and influence. So the American consumers will pay for this at the end of the day. So if there is any of this policy, it won't be a long-term policy. Finally, we'll make full preparation on this. So first is that our pricing strategy is cost-plus markup because we have enough cost advantage and uniqueness in IP and our self-owned brand. So these three advantages decide that we have pricing power for our products, so we can transmit all the negative influence to the end price. The second is we have been preparing ourselves in the supply chain. Now, for the U.S. market, our local sourcing has accounted for 30%, and it will increase in this year. And we have also cooperated with a lot of qualified overseas suppliers, as we shared, about 24% of our overseas suppliers are located overseas. And we are doing preparations in other aspects, but now I'm not at liberty to share more. And we'll share more after this project is done. Thank you. [Foreign language] Okay. Three things to add on these questions. So we have a very ambitious goal for the next 10 to 20 years, I think, if we do well enough, so MINISO USA will be a business like $10 billion or even $30 billion. So we have this imagination. But it's still a small fraction of the whole US consumption world. So number one, we are not like e-commerce players, right? So we are not that sensitive. And number two, if this is an industry-wide influence, it will benefit players with cost advantage such as MINISO. And number three, we contributed to local offline retail environment and ecosystem by adding diversity. We are not barbarian at the gate. We are not the broker and so on. Thank you. [Foreign language] We share our investor data that we want to focus on key markets such as Europe and North America. Because in addition to the USA, the European market in the next five years will embrace huge developments. Our initial goal is that by the end of the next five years, our store network can reach we have thousands of stores in Europe. So in addition to doing well in our existing distributed market in Europe, we will also try different ways, such as open directly operated flagship stores. We try to participate in operations or try to set up JVs with our distributors in various ways to support local markets. Meanwhile, we still have a lot of white space in Europe. In a lot of countries, we haven't had one single MINISO store, and that's our next stage planning. Except Europe, we now have two-thirds of overseas stores in Asian countries and Latin American countries. For example, in Latin American countries, this is a market that has the highest operational efficiency in MINISO's ecosystem. Now, in terms of per-store sales, our top five overseas markets, four of our top five markets are located in Latin America. Now, in this market, we have 515 MINISO stores, but this is a market with a 560 million population. So we believe we can have about 2,800 stores in there. For Asian countries, now it accounts for about one-third of our GMV in overseas markets. Although the same-store sales or per-store sales recovery is still lagging behind its peers, but for CY 2023, it still contributed about 40% of our overseas revenue. For the past four quarters in 2023, per-store sales recovery rates in Asian countries recovered steadily from 67% in Q1 to 75% in Q2 and to 79% in Q3, and further improved to 82% in Q4. We have high confidence to further improve our per-store sales in this area and to further enlarge our business. In general, we don't want to limit ourselves in the overseas market, and we should think long. Our strategy for overseas markets in the future is to focus on key markets such as Europe and U.S. markets and fully diversify the whole overseas operations by using our flexible store models. Thank you. [Foreign language] Hey, Michelle. This line is coming from Bank of America. Ms. Lucy Yu. Please go ahead. [Foreign language] So the first question is about the increasing support for distributors in Europe market. Could you please elaborate how are we going to support them? And what is the strategy difference between US and EU? The second one is on unit economics in domestic markets, especially that was the first year of reopening. So how should we compare the profitability of per-store versus 2019? And the last one is on Q1 guidance. Mr. Ye already guided for China GMV of 15% growth. So how should we think about overseas GMV growth in the Q1? Thank you. [Foreign language] European market is very good. Now, currently, we use flexible ways to cooperate and to enhance our support to local distributors, including JV or cooperating with store operations. I think the European market as a whole is a very good market, including the average GDP per capita, average consumer spending, and so on. I think it's a comparable market in terms of size and prospects with the U.S. market. [Foreign language] Population-wise, for Europeans as a whole, it has nearly 700 million population. So more than 470 million of that in the North American market. So in the longer term, we think the European market is still a very important growth engine for MINISO's overseas business. So for your second question about the store UE, Lucy, that's a very good question. As we shared on our investor date, the same-store sales of the whole CY23 in China was nearly 95% compared to the pre-COVID times, i.e., 2019 times. And we still maintain a very healthy payback period for our franchisees, our retail partners within one year. And for the Q1, about the guidance, I think hey, Lucy, you mean the guidance for top line and bottom line, right? Yeah. Top line for overseas and break that down into wholesale versus DTC. If you can give any guidance on the margins, that would be great. Thanks. Okay. Yes. I think we still see very healthy growth for the first 2 months in our overseas market. GMV increased about 40% on a yearly basis. And although we still have 2 to 3 weeks to end this quarter, now we believe the overseas market as a whole can maintain a yearly growth of about -5% to 45% yearly growth rate, including a 60%-70% increase in the DTC market and about high teens to low 20s in our wholesale markets. About the margins, I think there's still uncertainty here. We're still waiting to see because it depends on the margin profile of our DTC market. So for the Q1 as a whole, it's usually a low season for our overseas markets. So if you look at the past several years, Q1 usually has about low 10s or low 20s QoQ decline compared to the previous quarter, Q4. But we have observed better performance in this Q1 because of the DTC market. You may notice that we opened a lot of new stores in the Q4 last year. So that means the revenue contribution from the DTC market in this quarter will be significantly higher than that in last year. So because the DTC market is still in its early stage, and it's apparently not in a fully normalized margin profile. So it may dilute some of our operation margin as a whole. But we have high confidence that if we think long with the increase of the DTC's sales scale, it will have a positive impact on our operation margin. Hopefully, we can use sales leverage. We can have better control on rents, on labor costs, on promotional and advertising expenses, and so on, to improve the margin profile for the overseas DTC market, and at the end of the day, to improve the whole operation margin of the company. In general, we are quite positive about our margin profile for the whole year. Thank you. [Foreign language] Thank you. Hey, Lucy. The third line. The third line is coming from UBS, Mr. Samuel Wang. Please go ahead. [Foreign language] I have two questions. The first is regarding the SG&A ratio. I noticed that in the Q4 last year, our SG&A ratio is actually around 23%-24% of our total sales. In the past, I think our guidance is generally 20%-22% of the revenue. I understand the D2C is one of the main reasons. So just to check for 2024, is that a new norm for us to forecast an SG&A ratio given we are also very aggressive on D2C sales expansion? So that's the first question. The second question is regarding the distributors' strategy in China market. We aim to increase their store area for them. Do we have any pushbacks, and how do we persuade them to expand their store networks? And do we have any quantified number of how many big-format stores we are going to open in 2024? Thank you. Thank you, Samuel. This is Eason. For your first question about the SG&A trend, first of all, in the December quarter, we have seen it increase. But if you look at the whole SG&A ratio as a percentage of revenue, it increased like 1 percentage point compared to the same period last year, right? The yearly improvements are majorly in relation to our newly opened direct stores, especially in key markets such as North America, including increased rental-related expenses and people expenses and store-opening-related marketing expenses, and so on. As I shared in my answer to Lucy's question, if you look at the whole year, we feel positive about the improvements of the whole operational margin of our DTC market. With the revenue contribution of the DTC market increased, and if we successfully improve this margin profile, it will contribute positively to the whole operating margin, to the company as a whole. But if you look at this problem on a quarterly perspective, it will have some uncertainty because, for example, you put investment such as store rents, marketing expense in this quarter, but the store will have to open until next several quarters. It will obviously impact this quarter's P&L. I strongly suggest you look at this question at least on a yearly basis. For your second question about the channel upgrade, yes, we do have a plan, but it's not finalized yet. We now have nearly 4,000 stores, and nearly two-thirds are within 100 square meters. At the end of the day, we want to upgrade all of them, but we should take the measures step by step. It has to depend on the availability of the neighborhood in the shopping malls and depend on the negotiations with franchisees. That is business, right? You have to make negotiations, and it has some uncertainties. Thank you. The fourth line is coming from Jefferies. This is Anne Ling. Please go ahead. [Foreign language] So my first question is on whether for the MINISO brand, where you have a segment margin of 22.6% for the half year, and on a half-on-half basis, improve by 0.2 percentage point. So we're just wondering whether there's any breakdown or idea in terms of the margin difference between the domestic market versus the overseas market, and overseas market between direct operator and the wholesale business. 这个是我第一个问题。谢谢。 Okay. Thank you, Ann. About the breakdown, I mean, I think you mean the OP margin, right? Yeah. Yes. I think it's a dynamic mix, dynamic mix. For the 22.6%, we do not disclose them. Maybe it's after your calculation, but that's close, that's close to our management accounts. So among this mix, we have MINISO China, which obviously is SLI-ed, and with higher OP margin, higher OP margin, because the GP margin in China is nearly around 38%-nearly 40%, and the expense structure is quite light for this business. So obviously, it can have nearly 30% or so OP margin. But for our overseas market, especially for DTC market, since it's at its early stage and its margin profile is not that stable, and it fluctuates on a quarterly basis, so we do not think that this is the right time to discuss this part of margin. Thank you. [Foreign language] So my question is regarding the European operation, which is not part of the direct operated business. So moving forward, how are we going to reclassify it, or how do we look at the European market? And it sounds very good to break down, yeah. Yes, that's a very good question. And I think if you look at the whole overseas markets of MINISO, I think the best thing we noticed that is we have a very quite flexible business model among different markets. For Europe, you are right that all of our markets now are operated by our distributor partners. And Mr. Ye mentioned that hopefully by the end of next five years, we will have thousands of stores in European markets. And we have seen we are quite confident with the possibilities to achieve this goal. And margin-wise, you are right that it will contribute to a positive impact on the whole OP margin. Actually, we have continuously witnessed this trend go on during the past three to four months. While we see as we increase the proportion of IP products exported to this wholesale market, we have seen the whole margin profile of distributor market improved, including increase in GP margin and increase the sales leverage, and so on. [Foreign language] So my last question is on the U.S. market, where we have a very good performance, and so far, but at this stage, no, it's still a directly operated market where we run our own store. So when will we start our franchise business model in the U.S.? Thank you. That's a very good question. Yes, we have been quite open to consider various options in growing our U.S. market, but now more than 90% of our stores there are our directly operated. In the future, we are open, still open to explore various possibilities, but at this moment, we want to do it by ourselves because if you look at the wholesale market, the DTC market, and overseas market, obviously, when we want to accelerate the growth of a certain market, the best way is to do it by yourself because you can have more control on the whole business, right? So at this moment, the U.S. market is at its momentum. So we want to seize this momentum, and we want to know, to find out how well can we optimize the OP margin, and how large can we enlarge the addressable market at first? But in the future, we are still open, but. Not at this stage. Yeah, but not at this time. Thank you. Okay, got it. Thank you. Again, for joining our call today. Now we shall conclude our call. We will see you in the next quarter. Goodbye.