Smart Share Global Ltd (EM) 2023 Q1 法說會逐字稿

Hello, and thank you for standing by for Energy Monster's 2023 First Quarter Earnings Conference Call. (Operator Instructions) Today's conference is being recorded. (Operator Instructions)

您好，感謝您參加 Energy Monster 2023 年第一季度收益電話會議。 （操作員指示）今天的會議正在錄製。 （操作員說明）

I would now like to turn the meeting over to today's conference -- meeting over to your host for today's conference, Director of Investor Relations, Hansen Shi. Please go ahead.

現在我想將會議轉入今天的會議——今天會議的主持人，投資者關係總監史漢森。請繼續。

Thank you. Welcome to our 2023 first quarter earnings conference call. Joining me on the call today are Mars Cai, Energy Monster's Chairman and Chief Executive Officer; and Maria Xin, Chief Financial Officer.

謝謝。歡迎參加我們的 2023 年第一季度收益電話會議。今天與我一起參加電話會議的還有 Energy Monster 董事長兼首席執行官 Mars Cai；和首席財務官瑪麗亞辛。

For today's agenda, management will discuss business updates, operation highlights and financial performance for the first quarter of 2023.

在今天的議程中，管理層將討論 2023 年第一季度的業務更新、運營亮點和財務業績。

Before we continue, I refer you to our safe harbor statement in the earnings press release, which applies to this call as we will make forward-looking statements. Also, this call includes discussion of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to the most directly comparable GAAP measures. Finally, please note that unless otherwise stated, all figures mentioned during this conference call are in RMB.

在我們繼續之前，我請您參閱收益新聞稿中的安全港聲明，該聲明適用於本次電話會議，因為我們將做出前瞻性聲明。此外，本次電話會議還討論了某些非公認會計準則財務指標。請參閱我們的收益報告，其中包含非公認會計準則衡量標準與最直接可比的公認會計準則衡量標準的調節表。最後請注意，除非另有說明，本次電話會議中提到的所有數字均以人民幣為單位。

I would now like to turn the call over to our Chairman and Chief Executive Officer, Mars Cai, for the business and operation highlights.

我現在想把電話轉給我們的董事長兼首席執行官蔡先生，了解業務和運營要點。

Thank you, Hansen. Good day, everyone. Welcome to our 2023 first quarter earnings call. We are delighted to announce a strong 2023 first quarter results with both revenues and profitabilities making strong recoveries, both on a year-over-year and quarter-over-quarter basis. Revenues increased 11.6% year-over-year as the challenges that impacted the mobile device charging service industry in the past few years subsides. The rapid recovery of the foot traffic is clear throughout the first quarter.

謝謝你，漢森。今天是個好日子。歡迎參加我們的 2023 年第一季度財報電話會議。我們很高興地宣布 2023 年第一季度業績強勁，收入和盈利能力同比和環比均強勁復甦。隨著過去幾年影響移動設備充電服務行業的挑戰消退，收入同比增長11.6%。第一季度客流量的快速恢復是顯而易見的。

In the month of February -- January, February and March of 2023, our mobile device charging service [GMV] increased by 3%, 14% and 34%, respectively, driven by the sequential recovery in revenue per power bank. By March, we believe that the vast majority of impact from COVID on offline foot traffic has recovered, making the official turning point as we head back to normalization.

2023 年 2 月、1 月、2 月和 3 月，在每個移動電源收入連續復甦的推動下，我們的移動設備充電服務 [GMV] 分別增長 3%、14% 和 34%。到三月份，我們相信新冠疫情對線下客流量的絕大多數影響已經恢復，這成為我們回歸正常化的正式轉折點。

In the first quarter of this year, mobile device charging service GMV increased by 16% year-over-year and 35% quarter-over-quarter. This recovery towards normalization are significant and [stem] from drivers across the board. Recovery can be seen across all city tiers and all POI types during the first quarter. First tier cities saw a year-over-year growth in GMV of 24%, while all the rest of other city tiers, 15%.

今年第一季度，移動設備充電服務GMV同比增長16%，環比增長35%。這種向正常化的複蘇意義重大，並且[源於]全面的驅動因素。第一季度所有級別城市和所有 POI 類型均出現復甦。一線城市的 GMV 同比增長 24%，而其他所有其他城市的 GMV 同比增長 15%。

In terms of POI types, GMV of retail locations, restaurants and transportation hubs increased by 25%, 19% and 44% year-over-year, respectively. This robust growth across the board reflects the recovery in the industry driven by the restoration of foot traffic as well as our team's dedication to excellence in increasing Energy Monster's coverage. As the impact of pandemic decreased, our profitability has also made a significant recovery. The recovery in revenue allows us to reach a scale that can better cover fixed costs.

從POI類型來看，零售店、餐廳和交通樞紐的GMV同比分別增長25%、19%和44%。這種強勁的全面增長反映了人流量恢復推動的行業復甦，以及我們團隊在增加 Energy Monster 覆蓋範圍方面的卓越奉獻。隨著疫情影響的減輕，我們的盈利能力也有了明顯的恢復。收入的恢復使我們能夠達到能夠更好地覆蓋固定成本的規模。

Our non-GAAP net profit for the quarter was RMB 17.1 million, which is the first time we have reached profitability since the third quarter of 2021. This is a significant improvement compared to a loss of the same period last year of nearly RMB 90 million and RMB 327.2 million last quarter. We believe that as offline foot traffic continues to rebound, our revenue will continue to normalize as the efficiency of our cabinets and power bank increases.

我們本季度的非 GAAP 淨利潤為人民幣 1710 萬元，這是我們自 2021 年第三季度以來首次實現盈利。這與去年同期近人民幣 9000 萬元的虧損相比有了顯著改善上季度為 3.272 億元人民幣。我們相信，隨著線下客流量持續反彈，隨著機櫃和充電寶效率的提高，我們的收入將繼續正常化。

Our profitability will in turn also gradually return to normal levels. We believe that this positive trend in the recovery of our profitability will continue to make shape going into the rest of 2023. We are also pleased to report that we continue to maintain a strong cash flow with operating cash flow being positive at RMB 238.6 million for the first quarter of 2023. We are able to continue to grow our cash and cash equivalent balances. The strength in our capital -- balance sheet provides us with financial stability necessary to capture the growth of the industry as well as opportunistically expand into new initiatives that can leverage Energy Monster's advantages of operational and technological expertise.

我們的盈利能力也將逐漸恢復到正常水平。我們相信，這種盈利能力恢復的積極趨勢將在 2023 年剩餘時間內繼續形成。我們還很高興地報告，我們繼續保持強勁的現金流，經營現金流為正值，為人民幣 2.386 億元。 2023 年第一季度。我們能夠繼續增加現金和現金等價物餘額。我們的資本實力——資產負債表為我們提供了必要的財務穩定性，以抓住行業的增長，並伺機擴張到可以利用 Energy Monster 的運營和技術專業知識優勢的新舉措。

Our financial strength coming out of the challenges in the past few years is also a testament to our team's strategic planning and disciplined execution. During the quarter, we remain committed to expanding our coverage and improving efficiency to drive growth and achieve our strategic growth, both of these initiatives are fundamental aspects of our core beliefs in effective growth, which balances speed with quality.

我們在過去幾年的挑戰中取得的財務實力也證明了我們團隊的戰略規劃和嚴格的執行力。本季度，我們仍然致力於擴大覆蓋範圍和提高效率，以推動增長並實現我們的戰略增長，這兩項舉措都是我們平衡速度與質量的有效增長核心信念的基本方面。

For our network part model, we will leverage our brand and partner-oriented values to attract high-quality network partners and provide the necessary tools and support to unlock their growth potential. For our direct model, our ability to acquire and provide high-quality service tailored to KAs differentiates Energy Monster within the industry. We also continue to optimize our resources and streamline our operations to position ourselves to lead the industry in terms of efficiency.

對於我們的網絡部分模型，我們將利用我們的品牌和以合作夥伴為導向的價值觀來吸引優質的網絡合作夥伴，並提供必要的工具和支持來釋放他們的增長潛力。對於我們的直接模式，我們能夠獲取並提供針對 KA 量身定制的高質量服務，這使得 Energy Monster 在行業中脫穎而出。我們還繼續優化我們的資源並簡化我們的運營，使我們在效率方面處於行業領先地位。

Now let me walk you through our key initiatives in coverage expansion and efficiency improvements in greater detail. First is our continuous efforts in expanding our coverage, so that more users can access our mobile device charging service. We are proud to announce that the number of POIs has exceeded 1 million for the very first time. This is a significant milestone that reflects our ability to continue expanding the base of our operation. Compared to the end of 2020 and 2021, our POI increased by 51% and 18%, respectively.

現在，讓我更詳細地向您介紹我們在擴大覆蓋範圍和提高效率方面的關鍵舉措。首先是我們不斷擴大覆蓋範圍，讓更多的用戶能夠使用我們的移動設備充電服務。我們很自豪地宣布，POI 數量首次突破 100 萬個。這是一個重要的里程碑，反映了我們繼續擴大業務基礎的能力。與2020年底和2021年底相比，我們的POI分別增長了51%和18%。

In addition to a number of the POIs, we are also expanding the area where our service is available. During the quarter -- the first quarter of this year, we added 31 new countries, bringing the total number of countries and country-level regions to over 1,900. At the same time, we are also increasing the diversification of our POI mix and addition to the increase in areas.

除了一些 POI 之外，我們還在擴大服務範圍。今年第一季度，我們新增了 31 個國家，使國家和國家級地區總數超過 1,900 個。同時，我們也在增加POI組合的多元化以及增加區域。

New locations, such as those office buildings, medical facilities and public spaces, further cements our network coverage, allowing us to attract more new users and improving the experience of existing ones. This expansion of coverage is a reflection of our commitment to providing convenient and accessible charging solutions to our users, regardless of their location. Our user base continues to grow as well in accordance with the increase in our POI coverage.

辦公樓、醫療設施和公共場所等新地點進一步鞏固了我們的網絡覆蓋範圍，使我們能夠吸引更多新用戶並改善現有用戶的體驗。覆蓋範圍的擴大體現了我們致力於為用戶提供便捷且易於使用的充電解決方案的承諾，無論他們身在何處。隨著 POI 覆蓋範圍的擴大，我們的用戶群也在不斷增長。

During the first quarter, we added 13.5 million in cumulatively registered users bringing the total cumulative registered users to 347.2 million as of the end of the first quarter. The 16% year-over-year increase in cumulative registered users continues to clearly indicate that the demand for our service has not yet been fully met. New POIs continues to attract new users that were previously unable to access our service. We believe that as we continue to expand our POI network coverage in more areas and location types, our reputation as the #1 mobile device charging service provider will allow us to effectively increase our user base and better meet the demand of users for our service.

第一季度，我們的累計註冊用戶增加了 1350 萬，截至第一季度末，累計註冊用戶總數達到 3.472 億。累計註冊用戶同比增長16%，繼續清楚地表明我們的服務需求尚未得到充分滿足。新的 POI 繼續吸引以前無法訪問我們服務的新用戶。我們相信，隨著我們不斷擴大 POI 網絡覆蓋範圍，覆蓋更多地區和位置類型，我們作為第一大移動設備充電服務提供商的聲譽將使我們能夠有效增加我們的用戶群並更好地滿足用戶對我們服務的需求。

In the first quarter of this year, we made an adjustment of our POIs and the direct model as the offline foot traffic in China continues to normalize. Going forward, our direct model, [BD] personnel will put more emphasis on expanding into high-traffic locations that meet our standards.

今年第一季度，隨著中國線下客流量持續正常化，我們對 POI 和直營模式進行了調整。展望未來，我們的直接模式，[BD] 人員將更加重視擴展到符合我們標準的高流量地點。

For national and regional KAs, our KA and the business development team continues to sign new brands with higher levels of efficiency compared to industry peers that solely leverage the network partner model. As a result, we continue to sign a large number of POIs that belongs to chain stores operating in China during the first quarter of this year. The acquisition of national and regional KA continue to be an advantage for the company.

對於國家和地區的KA，與僅利用網絡合作夥伴模式的行業同行相比，我們的KA和業務開發團隊繼續以更高的效率簽約新品牌。因此，今年第一季度我們繼續簽署了大量屬於在中國經營的連鎖店的 POI。收購國家和地區 KA 仍然是公司的優勢。

Now for the network partner model, it continues to be the core driver of growth in POI count during the quarter. During the first quarter of 2023, we had 7,700 active network partners. This is an increase of 1,100 compared to the previous quarter and 6,600 compared to the same period last year. Our network partner team continues to train our partners by providing the know-hows and data needed to successfully run their operation.

現在，對於網絡合作夥伴模式而言，它仍然是本季度 POI 數量增長的核心驅動力。 2023 年第一季度，我們擁有 7,700 個活躍網絡合作夥伴。這比上一季度增加了 1,100 人，比去年同期增加了 6,600 人。我們的網絡合作夥伴團隊繼續通過提供成功運營運營所需的專業知識和數據來培訓我們的合作夥伴。

Looking forward, the combination of continuously acquiring new network partners alongside with unlocking the growth of existing ones will serve as the core drivers of growth under the network partner model.

展望未來，不斷收購新的網絡合作夥伴與釋放現有網絡合作夥伴的增長相結合，將成為網絡合作夥伴模式下增長的核心驅動力。

Overall, our POI composition and scale has changed when compared to the end of 2019. Our POIs are more diversified and expensive as ever as our service is available to more users across more regions and location types. We remain committed to providing our users with the best possible experience, meaning that our service has to be more readily available in more locations. That's why we will continue expanding our coverage. With the support of our ever-growing network partners, our coverage will become even more diversified in the future.

總體而言，與 2019 年底相比，我們的 POI 構成和規模發生了變化。隨著我們的服務向更多地區和位置類型的更多用戶提供，我們的 POI 更加多樣化和昂貴。我們仍然致力於為用戶提供盡可能最佳的體驗，這意味著我們的服務必須在更多地點提供更方便的服務。這就是為什麼我們將繼續擴大我們的覆蓋範圍。在我們不斷壯大的網絡合作夥伴的支持下，未來我們的覆蓋範圍將更加多元化。

Our direct model team continues to play a key role in placing our cabinets into high traffic and high earning locations. The improvements in our POI composition and scale is the result of our team's effort to adapt to the changes in the market. We believe our team's dedication will enable us to further expand our coverage and our market share. Efficiency is the other critical aspect of our business, and we are proud to report that we have made significant progress in this area.

我們的直接模型團隊繼續在將我們的櫥櫃放置在高流量和高收入地點方面發揮關鍵作用。 POI構成和規模的改善是我們團隊努力適應市場變化的結果。我們相信我們團隊的奉獻精神將使我們能夠進一步擴大我們的覆蓋範圍和市場份額。效率是我們業務的另一個關鍵方面，我們很自豪地報告，我們在這一領域取得了重大進展。

We are happy to announce that we have once again regained our profitability for the first time since the third quarter of 2021, while a significant part was due to the increase in revenue efficiency of our cabinets and power bank as a result of normalization of offline traffic, which helped us reach a scale that can better cover our fixed costs and expenses.

我們很高興地宣布，我們自2021年第三季度以來首次恢復盈利，其中很大一部分原因是線下流量正常化導致我們的櫥櫃和充電寶的收入效率提高。 ，這幫助我們達到了能夠更好地覆蓋固定成本和費用的規模。

The initiatives we have taken last year to reduce cost, improve efficiency are also bearing fruit. We have taken steps to reduce fixed costs, optimizing our contract structure to ensure that we are operating as efficiently as possible during the pandemic. As a result, the number of entry fee-type contracts decreased by more than 60% in the first quarter when compared to the same period last year, with entry fee contracts accounting for [15%] of incentive fees for location partners, down from 24% in the same period last year.

去年我們採取的降低成本、提高效率的舉措也正在取得成效。我們已採取措施降低固定成本，優化合同結構，以確保我們在疫情期間盡可能高效地運營。因此，第一季度入場費類合同數量較去年同期減少了60%以上，其中入場費類合同佔場地合作夥伴獎勵費用的比例為[15%]，低於去年同期的15%。去年同期增長24%。

Pure revenue-sharing contracts accounts for over 60% of total direct model contracts in the first quarter, up from about 40% in the same period last year. The cost down of our cabinets that we launched into production last year is also starting to help the reduction in depreciation. That's how we are able to achieve a decline in cost of revenues, while our revenues have a significant recovery in the first quarter.

第一季度，純收入共享合同佔直接模式合同總數的 60% 以上，高於去年同期的 40% 左右。我們去年投入生產的機櫃成本下降也開始有助於減少折舊。這就是我們能夠實現收入成本下降的原因，同時我們的收入在第一季度顯著回升。

On the operational side, the efficiencies of our BD personnel also continue to make progress. The number of POIs managed per BD personnel continued to improve. In the first quarter, the ratio reached about 160, increasing from about 140 in the same period last year. The efficiency of our network partner team is similarly reaching higher levels of efficiency. We are also investing in the future by designing a new generation of cabinets to continuously improve our competitiveness. Our system and risk control systems are being upgraded, ensuring that we are at the forefront of technological innovation, able to provide our users with the best possible experience.

在運營方面，我們BD人員的效率也在不斷進步。每個 BD 人員管理的 POI 數量持續增加。一季度該比例達到160左右，高於去年同期的140左右。我們的網絡合作夥伴團隊的效率同樣達到了更高的效率水平。我們還通過設計新一代機櫃來投資未來，不斷提高我們的競爭力。我們的系統和風控系統正在升級，確保我們走在技術創新的最前沿，能夠為我們的用戶提供最好的體驗。

As the number of network partner increases, we continue to improve their efficiency and corresponding risk control measures to provide long-term efficiency. We believe that these investments in the future will enable us to maintain our competitive advantage and continue driving growth and profitability in the years to come.

隨著網絡合作夥伴數量的增加，我們不斷提高他們的效率和相應的風險控制措施，以提供長期的效率。我們相信，未來的這些投資將使我們能夠保持競爭優勢，並在未來幾年繼續推動增長和盈利。

We are proud of the progress we have made in improving efficiency, reducing costs and investing in the future. We remain committed to maximizing efficiency and driving sustainable growth and profitability, while also providing our users with the best possible experience. As we look ahead to the rest of this year, we are optimistic about the future and confident in our ability to continue driving growth and profitability.

我們對在提高效率、降低成本和投資未來方面取得的進展感到自豪。我們仍然致力於最大限度地提高效率並推動可持續增長和盈利能力，同時為我們的用戶提供最佳體驗。展望今年剩餘時間，我們對未來感到樂觀，並對我們繼續推動增長和盈利的能力充滿信心。

The first quarter of 2023 marked the beginning of the recovery in offline foot traffic. We have delivered a strong recovery trend in terms of financials, both in terms of revenue growth and profitability even during the recovery phase. The first quarter's recovery trend will continue as we head back towards full normalization during the second quarter.

2023年第一季度，線下客流量開始復蘇。即使在復蘇階段，我們在財務方面也呈現出強勁的複蘇趨勢，無論是收入增長還是盈利能力。隨著我們在第二季度恢復全面正常化，第一季度的複蘇趨勢將繼續下去。

In April, mobile device charging service GMV increased by 64% year-over-year, and the number is 39% in May. During the Labor Day holiday, we set a new historical high with daily GMV averaging 18 million during the first 5 days and peaking at 21 million on May 1. We are optimistic about the overall recovery during the second quarter of this year.

4月份移動設備充電服務GMV同比增長64%，5月份這一數字為39%。勞動節假期期間，我們創造了歷史新高，前五天日均GMV為1800萬，5月1日達到峰值2100萬。我們對今年第二季度的整體復甦持樂觀態度。

In conclusion, we are very proud of the progress we have made in driving growth and profitability, and we are optimistic about the future as well. We were able to achieve significant recovery in terms of our revenue and profits during the first quarter. The second one looks even more promising. We believe that our team's dedication to our company's value and management team's vision on the industry has allowed us to navigate our out of last year's challenge more efficient than ever.

總之，我們對在推動增長和盈利方面取得的進展感到非常自豪，並且我們對未來也持樂觀態度。第一季度我們的收入和利潤實現了顯著復甦。第二個看起來更有希望。我們相信，我們團隊對公司價值的奉獻和管理團隊對行業的願景使我們能夠比以往更有效地應對去年的挑戰。

We are also pleased to see that Energy Monster's market share has reached new heights as well-known as of the end of 2022 based on third-party reports and continue to lead the industry in terms of market share. We have been cementing our position in China's mobile device charging service industry in the past years and will continue to do so going forward.

我們也很高興地看到，根據第三方報告，截至2022年底，Energy Monster的市場份額已達到眾所周知的新高度，並在市場份額方面繼續領先行業。過去幾年，我們一直在鞏固我們在中國移動設備充電服務行業的地位，並將繼續這樣做。

Looking ahead to the second quarter and going into the future, our 2 main priorities continues to be expanding our network coverage and improving our efficiency. Through a combination of network partners and direct models, we are confident that we can continue to expand our market share, given our advantage in economies of scale. The benefits of our network effect in helping us more efficiently acquire new users and POIs give us a competitive edge over our peers. The execution of our strategies in coverage expansion and efficiency improvement in combination with our strong balance sheet position us to best capture the mobile device charging service industry.

展望第二季度和未來，我們的兩大重點仍然是擴大網絡覆蓋範圍和提高效率。鑑於我們的規模經濟優勢，通過網絡合作夥伴和直接模式的結合，我們有信心能夠繼續擴大我們的市場份額。我們的網絡效應可以幫助我們更有效地獲取新用戶和興趣點，這使我們比同行更具競爭優勢。我們在擴大覆蓋範圍和提高效率方面的戰略執行，加上我們強大的資產負債表，使我們能夠最好地佔領移動設備充電服務行業。

Thank you very much. I'll now turn the call over to Maria Xin, our Chief Financial Officer, for the financial highlights.

非常感謝。現在我將把電話轉給我們的首席財務官 Maria Xin，了解財務要點。

Thank you, Mars. Now let me walk you through the first quarter 2023 financial results in greater detail.

謝謝你，火星。現在讓我更詳細地向您介紹 2023 年第一季度的財務業績。

For the first quarter of 2023, revenues were RMB 822.8 million, representing 11.6% year-over-year increase. Revenues from mobile device charging business were up 10.7% to RMB 796.5 million (sic) [RMB 794.5 million] and accounted for [96.6%] of our total revenue for the quarter. The increase was primarily due to the general recovery in offline foot traffic in China during the quarter. Revenues from power bank sales were up 43.7% year-on-year to RMB 18.6 million and accounted for 2.3% of our total revenues for the quarter. The increase was primarily due to the general recurring in offline foot traffic in China during the quarter.

2023年第一季度，收入為人民幣8.228億元，同比增長11.6%。移動設備充電業務收入增長 10.7% 至人民幣 7.965 億元（原文如此）[人民幣 7.945 億元]，占我們本季度總收入的[96.6%]。這一增長主要是由於本季度中國線下客流量的普遍復甦。移動電源銷售收入同比增長 43.7% 至人民幣 1,860 萬元，佔本季度總收入的 2.3%。這一增長主要是由於本季度中國線下客流量的普遍重複。

Other revenues were up 52.8% year-over-year to RMB 9.8 million and accounted for 1.2% of our total revenue. The increase was primarily attributable to the increase in advertisement efficiency and new business initiatives. Cost of revenue was down 0.1% year-on-year to RMB 127.4 million for the first quarter of 2023. The decrease was primarily due to the decrease in maintenance costs and disposal cost, which was partially offset by the increase in depreciation and the cost of power banks sold.

其他收入同比增長52.8%至人民幣980萬元，佔總收入的1.2%。這一增長主要歸因於廣告效率的提高和新業務舉措。 2023年第一季度收入成本同比下降0.1%至人民幣1.274億元。下降主要是由於維護成本和處置成本減少，但部分被折舊和成本增加所抵消已售出 的移動電源。

Gross profit was up 14.1% year-over-year to RMB 695.4 million for the first quarter of 2023. Operating expenses for the first quarter of 2023 were RMB 711.2 million, up 0.3% year-over-year. Excluding share-based compensation, non-GAAP operating expenses were RMB 704.9 million representing a year-over-year increase of 0.4%. Research and development expenses for the first quarter of 2023 was RMB 21.4 million, down 20.8% year-over-year, the increase was primarily due to the decrease in personnel-related expenses.

2023年第一季度毛利潤同比增長14.1%至人民幣6.954億元。2023年第一季度運營費用為人民幣7.112億元，同比增長0.3%。不計入股權激勵，非公認會計準則運營費用為人民幣7.049億元，同比增長0.4%。 2023年第一季度研發費用為2140萬元人民幣，同比下降20.8%，增加主要是由於人員相關費用減少。

Sales and marketing expenses for the first quarter of 2023 were RMB 665.3 million up 0.8% year-over-year. The increase was primarily due to the increase in incentive fees paid to network partners, which was partially offset by the decrease in entry fees and incentive fees paid to the location partners and personnel-related expenses. General and administrative expenses were RMB 26.8 million in the first quarter of 2023, down 2.2% year-over-year. The decrease was primarily due to the general increase in efficiency of our operations. Loss from operations were RMB 15.8 million and operating margin for the first quarter of 2023 were negative 1.9% compared to negative 13.5% in the same period last year.

2023年第一季度銷售及營銷費用為人民幣6.653億元，同比增長0.8%。這一增長主要是由於支付給網絡合作夥伴的獎勵費增加，但部分被支付給地點合作夥伴的入場費和獎勵費以及人員相關費用的減少所抵消。 2023年第一季度管理費用為人民幣2680萬元，同比下降2.2%。下降的主要原因是我們運營效率的普遍提高。運營虧損為人民幣 1,580 萬元，2023 年第一季度運營利潤率為負 1.9%，而去年同期為負 13.5%。

Net income was RMB 10.8 million in the first quarter of 2023 compared with a net loss of RMB 96.4 million in the same period last year. Net margin for the first quarter of 2023 was 1.3% compared to a net margin of negative 13.1% in the same period last year. Non-GAAP net income, which excludes share-based compensation expenses, was RMB 17.1 million in the first quarter of 2023 compared to a non-GAAP net loss of RMB 89.7 million in the same period last year.

2023年第一季度淨利潤為人民幣1080萬元，而去年同期淨虧損為人民幣9640萬元。 2023年第一季度淨利潤率為1.3%，而去年同期淨利潤率為負13.1%。 2023 年第一季度，不按美國通用會計準則計算的淨利潤（不包括股權激勵費用）為人民幣 1710 萬元，而去年同期的非美國通用會計準則淨虧損為人民幣 8970 萬元。

As of March 31, 2023, the company had cash and cash equivalents, restricted cash and short-term investments of RMB 3.1 billion. Cash flow generated from operations for the first quarter of 2023 was RMB 238.6 million. Capital expenditure for the first quarter of 2023 was RMB 170.3 million.

截至2023年3月31日，公司擁有現金及現金等價物、限制性現金及短期投資人民幣31億元。 2023年第一季度運營產生的現金流為人民幣2.386億元。 2023年第一季度資本支出為人民幣1.703億元。

Thank you for your listening. We are now ready for your questions. Operator?

感謝你的聆聽。我們現在已準備好回答您的問題。操作員？

(Operator Instructions) Your first question comes from Vicky Wei with Citi.

（操作員說明） 您的第一個問題來自花旗集團的 Vicky Wei。

So I have one small question. So given the current positive recovery trend that you have seen, would you please provide some color about the outlook for the second quarter and for the whole year, for example, in terms of revenue and margin profile?

所以我有一個小問題。鑑於您目前看到的積極復甦趨勢，您能否提供一些有關第二季度和全年前景的信息，例如，在收入和利潤率方面？

Thanks for your question. The first quarter's recovery trend will continue as we have back towards normalization during the second quarter of 2023. In April, mobile device charging service GMV increased by 64% year-over-year and 59% in May. We are also able to reach new historical highs during the Labor Day first of all in early May. That's why we are optimistic about the overall recovery during the second quarter of 2023, given the current trend. In terms of our net margin, we have regained [profitability] this quarter. We are confident that going forward, we will be profitable for the full year 2023 based on the current trends.

謝謝你的提問。隨著我們在 2023 年第二季度回歸正常化，第一季度的複蘇趨勢將持續下去。4 月份，移動設備充電服務 GMV 同比增長 64%，5 月份增長 59%。我們還能夠首先在五月初的勞動節期間達到新的歷史高點。因此，鑑於目前的趨勢，我們對 2023 年第二季度的整體復甦持樂觀態度。就淨利潤率而言，本季度我們已經恢復了[盈利能力]。我們有信心，根據目前的趨勢，展望未來，我們將在 2023 年全年實現盈利。

Your next question comes from Violet Yu with China Renaissance.

你的下一個問題來自華興資本的餘紫薇。

Congratulations on the recovery for the quarter. So I have a question on the POI count for the quarter. It seems like the overall growth in POI is lower than previous quarter. Can management share the exact reason for the lower than usual growth and possibly provide any guidance on POI target by the end of the year?

祝賀本季度的複蘇。我對本季度的 POI 計數有疑問。 POI 的整體增長似乎低於上一季度。管理層能否分享增長低於平常的確切原因，並可能在年底前提供有關 POI 目標的任何指導？

Thank you for your question. It's a very good one. Actually, this quarter is a bit special because it is the first quarter coming out of the COVID control, because of the lower than usual foot traffic in China in the past years, a number of locations under the direct model will enable to meet the revenue standards of our operation before COVID. That's why in the first quarter of this year, we've made an adjustment of our POIs under the direct model as the offline foot traffic in China continues to normalize.

謝謝你的問題。這是一個非常好的。其實這個季度有點特殊，因為是疫情解除後的第一個季度，由於過去幾年中國人流量低於平時，不少直營模式的門店將能夠滿足收入新冠疫情爆發前我們的運營標準。這就是為什麼今年第一季度，隨著中國線下客流量持續正常化，我們對直營模式下的 POI 進行了調整。

We actually removed approximately 100,000 POIs under the direct model that are considered in our system to be underperforming during the normal foot traffic levels. This move has lowered the number of POIs under the direct model as of the end of the first quarter of this year. However, we believe that this adjustment is really needed as we fully emerge from the impact of COVID and position ourselves for the future.

實際上，我們在直接模式下刪除了大約 100,000 個 POI，這些 POI 在我們的系統中被認為在正常客流量水平下表現不佳。此舉降低了截至今年第一季度末直營模式下的 POI 數量。然而，我們認為，隨著我們完全擺脫新冠疫情的影響並為未來做好準備，這種調整確實是必要的。

As for the POI target for the end of the year, we do not offer any specific guidance on the POI given that our approach to POI is market driven, meaning that we expand into POIs only if they fit the standards of the company. On the other side, I will see something very positive. Even with the lower than usual growth of POIs, we see the demand of users is strong. We have 1 million POIs. And also, we acquired about 13.5 million accumulated users -- registered users for the first quarter that brings number up to 347.2 million as of the end of the first quarter.

至於年底的 POI 目標，我們不會對 POI 提供任何具體指導，因為我們的 POI 方法是市場驅動的，這意味著只有符合公司標準的 POI 才會擴展到 POI。另一方面，我會看到一些非常積極的事情。儘管 POI 的增長低於平常，但我們看到用戶的需求依然強勁。我們有 100 萬個 POI。此外，我們還獲得了約 1350 萬累計用戶——第一季度的註冊用戶，截至第一季度末，註冊用戶數量達到 3.472 億。

So we see that this adjustment of the POI will make the direct model more healthy. And also given the POI location expansion, we see more users coming to the services, which also shows a very strong recovery of the demand in the market.

所以我們看到POI的這次調整會讓直營模式更加健康。而且隨著 POI 位置的擴展，我們看到更多的用戶開始使用該服務，這也表明市場需求的強勁復甦。

Thank you very much for the question.

非常感謝你的提問。

Your next question comes from Victor Tang with Goldman Sachs.

你的下一個問題來自高盛的 Victor Tang。

Can management provide a bit more insight on the competitive landscape in light of the recovery in the industry? Are we seeing more competition? I also have a quick question on the POI for network partner model. Is there any growing trends of network partner model contributing going forward?

鑑於行業復甦，管理層能否對競爭格局提供更多見解？我們是否看到更多的競爭？我還有一個關於網絡合作夥伴模型 POI 的快速問題。網絡合作夥伴模式貢獻未來是否有增長趨勢？

Thanks a lot for the great question. From our perspective, the competition is actually a lot less intense in the first quarter. Even after the general recovery, this is a bit counterintuitive, but the general landscape of the industry has changed a lot in the past few years. Let's see before COVID, a number of our peers in the industry and Energy Monster relied heavily on the direct model. Competition tends to be higher where all of the players within the industry are expanding using the direct model. However, during the COVID, most of our competitors [shipped] almost completely to network partner model, while we maintained our strong direct model capabilities.

非常感謝這個好問題。從我們的角度來看，第一季度的競爭實際上沒有那麼激烈。即使在總體復甦之後，這也有點違反直覺，但過去幾年行業的總體格局已經發生了很大變化。讓我們看看在新冠​​疫情之前，我們的一些業內同行和Energy Monster都嚴重依賴直接模式。當行業內的所有參與者都使用直接模式進行擴張時，競爭往往會更加激烈。然而，在新冠疫情期間，我們的大多數競爭對手幾乎完全採用網絡合作夥伴模式，而我們則保持了強大的直接模式能力。

The current industry landscape is a lot different because of the general shift towards the network partner because network partners are profit-driven. That's why we are not seeing an uptick in incentive fees for the new signings in the first quarter. So I see the competitive landscape is not as strong as usual before COVID.

當前的行業格局有很大不同，因為網絡合作夥伴以利潤為導向，普遍轉向網絡合作夥伴。這就是為什麼我們沒有看到第一季度新簽約球員的激勵費上漲。所以我認為競爭格局並不像新冠疫情之前那麼激烈。

As for your question on the network partner model. Our network partner model continues to be the main driver of the growth of the POI account during the first quarter mainly because of the increase in network partners count in the past year. Because of this significant increase, one of our main goals this quarter and this year actually is to work alongside our network partners to operationally support them so that they are able to grow alongside us. At the same time, we expect the number of POIs operated under the network partner model to continuously grow, but the increase in percentage of POI managed under the network partner model this quarter is mainly because of the adjustment in our direct model POI portfolio.

至於你關於網絡合作夥伴模型的問題。我們的網絡合作夥伴模式仍然是第一季度 POI 賬戶增長的主要推動力，這主要是因為去年網絡合作夥伴數量的增加。由於這一顯著增長，我們本季度和今年的主要目標之一實際上是與我們的網絡合作夥伴合作，為他們提供運營支持，以便他們能夠與我們一起成長。同時，我們預計網絡合作夥伴模式下運營的 POI 數量將持續增長，但本季度網絡合作夥伴模式下管理的 POI 比例的增加主要是由於我們直營模式 POI 組合的調整。

Going forward, we will continue leveraging our both models to expand our network coverage and further increase our market share within the industry. Thanks a lot.

展望未來，我們將繼續利用這兩種模式擴大我們的網絡覆蓋範圍，進一步提高我們在行業內的市場份額。多謝。

We are now approaching the end of the conference call. I will now turn the call over to Energy Monster's CFO, Maria Xin, for closing remarks.

我們現在電話會議即將結束。我現在將把電話轉給 Energy Monster 的首席財務官 Maria Xin 進行總結髮言。

Once again, thank you for joining us today. Please don't hesitate to contact us if you have any further questions. Thank you for your continued support, and we look forward to speaking with you in the coming months. Thank you.

再次感謝您今天加入我們。如果您還有任何疑問，請隨時與我們聯繫。感謝您一直以來的支持，我們期待在未來幾個月與您交談。謝謝。

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.

感謝您參加今天的會議。演示到此結束。您現在可以斷開連接。再會。