富途控股 (FUTU) 2019 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by and welcome to the Futu Holdings Fourth Quarter and Full Year 2019 Earnings Conference Call. (Operator Instructions) Please be advised that this conference is being recorded. I'd like now to hand the conference to your first speaker today, Chief of Staff and Head of IR at Futu, Mr. Daniel Yuan. Thank you. Please go ahead, sir.

女士們、先生們，感謝大家的支持並歡迎參加富途控股2019年第四季及全年業績電話會議。（操作員說明）請注意，本次會議正在錄製中。現在我想把會議交給今天的第一位發言者，富途辦公室主任兼 IR 主管 Daniel Yuan 先生。謝謝。請繼續，先生。

Thank you, operator, and thank you for joining us today to discuss our fourth quarter and full year 2019 results. Joining me on the call today are Leaf Li, our Chairman and Chief Executive Officer; Arthur Chen, Chief Financial Officer; and Robin Xu, Senior Vice President.

感謝營運商，感謝您今天加入我們討論我們的 2019 年第四季和全年業績。今天與我一起參加電話會議的是我們的董事長兼執行長李葉 (Leaf Li)；陳亞瑟，財務長；徐彥，資深副總裁。

As a reminder, today's call may include forward-looking statements, which represent the company's belief regarding future events, which by their nature are not certain and are outside of the company's control. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. For more information about the potential risks and uncertainties, please refer to the company's filings with the SEC, including its registration statement.

提醒一下，今天的電話會議可能包括前瞻性陳述，這些陳述代表了公司對未來事件的信念，這些事件本質上是不確定的，並且不在公司的控制範圍內。前瞻性陳述涉及固有風險和不確定性。我們提醒您，許多重要因素可能導致實際結果與任何前瞻性陳述中包含的結果有重大差異。有關潛在風險和不確定性的更多信息，請參閱該公司向 SEC 提交的文件，包括其註冊聲明。

So with that, I will now turn the call over to Leaf Li. Leaf will make his comments in Chinese and I will translate.

那麼，我現在將電話轉給李葉。Leaf將以中文發表評論，我將進行翻譯。

(foreign language)

（外語）

[Interpreted] Hello, everyone. Thank you for joining us today. I am pleased to once again announce a strong quarter, driven by robust growth in paying clients and total client assets.

【解讀】大家好。感謝您今天加入我們。我很高興再次宣布，在付費客戶和客戶總資產強勁成長的推動下，本季表現強勁。

(foreign language)

（外語）

[Interpreted] We added 21,620 paying clients in the fourth quarter of 2019, the highest quarterly paying client net addition we have witnessed so far. As of year-end, the total number of paying clients reached over 198,000, representing a 49% increase year-over-year. When we reported our third quarter earnings, our guidance was 190,000 to 195,000 paying clients. We're pleased that our actual results surpassed our previous expectations. In 2020, we are aiming for 45% growth in the number of paying clients, which means that our total paying clients will surpass 285,000 by the end of 2020.

[解讀]我們在 2019 年第四季新增了 21,620 名付費客戶，這是迄今為止我們見證的最高季度付費客戶淨增量。截至年底，付費客戶總數超過19.8萬戶，年增49%。當我們報告第三季收益時，我們的指導是 190,000 至 195,000 名付費客戶。我們很高興我們的實際結果超出了我們先前的預期。2020年，我們的目標是付費客戶數量增加45%，這意味著到2020年底我們的付費客戶總數將超過285,000人。

(foreign language)

（外語）

[Interpreted] We attribute our strong paying client growth in the fourth quarter to a combination of optimized marketing efforts, upbeat market sentiment and high-profile Hong Kong IPOs. In the fourth quarter, we selectively worked with a number of targeted third-party channels whose client profile is similar to ours. The active IPO market was also beneficial for us. Our client's total subscription for Alibaba and Poly Property Development IPOs both exceeded HKD 5 billion. Notably, our clients accounted for 13% of Alibaba's total number of retail subscribers and 5% of its public tranche allocation. The frenzy around Alibaba's secondary listing in Hong Kong gives us confidence that our business will be a key beneficiary of the continued dual and secondary listing of high-quality Chinese new economy companies in Hong Kong.

[解讀]我們將第四季付費客戶的強勁成長歸因於優化的行銷力度、樂觀的市場情緒和備受矚目的香港IPO。第四季度，我們選擇性地與一些客戶狀況與我們相似的目標第三方管道合作。活躍的IPO市場也對我們有利。我們客戶對阿里巴巴和保利地產IPO的認購總額均超過50億港元。值得注意的是，我們的客戶佔阿里巴巴零售用戶總數的 13%，佔其公開份額分配的 5%。阿里巴巴在香港第二上市的熱潮讓我們相信，我們的業務將成為中國優質新經濟公司持續在香港雙重上市和第二上市的主要受益者。

(foreign language)

（外語）

[Interpreted] Total client assets jumped 71% year-over-year to HKD 87.1 billion. Average client assets totaled HKD 439,000 as of year-end, up 15% year-over-year. As we transform to a business model that increasingly relies on AUM-based income, we are encouraged that clients continue to entrust us with more assets, with a growing share of their assets flowing into our mutual fund distribution business. Total client assets in mutual funds surpassed HKD 6 billion as of year-end, about 4 months after the official launch of the business, representing over 100% sequential growth. We have established comprehensive fund selection criteria and continue to source and onboard the best-performing fund products across asset classes from top-notch Chinese and global fund houses. We expect to distribute over 50 mutual funds on our platform by mid-2020. Besides mutual funds, we also plan to roll out other wealth management products in the second half of 2020.

【解讀】客戶總資產年增71%至871億港元。截至年底，客戶平均資產達港幣43.9萬元，年增15%。隨著我們轉型為越來越依賴基於資產管理規模的收入的業務模式，我們鼓勵客戶繼續委託我們提供更多資產，越來越多的資產流入我們的共同基金分銷業務。截至年底，即該業務正式推出約4個月後，互惠基金客戶總資產已超過60億港元，季增超過100%。我們建立了全面的基金選擇標準，並繼續從中國和全球頂尖基金公司的資產類別中尋找和引進表現最佳的基金產品。我們預計到 2020 年中期將在我們的平台上分銷 50 多個共同基金。除共同基金外，我們也計劃在2020年下半年推出其他理財產品。

(foreign language)

（外語）

[Interpreted] Our enterprise service in the fourth quarter posted strong results yet again. We added a record 23 new ESOP clients, which brings our total number of clients to 79 as of year-end. In addition, we provided subscription services to 8 U.S. IPOs during the fourth quarter. Our enterprise clients continue to make steady contributions to new paying clients.

【解讀】第四季我們的企業服務再創佳績。我們新增了 23 位 ESOP 客戶，創歷史新高，截至年底，我們的客戶總數達到 79 位。此外，我們在第四季度為 8 筆美國 IPO 提供了認購服務。我們的企業客戶持續為新的付費客戶做出穩定的貢獻。

(foreign language)

（外語）

[Interpreted] Moving on to the current quarter. Despite the outbreak of the COVID-19, our operating metrics have shown resilient growth so far. Many traditional financial institutions, that rely heavily on an offline presence for account opening and customer services, has had to suspend the operations of their physical branches, which at this difficult time underscores the merits of a purely online one-stop financial technology platform like us, where clients can enjoy an end-to-end mobile experience for everything from account opening and money transfer to trade execution, margin lending, mutual fund investments, market news and social interaction. The launch of new products and services during the first quarter may be slightly delayed, but it should not weigh on the long-term growth prospects of our business.

[解釋] 進入當前季度。儘管爆發了 COVID-19，但迄今為止我們的營運指標仍顯示出彈性成長。許多嚴重依賴線下開戶和客戶服務的傳統金融機構不得不暫停實體分支機構的運營，這凸顯了像我們這樣的純線上一站式金融科技平台的優勢，客戶可以享受端到端的移動體驗，從開戶和轉帳到交易執行、保證金貸款、共同基金投資、市場新聞和社交互動。第一季新產品和服務的推出可能會略有延遲，但這不會影響我們業務的長期成長前景。

(foreign language)

（外語）

[Interpreted] In 2020, we redefined our company's mission and vision as below. Our mission is to make investing easier and not alone. Our vision is to become a highly influential global financial services platform. To achieve that, we will continue to enhance our technology infrastructure, maintain our relentless focus on user experience, enrich training product offerings, expand our wealth management services footprint and promote social collaboration.

【解讀】2020年，我們重新定義了公司的使命和願景如下。我們的使命是讓投資變得更容易，而不是孤單。我們的願景是成為具有高度影響力的全球金融服務平台。為實現這一目標，我們將持續加強技術基礎設施、持續關注使用者體驗、豐富培訓產品、擴大財富管理服務範圍並促進社會協作。

(foreign language)

（外語）

[Interpreted] In 2020, we will continue to focus on our 3 KPIs, namely paying clients, client retention and net asset inflow. We are confident that we will extend our market-leading position and further entrench ourself as the broker of choice.

【解讀】2020年，我們將持續聚焦付費客戶、客戶留存、淨資產流入三大KPI。我們有信心，我們將擴大我們的市場領先地位，並進一步鞏固我們作為首選經紀商的地位。

(foreign language)

（外語）

[Interpreted] Next, I'd like to invite our CFO, Arthur, to discuss our financial performance.

[解讀]接下來我想邀請我們的財務長Arthur來討論一下我們的財務表現。

Thanks, Leaf and Daniel. In the fourth quarter, we record total revenue of HKD 254 million, up 37% year-over-year and 20% Q-on-Q. Let me walk you through some of our key financial details for this quarter. Brokerage commission and handling charge income was HKD 152 million, an increase of 34% from the same period in 2018 and up 23% Q-on-Q. Total trading volume in this quarter was relatively flat year-over-year, but was up 7% sequentially.

謝謝，葉和丹尼爾。第四季總營收為2.54億港元，年增37%，季增20%。讓我向您介紹本季的一些關鍵財務細節。經紀佣金及手續費收入為1.52億港元，較2018年同期成長34%，較上季成長23%。本季總交易量與去年同期相比相對持平，但季增了 7%。

Our blended commission rate climbed to 6.7 basis point in the fourth quarter. This rate hike can be attributed to higher IPO subscription fees amid active Hong Kong IPO market and the growing contributions from derivative tradings. Brokerage commission and handling charge income contribute about 49% of our total revenue in this past quarter.

第四季我們的混合佣金率攀升至 6.7 個基點。此次升息可歸因於香港IPO市場活躍以及衍生性商品交易貢獻不斷增加，IPO認購費上漲。經紀佣金和手續費收入約佔上一季總收入的 49%。

Interest income was HKD 128 million, an increase of 24% year-over-year and 11% Q-on-Q. This growth was mostly due to a 52% year-over-year increase in margin financing and the security lending balance. IPO financing interest income also surged due to higher Hong Kong IPO subscription.

利息收入為1.28億港元，年增24%，季增11%。這一增長主要是由於保證金融資和擔保貸款餘額同比增長 52%。由於香港IPO認購量增加，IPO融資利息收入也大幅增加。

Interest income contribute about 41% of our total revenues. Other revenue was HKD 31 million, this 185% year-over-year increase was mainly attributed to our new mutual fund distribution business and higher IPO financing service charges income as well. Other income contributed about 10% of our total revenue.

利息收入約占我們總收入的41%。其他收入為 3,100 萬港元，年增 185%，主要歸功於我們新的共同基金分銷業務以及較高的 IPO 融資服務費收入。其他收入約占我們總收入的10%。

On the cost side, total cost was HKD 87 million, an increase of 35% year-over-year and 24% Q-on-Q. Most of costs grew in line with our revenue. As a result, gross margin was 72%, which was relatively flat compared with the same period last year. In terms of the operating expenses, total expenses was HKD 181 million, an increase of 81% year-over-year.

成本方面，總成本為8,700萬港元，較去年同期成長35%，較上季成長24%。大部分成本的成長與我們的收入一致。結果，毛利率為72%，與去年同期相比相對持平。營運開支方面，總開支為1.81億港元，年增81%。

Breaking down our operating expenses. R&D expenses were HKD 74 million, an increase of 63% from last year and up 4% from last quarter. The year-over-year rise was primarily due to the increase in R&D headcount in 2019 as we continued to enhance infrastructure and enrich our product offering. But as you can see from the Q-on-Q trend, our R&D headcount stabilized in 4Q, and we are projecting a moderate headcount increase in 2020.

細分我們的營運費用。研發費用為 7,400 萬港元，較去年增加 63%，較上季增加 4%。年比成長主要是由於2019年我們持續加強基礎設施和豐富產品種類，研發人員數量增加。但從環比趨勢可以看出，我們的研發人員數量在第四季趨於穩定，我們預計 2020 年研發人員數量將適度增加。

Selling and marketing expenses was HKD 51 million, up 108% year-over-year and 30% Q-on-Q. We further diversified our marketing efforts and partnered with some target third-party channels to continue to bring high-quality clients. Average assets per paying clients stood at HKD 439,000 as of year-end, which is much higher than our peers.

銷售及行銷費用為 5,100 萬港元，年增 108%，季增 30%。我們進一步多元化行銷力度，並與一些目標第三方管道合作，持續帶來優質客戶。截至年底，每位付費客戶的平均資產為 439,000 港元，遠高於同業。

General and administration expenses was HKD  56 million, an increase of 80% on a yearly basis. The rise was primarily due to the increase in headcount for general and administrative personnel as well as higher professional service fees post the IPO.

一般及行政費用為 5,600 萬港元，年增 80%。這一增長主要是由於一般和行政人員人數的增加以及首次公開募股後專業服務費用的增加。

Net income increased by 15% year-over-year to HKD 44 million. Non-GAAP adjusted net income increased by 19% to HKD 49 million. Overall, we are pleased with our performance in this quarter. We have demonstrated resilient growth across our operating metrics, and we are particularly glad to see that our paying client growth has reached -- accelerated in fourth quarter. We are expecting robust growth in the first quarter this year as well, as our purely online business has benefited from the drop in off-line activities as a result of coronavirus outbreak.

淨利潤年增 15% 至 4,400 萬港元。非 GAAP 調整後淨利成長 19%，達到 4,900 萬港元。總的來說，我們對本季的表現感到滿意。我們的營運指標顯示出彈性成長，我們特別高興地看到我們的付費客戶成長在第四季度達到了加速。我們預計今年第一季也將強勁成長，因為我們的純線上業務受益於冠狀病毒爆發導致的線下活動下降。

As we continue to enrich our trading product offering and execute our strategy of becoming a one-stop digital financing platform, we are confident about the growth prospects of our business in 2020.

隨著我們持續豐富交易產品，並執行成為一站式數位融資平台的策略，我們對2020年業務的成長前景充滿信心。

That concludes our prepared remarks. We would now like to open the call to questions. Operator, please go ahead. Thank you.

我們準備好的演講到此結束。我們現在要開始提問。接線員，請繼續。謝謝。

(Operator Instructions) We have the first question coming from Goldman Sachs, Chen, Wei.

（操作員指示）我們的第一個問題來自高盛陳偉。

Leaf, Arthur. Can you hear me?

葉，亞瑟。你聽得到我嗎？

(foreign language)

（外語）

Yes.

是的。

Okay, okay. So congratulations on the strong first -- fourth quarter. I got 2 questions. One is regarding the client. Second is regarding service pricing. So for the clients, we actually see a very strong new paying client growth in the fourth quarter. I think you elaborate some more on the results about the IPO of Alibaba and some of the third-party channels you are working with. So can you elaborate more on third-party channels, like how do they work with you in terms of like client traffic addressing? And secondly is, can you break it down more on the percentage of -- or the mix of Mainland investors, Hong Kong local investors and ESOP clients, what's the mix of those -- of 3 types in the new paying clients? And is there any like profiling of their -- like how they -- how much they're putting money and also how frequent they trade on these 3 type of clients? And secondly, I just want to ask, you see the brokerage commission rate has pick up quite a lot in the fourth quarter. If we calculate it around like the gross, commission rate is around 6.7 bps. And can you, yes, just explain some more on why there was a strong pickup? And also regarding the margin financing pricing, so we see the Hong Kong Financial Bureau has cut the benchmark interest rate, so not the prime rate yet, but would that be subsequent rate cuts on margin financing loans in 2020?

好吧好吧。因此，恭喜第一季和第四季的強勁表現。我有 2 個問題。一是關於客戶。其次是關於服務定價。因此，對於客戶來說，我們實際上看到第四季度新付費客戶的成長非常強勁。我想你對阿里巴巴IPO的結果以及你正在合作的一些第三方管道做了更多的闡述。那麼您能否詳細介紹第三方管道，例如他們如何在客戶端流量尋址等方面與您合作？其次，您能否進一步細分一下新付費客戶中三類客戶的比例，或者說內地投資者、香港本地投資者和員工持股客戶的組合，這三種類型的組合是怎樣的？是否有類似的分析——例如他們如何投入資金以及他們在這 3 類客戶上進行交易的頻率？其次，我想問一下，你看第四季經紀佣金率上升了很多。如果我們按照毛額來計算，佣金率約為 6.7 個基點。是的，您能否再解釋為什麼會強勁​​回升？還有關於保證金融資定價，所以我們看到香港財政局下調了基準利率，所以還不是最優惠利率，但這會是2020年保證金融資貸款的後續降息嗎？

Okay. Thank you, Wei Chen. This is Arthur. I think you mentioned 4 points. Maybe I address the first -- the second to fourth questions. I will leave the first question to my colleague, Robin Xu, who can elaborate our cooperations with third-party channels in terms of new client acquisitions in the fourth quarter.

好的。謝謝你，魏晨。這是亞瑟。我想你提到了4點。也許我會解決第一個問題──第二個問題到第四個問題。第一個問題請給我的同事徐彥，他可以詳細介紹我們在第四季的新客戶獲取方面與第三方管道的合作情況。

In terms of the client profiles, we see a very strong growth from the Mainland in fourth quarter. I think partially because of many hot IPOs, such as Alibaba and Poly Project Management, the names these Chinese clients are quite familiar. So they are more willing to participate in these activities.

就客戶概況而言，我們看到第四季度來自大陸的成長非常強勁。我認為部分原因是由於阿里巴巴和保利專案管理等許多熱門IPO，這些中國客戶對這些名字相當熟悉。所以他們更願意參與這些活動。

So far, I think at the end of last year, the Hong Kong-based clients account for roughly 30% of our total paying clients. And I do think this -- percentage-wise, this portion may continue to increase in the first quarter of this year. We got a very strong momentum in Hong Kong in terms of new client acquisitions.

到目前為止，我認為截至去年底，香港客戶約占我們付費客戶總數的30%。我確實認為，從百分比來看，這一比例可能會在今年第一季繼續增加。我們在香港的新客戶獲取方面取得了非常強勁的勢頭。

And in terms of the pricing or the fee rate, I think the major reason Leaf and I mentioned in the opening remarks, there are certain one-off activities such as the IPO subscription fees which also we blended into our trading commission rate into our total commission revenue in fourth quarter. And also, as we mentioned to investors earlier, because certain of our new clients -- normally, we will offer them 3 to 6 months commission-free period. As more and more people -- the commission-free period expires, this will boost our blended commission rate. And in terms of the margin and also the impact of the interest rate cut, we do notice that the recently the Fed cut rates very aggressively. I think for the time being, we will continue to maintain our margin rate policies. Even back, we -- just to recall, when we launched our margin business 3 to 4 years ago, at that time, the Fed was also keeping the 0 rate. So for the time being, we will continue to keep our fixed margin rate in Hong Kong and in the U.S. as well.

就定價或費率而言，我認為 Leaf 和我在開場白中提到的主要原因是，存在某些一次性活動，例如 IPO 認購費，我們也將其納入我們的交易佣金率。第四季佣金收入。而且，正如我們之前向投資者提到的，由於我們的某些新客戶，通常我們會為他們提供 3 至 6 個月的免佣金期。隨著越來越多的人——免佣金期到期，這將提高我們的混合佣金率。從降息幅度和影響來看，我們確實注意到最近聯準會降息的幅度非常大。我認為目前我們將繼續維持我們的保證金率政策。甚至回想起來，當我們三、四年前推出保證金業務時，當時聯準會也維持著零利率。因此，目前我們將繼續維持香港和美國的固定保證金率。

I will leave the first question to Robin.

我將第一個問題留給羅賓。

Okay. (foreign language)

好的。（外語）

[Interpreted] So breaking down our new paying client acquisition in the fourth quarter. So our paying clients from word-of-mouth referrals is strong as always. And as for ESOP clients, it may take some time for their shares in RSU to get vested. So you will see some of the impact from our strong ESOP business later on in the following quarters. And regarding the third-party channel collaboration, and as we mentioned, the fourth quarter was very hot -- we saw a very hot Hong Kong IPO market. And through these third-party channels, we were able to reach a lot of clients that are interested in these high-quality Chinese new economy companies. And in the fourth quarter, roughly 20% of our new paying clients come from this channel. And in terms of our Hong Kong new paying clients, so in the third quarter due to the social situation, the client acquisition growth came down a bit, though we are very glad to see that the growth rate has rebounded in the fourth quarter. And the contribution from Hong Kong paying clients continue to increase steadily.

[解讀] 因此，我們對第四季度的新付費客戶獲取情況進行了分析。因此，我們透過口碑推薦獲得的付費客戶一如既往地強大。而對於 ESOP 客戶來說，他們的 RSU 股份可能需要一段時間才能歸屬。因此，您將在接下來的幾個季度看到我們強大的員工持股計畫業務的一些影響。至於第三方通路合作，正如我們所提到的，第四季非常火爆——我們看到香港IPO市場非常火爆。透過這些第三方管道，我們接觸到了許多對這些優質中國新經濟公司感興趣的客戶。在第四季度，我們大約 20% 的新付費客戶來自這個管道。而就我們香港的新付費客戶而言，第三季由於社會狀況的原因，客戶獲取成長有所下降，儘管我們很高興看到第四季成長率有所回升。香港付費客戶的貢獻持續穩定成長。

Robin and Arthur. I just -- I need to follow-up a bit on the client acquisition. So given all -- like you said, the social -- the social event is phasing out like what you can see from the first quarter new clients from Hong Kong local investors. So is there any changes of marketing strategies in the Hong Kong local markets? Maybe broadly overall, like in China, Mainland? So is there any change of the marketing strategy or client acquisition strategies, including like the third-party channel you mentioned that you worked with in the fourth quarter? Is that the norm that you collaborate with in 2020 to attract more clients?

羅賓和亞瑟。我只是——我需要對客戶獲取進行一些跟進。因此，考慮到所有因素——就像你所說的社交活動——社交活動正在逐步消失，就像你從第一季來自香港本地投資者的新客戶中看到的那樣。那麼香港本地市場的行銷策略有變化嗎？也許總體而言，例如在中國大陸？那麼行銷策略或客戶獲取策略是否有任何變化，包括像您提到的在第四季度合作的第三方管道？這是您在 2020 年合作吸引更多客戶的常態嗎？

I will leave the question to Robin.

我會把問題留給羅賓。

Okay. (foreign language)

好的。（外語）

[Interpreted] Right. So in terms of our Hong Kong strategy, so we see a growing contribution from our online marketing channels. So in the fourth quarter and also in the first quarter of 2020, we have over 90% of our paying clients that come from online marketing. And in the short time being, we'll also prioritize online client acquisition in Hong Kong. And as far our Mainland China client acquisition strategy, I think we want to change our strategy dynamically based on the market sentiment and also based on the hot topics in the market. And obviously, the hot IPO -- Hong Kong IPO market in the fourth quarter kind of fueled the growth of the third-party channels marketing, though we'll also keep an eye on what's going on in the market and timely adjust our strategy.

【解釋】對。因此，就我們的香港策略而言，我們看到網路行銷管道的貢獻越來越大。因此，在 2020 年第四季和第一季度，我們超過 90% 的付費客戶來自線上行銷。短期內，我們也將優先考慮在香港獲取線上客戶。就我們的中國大陸客戶獲取策略而言，我認為我們希望根據市場情緒和市場熱點動態地改變我們的策略。顯然，第四季度IPO——香港IPO市場的火熱推動了第三方通路行銷的成長，但我們也會密切關注市場動態，及時調整我們的策略。

Our next question comes from the line of Daphne Poon from Citi.

我們的下一個問題來自花旗銀行的 Daphne Poon。

So I have a couple of questions here. I probably will go one by one. So the first question is about your -- the trading volume or the turnover. As we observed the turnover has been declining over the past few quarters, which is if we divided trading volume by your average client assets. So I would be wondering whether that is a structural trend because of the change in like client profile, whether new clients are getting less active compared to the previously acquired clients? And yes, so what is the outlook here? And also related to that is, since you're launching some new [securities] product, whether that will help improve the turnover going forward?

所以我有幾個問題。我大概會一一去。所以第一個問題是關於你的－交易量或營業額。正如我們所觀察到的，過去幾季的營業額一直在下降，這是用交易量除以平均客戶資產得出的結果。所以我想知道這是否是一種結構性趨勢，因為類似客戶資料的變化，與以前獲得的客戶相比，新客戶是否變得不那麼活躍？是的，那麼這裡的前景如何呢？與此相關的是，由於您正在推出一些新的[證券]產品，這是否有助於提高未來的營業額？

Okay. Thank you, Daphne. This is Arthur. Let me answer your questions. I think it is still too early to judge whether the investors profile or characteristics have been dramatically changed. You are right. Our -- in terms of trading velocities of our client in 2019 was softer compared with what they did in 2018. But we think it is mainly due to the market's fluctuations and the markets -- the overall market [hangovers], slowdowns in 2019. Year-to-date, actually, we see the trading velocities increase a lot, partially due to the volatile market, and secondly, due to our continued expansions of our new clients. So I think it is still too early to tell there's any structural changes for the trading velocity assumptions going forward.

好的。謝謝你，達芙妮。這是亞瑟。讓我回答你的問題。我認為現在判斷投資者的形像或特徵是否發生了巨大變化還為時過早。你是對的。就我們客戶 2019 年的交易速度而言，與 2018 年相比，我們的交易速度較弱。但我們認為這主要是由於市場波動和市場—整體市場[宿醉]，2019年放緩所致。實際上，今年迄今為止，我們看到交易速度大幅增加，部分原因是市場波動，其次是由於我們新客戶的不斷擴張。因此，我認為現在判斷未來交易速度假設是否會發生任何結構性變化還為時過早。

Okay. But do you expect like the product launch to help actually to improve? Or have you seen any impact so far with the launch of the [future's] products?

好的。但您是否期望產品發布能真正幫助改善？或者到目前為止，您是否看到[未來的]產品的推出產生了任何影響？

Yes. We launched our Hong Kong option tradings in last -- fourth quarter. And also, we just launched our index future products in Hong Kong this March. We do think -- we do observe that the trading velocities for these new products help our overall trading velocity increase a lot. And I think we will continue to enrich our products in the future, this asset class, going forward. So I do think this will help us regain the momentum in terms of trading velocity this year.

是的。我們在上個第四季推出了香港期權交易。此外，我們今年三月剛在香港推出了指數期貨產品。我們確實認為 - 我們確實觀察到這些新產品的交易速度有助於我們的整體交易速度大大提高。我認為我們未來將繼續豐富我們的產品，即這個資產類別。因此，我確實認為這將幫助我們在今年的交易速度方面重新獲得動力。

And the next question is about the trading volume breakdown. So can you give us a breakdown by market like Hong Kong versus U.S.? And also by products, how much contribution you have from derivatives in Q4?

下一個問題是關於交易量的細分。您能給我們按市場（例如香港與美國）進行細分嗎？還有從產品來看，第四季衍生性商品的貢獻有多少？

Sure. Similarly to the previous quarter, in the fourth quarter, the trading volume was roughly evenly spread over Hong Kong and the U.S. And in terms of the asset class, still main income's from the cash products, given that we just launched the option trading in Hong Kong last November. But I do expect in the coming quarters, you can see percentage-wise, the derivative contribution will become much, much higher.

當然。與上季類似，第四季交易量大致平均分佈在香港和美國。從資產類別來看，主要收入仍來自現金產品，因為我們剛剛在香港推出了選擇權交易孔去年11月。但我確實預計在接下來的幾個季度中，您可以看到衍生性商品貢獻的百分比將變得非常非常高。

Okay. And the next question is actually a follow-up about the interest rate cut cycle. So you mentioned just now that your product pricing on the margin [room] will remain stable. So does it means that your NIM is actually going to expand in the rate cut cycle because, I guess, funding cost should be coming down as well?

好的。而下一個問題其實是關於降息週期的後續。所以您剛才提到，您的產品定價的保證金將保持穩定。那麼這是否意味著你的淨利差實際上會在降息週期中擴大，因為我猜融資成本也應該下降？

Yes, we are still doing the detailed evaluations on the interest as the news was just out early this week. On a static basis, I think the rate cut may hurt our top line by 7% to 8% given we will suffer the interest income from client's idle cash. Definitely, the rate cut will hurt our profitabilities. But I think on the flip side, it is also an opportunity for us to get closer to clients, as people are seeking for more investment products and useful investment education, and we will become more determined to move forward our wealth management business initiative this year.

是的，我們仍在對興趣進行詳細評估，因為本週早些時候剛剛發布了消息。在靜態基礎上，我認為降息可能會損害我們的收入 7% 至 8%，因為我們將遭受客戶閒置現金的利息收入。毫無疑問，降息會損害我們的獲利能力。但我認為從另一方面來說，這也是我們與客戶拉近距離的一個機會，因為人們正在尋求更多的投資產品和有用的投資教育，今年我們將更加堅定地推進我們的財富管理業務計劃。

Okay. So you mean the decline in the -- basically the idle cash interest income will be the key driver here?

好的。所以你的意思是──基本上閒置現金利息收入的下降將是這裡的關鍵驅動因素？

Yes. I think in terms of margin, as I answered Wei Chen's questions before, initially or for the time being, we will continue to maintain our fixed rate, which -- the pricing charge to clients. So in terms of the margin spread, actually, we will get some benefit from the rate cut. But this benefit cannot fully offset the revenue loss we generate from the clients' idle cash.

是的。我認為在保證金方面，正如我之前回答過陳偉的問題一樣，最初或暫時，我們將繼續維持我們的固定利率，即向客戶收取的定價費用。所以就保證金利差而言，實際上我們會從降息中得到一些好處。但這種收益並不能完全抵銷我們從客戶閒置現金中產生的收入損失。

Right, right. Understand. Okay. And lastly, is about the commission rate, the brokerage commission rate. So can you give us some outlook on the trend here? Because we've seen that it has been rising in the past few quarters. Do you think that the current level, like the 4Q level, 6.7 basis points, is this sustainable? Or yes, so how should we expect the trend going forward?

是的是的。理解。好的。最後是關於佣金率，經紀佣金率。那麼您能給我們一些關於這裡趨勢的展望嗎？因為我們看到它在過去幾個季度一直在上升。您認為目前的水平（如第四季的水平，6.7 個基點）是否可持續？或者是的，那麼我們該如何預期未來的趨勢呢？

Sure. I think there are some one-off reasons for the fourth quarter high commission rate because of the -- we blended the IPOs' contributions into the commission incomes. So on a like-for-like basis, I do think there is no near-term pressures in terms of commission pressure from a competitive landscape. So I think the average numbers, which we generate in 2019 can be a reference point for 2020.

當然。我認為第四季佣金率較高有一些一次性原因，因為我們將首次公開發行的貢獻納入佣金收入。因此，在同等基礎上，我確實認為競爭格局的佣金壓力不會帶來短期壓力。所以我認為我們 2019 年產生的平均數字可以作為 2020 年的參考點。

Okay. Actually, related to that IPO contribution, so may I know that how do you book that IPO revenue? Because I see that comes in actually different revenue lines. So that contributed to both your brokerage commission income and also part of that is booked under the other income. So how do you like split between the 2 categories?

好的。實際上，與IPO貢獻相關，請問您如何記入IPO收入？因為我發現這其實有不同的收入來源。因此，這既有助於您的經紀佣金收入，也有一部分記入其他收入。那麼您覺得這兩個類別之間的劃分如何呢？

Yes. For the Hong Kong IPO, for example, we do some marketing campaigns and PR activities for these IPO companies or the corporates. So we booked the revenue generating from such kind of service into the other income. And for the IPO retail portion participations besides the normal trading commissions when people participate IPO subscriptions, we will have additional one-off commission charge. We will book these commission charge into the overall -- our commission revenues.

是的。以香港IPO為例，我們為這些IPO公司或企業做一些行銷活動和公關活動。因此我們將此類服務產生的收入計入其他收入。而對於IPO零售部分參與，除了人們參與IPO認購時的正常交易佣金外，我們還會額外收取一次性佣金。我們將把這些佣金記入我們的佣金收入總額中。

Our next question comes from the line of Stanley Xia from Goldman Sachs.

我們的下一個問題來自高盛的 Stanley Xia。

I actually want to follow-up a bit on wealth management sector. We see that the total client assets in mutual funds surpassed HKD 6 billion, which beat the last management guidance. I was just wondering what is the main driver for this. And on top of that, I'd really appreciate if management team could provide some more outlook for wealth management business in 2020?

我其實想跟進一下財富管理領域。我們看到共同基金的客戶總資產超過 60 億港元，超出了最新的管理層指引。我只是想知道這的主要驅動力是什麼。除此之外，如果管理團隊能為2020年財富管理業務提供更多展望，我將不勝感激。

Sure. Thank you. I think one of the major reasons for the increase in terms of AUMs in the wealth management in fourth quarter is more product offerings. Because in the third quarter, we just have less than 10 mutual fund products launched in our platforms. Actually, in the fourth quarter last year, we provided more products. In particular, we diversified from money market funds to more fixed income products and also the equity funds, not only just concentrate in Hong Kong, China or even Asia, actually, will provide a more diversified global products, which can further enhance our clients' interest. We will maintain such strategy. I do think product availability is very important when we start to kick in this new business. As Leaf mentioned in the opening remarks, we do expect in our platforms, you can see over 50 new mutual fund products launched in the middle -- before the middle of this year.

當然。謝謝。我認為第四季財富管理資產管理規模成長的主要原因之一是產品種類的增加。因為第三季我們平台上推出的共同基金產品還不到10個。事實上，去年第四季我們提供了更多的產品。特別是，我們從貨幣市場基金轉向更多的固定收益產品和股票基金，不僅集中在香港、中國甚至亞洲，實際上會提供更加多元化的全球產品，這可以進一步增強我們客戶的投資機會。興趣。我們將維持這樣的策略。我確實認為當我們開始開展這項新業務時，產品可用性非常重要。正如 Leaf 在開場白中提到的那樣，我們確實希望在我們的平台上，您可以看到超過 50 種新的共同基金產品在今年年中之前推出。

In terms of the client assets, it is very difficult to tell, in particular, judging from the recent market volatilities, we do see a very strong good momentum in terms of AUM growth in January and also in February. But suddenly, it has been pulled back a lot in the past 2 weeks. Because of the market volatilities, a lot of people just redeemed their money market funds and tried to average down their stock positions. But despite this near-term market volatilities, we do think we should make up very big efforts in terms of growing the wealth management's AUM this year. I think one of the reasons we have some hesitation last year is because of the rate cycle, as I answered the questions to Daphne and also Wei Chen before. But this hurdle has been erased given that the Fed has cut rates into 0. So the opportunity cost for us now actually become nothing. So we will make more efforts into the fund distribution.

從客戶資產來看，這很難說，特別是從最近的市場波動來看，我們確實看到1月和2月的AUM成長動能非常強勁。但突然間，這兩週就被拉了很多。由於市場波動，許多人只是贖回貨幣市場基金，並試圖平均減持股票部位。但儘管近期市場出現波動，我們確實認為今年我們應該在增加財富管理資產管理規模方面做出很大的努力。我認為去年我們猶豫的原因之一是利率週期，就像我之前回答過達芙妮和陳偉的問題一樣。但鑑於聯準會已將利率降至0，這一障礙已被消除。因此，我們現在的機會成本實際上已經為零。所以我們會在資金分配上加大力度。

(Operator Instructions) Our next question comes from the line of Lily Liu from HSBC.

（操作員指示）我們的下一個問題來自匯豐銀行的Lily Liu。

(foreign language)

（外語）

I will ask this question in English. Because we see a very significant growth in the balance of margin loan, so going forward, will we see a source of funding for this business growth? And are we see a massive margin pulled pressure from our clients in the recent market crash?

我會用英語問這個問題。因為我們看到保證金貸款餘額有非常顯著的成長，所以展望未來，我們會看到這項業務成長的資金來源嗎？在最近的市場崩盤中，我們是否看到客戶的巨大利潤壓力？

Okay. Thank you, Lily. This is Arthur. For your 2 questions, I will answer your second question first. I will leave the first question about growth and the competitive landscape to my colleagues, Leaf and Robin.

好的。謝謝你，莉莉。這是亞瑟。對於你的2個問題，我先回答你的第二個問題。我將把關於成長和競爭格局的第一個問題留給我的同事 Leaf 和 Robin。

In terms of margin balance, you're right, we've maintained a very good momentum in 2019, partially thanks to the overall good benign market condition. In terms of funding source, last year, equity fundings, i.e., our own capital contributed about 50% of the funding source, and the remaining 50% mainly come from our financial partners, such as commercial banks in Hong Kong, et cetera. Currently, after our last year's IPO, I do think that our leverage ratio is still quite healthy. So in terms of the leverage upside, we still have a very room to -- big room to grow.

就保證金平衡而言，你是對的，我們在 2019 年保持了非常好的勢頭，部分歸功於整體良好的良性市場狀況。從資金來源來看，去年我們是股權融資，也就是我們的自有資金貢獻了大約50%的資金來源，剩下的50%主要來自我們的金融合作夥伴，例如香港的商業銀行等。目前，在我們去年首次公開募股之後，我確實認為我們的槓桿率仍然相當健康。因此，就槓桿上升而言，我們仍然有很大的成長空間。

Okay. (foreign language)

好的。（外語）

(foreign language)

（外語）

Sure. I think the reason market volatility may -- left people concerned whether there's any margin cost, I think in Hong Kong markets and also in the U.S. market, we still use a very prudent margin policies, but we did not provide a very high leverage to our clients. We do see some small margin cost, but I think the overall the size is not very material compared with our coming first quarter P&L impact.

當然。我認為市場波動的原因可能是——讓人們擔心是否有保證金成本，我認為在香港市場和美國市場，我們仍然使用非常審慎的保證金政策，但我們沒有提供很高的槓桿來我們的客戶。我們確實看到了一些小額利潤成本，但我認為與我們即將到來的第一季損益影響相比，整體規模並不是很大。

(Operator Instructions) There are no further questions at this time. I'd like to hand the conference back to our presenters. Please continue.

（操作員說明） 目前沒有其他問題。我想把會議交還給我們的主持人。請繼續。

Thank you. That concludes our call today. On behalf of the Futu management team, I would like to thank you for joining us today. If you have any further questions, please do not hesitate to contact me or any of our Investor Relations representatives. Thank you, and goodbye.

謝謝。我們今天的電話會議到此結束。我謹代表富途管理團隊感謝您今天加入我們。如果您有任何其他問題，請隨時與我或我們的任何投資者關係代表聯繫。謝謝，再見。

Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may all disconnect.

女士們、先生們，今天的會議到此結束。感謝您的參與。你們都可以斷開連線。

[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]

[本文字記錄中標記為[已翻譯]的部分是由現場通話中的口譯員朗讀的。]