Yatsen Holding Ltd (YSG) 2023 Q4 法說會逐字稿

Ladies and gentlemen, good day, and welcome to the Yatsen's fourth quarter and full year 2023 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Irene Lyu, Vice President, Head of Strategic Investment and Capital Markets. Please go ahead.

女士們、先生們，美好的一天，歡迎參加逸仙2023年第四季和全年財報電話會議。今天的會議正在錄製中。現在，我想把會議交給副總裁、策略投資與資本市場主管呂艾琳。請繼續。

Thank you, operator. Please note the discussion today will contain forward-looking statements relating to the company's future performance and are intended to qualify for the safe harbor from liability as established by US Private Securities Litigation Reform Act.

謝謝你，接線生。請注意，今天的討論將包含與公司未來業績相關的前瞻性陳述，旨在符合美國私人證券訴訟改革法案規定的免責責任安全港的資格。

Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions, and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and this discussion.

此類陳述並非對未來績效的保證，並受到某些風險和不確定性、假設和其他因素的影響。其中一些風險超出了公司的控制範圍，可能導致實際結果與今天的新聞稿和本次討論中提到的結果有重大差異。

A general discussion of the risk factors that could affect Yatsen's business and financial results is included in certain filings of the company with the Securities and Exchange Commission. The company does not undertake any obligation to update this forward-looking information, except as required by law.

該公司向美國證券交易委員會提交的某些文件中包含了對可能影響 Yatsen 業務和財務業績的風險因素的一般性討論。除法律要求外，本公司不承擔更新此前瞻性資訊的任何義務。

During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only. Please see the earnings release issued earlier today for a definition of non-GAAP financial measures and a reconciliation of GAAP, non-GAAP financial results.

在今天的電話會議上，管理階層還將討論某些非公認會計準則財務指標，僅供比較之用。請參閱今天稍早發布的收益報告，以了解非 GAAP 財務指標的定義以及 GAAP、非 GAAP 財務表現的調整表。

Joining us today on the call from Yatsen's senior management team are Mr. Jinfeng Huang, our Founder, Chairman and CEO; and Mr. Donghao Yang, our CFO and Director. (Operator Instructions) As a reminder, this conference is being recorded. In addition, a webcast replay of this conference call will be available on Yatsen's Investor Relations website at ir.yatsenglobal.com.

今天加入我們的中山高階管理團隊的電話會議包括我們的創辦人、董事長兼執行長黃金峰先生；以及我們的財務長兼董事楊東浩先生。（操作員指示）謹此提醒，本次會議正在錄製中。此外，本次電話會議的網路直播重播將在逸仙的投資者關係網站 ir.yatsenglobal.com 上提供。

I'll now turn the call over to Mr. Jinfeng Huang. Please go ahead, sir.

我現在將電話轉給黃金峰先生。請繼續，先生。

Thank you, Irene and thank you, everyone, for participating in Yatsen's fourth quarter and full year 2023 earnings conference call today. I'd like to begin with a macro overview before diving into the details of our strategy and progress across our segments and brands.

謝謝艾琳，謝謝大家今天參加逸仙第四季和2023年全年財報電話會議。我想先進行宏觀概述，然後再深入了解我們的策略細節以及我們各個細分市場和品牌的進展。

China's beauty market experienced a modest recovery in 2023 according to the drafted data published by the National Bureau of Statistics of China, total retail sales of consumer goods grew by 8.3% year over year for the fourth quarter and the 7.2% for the full year. Against this patch of, total beauty retail sales were up 1% year over year for the fourth quarter and 5.1% for the full year.

根據國家統計局公佈的數據，2023年中國美妝市場溫和復甦，第四季社會消費品零售總額較去年同期成長8.3%，全年成長7.2%。在此期間，第四季美容零售總額較去年同期成長 1%，全年成長 5.1%。

Online beauty sales patterns were mixed in 2023. Sales on Tmall decreased while sales on Douyin increase year over year for both the fourth quarter and the full year. We made solid progress this quarter [amid a seal spot retail environment] returning to a growth statutory as we executed our strategy transformation plan.

2023 年線上美容銷售模式好壞參半。第四季和全年天貓銷售額較去年同期下降，抖音銷售額較去年同期成長。我們在執行策略轉型計畫時，本季（在密封現貨零售環境中）取得了紮實的進展，恢復了法定成長。

Perfect Diary's brand repositioning is also proceeding as intended to pave the way for future growth. We remain focused on building strong brand equity through superior product and a consumer satisfaction while continued investment in brand building and R&D.

完美日記的品牌重新定位也在按計劃進行，為未來的發展鋪路。我們仍然專注於透過卓越的產品和消費者滿意度來建立強大的品牌資產，同時繼續投資於品牌建立和研發。

Our total net revenue for the fourth quarter beat our guidance up 6.7% year over year. Net revenues from our skincare brands for the fourth quarter grew by 17.6% year over year. Our clinical and the premium skincare brands, including Galenic, DR.WU and Eve Lom, delivered another solid performance. Recording a 23.4% year over year growth in combined net revenues and a further elevating their contribution to total net revenues.

我們第四季的總淨收入年增 6.7%，超出預期。第四季我們的護膚品牌淨收入年增 17.6%。我們的臨床和高端護膚品牌，包括 Galenic、DR.WU 和 Eve Lom，再次表現出色。合併淨收入年增 23.4%，進一步提升了對總淨收入的貢獻。

Net revenues from color cosmetic brands declined slightly by 1.8% year over year for the fourth quarter. In terms of channel optimization, we continue to strategically close underperforming offline stores. As of the end of 2023, we operated 110 off-line experience stores for the Perfect Diary's brands as compared with 158 stores a year ago.

第四季彩妝品牌淨收入較去年同期小幅下降1.8%。在通路優化方面，我們繼續策略性關閉表現不佳的線下門市。截至2023年底，我們經營完美日記旗下品牌線下體驗店110家，而一年前為158家。

Our two other color cosmetic brands Little Ondine and Pink Bear continued to resonate with their customers and recorded year over year revenue growth. Our fourth quarter gross margin improved to 73.7% from 71.1% for the prior year period, benefiting from higher gross margin products and a more disciplined pricing and discount policies.

我們的另外兩個彩妝品牌Little Ondine和Pink Bear繼續與客戶產生共鳴，營收年增。我們第四季的毛利率從去年同期的 71.1% 提高到 73.7%，受益於毛利率較高的產品以及更嚴格的定價和折扣政策。

Our net loss margin expanded to 46.1% for the fourth quarter, primarily attributable to an impairment of goodwill as well as increased investments in our brands. The goodwill impairment recorded in the fourth quarter represents the amount by which the carrying value of Eve Lom reporting unit exceeded its fair value. Based on quantitative goodwill impairment test, due to weaker operating results than expected at the time of acquisition.

第四季我們的淨虧損率擴大至 46.1%，主要歸因於商譽減損以及品牌投資增加。第四季記錄的商譽減損代表 Eve Lom 報告單位的帳面價值超過其公允價值的金額。根據定量商譽減損測試，由於經營績效弱於收購時的預期。

Despite challenges in the market environment and ongoing competition, we still see potential in the brands. For the full year 2023, our net loss margin was 22% as compared with 22.2% in 2022. Our non-GAAP net loss margin narrowed to 8.7% from 12.2% for the prior year period. A significant improvement that underscores our skill in balancing cost structure optimization is the need to grab market opportunities as we drive sustainable growth.

儘管面臨市場環境的挑戰和持續的競爭，我們仍然看到這些品牌的潛力。2023 年全年，我們的淨虧損率為 22%，而 2022 年為 22.2%。我們的非 GAAP 淨虧損率從去年同期的 12.2% 收窄至 8.7%。突顯我們平衡成本結構優化技能的一項重大改進是，在推動永續成長時需要抓住市場機會。

Moving on to the brands and products for our skincare brands, we maintained our focus on brand building and introduced efficient product to foster deeper connections with each brand's audience. Galenic recorded solid performance during the Double 11 shopping festival, ranking number one in the premium brightening serum category in terms of a retail sales value on both Tmall and Douyin, [with VC serum]

至於護膚品牌的品牌和產品，我們繼續專注於品牌建設，並推出高效產品，以與每個品牌的受眾建立更深入的聯繫。蓋倫在雙11期間表現亮眼，在天貓和抖音上均排名高端亮白精華液品類零售額第一，[含VC精華]

The brand is also making progress on it's courter line to align winning the Essence of the Year award at Bazar Beauty Awards 2023 for it's Couture Secret d'Excellence active serum. DR.WU acne research firm announced its first batch of pioneering research projects at the 2023 National Congress of Cosmetic Dermatology in Shanghai and DR.WU will continue to push boundaries in clinical acne research and the application of mandelic acid propelling the fields of long-term development.

該品牌還在其 Courter 系列上取得了進展，以使其 Couture Secret d'Excellence 活性精華液贏得 2023 年 Bazar Beauty Awards 的年度精華獎。DR.WU痤瘡研究公司在上海舉行的2023年全國美容皮膚科學大會上公佈了首批開創性研究項目，DR.WU將繼續突破臨床痤瘡研究和扁桃酸應用，推動長期痤瘡領域的發展發展。

Although Eve Lom opened its first off-line store in Southern China in January this year, bringing the brands have higher experience to a broader customer base. While with that with respect to color cosmetics on Perfect Diary's brand repositioning continues to gain traction among its target customers.

雖然Eve Lom今年1月在華南地區開設了首家線下店，將品牌更高的體驗帶給了更廣泛的顧客群。同時，完美日記的彩妝品牌重新定位繼續在其目標客戶中獲得吸引力。

Biolip Essence Lipstick, the new hero product we launched in September 2023 has been gaining market share in the lipstick category on both on Tmall and Douyin. During the quarter, the newly launched the lipstick made Perfect Diary's number one lipstick brand in terms of retail sales value on Douyin.

Biolip 精華唇膏是我們於 2023 年 9 月推出的新主打產品，在天貓和抖音的口紅類別中都佔據了市場份額。本季度，新推出的口紅成為完美日記抖音零售額第一口紅品牌。

Given these product lines potential we expanded, the third phase is to include piled, in essence, mixing intermittently three and apparel, in essence, matte lipstick in February 2024, in reaching offering for customers to experience is that the balance formulation. (inaudible)also recently launched it's multi(inaudible)the brands very first other integrating the WinCo cream with the makeup primers and the natural foundition.

鑑於我們擴展這些產品線的潛力，第三階段是在2024年2月包括堆積、本質、間歇混合三種和服裝、本質、啞光口紅，以達到提供給客戶體驗的平衡配方。 （聽不清楚）最近也推出了它的多（聽不清楚）品牌，這是第一個將 WinCo 霜與底妝和天然粉底結合在一起的品牌。

Both (inaudible) and the Pink Bear introduced new products during the quarter deeper on the little white i-line pan on the I color award in the color cosmetics category at a bulk of Beauty Awards, some chemistry. While compares very keen eye shadow (inaudible) Beauty Awards, color Development Award.

（聽不清楚）和 Pink Bear 都在本季度推出了新產品，在彩妝類 I Color 獎上的小白色 i-line pan 上深入推出了新產品，在許多美容獎中，有一些化學反應。而比較敏銳的眼影（聽不清楚）美容獎、色彩開發獎。

Moving now to the R&D. R&D expenses as a percentage of revenues were 3.4% for the fourth quarter and 3.3% for the full year 2023. Over the past year, we have significantly enhanced our R&D capabilities under the leadership of our Chief Scientist pipeline City officers, establishing a comprehensive R&D framework and a clear strategy direction.

現在轉向研發。第四季研發費用佔營收的百分比為 3.4%，2023 年全年為 3.3%。一年來，我們在首席科學家管道城市官員的帶領下，研發能力顯著增強，建立了全面的研發框架和明確的策略方向。

The R&D team has developed its iconic products, including Perfect Diary's lipstick essence, Biolip essence lipstick, Galenic's Vivifiant invigorating Micro Mask. We also strengthened our R&D infrastructure by setting up our Shanghai R&D centers. Along with these efforts, we promoted innovation through industry academia collaboration, including leading initiative, but in initiatives such as pop-up with acne research firm ended Galenic dermatology research firm. Going forward, we remain committed to R&D investments to drive innovation and growth.

研發團隊開發了其標誌性產品，包括完美日記口紅精華、Biolip精華口紅、蓋倫Vivifiant活力微面膜等。我們也透過設立上海研發中心來加強我們的研發基礎設施。除了這些努力之外，我們還透過行業學術界合作促進創新，包括領先舉措，但在諸如與痤瘡研究公司的彈出等舉措中，結束了蓋倫皮膚病學研究公司。展望未來，我們將繼續致力於研發投資，以推動創新和成長。

Before I conclude a brief update on our 2023 ESG performance. Dedication to environmental and social responsibility and employee welfare is integral to our brand and a future development. We published our second ESG report in 2023, highlighting our alignment with prevailing green development initiatives.

在結束之前，我先簡單介紹一下我們 2023 年 ESG 表現。致力於環境和社會責任以及員工福利是我們品牌和未來發展不可或缺的一部分。我們在 2023 年發布了第二份 ESG 報告，強調我們與現行綠色發展措施的一致性。

Furthermore, we were honored to be recognized at the China's 2033 DEI employer awards for our deep commitment to inclusion and employee welfare. To summarize, we are pleased with our return to growth in the fourth quarter, and I will remain focused on pursuing sustainable growth with innovation across our brands.

此外，由於我們對包容性和員工福利的堅定承諾，我們很榮幸獲得中國 2033 DEI 雇主獎的認可。總而言之，我們對第四季度恢復成長感到高興，我將繼續專注於透過我們品牌的創新來追求永續成長。

With that, I will now turn the call over to our CFO, Donghao Yang, to discuss our financial performance. Thank you, everyone.

現在，我將把電話轉給我們的財務長楊東浩，討論我們的財務表現。謝謝大家。

Thank you, David, and hello, everyone. Before I get started, I would like to clarify that all financial numbers presented today are in renminbi amounts and all percentage changes refer to year-over-year changes unless otherwise noted.

謝謝你，大衛，大家好。在開始之前，我想澄清一下，除非另有說明，今天提供的所有財務數據均以人民幣為單位，所有百分比變化均指同比變化。

Total net revenues for the fourth quarter of 2023 increased by 6.7% to RMB1.07 billion from RMB1.01 billion for the prior-year period. The increase was primarily attributable to a 17.6% year-over-year increase in net revenues from skincare brands, partially offset by 1.8% year-over-year decrease in net revenues from color cosmetics brands. Gross profit for the fourth quarter of 2023 increased by 10.6% to $719.1 million from $714.6 million for the prior year period.

2023年第四季淨收入總額從去年同期的人民幣10.1億元成長6.7%至人民幣10.7億元。此成長主要歸因於護膚品牌淨收入年增17.6%，部分被彩妝品牌淨收入較去年同期下降1.8%所抵銷。2023 年第四季的毛利從去年同期的 7.146 億美元成長 10.6% 至 7.191 億美元。

Gross margin for the fourth quarter of 2023 increased to 73.7% from 71.1% for the prior year period. The increase was driven by increasing sales of higher gross margin products and more disciplined pricing and discount policies across all of our brand portfolios.

2023 年第四季的毛利率從去年同期的 71.1% 增至 73.7%。這一增長是由於毛利率較高的產品銷售增加以及我們所有品牌組合中更嚴格的定價和折扣政策所推動的。

Total operating expenses for the fourth quarter of 2023 increased by 67.7% to RMB1.33 billion from RMB792.9 million for the prior year period. As a percentage of total net revenues, total operating expenses for the fourth quarter of 2023 were 124% as compared with 78.9% for the prior period. Fulfillment expenses for the fourth quarter of 2023 were RMB62.7 million as compared with RBM62.5 million for the prior year period. As a percentage of total net revenues, fulfillment expenses for the fourth quarter of 2023 decreased to 5.8% from 6.2% for the prior year period. The decrease was primarily attributable to further improvements in logistics efficiency.

2023年第四季的總營運費用從去年同期的人民幣7.929億元成長67.7%至人民幣13.3億元。2023 年第四季的總營運支出佔總淨收入的百分比為 124%，而上一季為 78.9%。2023 年第四季的履行費用為人民幣 6,270 萬元，而去年同期為 6,250 萬元。2023 年第四季的履行費用佔總淨收入的百分比從去年同期的 6.2% 下降至 5.8%。下降的主要原因是物流效率進一步提高。

Selling and marketing expenses for the fourth quarter of 2023 were RMB717.4 million as compared with RBM535.2 million for the prior period. As a percentage of total net revenues, selling and marketing expenses for the fourth quarter of 2023 increased to 66.9% from 53.2% for the prior period. The increase was primarily due to the Perfect Diary brand upgrade, as well as our investments in new product launches across our brands.

2023年第四季的銷售和行銷費用為人民幣7.174億元，而上一季為人民幣5.352億元。2023 年第四季銷售和行銷費用佔總淨收入的百分比從上一季的 53.2% 增至 66.9%。這一成長主要是由於完美日記品牌升級，以及我們對各品牌新產品推出的投資。

General and administrative expenses for the fourth quarter of 2023 for RBM158.7 million as compared with RBM169.9 million for the prior year period. As a percentage of total net revenue, general and administrative expenses for the fourth quarter of 2023 decreased to 14.8% from 16.9% for the prior year period. The decrease was primarily attributable to a reduction in share-based compensation.

2023 年第四季的一般及管理費用為 1.587 億人民幣，而去年同期為 1.699 億人民幣。2023 年第四季的一般及管理費用佔淨收入總額的百分比從去年同期的 16.9% 下降至 14.8%。減少的主要原因是股權激勵減少。

Research and development expenses for the fourth quarter of 2023 were RBM36.9 million as compared with RBM25.1 million for the prior year period. As a percentage of total net revenues, research and development expenses for the fourth quarter of 2023 increased to 3.4% from 2.5% for the prior year period. The increase was primarily attributable to an increase in personnel costs, reflecting our commitment in enhancing our research and development capabilities.

2023 年第四季的研發費用為 3,690 萬元人民幣，而去年同期為 2,510 萬元。2023 年第四季的研發費用佔總淨收入的百分比從去年同期的 2.5% 增至 3.4%。這一增長主要是由於人員成本的增加，反映了我們對增強研發能力的承諾。

Impairment of goodwill for the fourth quarter of 2023 was RMB354 million as compared with nil in the prior year period. Impairment recorded in the quarter represents the amount by which the carrying value of the eLong reporting unit exceeded its fair value based on quantitative had goodwill impairment tests primarily due to weaker operating results than expected at the time of acquisition. Loss from operations for the fourth quarter of 2023 to RMB539.6 million as compared with RMB78.2 million for the prior year period.

2023年第四季商譽減損為人民幣3.54億元，去年同期為零。本季度記錄的減損代表藝龍報告單位的帳面價值超過其基於定量商譽減損測試的公允價值的金額，這主要是由於經營業績弱於收購時的預期。2023 年第四季營運虧損為 5.396 億元，上年同期為 7,820 萬元。

Operating loss margin was 50.3% as compared with 7.8% for the prior year period. Non-GAAP loss from operations for the fourth quarter of 2023 was RBM125.9 million as compared with non-GAAP income from operations of RBM11.5 million for the prior year period. Non-GAAP operating loss margin was 11.7% as compared with non-GAAP operating income margin of 1.1% for the prior year period.

營業虧損率為 50.3%，去年同期為 7.8%。2023 年第四季的非 GAAP 營運虧損為 1.259 億人民幣，而去年同期的非 GAAP 營運收入為 1,150 萬人民幣。非 GAAP 營業虧損率為 11.7%，而去年同期非 GAAP 營業利益率為 1.1%。

Net loss for the fourth quarter of 2023 was RMB494.5 million as compared with RMB55 million for the prior year period. Net loss margin was 46.1% as compared with 5.5% for the prior year period. Net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the fourth quarter of 2023 was RMB0.91 as compared with RMB0.09 as of prior period.

2023年第四季淨虧損為人民幣4.945億元，去年同期淨虧損為人民幣5,500萬元。淨虧損率為 46.1%，去年同期為 5.5%。2023年第四季稀釋後每股美國存託股份歸屬於逸仙普通股股東的淨虧損為人民幣0.91元，上期為人民幣0.09元。

Non-gAAP net loss for the fourth quarter of 2023 was RMB93.7 million as compared with non-GAAP net income of RMB34.7 million for the prior year period. Non-GAAP net loss margin was 8.7% as compared with non-GAAP net income margin of 3.4% for the prior year period.

2023 年第四季非公認會計準則淨虧損為人民幣 9,370 萬元，而上年同期非公認會計準則淨利為 3,470 萬元。非 GAAP 淨虧損率為 8.7%，而去年同期非 GAAP 淨利率為 3.4%。

Non-GAAP net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the fourth quarter of 2023 was RMB0.17 as compared with non-GAAP net income attributable to ordinary shareholders per diluted ADS of RMB0.06 for the prior-year period.

2023年第四季度，以非美國通用會計準則計算，每稀釋美國存託股票歸屬於逸仙普通股股東的淨虧損為人民幣0.17元，而上年同期，按非美國通用會計準則計算，每稀釋美國存託股票歸屬於普通股東的淨利為人民幣0.06元。

Now I would like to briefly walk you through the highlights of our full year results. Total net revenues for the full year of 2023 decreased by 7.9% to RMB3.41 billion from RMB3.71 billion for the prior year period, primarily attributable to the decline in net revenue from color cosmetic brands, partially offset by the increase in net revenues from skincare brands.

現在我想向您簡要介紹我們全年業績的亮點。2023年全年淨收入總額從去年同期的37.1億元下降7.9%至人民幣34.1億元，主要是因為彩妝品牌淨收入下降，但被淨收入增加部分抵銷來自護膚品牌。

Gross profit for full year of 2023 decreased by 0.2% to RMB2.51 billion from RMB2.52 billion for the prior year period. Gross margin for the full year of 2023 was 73.6% as compared with 68% for the prior year period, primarily attributable to first increasing sales of higher gross margin products from skincare brands and certain more disciplined pricing and to some policies and Board have cost optimization across all of our brand portfolio.

2023年全年毛利由上年同期的人民幣25.2億元下降0.2%至人民幣25.1億元。2023年全年毛利率為73.6%，而去年同期為68%，主要歸因於護膚品牌毛利率較高的產品銷量首次增加以及某些更嚴格的定價以及一些政策和董事會的成本優化涵蓋我們所有的品牌組合。

Loss from operations for full year 2023 was RBM913.4 million as compared with RBM928.9 million for the prior year period. Non-GAAP loss from operations for the full year of 2023 was RBM427.5 million as compared with RBM539.3 million for the prior year period. Net loss for full year of 2023 was RBM750.2 million as compared with RBM821.3 million for the prior-year period.

2023 年全年營運虧損為 9.134 億人民幣，而去年同期為 9.289 億人民幣。2023 年全年非 GAAP 營運虧損為 4.275 億RBM，去年同期為 5.393 億RBM。2023 年全年淨虧損為 7.502 億元人民幣，去年同期為 8.213 億元。

Net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the full year of 2023 was RBM1.6 compared with RBM1.37 for the prior-year period. Non-GAAP net loss for the full year of 2023 was RMB296.1 million compared with RBM452.9 million for the prior-year period. Non-GAAP net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the full year of 2003 was RMB0.53 as compared with RMB0.76 for the prior period.

2023年全年每股攤薄美國存託股歸屬於逸仙普通股股東的淨虧損為1.6元人民幣，而去年同期為1.37元。2023 年全年非 GAAP 淨虧損為 2.961 億元，去年同期淨虧損為 4.529 億元。2003 年全年每股攤薄美國存託股按非美國通用會計準則計算的歸屬於逸仙普通股股東的淨虧損為人民幣 0.53 元，而上期為人民幣 0.76 元。

As of December 31, 2023, the company had cash, restricted cash and short-term investments of RMB2.08 billion as compared with RMB2.63 billion as of December 31, 2022. Net cash generated from operating activities for the fourth quarter of 2023 of RBM90.5 million of compared with net cash generated from operating activities of RMB106.6 million for the prior period. Net cash used in operating activities for the full year of 2023 was RMB107.4 million as compared with net cash generated from operating activities of RBM136.2 million for the prior year period.

截至2023年12月31日，公司擁有現金、限制性現金及短期投資為人民幣20.8億元，截至2022年12月31日為人民幣26.3億元。2023 年第四季經營活動產生的現金淨額為 9,050 萬元人民幣，而上一季經營活動產生的現金淨額為 1.066 億元。2023年全年經營活動使用的現金淨額為人民幣107.4百萬元，而去年同期經營活動產生的現金淨額為人民幣136.2百萬元。

Looking at our business outlook for the first quarter of 2024, we expect our total net revenues to be between RBM765.4 million and RMB803.7 million, representing a year-over-year increase of approximately 0% to 5%. These forecasts reflect our current and preliminary views on the market and operational conditions, which are subject to change.

展望2024年第一季的業務前景，我們預期淨收入總額將在7.654億元人民幣至8.037億元人民幣之間，年增約0%至5%。這些預測反映了我們對市場和營運狀況的當前和初步看法，這些看法可能會改變。

With that, I would like to open the call to Q&A.

至此，我想開始問答環節。

We will now begin the question and answer session to ask a question.

我們現在開始問答環節來提問。

(Operator Instructions)

（操作員說明）

Maggie Huang, CICC.

黃美琪，中金公司。

Well, thanks for taking my question. This is Michael Huang from CICC. I am firstly congratulation on our revenue, returning to growth and beating our guidance. And I have two questions and the first one is regarding Perfect Diary. And we about to see the good performance of our new products, like Essence, lipstick in Q4.

嗯，謝謝你回答我的問題。我是中金公司的 Michael Huang。我首先祝賀我們的收入恢復成長並超越我們的指導。我有兩個問題，第一個問題是關於完美日記的。我們即將在第四季度看到我們的新產品，例如精華液、口紅的良好表現。

So, for this year, do you have a target revenue contribution from the new products? And how should we expect on the revenue growth and net margin of the brand Perfect Diary? And that's my first question.

那麼，今年您對新產品的營收貢獻有目標嗎？那麼完美日記品牌的營收成長速度和淨利率又該如何預期呢？這是我的第一個問題。

And my second question is regarding the Women's day shopping festival. So, how is the performance of our brands so far? And is that in line with our expectations? And that's my question. Thank you.

我的第二個問題是關於婦女節購物節的。那麼，到目前為止，我們品牌的表現如何？這符合我們的預期嗎？這就是我的問題。謝謝。

Thank you, Maggie. For your first question on the performance of Perfect Diary. Since our launch of the Biolip Essence Lipstick is performance has been trending up. So, for example, last year December, the new lipstick is ranking number two on both Tmall and (inaudible) is performing well. And in terms of new product contributions for the brand. Last quarter, so Q4 2023 a little below 40%. And we believe this year, it will trend up to above 50%. So, that's for the new products.

謝謝你，瑪吉。關於你的第一個問題，關於《完美日記》的表現。自從我們推出 Biolip 精華唇膏以來，其性能一直呈上升趨勢。例如，去年12月，新款口紅在天貓上排名第二，（聽不清楚）表現良好。以及在新產品對品牌的貢獻方面。上個季度，2023 年第四季略低於 40%。我們相信今年這一比例將上升至 50% 以上。這就是新產品。

And you also asked for margin. So, basically for this new product launch and also the Perfect Diary's brand upgrade, we are seeing some good feedback and results so far. First of all, the gross margin is much higher for this new product compared to the old product. And also the brand average selling price also increased a lot to around 140 to 150 on both(inaudible) And also in terms of consumer, profile will also attract more customers from a higher with higher affordability and beauty spending in general. So, that's for your question number one.

而且您還要求保證金。所以，基本上對於這次新品的發布以及完美日記的品牌升級，我們到目前為止看到了一些很好的回饋和結果。首先，這款新產品的毛利率比老產品高出許多。而品牌平均售價也大幅上漲，達到 140 至 150 左右（聽不清楚）。而且就消費者而言，形像也將吸引更多具有更高承受能力和美容消費的消費者。這是你的第一個問題。

And then for question number two, regarding to the women's sales performance. So, far, I would say shopping has already started looking at overall market performance, relatively modest. So, as a result for our brands were also through a relatively steady growth. So, we are more putting more resources effort for the bigger shopping festival, both for example, 618 and (inaudible)

然後是第二個問題，關於女性的銷售表現。到目前為止，我想說購物已經開始關注整體市場表現，相對溫和。因此，我們的品牌也經歷了相對穩定的成長。所以，我們投入更多的資源來舉辦更大的購物節，例如618和（聽不清楚）

Yes. Got it. That's very helpful. Thank you very much. And I have no more questions.

是的。知道了。這非常有幫助。非常感謝。我沒有更多問題了。

Thank you.

謝謝。

This concludes our question and answer session. I would like to turn the conference back over to management for any closing remark.

我們的問答環節到此結束。我想將會議轉回管理階層發表閉幕詞。

Thank you once again for joining us today. If you have have any further questions, please feel free to contact us at Yansten directly or at Piacente Financial Communication. Our contact information for both IR in China and the US can be found in today's press release. Thank you and have a great day.

再次感謝您今天加入我們。如果您還有任何疑問，請隨時直接聯絡 Yansten 或 Piacente Financial Communications。我們在中國和美國的投資者關係聯絡資訊可以在今天的新聞稿中找到。謝謝您，祝您有美好的一天。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。