NAAS - Earnings call transcript Q3 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the NaaS Third Quarter 2024 Earnings Conference Call.[Operator Instructions]I must advise you that this conference is being recorded. I would now like to turn the conference over to your first speaker today, Mr. John Wang, the company's Investor Relations Director. Thank you, and please go ahead.

John Wang

Thank you, operator. to Quarter welcome Call. Earnings and everyone, NaaS XXXX Third Conference Hello, company's today earlier were are The issued and results posted online.

the Executive Steven Joining Yang, Officer. on call Ms. are me Cathy our Chief our Officer; Sim, Mr. and Chief Financial today Wang

Wang our agenda, an provide financial and highlights. Ms. business operating results overview discuss Sim will For our our and highlights, will today's of Mr. go through

most call statement as continue, discussions IFRS Before measures. will this applies you in harbor the reconciliation earnings our comparable refer safe which that earnings refer which I Please statements. we to of measures. forward-looking contains of our this we make note the financial Also, a release, press measures to non-IFRS to release, certain please non-IFRS -- call to

figures Wang that this please now turn note unless during are RMB. our all to Yang. Cathy over stated, otherwise CEO, I mentioned in please Ms. Cathy, the will call conference ahead. Finally, go call

Wang Yang

I'm update Wang. third quarter everyone. CEO, business the and this take Hello, Cathy XXXX investors for excited to on opportunity Today, to our progress. our highlights of NaaS's [Interpreted] our share performance I'm

net First, I'd achieving the breakeven positive advancement. the iteration, strategic After efficiency quarter, reached and significant like and a XX.X gains profit during non-IFRS time a RMB for third June technological non-IFRS In single to we delivered profit the quarter through milestone. second net million. quarter, in first operational a announce in cost our reduction

overall This improved consecutive high-margin an core outcomes. high By in quarter, concentrating high-growth, Our of of services, XX.XX reaching positive clearly quarter. of a move our core third RMB third in year-over-year million services producing increase gross quarters, strategically for charging the XX%. the all-time revenues has is business on XX% X margin charging reported

our market's leveraging accelerated the core we AI-driven towards the on meet concentrating costs. are demand analytical technological strategic our centered the fully potential capabilities our services reduced by more on business. greater insights strategy Furthermore, profit to for This a allocation. resource also shift charging laying is unlocking quarter, and charging for we operating core digitalized and company. We've foundation significantly business, growth sustainable This

Manufacturers, sales year-over-year China rapidly. continues to the by sales car monthly XXXX fourth energy the for selling of with the XXX% the a quarter user as third number substantially transacting record full expenses from of vehicles. September center continuing directly grew new new XXXX in XX% new quarter to of grow quarter marketing efficiency. of in third of increasing instance, a record-breaking with Association market improving vehicle revenue production decreased profitability, These XXXX have this and profitability. China's will the on our users achievements According XX.X% domestic platform in of XX% through this year activity growth Meanwhile, the sales Automobile by hitting XXXX quarter to to operational and saw year-over-year robust For of environment, the the priorities and high. company's energy surpass enhanced and NaaS share our market XX%. Amid XXXX, scale percentage and EV technology.

by technology strengthen to to to the our on innovation scale. on and We leverage demand enhance support will capitalizing profitability continue charging our industry strategically supply services, the and focus position interconnectivity scale both of growth on side and economies and

over more strategic experience of years over join He expansion his experience operational Singapore Steven our Steven have who will XX corporate We're excited shareholders. and with international our and Sim, value capital a extensive please We performance. capital strategic in brings CFO, will management. Born welcome and and financial appointed provide deep a our and domestic progress, Steven, markets, and financial of expertise create business firms newly U.S. with accounting you. in companies. and our overview and raised X trust to Next, along empower for NaaS. big background practical detailed our in in to listed

Steven Sim

welcome. you at delighted new join warm time of and for for Thank Financial substantial Cathy such quarter. joining NaaS. us. and Steven Chief team I'm to to Hello, the the Officer a the our progress everyone, we've thank I'm for pivotal review this for Sim, company the you made

margins We has optimize with first coupled energy and are demand improved quarterly non-IFRS AI net positive high charging intensifying income. to low-margin profitability services, This and our with focus leveraging solutions out shift, on core phasing supply record connectivity. gross our

about release. and please press refer with reconciliation measures, release, to press the measures details non-IFRS For our our to IFRS please refer

Our potential for the Zhejiang promising operators government project. like charge NEF point enhances and monetization show platform efficiency through collaborations

our are Motors Fujian including connectivity and charging charge expanding our operators and FAW adds ecosystem stations October strengthening in IM key and and convenience. of network partnerships chargers. Volkswagen We and partnership our Notably, EV X,XXX point enhancing with chargers, XXX

Our Early success AI-driven remains and site value efficiency and Zhejiang NEF's in On our demonstrating NEF system ESG, optimizes user subsidy better experiences. charging the sustainability includes to NaaS. unlock monetization. operations benefits allocations and platform, customer central boosting like

efforts Inclusive success value and creation. green China Alliance, reinforcing ESG is ESG with Corporation and initiatives our leadership City growth and innovation and XXXX NaaS partnerships positioned focused energy for like sustainable ecosystem Alliance Our expand access highlights strategy, in to report long-term development. Through the Carbon

of we ever reached net quarterly our by our achieving a million. positive XX.X major first financial highlights. QX, for Next RMB income non-IFRS In milestone

Following our non-IFRS June. breakeven in

ways. RMB and our on various through core company our demand in Solutions The XX.X direction testament to to refer our continuous strength about on to focus non-IFRS This were accomplishment side, efficiency reconciliation quarter, million, of our -- IFRS due the XX% release. This Solutions please Charging to revenue improving by X.XX to reflects the measures strategic this details services expansion driven high-margin press our efficacy reaching high-margin supply shift revenue the development Energy platform both offerings. with testament strategic our surged For by along to operational strategic technology execution. our focus and of a efficiency. Energy is existed measures, businesses and with RMB business. million year-over-year, keep

For transitioning capital-intensive deliberately offer to example, higher away we Again, company, core mentioned NewLink solutions our sell lower-margin, projects to and Sinopower as XXXX. our services potential growth which we have concentrate charging profitability. in business, from announced been to parent earlier, on August energy

expenses As central sales customer subsidy QX a which with In achieved our our gross decreasing in substantial a profit the historical efficiency period a in expenses consecutive marking The improving sales by sales up reductions we improvement primarily last driven schemes. quarter was substantial and declines. high margin, significant operating fourth by there result, sustainable in in remains XX%, operating for year-over-year, reached XX% was same the strategies, XX% strategy reduction year. Cost from efficiency substantial growth. to XXXX, our of expenses of

users with and management engagement XX% As a without performance. effectively these reductions, result, increasing by engagement maintained that through record compromising strong our platform company's and supports the disciplined demonstrate we despite result user activity market year-over-year, cost customer transaction high. This reaching expansion

Our charging are efficiency in focus services, optimizes and AI-powered increase connected system charger XX% and like driving on scaling as expand. NEF pricing. placement, high-margin the which a both utilization chargers supported tool These advancements by profitability we dynamic year-over-year and

by XX% our controls by This in quarter, growth XX.X% sales of compromising expenses grew supporting without effectiveness cost demonstrate year-over-year. XX.X% result we by while and quarter-over-quarter, users expenses disciplined administrative quarter-over-quarter engagement. transaction the reduced This

and for concludes efficiently gross Looking us maintain technology, in quarters. momentum shareholders. By ahead, well margins remarks prepared coming our high-growth value today. opportunities we on asset-light delivering for the positioned while This sustainable this scale focusing leveraging improving model and to enable to are our

questions. We take are now you. Thank ready to

Operator

Sachs. from question Song comes first Goldman Ting with The

Ting Song

profit which profitability quarter. improving how this first positive This question. it on to how the would this the what on third and more we gross to trend you for the operational is you expect narrow about on ask to efficiency Congratulations the as loss I the company, quarter you this could for would my significantly progress mentioned would in your I to important I and could explore margin your before, you second in able to Could quarter? operational this elaborate year. like and like the know expenses improvement have are operational you future? is And made like year, make more one,

Steven Sim

Thank you, Ting.

question. This me is Steven. your Let take

profit progress XX.X strategy, profit gross of focusing executing In XX.X the million success achieved in gross high-margin increase million the of QX on and our we For quarter-on-quarter. scale. improvement. a This our substantial growth cost stream in in first profit control, platform QX in from the gross profitability and RMB our XXXX, revenue reaching illustrates advantage increasing on the leveraging question positive XX%, on margin and RMB on

on the our Our gross effectiveness in underscores also XX% QX capital focusing an heavy historical of not expenditure this improvement core XX% This a was and margin also QX. the and improvement on high, focus substantial to our from diluting business in strategy and business. our noncore reached

operational of is a enhanced growth as also margin efficiency across result Our and departments. optimization

that to we basis, an departmental profitability. On us As through I performance prepared went we continue is in enhance moving allow this to And do efficiency, in reviews so forward think overall our a and our scale with as It efficiencies on the for these as goal same growth EVs did to number at and the us, we the time we well road. reach the the strong. as challenge a on margin deliver remarks, ongoing improved will mention and deepen our is further efficiency to keep of to the margin gross basis. continuous operating continuous

continued improvements upcoming the about confident are we think you. in quarters. Thank I

question, you mentioned on expense in efficiency more. I on my I some operating me just also the second I mentioned elaborate guess, aspects operating think the previous let And already. on and answer, trend,

compared by was our again, losses in and QX increasing QX. losses identifying we operating operational also from savings proactive higher going reduction has operating should X.X been this more should our million. last is maximizing by cut fixed quarter. a customer opportunity costs efficiencies. accumulated to in policies as the cover efficiency possible As growth this due nonessential total reductions we million the RMB across without approach in a improving cost see to reflecting our on cost-effective the resources I and an losses. possible from on optimizing expenses expenses without notable measures million was R&D QX resulted reduction our selling XX% mentioned there and answer, implemented efforts all in RMB and major previous saw projects. And QX Administrative down to of scale reduced And we This cost in decreased overall, million expenses reduction more sales on from the leverage percentage And this my with company team XX.X certain by and resource. RMB streamline fixed operational a scaling of And cost XX% forward XX tandem. And in aggressive basis, again, to basis, scale, projects, a this and areas, effort and operational series in RMB XX.X QX, focus in a subsidy sacrificing extent in and control decreasing growth to

focused continue come the our to with best the into so but market really same approach you. the tap the to do up will Thank a time, more We streamlined to of abilities at and to business. potential,

Operator

from The comes go next ahead. Amber with question Jefferies. Yu Please

Unknown Analyst

since how results. leadership on composition company's background revenue and maintain you have is been Could financials? to market market competitive tough your please on What seems question strategic and margins talk I to its competition why you charging And rapidly has shifting my leverage impacting core Congrats improving this? X made does well. And done in your questions. NaaS your that like NaaS the to service. plan due It it a so advantage outstanding in has focus second and and operations are your decision? the any is is about

Steven Sim

of be to in Thank on business on value been from the the Therefore, day think building revenue it to customers what will business, the focus Amber. the linking a going our core platform strategy has in composition Solutions in X, focus new, to we value. best the back services. we to efforts the the various Energy believe profitability, -- to business, deep except business just and first initiative but realigns quarters, the NaaS's past has this I question operations, key our be. And requires give because ongoing retreating best business focusing knowledge we is On nothing you, value platform. And achieve And to which also our mentioned on from unlike business on the that the that doesn't back what the we in lower-margin go increasing that our business. our thinking strategic charging our in your key that investments previously core do really a are shareholders heavy long-term is long-term and not

our shift XX%. us efficiently. So reaching with has financials high already This impact profit we and a margins a higher asset scale shown are significant of returning record margin on light business gross the to allowing to company

and areas core simplifying customers allocate focusing growth Additionally, for resource and charging them. and better users find partners lines delivering and in margins costs deliver able are and better drive to on business our to our our help to more on also services, we by that our services better higher

in to value So question. turn the allow turn, the this, will to platform the to our That's first in to answer more and us return users.

On advantages. various in to tough very business focus values, do to as market. so, a both in the well a we've mentioned say that of delivering answer very point in whole distinct And I done second question last on platform. growing we competitively on think few the would competition, And a essentially platform I the really is to have stakeholders I my

essentially users. all behavior operators to insights and charging chargers at boost our utilization helping enhance key advantage seamless experience optimize dynamically an and locate and users which analytics takes operations We optimized and enable have data both advanced provide these in for profitability, ensure analytics, real-time AI user efficiency, powered tools and our price. These operators that a instantly through station

ecosystem extensive market with give energy players reach. charging partnership strong our operators the OEM and Secondly, us including companies

expand we and collaborations infrastructure loyalty in grow will while user to fostering scale, As these us allow retention. efficiently

and scalable streamlined capital platform this our enables investments, and asset-light us growth a heavy maintain our cost with Lastly, structure profitability. helped

future combination evolving Thank ready cost-efficient competitive enable partnership which to of will meet you. this us remain growth, think challenges. market, strategic I tech to leader and in to allow a the EV us

Operator

The comes James next with question Zhou UBS. from

Please go ahead.

Nianyi Zou

profitability see all, very NaaS's time finally are question they further the the if example, user first have at run? look financials, long take of non-IFRS in sustainable see trends subsidies? is profitability. how the in for And First the quarter. my metrics regarding this been positive influencing what key to moving we forward, a net some NaaS's happy company's we profit the overall And in And for can impacting second expect closer

Steven Sim

you, Thank James.

for First the moving expectation negative the in XX.X first negative time profit to for quarter, million our QX significant for I QX question -- a us RMB reaching million whole XXX XX.X positive non-IFRS -- with forward. QX million and on RMB quarterly the in marked what on year. RMB turning in the quarter and profit the guess, compared last Again, this milestone net is

improvement. to also momentum both really to quarter-on-quarter, Obviously, want the continue leverage profitability on aspects, our to year-on-year cost all on So to and ride scaling is a sure and continue significant efficiency effect. we make our to it's sustainable our and

be I XX%. a business in think with drivers services the growth key the charging healthy margin record gross will reaching a continued

our user efficiencies. partners. And also we year-on-year. XX% experience sacrificing on overall tax right maintain that leverage, the and I by similarly, think to to without business and try margins will And growth Again, basis. balance want those and by grow to to fell this we growth, to services finding on operations an want and focus expenses on operating the streamlined the our our is operating

to are Looking high-margin deliver as confident we trend our continue chargers ahead, XX% users, year-on-year well will growth think by profitability. services. And in core and and the positive in platform. advantage connected increase XX% and sustaining AI-driven are we transaction I this on to With I in value positioned will leverage our we think maintain efficiency we scale year-on-year our expanding long-term

our to charging are cannot second value of continue question our and with companies them give grab The landscape partners. EV focus. Without continue user NaaS's our users, trends station market subsidies question, the creating do doubt, overall impacting and how the I since Without the they've right think charging a the subsidies customer intensive to competitive and on that value excellent relatively we to grow in both to profitability. stable market. platform been means main company's to the has need XXXX, cannot the to do we been which is more not users

cost, I helping stations is transparent or user more creating of for focus different into split overview offering experience daily improving delivering charging our a helping the deepening users via users, when charging with them app, think example, better timing. have there's an user value, relationship basis cost find more faster, better experience, been our on on

obviously to the it's at example, night electricity at charge cheaper price. For lower

well think or initiated in reduction user these a will retain believe that because in at I do we we significant net we subsidies are XXXX, we to our a incentives So itself company things does that both positive than anecdotally, subsidies we revenue and since subsidies, user on drive our looking improve impact to the With of take basis. being rely have and are a said, various more continue and incentivize users reached other grow that not beginning gradual a going-forward decreasing reduced, that of historical rates, experience the By sustainable model seen growth. which high. have of on gross -- reliance we and fostering on users. to

also focusing growth allocate profitability turn I return deeper more. and effectively, long-term on subsidized users us focus which this a more allow rather to higher allow us than to goals resource network in our benefit to supports our think areas and

partnership. revenue using scheme driven continuously streamline think by process. market organic value by seeing Instead discount-driven This is making subsidy acquisition stronger offerings of subsidies more user than I on based primary as driver, growth. customer strengthened This our our optimizing are strategies. we will a inherent move position attractive rather channels generation also and

with should think users has and that subsidies, keep customer growing. the platform users company's the I in newly that fact through been also transaction we is mind registered another in key reduction

of the revenue vision model adapt Thank leader market our So with it's a a you. can it in not much. with grow that charging space demand. Overall, too sustainable and EV becoming been aligns more with impacted profitable

Operator

with Ethan comes Zhang from next The Nomura. question

Ethan Zhang

and So achieved in rate. saw congratulations for has first, is, higher a the your average than industry significant conductions, charger I increase which growth results, NaaS the we believe,

is charging think my network? attribute this fast do yourself leader growth And EV to? you do expanding in as a NaaS what question you positioning how So is -- how China's

Steven Sim

Ethan. you, Thank

can XX% infrastructure. we true our technological back NEF, innovation. NaaS that we EV and I and in The it's helped case, demand EVs, combination data charger EVs sales high-demand place have supply is is site think the number in being forging strategic the on national new and AI-powered is, supply partners this Again, helping again, efficiently big to the call a our new quickly chargers analysis. factors. our question. operations year-on-year good fintech network area. This optimized meet going the as system, focus growth this and growth of side most reflects station growing been increase alliance of charging our side partners connection this road the with attributed us also and in car with substantial which we've selection. And In energy to really regional scale. and for strategic XX% to The This to on EVs. all a be ensure our expand we able this partnership And

operating this have driving charging maintenance across growth the to our board. On operators, predictive the is and pricing network dynamic more the made improvement in efficiency, and attractive

a us market. EV I expansion leader think our in making China's charging rapid continuing

for simple positions and market strong commitment the long-term the country. With easy chargers continue global and and more of users. to efficient is better, we are smart placement, for grow grow. EV they're to continuing advanced our but we experience stations, reliable sure just EV the We network partnership, are continues technology creating as drivers adding This to access NaaS are across a charging more that fundamentals site not success AI to for charging connected strong a making and

Operator

comes go Zhao Securities. next from question Jifeng with ahead. The Please Joe

Unknown Analyst

Fujian have expansion operational I experience regional expanded in company's read user NaaS's strategy? charging for key company's contribute partnership in the NaaS's to technology, operators? efficiency powered How presence and long-term how recent province regional enhancing is cities. the AI the this does And

Steven Sim

and key crucial [indiscernible] strategy in EV smaller coverage users, partnership expansion general part particularly the green specifically X,XXX our increase the collaboration with over province and improve in X,XXX accessibility Xiamen extends the at like This regional we working progress stations a and national the cities into and consumers, like over interconnected and charging So large small. long-term local DC And highly this strengthens towards across also with for network Putian. network. Fuzhou. XXX of we've both in And cities the fast NaaS's the Fujian to level our to presence and charging future. to our are a This Fujian, -- integrated is successfully world's China significantly create China chargers our for government really our and both

enhancing NEF charging optimized role AI-powered central the in this plays Our maintenance experience by providing effort, user real-time availability, a and system, predictive site again station selection.

our boosts operators, charging real-time supply, profitability operational financial and experience electricity a sustainability. demand earlier, This mentioned technology through experience users. for this Thank dynamic friendly For ensure which as I pricing user both on and key efficiency key you. regional based for creates our

Operator

to As the the back there further over like are call now, closing remarks. no to for I'd company questions turn

Steven Sim

today. Thank us once again for joining you

If you contact to have please questions, free you. Thank feel us. further

Operator

conference concludes This call. the

your You by call.] may spoken you. [Portions transcript that live an now are line. on [Interpreted] of were the present marked this interpreter Thank disconnect

NaaS Technology (NAAS) 20 Nov 242024 Q3 Earnings call transcript