Earnings call transcript Q3 2023

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 Uxin's Earnings Conference Call for the Quarter Ended December 31, 2022. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a Q&A session. Today's conference call is being recorded.

If you have any questions, you may disconnect at this time.

turn call, over Mr. to for your like conference today's now the to call host I'd Jack Wang. ahead, go Please Jack.

Jack Wang

December Hi. Thank call ended conference to Uxin's XXXX. you, operator. Hello, for everyone. the Welcome earnings XX, quarter

questions me On and will our operations the financials will CEO; our during and today, the highlights, Lin, answer be call we D.K., available by Founder John review (ph) will D.K. that They discuss followed session and also follows. have to CFO. company guidance. and our business your Q&A who with John,

Before you may we subject contain which to to proceed, to I would our actual inherently cause that forward-looking like remind from are that may this expectations. differ call uncertainties results risks and current statements

please SEC. with refer to discussions detailed For our uncertainties, the of the and filings risks

that, D.K. the to call Now will turn sir. over Please ahead, with our I go CEO,

Kun Dai

Language] [Foreign

for of everyone. today. an investor, Hello, overview Jack. To Thanks, and progress both Chinese. Thank I domestic accommodate call [Interpreted] our international our both in and you earnings English conference provide business will joining

recent start the we're of quarter trends. key this efforts an focal then will as today's reviewing share our well the on as and the call pursuing update direction points I market by

impressive XXXX year for the in quarter the huge October impact year-over-year our sales volume During the impacts, XX% retail an quarter growth. of and market. control reached measures the third units, fiscal to XXXX, fluctuations COVID December from stringent created Despite representing such X,XXX

used in towards industry. customer efficiency managing the and the of competitive reinforce recent have chain car supply the In service, costs optimizing our business we directed Uxin’s enhancing quarter, consistently to resources edge

hospitality, customers' meets system XX experience, car and to consecutive services. quality recognition and refined quarters. continued standards, in growing advance. four in success among experience solid our needs our of period service capabilities remained October of As building we persist This reputation improved at product elevated strengthening effectively testament the in a level is and long that a over our time and for the by XXXX, top our score From car aftersales achievement industry improving service a to to buying NPS customers and the December customer buying driven to our our vehicle commitment

around To we of a we basis system, the implementing end By a series an time and of manage efficiency, actions further car tracking the the to processing were fixed line. base improve same acquiring circulation compared production from vehicles of operational reduction to time on time dynamic sale XXXX, step the XX% on vehicle standardizing for our every and such reduced used last upgrading reduce by the hourly to able hours listing as year. spend waiting period a to

management, automate part Going cross-team forward, production to et process, strengthen optimize we coordination, our cetera. spare continue will

Our industry transparent car goal is used leading an factory production to efficiency. reconditioning on create to maximize our

precise and branding, each intermediate to assigns This time, to a crop. to judgments implementing reduced as irrigation and This various we fine-tuning actions to dedicated individual using management tasks solutions vehicle involves of reconditioning balanced improve super scale cars operations, applied modern reconditioning By each dosage same the is tasks cetera. so reconditioning on we customized vehicle, substantially our et irrigation By cost conditions, mileage, precise our approach have and cost. At for we're price, all that where system each developing timing capabilities. are each systematically control on such overall car for have implemented to similar DRIP agricultural large factors based called used making or production our car. evaluates production

services Xi'an as superstore we style business comprehensive inspection, two our largest fully the car The car customers used for data such the highly establishing are in and months IRC has in indicates replication as This car all-encompassing convenient on paves it call, superstore one-stop offering our IRC our our December mentioned store our upgraded revamped Xi'an the in car over operations that warehouse traditional way self-operated consistently XXXX, in-house DNB a buying previous conversion components: as includes and reconditioning advantages vehicle track, used factory value-added and Recent transformed exhibition future. model a large-scale recognized Additionally, services. and superstore, sales, reconditioning, Northwest features a the in have Xi'an dealers, performance all China. capitalizing earnings used and rate experience. improved on sales our

will contribute its inventory this Xi'an growth sales year. up our that increasingly build gradually to we IRC As

Regarding price the in which months three is quarter of first significant a we current reinstate from consumer in market fluctuations to Tesla same market confidence was auto first COVID policies. XXXX. and Chinese first environment of year the the economic January, the conditions, At experienced China recovery the have our time, significant price a fiscal reduction. the has observed Starting as XXXX, announce

system concluded February salability car pricing vehicle minimizing prices acquisition that analyzed AI impact to March. of price strategies the January, throughout reactions implemented trigger Tesla the the starting chain lead models and volatility. vehicle the volatilities a prudent price from and salary quarter by reductions caused by we series Our successfully new and in price would of like Therefore,

has noticed been stabilizing. April, In market that the we auto

single are calendar business brand Looking forward, a production reputation, with year improved in XXXX. and sustaining on performance the recognition, profitability costs, we efficiency solid in delivering reduced store sales confident basis and of achieving growing our high-quality

turn will John, to to please? I that, CFO, With walk our financial the call over through you John, the results.

John Lin

[Foreign Language]

convenience. both we Since English D.K., our and everyone's for attending will call, in and you, foreign Chinese [Interpreted] domestic Thank be remarks everyone. and investors our delivered have both hello,

from which XXXX. months third will Now at financial of year the XX, look three closer provide a our results I the XXXX, ended December quarter fiscal is

mentioned through D.K. strict our disrupted October retail As control earlier, measures. were from COVID by November sales

face continued due the measures these rates. regions December, week of varying in lifted to across to Although, challenges were market car infection used different second the the

made our business However, we in are report outpacing sales has rebound and remarkable industry the are delighted to recovery. a that

In December units, surpassing our fact, record alone, levels. retailed in we X,XXX pre-pandemic

year-on-year. the quarter, China used year-over-year and XX% and only X% second up transaction the volume and was the declined sequentially in lower transaction retail X% three Our XX% In car in volume October months December. X,XXX comparison, than total between units,

in up declined selling the quarter RMBXXX,XXX to million, price average from down this year-over-year. revenue Our RMBXXX RMBXXX,XXX previous totaled and retail (ph) Overall, XX% in sequentially quarter. XX%

down Wholesale to transaction X,XXX quarter, previous the compared was this volume quarter. XX%

environment the not priced volumes. our need faced and a cautiously market and vehicle vehicle prudent standards that retail acquisition We sourcing an reduced did pandemic, vehicles more During adopted strategy. we unfavorable the

the in this quarter. to decreased the RMBXX,XXX in previous quarter from result, a As ASP wholesale of vehicles RMBXX,XXX

for total which RMBXXX decline previous sales third sequential was revenue the Our from the quarter million, XX% wholesale represents quarter. a

XX% million, RMBXXX revenue. Our both retail total X%. lower On revenues, basis, our year-over-year by wholesale sequentially, wholesale to due and decreased primarily including total a was down revenues

X.X% quarter previous Gross X.X%, quarter. down from was in the the margin for

took we steps downturn, our inventory market structure. the During proactive refine to

As on a some vehicles. result, recorded we write-downs unsold of our

strategies We turnover gross also and to implemented October in to pricing between high-priced December. our conditions short-term response margin. actions, accelerate vehicles the impact the These of had market on various a challenging

expect in our we anticipate exceed in improvements we and fourth the to it X% in starting ahead, that will gross quarter, margin year. Looking see coming the

XX% previous Total quarter from by reduced quarter. operating expenses for the the

have to costs manage navigated effectively. we approach our pandemic, order taken our we in the a overall measured through expenses operating As to marketing

rapidly, reduction business on efficiency This will implementing grows at our Even our daily measures improvement an and help expand remain in strategy we committed discipline. maintaining our cost optimal ROI financial focus to us while operations. business as our

our signed The a in RMBX.X of based down financing U.S. value to repeat transactions. RMBXX.X RMBX.X was gain in change Our I reflect operations. the million, loss financial the resulted release gain financing detailed financial warrants earnings quarter. as The our not not to a and price related fair to agreement our stock million there's published from changes XXXX. of is numbers before, non-GAAP This in treatment on does our due operations related were the adjusted business million so the previous here. non-cash will fair GAAP impact a Same online, value from statements in we

an we excited restructured In payment we our plan. our to with also financial on I am a secured update successfully convertible so financing our investors. XXXX, share in $XXX million XXXX, position. And

of XX, payment completion obligations amounts, financial of successful us while opportunities. strengthening significantly notes remaining balance fulfilled flexibility cleared of development enabling we our to business at totaling all resources payment our most $XX.X future have our million. focus structure, and our This convertible As on sheet our large March historical better improve further liabilities

schedule. million $XXX of be will investors. a agreed remaining upon our our signed completed investors with we million. XXXX, paying financing (ph) completed successfully also agreement the million payment $XX their The June have To per $XX as In date,

with and for XX, car XXXX, the quarter Chinese Festival year fiscal the For around Lantern traditionally was February being January on used holiday that the lasts three the Year off-season an fourth New X, weeks on season of transaction. until the

a fluctuations, observed in pace. trend has purchasing used maintain to remain we us and for week in Despite cars February, healthy new caused price potential in expansion Additionally, widespread the a hesitant enabling we buyers during reductions in recent the which become March, our second stable January cars. of inventory China more strategies to the of and price vehicle prudent acquisition

size inventory our fluctuations price comparison, our business. to The our sales for approximately in units helped of given margin to cars we minimize achieved level retail turnover compared new profiles impact third In low with available car inventory X,XXX retail market inventory XXXX. better used Encouragingly, Currently, sale. our our had on continued is situation, and improve quarter. the reduced of relatively XXX in the efficiency November the

restrained we decrease inventories the to the sales and quarter level sales low our quarter. the in to third However, fourth retail our performance, compared expect

the compared Considering cars. retail and reach in our ended XX, We volume volume the X,XXX on of retailed quarter ASP anticipate factors, transaction with approximately project an fiscal to during a units March decrease RMBXXX,XXX that XXXX (ph) the XXXX year we of anticipated transaction for market previous seasonal quarter. fourth will

transaction wholesale is approximately X,XXX with Our units expected of ASP be RMBXX,XXX. volume around an to

retail to vehicle revenue RMBXXX include million. as value-add as to which service range RMBXXX between estimated sales wholesale revenue, and million well revenues, total Our are

line outlook, March projecting now In quarter full concluded on fourth XX, for fiscal are the XXXX, we of which our year XXXX. with

representing Furthermore, growth the wholesale transaction we in will volume Our decline of fiscal our reach total of to RMBX.XX retail the billion, reflecting wholesale for anticipated of XXX%. RMBX.XX revenue, services value-add year-over-year XX% year, of vehicle a billion Meanwhile, retail will a increase X%. representing range transaction vehicle approximately XX%. units, year-over-year around that units, and including estimate X,XXX sales our volume revenues revenue is reach year-over-year revenue to to a be XX,XXX sales

we prepared And remarks concludes ready are our questions. today. Operator, take now that to

Operator

you. Instructions] [Operator Thank

Jack Wang

that some call. a issue might there getting feedback We're be technical the operator. Hi, on

able So not to people are join.

received have And COVID-XX question, I we So over two IRCs the Are our any where we'll offline. there to this D.K. the take questions region to in located? particularly are opportunity go some CEO, will direct first the remaining issues,

Kun Dai

Language] [Foreign

October from our and November impacted So COVID-XX logistics. affecting pandemic significantly sales everything in acquisition XXXX, the to to from [Interpreted] vehicle business,

prevention has rebounded However, market since when XXXX, were rapidly. the second of the the policies week December lifted, epidemic

now, COVID our As on of poses any operations. no longer impact

Jack Wang

we at you this point? I'll of upgrade move second our direct the for to I will build-out to is plans IRC question Is CEO, question the And that -- do D.K. the any and complete received. Xi'an have future on upgrades? also there XXX%

Kun Dai

Language] [Foreign

upgrade XXX% of is complete. and in our expansion The Xi'an IRC [Interpreted]

X The Northwest times provide used before. capacity largest in XXX% have the with much As which showroom superstore expanded self-owned to is our with will drive inventory our selection, inventory, in will customers conversions. a we wider in vehicles, X,XXX turn larger increase than China which sales car

in also the to and factory sales reconditioning of diversity the completion our used we selection state-of-the-art after accessories, maintenance providing Xi'an, car now our of and of upgrades comprehensive vehicle customers. services offering an are modifications extensive meet With

of reconditioning our full superstore top functions. fully is are capabilities externally. IRC with Xi'an car formed of we exporting The now On IRC and four that, our used first capable cutting-edge

in capable are All of being operations, other replicated its now from business systems to service of management cities. standards and processes

Simultaneously, growth. April, expansion steady auto market our and pace in stabilizes a continue will we strategic with planning. to drive inventory accordance [indiscernible] will in the increase As cash of position network our our IRC sales we in

updating expansion are everyone Our to plans underway, look progress on in due already course. and our forward we

Jack Wang

from is we has will The fully to really which Securities. that And convertible company think comes I $XX.X million notes. question, the the move repaid question on about the next TF

and So its more can future you provide arrangements that please will business I these your direct on details question John to on to impact developments. answer.

John Lin

Language] [Foreign

correct. is That [Interpreted]

We have major recently announcement issued with an two updates.

preferred the XXXX. from $XXX received senior have planned million shares in of we the June convertible Firstly, the million signed with $XX subscription total Capital from agreement of NIO

of note you several as $XXX have remaining our In the Secondly, announced through million financing million we repayment note $XX.X raised restructurings. and asked, XXXX, convertible underwent balance. convertible the full we

the into convertible installments. paid were As the a be of result, to with converted notes was about XX% using remainder in shares,

As of outstanding March historical comprehensive decided the benefits our company. from which evaluation of largest significant liability repay fully After to and $XX.X note, to debt. , will outstanding XX, million clear XXXX the represented we convertible three Uxin's the bring have applications

of the Firstly, the with balance has remaining reduced, enhance in our structure safety, debt Uxin much improved. significantly future pay healthier. is After sheet making repayment been full the payment, to financial will that our note, greatly the of convertible the structure our financial we need historical long-term which

interested future. concern the are Secondly, convertible The for major the repayment company. for creates been financing potential note outstanding in conditions had who a the in investors complete better potential

the allowing of development this Accompanied series future With funds from focus significantly the profitability business favorable has market rather position. repayment. achieve plan basis full Uxin initiatives us enable to for decreased, to a a efforts of more store will our than on by repayment, debt our investment to this repayment year, a investment single on capital risks

our model. thirdly, domestic acquisition collaborating full has institutions actively implement corporation has corporation the complete way several in chain for institutions. are notes, process financing the laid partnerships with And cleared forms is repayment repayment smoother well-known present, us our At a business domestic convertible the and institutions. with financial financial foundation of capital-intensive of financial the Vehicle we supply various between with to for he

the implementation vehicle chain significantly into will the With reduce it supply of own for process. our financing, cash need acquisition

to areas establish our new As a in expansion, we our or will plan, reduced. our provides This business of model. significantly necessary allowing accordance funding slower investments in on our into higher superstores with pace faster flexibility continue business while return expand move greater us and be new to bringing to as needs simultaneously business

I sustained to finally, long-term Uxin, prioritized like would value. And that emphasize we at and growth

is management strategically line development also long-term goals. in financial Our business planned with our

receipt the the in forward can convertible we investment development fill and with successful full high and greater of of future. With our the move agility note, NIO repayment our Capital's quality

Jack Wang

And that's the the answer earlier. to question

March of both what are in Now another electric cars? have CEO, the The how used D.K., cuts price in question on market question CITIC the to we direct from see price Security. and car strategies address. impact response is, do on I gasoline and this early you our cuts your will question to to

Kun Dai

[Foreign Language]

began in on market. reduction. to resulting used initially the new high turnover volatility industry-wide across cars leading adopt was decided impact when higher the buy started in February, the price Consumers used intended [Interpreted] market brands. late car car supply a market From The and the a recovering inventory to on announced and price used and impact used in COVID pressure notable cars surface approach, industry early purchasing see demand from a prices. car limited cuts who at Tesla time, various wait still with to of dealers that January most car to At

minimally in governance affected We also new decisions, car big We systems and management recent to our the strict prices. make analysis our by rely fluctuations are discipline. sophisticated on informed information by guided data which business were

recovery rapid car January with the in purchasing Following experienced at Chinese February. dealers elevated vehicles prices market most the car restrictions, a easing COVID used of used and

the and deviated and conducting current market AI its market reasonable markets our acquisition competitive came However, in price vehicle that scanned has and data, continually from level. both analyzed model pricing analysis internal conclusion to recent external

months reasonable have first a strategy inventory low prudent our low and levels prices implemented relatively price a fluctuations. exposure we of maintained the we and new impact and XXXX. With fluctuations structure, three the vehicle scale minimized to in throughout inventory inventory analysis, that the a of acquisition Following car risk controlled

contribution and per such, efficiency increased. As three the first also turnover our profit inventory not of affected was XXXX the in vehicle has months

especially Our the for past and market two the as business This based business future our our in decision-making solid the extreme our of a foundation and bolsters our mechanism over data, model management challenges withstood years further expansion. AI well confidence in systematic as XX capabilities pricing of under conditions, years. capability has on provide

first observed has year. months we earlier China's the the that passed, that markets the have observed not used of been new stabilizing XXXX of three April. that of Now car We volatility level anticipate have rest and year will since same this the see

sales to car approximately our by growth the inventory China's than higher far we to XXXX. plan and this expect we such, XX% grow increase rate mind, industry With achieve year-over-year in average. gradually As used a in

Jack Wang

question answer question. earlier the the that's to the And -- that's

another received have question from CITIC. We

So the our talked it stores for based breakeven? Hefei, in does our about a single on how earlier. We about experience store question and to of breakeven long is one Xi'an take

So what's that that? to question the our CFO, to address. I company's achieve John, key plans to will direct

John Lin

[Foreign Language]

[Interpreted] trajectories we area, management two in a years IRC hard superstores. clear of of to specifics the systems XX After and are achieve of around superstore. and Currently, initial about a are about from single achieving a When expect growth each we monthly we store optimize superstore operation volumes. able to a we the XX achieve now sales business sales business profitability very of volume new the work, established lower even strive single the new to to it months our months take are also to breakeven profitability. and retail continuing X,XXX in units, launch at to we reaches When

to year on have single breakeven focus. business areas three One that, we objectives a store is achieve To identified basis. main achieve of our of this key

boost levels volume. turnover inventory transaction maintaining our the increase to high Firstly, retail we while to plan sales

minimize fluctuations. a months we mentioned has market negative impact in of three adopted acquisition strategy first of XXXX, prudent D.K. to earlier the As the

inventory in-store are our relatively currently levels result, a low. As

sales store April, achieved Hefei even steadily to has lower to a retail while turnover. sales. X,XXX X,XXX our the first increasing Hefei maintaining However, sales start achieve achieved or monthly our from months had would our units three XXXX, and up profit. September generate inventory and Starting we in high volume retail will superstore XXXX. If similar breakeven superstore turnover in aim In been of sales our ramp gradually per is sales of XXXX, retail

In is have resulted we vehicle in strength, we have second power branding the gross in of to of each product months, that the quality gross focus area the notable sell. from our and past further And advantages, a margin service increase vehicle profit our observed sales. increase

Additionally, with and the our new advanced aftersales maintenance, and contribution financing, our such superstores revenue from the vehicle opening of of upgrades grow our profit factory, and completion we gross services, will accessory high-margin value-added reconditioning others. insurance, as gradually

thirdly, focus maintain on we lean will improvement. for and and cost our continue reduction And management our efficiency drive

cutting-edge We volume management efficiency our stores each at of aspects our reduce technologies or all processes, will ensure car of used across continually so, achieve our incorporate By a can digital that refine business. profitability reconditioning of monthly and lower. to business systems, sales we and our operational our management improve will enhance costs doing X,XXX vehicles

D.K. XXXX. stay goal. achieving ability store you. performance earlier, this single to profitability has in Please by shared for tuned confident As our Thank our very also are we achieve in

Jack Wang

questions received from the we all have community. the investment That’s Okay.

this you. Thank to We next to we about you Hopefully, out that we technical when are the sort talk are issue get sorry experiencing. quarter. you

Operator

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

disconnect. You may now

Uxin Limited (UXIN) 11 Apr 232023 Q3 Earnings call transcript