UXIN - Earnings call 2 2024

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to Uxin's First and Second Quarter Fiscal Year 2024 Earnings Conference Call. [Operator Instructions] Today's conference call is being recorded.

If you have any objections, you may disconnect at this time.I would now like to introduce your host for today's conference call, Mr. Jack Wang. Please go ahead, Jack.

Jack Wang

right. All operator. you, Thank everyone. hello, And to Uxin's second XX, the and call and earnings of fiscal conference quarters respectively. June XX, for year September first XXXX, Welcome XXXX XXXX, ended

have we both the will and are D.K., proceed, well On discuss the you John CFO. and financials business our be guidance. uncertainties will during Lin, me your to results follows.Before from expectations. actual by to may company with session answer to today, highlights, risks as cause would Q&A our and remind our followed I that that available CEO contain questions like call to forward-looking Founder as inherently and call this review may operations differ will statements D.K. that which They we John, subject who

detailed the For the D.K. our sir. please filings will refer over the uncertainties, Please to to and turn SEC.Now our CEO, I ahead, call of with risks go discussions

Dai Kun

Language] [Foreign

Jack Wang

Thank [Interpreted] communication with earnings today investors. and and progress the facilitate you in with company's call. to our on domestic the both Hello, and all share reconnect to for English. I both international you everyone. latest pleased call I'm our will Chinese joining

Dai Kun

Language] [Foreign

Jack Wang

performance will XXXX. City financing the the our transactions X second review the [Interpreted] XXXX quarters and September of goals. share April key the Due to first I the then past some future achievements first government in year highlights quarters of the and fiscal of the month, of to first of with and we quarter presenting of Today, past covering are Hefei our the release postponed we financial results.

Dai Kun

Language] [Foreign

Jack Wang

Subsequently, prudent current continued adopted who China's first inventory purchasing June Consequently, at of XXXX a approach first with XX% shift maintaining the saw new March the market. In quarter, to from pandemic. filled east previous demand dynamics, cars. the to by fiscal Aligning market a year to initially we led units. aggressive pricing and witnessed acquisition the [indiscernible] of April consumers cars these in car surge pent-up strategies This our volume the quarter beginning used a on by XXXX, during end X,XXX [Interpreted] lower from buying of within cautious totaling the in quarter a car for strategy, spend transaction opted retail decrease levels. we through

average to X% September, However, inventory far increased and XX% levels, and second in rebound between of in a growth industry's notable significant July we volume. a volume rate in our transaction the X,XXX quarter sequential resulting growth in retail strategically units, the surpassing transaction

Dai Kun

[Foreign Language]

Jack Wang

effectively Throughout of below this maintained our sale vehicles [Interpreted] we period, base the XX. turnover on

EBITDA, our nearly positive has adjusted simultaneously EBITDA enhancing loss. profitability to our reaching from same with expanded X.X% last our year. in September company's XX% to Xi'an in as superstore A gross reduction year-over-year notable margin the in achievement While X.X% a the period contributing overall

operations are Additionally, of uphold the underlines a maintaining that model growth path. our Promoter a healthy progressing our around Score, consistently and performance along points superstore and or business we XX X the This Net for score consecutive quarters. success industry's signifies highest robust NPS,

Dai Kun

Language] [Foreign

Jack Wang

meters [Interpreted] its super area operations advanced a company's bolster growth largest XX,XXX at meant -- trial retail most It in the the this is highlighting Changfeng state-of-the-art world's September XXXX. to advanced showcase superstore warehouse with that Encompassing to XXX,XXX also a superstore Hefei City in of worth our the forthcoming vehicles. the our used square most features significantly commenced and used capacity Changfeng factory that vast superstore that to facility years. business The inventory of expansion up reconditioning in is car car

Dai Kun

[Foreign Language]

Jack Wang

City Industrial this XX equity time, the Under end X.X used agreement, of environment, the government substantial Investment and years of supply commit local Hefei will next to City Hefei and operation development and same the [Interpreted] At of automotive superstore Investment signed support North agreement to car up the robust the location, September. the investment an billion at we Hefei RMB using in with business business over well-established favorable offer support city downstream subsidiary industry city's of chains of to continued upstream growth. Uxin's our fostering advantages Construction Hefei. strategic The

Dai Kun

[Foreign Language]

Jack Wang

upgrade its profitability the our [Interpreted] Reflecting superstore by experience, X reached EBITDA have September on into December in Xi'an XXXX, since successfully operation. and relocation of we XXXX, just our month

control earlier. began profitability similar even Our with XXXX operations in is March on the profitability XXXX trial with an path by our its which our to the a combined scalable our clear overall reach adjusted of XXXX company's superstores, overall September EBITDA Hefei by or established a to is objective have and and ongoing profitability, Leveraging or towards profitability superstore, cost reach we efforts sooner. goal optimization, EBITDA September in strategy

Dai Kun

Language] [Foreign

Jack Wang

and last us adding we the enhanced targets. our years, surpassing Over efficiency, X operational management to [Interpreted] closer have capabilities significantly our norms profitability industry and

today, areas like call highlight X of I the development. would key During to

Dai Kun

[Foreign Language]

Jack Wang

in [Interpreted] successfully training advanced color completed our XX prices vehicle age, from pricing to and to It competitive ensuring of also our mileage. autonomously intelligently selling, turnover system. considering vehicle adjust in and test both days. optimal pricing efficiency This and an XX as response in interest, system drives Firstly, for customer and This quote of dynamically condition, strengthens we set market purchasing vehicles, have feedback the AI-powered offline factors conditions. position such position

Dai Kun

[Foreign Language]

Jack Wang

at from vehicles the system, factory facilitating implement used X optimizes timeframe to the large reconditioning real-time efficient the able parallel tasks by materials. repair, factory, maintaining intelligent has intake cutting-edge guarantees equipment process supply pioneered dramatically the days. have technologies workshop sophisticated and our processing and vehicle integration a management This cost, to scale. inspection, to we X of advanced of reconditioning diagnosis leveraging and most vehicle across industry's monitoring transparent slash use been transmission and operation superior super while vehicle sales data production integrated We've car listing turnover to quality. reconditioning workforce, enabling only for of our and all reduced of while system board, The accelerate of Secondly, cars [Interpreted] the

Dai Kun

[Foreign Language]

Jack Wang

optimal committed cost remain facets through control strategies. large-scale we've and business. XD by We improvements led This in and Furthermore, integration has an in our is to structure like smart innovate across vehicle supply highlighted achieved reconditioning. reductions of chain advancements leveraged [Interpreted] cost operational printing repairs, various and the which ground-breaking to technologies substantial expense incorporating cost establishing processes

Dai Kun

[Foreign Language]

Jack Wang

of in vast superstores, all support, all-encompassing array X in and Xi'an Lastly, service our Within assented market brands customer robust operations, the have just inherent after we the options, reputation provide superstores our vehicle regional sales our leading markets. customers. advantages and in year a customers of superstores we which exceptional attracting had [Interpreted] rapidly Through offline proven recognition. of cultivated a Hefei has used-car become among local to of

lowers marked We is food significantly have distinctly noticed in traffic, evolve, superstores as which a increase costs with that organic customers. acquiring there our new associated the offline

Dai Kun

Language] [Foreign

Jack Wang

Our the the adaptable overall business by we swiftly In will anticipate September profitability or refined superstore China. reach confidence that across regions vision, XXXX. [Interpreted] model is and now model our before company fully see we in as various strategic with long-term

turn through over the effectiveness I'd more and strategy that, to with into please? our ensuring results. call enhanced cities CFO like each accelerated approaches, financial John, for even integrate will innovative cost expansion the walk Our to you an new superstore.Yes, profitability to

Feng Lin

Language] [Foreign

Jack Wang

and everyone. at and financial second XXXX. closer of D.K., first for for hello, [Interpreted] first from face a the the our and I results already period. quarter of our fiscal to conditions opted D.K. low fluctuating market of will quarters In an overview acquisition the Thank relatively transaction provide year of XXXX, strategy we inventory adopted has vehicle maintain look the a the this fiscal year volumes you, levels. provided prudent retail

transaction decreased sequentially, by volume units. quarter first in retail the XX% to our such, X,XXX As

second by in grow retail the enabling increased inventory our the second During levels, units us we XX% quarter. volume to quarter, contract our to X,XXX

Feng Lin

[Foreign Language]

Jack Wang

sorry, in revenue In quarter inventory landscape, XXX reached RMB reflected refined second adjustment over to of average retail first X last evolving period in last selling This or strategic -- XXX,XXX sequential same year demand. price increase which the structure the response approximately quarter. XXX,XXX diligently sales the market retail to XXX Our vehicles, representing current a X,XXX quarters. from RMB RMB to our the our of million, decreased with we RMB align in from the [Interpreted] is XX% economic million ASP in the

Feng Lin

Language] [Foreign

Jack Wang

of remained stable a XX RMB million with sales business in relatively units of and transaction a quarter with a segment X,XXX [Interpreted] units of revenue Our revenue million the quarter. XX volume compared first to X,XXX in wholesale RMB sales second the

Feng Lin

[Foreign Language]

Jack Wang

penetration Furthermore, thanks were total and -- Overall, operations. sorry, of efficiencies we factory for accelerate in XXX reduced [Interpreted] the the turnover, XXX increased modernized inventory rate from the vehicle our the first gained of XXX million costs, RMB a RMB value-added to revenues our second quarter. per million RMB increase our our quarter XX% further services sequential million, from

As a our result, substantial a improvement gross margin. saw we in

Specifically, and X quarter X.X% XXXX, X.X points. second in margins This year of X.X%, fiscal the were percentage quarters our increase and first gross a of represents year-over-year and respectively.

through gross Looking with by reductions an fueled ahead, services, premium higher enhancement anticipate our in from revenues coupled further repair achieved we and volumes. financial our margins, cost and in maintenance increase sales insurance

Feng Lin

[Foreign Language]

Jack Wang

our was the stringent superstores, This XX.X narrowed in associated [Interpreted] million operating they compared opening a RMB year-over-year largely the have key the maintained to by costs achieving expenses for including XX% managing control previous the from related quarter XX.X million to to expenses projected On to Hefei RMB over with this, our Loss quarter. quarter showed RMB Changfeng the second first to stable. operations XX.X of relocation. in second ensuring the uptick site operating disciplined future. the we increase year-over-year strategy to This million profitability XX.X in remain expenses, Despite is RMB our expenses, to in our million front and slight due approach to XX% quarter.

Feng Lin

Language] [Foreign

Jack Wang

EBITDA disclosing are profitability. or superstore financial result started the to other a as superstore which As compensation amortization financial this Hefei have EBITDA, investment operations. effect leasing Hefei year of a in and stock-based company's in a our more substantial metric including and items of standard of from it [Interpreted] offers Adjusted charges, onetime adjusted business our reflection property, subsidiary performance, To noncash recorded provide using removes Uxin a Changfeng the and EBITDA a and accurate key City the evaluate we our expenses. clearer actual depreciation, noncash government's our has of of from Hefei picture the the

Feng Lin

Language] [Foreign

Jack Wang

and the has year. EBITDA enhancement first RMB RMB was of million, same gross Adjusted period million loss in a of a [Interpreted] loss structure positive quarter, this of year period -- a this The September improvement progress last was our in reduction superstore, a profitability. of Attachment the last XX.X in our XX.X to a second is cost in first Xi'an quarter representing and million of XX representing RMB EBITDA loss the substantial reduction XX.X continuous adjusted margin XX.X million, same In or adjusted of corporate of expense led in year. a RMB our to the or XX.X refinement million our last from million our which XX% RMB achieved in the period XX% from of a year. in EBITDA RMB

Feng Lin

[Foreign Language]

Jack Wang

just I D.K. would target [Interpreted] like profit to the reiterate mentioned.

EBITDA with our they and next cornerstone is September, we have roughly subsidiary aim confident is future sustainable position entered -- profitability of trajectory Uxin adjusted XXXX.We investing reach March XXX investment tranche equity development, the entire in company financial local the decade, level to profitability X.X to In business investment first up at for the by Under RMB growth Our objectives. this agreement platform. RMB extend to strong Hefei over high-quality, the we and Hefei a by in into XXXX store September million the committed and that have completed. with agreement, essentially towards our to an this billion government are

XXX our investors from before the credit nearly amounting XX million. a financing remaining to institutions from of disbursement to year. of X close total previous Moreover, Additionally, the end with million recently funding secured new the round inventory we line RMB to finalize financial have of arranged USD we

Feng Lin

[Foreign Language]

Jack Wang

of we year October anticipate growth improve return a fiscal and For to as levels sales third the XXXX inventory conditions [Interpreted] XXXX, increase. in market and steady December quarter between

around Our is X,XXX ASP retail XXX,XXX. retail for RMB to around expected be vehicles transaction be to the while volume units, expected is

value-added for to the questions. Operator, revenue, million be RMB prepared sales of revenue services range million.And that transaction and ready now retail RMB estimate RMB also wholesale around be X,XXX revenues, units We sales ASP our to to XXX revenue wholesale expected in that volume expect we total are concludes to XX,XXX. XXX remarks be our including our today. We with vehicle vehicle around

Operator

[Operator Kai Instructions] from first comes CITIC Today's with question Qian Securities.

Kai Qian

the which another gross I change profit [Foreign in Language] is margin. have about So question,

from to factors rebound that gross now, third September, there is a means second rebound. [indiscernible] achieved we of know we the that So update have of [indiscernible] the progress the which right so And our contributed we quarter maintain are the lot to on quarter big July a profit.

could detailed IRC about especially operations? So of information give you from us factors, the Xi'an contribution right the more different

Feng Lin

[Foreign Language]

Jack Wang

that [Interpreted] This is I'll and question. address John,

for from profit Our -- X.X% profit in has sales growth in approximately vehicle In services. sales XX% primarily value-added aspects: vehicle period a the driven improvement X vehicle improvement, X.X% last and the in retail by in seen gross margin notable value-added a year stems year-over-year quarter, and this by last services. was XX% rising from gross The the to gross profits same profit quarter.

Feng Lin

Language] [Foreign

Jack Wang

attributed profit the model. efficiency translates and large turnover. accurate risk the success to more The uptick gross a in can vehicle of success increase pricing sales This faster our [Interpreted] be to from superstore inventory sales

market Additionally, our in as the improved significantly the price the used stabilizes, year. sales spread previous compared to car has

Feng Lin

[Foreign Language]

Jack Wang

seen, through car car and repairs. superstores of used that suitable array traditional comprehensive As products, services marketplaces. insurance, cost-effective sales warranties, accessories business model natural customers you've achieve can to over finance an maintenance provide value-added advantage we a insurance surpasses finance This dealers. leverage and extended represents conversions offer We used and accessories, [Interpreted] factories including traditional a experience superstore offline more and our

is rate we still that significant penetration services, further and our believe the value-added for potential there improving consistently a growth. are We of

Feng Lin

[Foreign Language]

Jack Wang

our diagnosis system integrated world's on most And such and factory noticeable reduce reconditioning facilitate as costs same vehicle inspection, continue in has has impact the up XD process and time efficiency used indeed IRC cost. improvement. printing reduction rollout time, smart factor and processes system. equipment and the made for featuring end-to-end margin parts while improved we reconditioning advanced advanced [Interpreted] with reconditioning the D.K. mentioned Xi'an gross significantly a in to our this running, integrating spare the management repair, repairs car the the At transparent turnover earlier and supply

result, has As and reconditioning decreased. per time further a cost vehicle the

our ago. more per is than the As percentage that than optimization The my profit gross the contributed cost to now, And your in question. is reconditioning of of lower improvement reconditioning vehicle margin. answer alone about year X.X XX% process points a the to

Kai Qian

from on [Foreign in Language] continued market. So do we of the quarter be this the to impact from short we covering think in no car saw stable months, next retail maybe transaction July that September, strong but the and can last volume transection the few be new trend quarter there currently fourth quarter or may

end transaction the and And volume where our 'XX, so next rebound continue year? retail in in can

Dai Kun

[Foreign Language]

Jack Wang

first. This perspective is [Interpreted] I And sales address D.K. question the your of will

So car from July to normal. use to new after returned September prices stabilized, XXXX, car the gradually market

In domestic average the used car to July, quarter. transaction of June only compared quarter an XX% the recover rate the period, sequential began growth same saw volume a X%. Our market sales volume in September growth to in showing the

our So market. significantly exceeded the performance

Dai Kun

Language] [Foreign

Jack Wang

to both Regarding stable June around and structure same the period of our [Interpreted] vehicles decline XXX,XXX. in retail last ASP XXX,XXX. slight to the it remained around demands. the current at quarters, economic proactive the was approximately XXX,XXX. optimization ASP experienced market At year, RMB the due vehicles, align inventory our RMB of The was a And and beginning RMB in and the conditions retail September year, of it with ASP

October, cars our relatively mainly answer consists pricing Overall, of lessened our car years. question. the aged impact So new the cars your new starting a vehicle adjustment in remained after new on structure, our to has of of to round underwent us the reductions, X ASP inventory has my market but completing of used stable.And now X that's

Operator

Fei from And our next TF question comes Securities. with today Dai

Fei Dai

is consumer the that the change. Given any addressing of current first perspective, That economy risk quite From in Language] challenging. company is are my behavior? there [Foreign and conditions the How economy question. company's market is change impact the

Dai Kun

Language] [Foreign

Jack Wang

is that will This question. D.K, [Interpreted] and answer I

So aspects. really around for profitability centers us, key X attaining

reasonable levels inventory Firstly entails pricing. evaluating consistently through

necessitates of reduction turnover current to at the involves enhancing and efficiency. cost commitment it maintaining and drive an ongoing thirdly, efficiency Secondly, sales

Dai Kun

Language] [Foreign

Jack Wang

the volatility most new market is prices. observed notable the car continued So stemming [Interpreted] we reduction from that in potential the impact

competitive strategies On some reasonable prices, cars side, their adjust price our cushions risk inventory the the may market acquisition had to acquisition AI-driven prices the acquisition their car require the increase. time we digital year most the pace expectations, influencing vehicle can car leveraging selling this pricing the potentially used determine the system, of customers pricing cars. in increasingly new used for in market, And lowering

Dai Kun

Language] [Foreign

Jack Wang

from [Interpreted] purchasing the to price customers cars. evident new And may the on March, wave approach during car wait-and-see in sales response reduction a as market front, the adopt used

turnover vehicle for However, from competitiveness we're XX efficiency and benefiting inventory expanding leveraging retail in days we that and with selection, driven market our and feedback pricing systems regions high inventory structure, by adjusting conversion by in brand digital healthy sales the confident maintaining a sales continuously for AI reputation timely leading utilizing within operate. our model dynamically influence

Dai Kun

Language] [Foreign

Jack Wang

And And And we to question. the price anticipate car supply stable the demand definitely furthermore, also that The the new sustainable. new our answer to used confident market your normalize. reductions in level. the to in car [Interpreted] and achieving market will expect We're a we are not be profitability return goals. to

Operator

like call to concludes question-and-answer the back I'd This remarks. for closing management to our hand session. any

Jack Wang

continued today's you support the forward again all We for in you in look your future. for call with Uxin. Thank again joining and speaking to

Operator

today's concludes you you. today's This attending call. all presentation. Thank for thank We conference

that the transcript are may day.[Portions live your a spoken have on present an [Interpreted] disconnect by now marked interpreter call.] this You lines, were wonderful of and

Uxin Limited (UXIN) 28 Nov 232024 Q2 Earnings call transcript