Good day, ladies and gentlemen. Thank you for standing by and welcome to Boqii’s Fiscal 2021 Fourth Quarter and Full Year Earnings Conference Call. Currently, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, we are recording today’s call. If you have any objections, you may disconnect at this time. I will now turn the conference over to Mandy Luo, Boqii’s IR Manager.

Thank you, operator, and hello everyone. Welcome to Boqii’s fiscal 2021 fourth quarter and full year earnings conference call. Joining us today are Ms. Lisa Tang, Co-CEO and CFO; Mr. Kai Fang, Chief Strategy Officer; and Mr. [indiscernible] our Financial Director. We released our results earlier today. The press release is available on the company’s IR website at ir.boqii.com as well as from Newswire services. A replay of the call will be available on our IR website later today. Before we continue, please note that today’s discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company’s actual results may be materially different from the expectations expressed today. Further information regarding this and other risks and uncertainties are included in the company’s public filings with the SEC. The company does not assume any obligations to update any forward-looking statement except as required under applicable law. Please also note that certain financial measures that we use on the call such as adjusted net loss, adjusted net loss margin, EBITDA and EBITDA margin are expressed on a non-GAAP basis. Our GAAP results and reconciliations of GAAP to non-GAAP measures can be found in our earnings press release. Also, please be reminded that unless otherwise stated, all figures mentioned during the conference call are in Chinese renminbi. With that, let me now turn the call over to our Co-CEO and CFO, Lisa Tang. Please go ahead, Lisa.

Okay. Thank you, Mandy, and thanks everyone for joining the call. Fiscal 2021 was a special new year and we paid more attention to the core demands and the pain points of pet parents, as well as the core values and the strategies of Boqii and we achieved encouraging results, despite the challenging market environment. In brand incubation with the help of accurate traffic and the private domain users, we have strengthened the spot of emerging brands and the middle sized brands, so that pet owners have more choices. We now provide more than Chinese are in the SKUs and 600 and high brands platform. On the supply chain side, we continue to strengthen the layout of warehouses and the logistics. And now we have five large warehouses and three bound warehouses in China. These warehouses will become distribution hubs to meet the needs of pets from food supplies and medical products, including domestic and global pet products. On the operating side, we have continued to reduce the CAC and the fulfillment expenses and significantly improve the customer efficiency and profitability. In the final quarter of fiscal 2021, our GMV grew 50.7% year-over-year, reaching RMB553.7 million. Our total revenues grew 47.1% year-over-year to RMB230.4 million. On the user engagement front, our active buyers ranged 3.8 million in fiscal 2021, up 17.4% from 3.3 million in the fiscal 2020. Notably, our users remain highly engaged and our active buyers spend an average of RMB613.35 million in fiscal 2021, growth of 33.2% from fiscal 2020. Increasing user spending reflects the unique value position of the Boqii’s ecosystem. In addition to our strong organic growth, we continued to develop a distinguished and defined customer journey by building out an extensive portfolio of quality content, products and services. Earlier in April, we announced a…

Thank you, Lisa, and thanks everyone for joining the call today. Despite the unprecedented challenges brought by the COVID-19 in the past fiscal year, we delivered a full strong quarter with a phenomenal growth trajectory. The solid results underscore the sustainability of our ecosystem and all it has to offer. We expanded our service spectrum and touch points with the pet parents. We are determined to develop set, find all-round experiences for our customers. Our key move to complete the circle of our ecosystem is physical pet care network. On May 1, we opened our first offline flagship store to offer our comprehensive service and the products, including the pet adoption, training, grooming, boarding service, and the selling of merchants. This is one small operational step, but one giant strategic leap. We are facing a highly fragmented physical pet service market in China. We’re over 99% stores operated by mom-and-pop shops or small franchises with less than five stores, leveraging our unparalleled user base and data, solid supply chain capability, and our partnerships with the leading brands. We are confident to reshape the traditional brick and mortar pet services industry. We aim to build a fully-integrated multi-channel approach that is disrupting the pet market and the providing pet parents with a differentiated solution for all their pets needs. Now let’s go down to detail to the numbers. As Lisa mentioned earlier, we had a solid fourth quarter. Revenue grew to RMB230.4 million. The 47.1% year-over-year growth rate was the highest growth rate in the past three years. Our quarterly active users also increased by a record high rate of 35.2% year-over-year to RMB1.3 million. Revenue generated from our Boqii Mall was RMB87.4 million up by 52.5% year-over-year, while revenue generated from third-party platforms grew 39.1% to RMB137.6 million. Through our…

We will now begin the question-and-answer session. [Operator Instructions] Our first question comes from Darren Aftahi with ROTH Capital Partners. Please go ahead.

Hi, good evening. Thanks for taking my questions. Just a few, if I may. First on your Kuaishou partnership, can you just talk in general how that’s going change your social e-commerce strategy going forward? And how much of a strategic emphasis is this as a part of your overall strategy?

Thank you, Darren. That’s a great question. So, yes, as we noted that, we enter into a strategic partnership with one of the China’s leading shorter video social networking platform, Kuaishou. We cooperate – fully cooperate with Kuaishou in mainly three areas. First on content, we are working with the KOLs and KOCs on Kuaishou to incubate more pets related content to attract more traffic. Also we hope with this high quality content we can promote the caring for the health and wellness of pets to more pet parents and parents to be’s. Second, on the e-commerce front, as we all know that for the last quarter, Kuaishou’s e-commerce GMV growth more than doubled last quarter, which indicates a dedication of Kuaishou’s strategic focus. We hope this partnership will empower Kuaishou with our supply chain expertise and our broad range to more the pet brands so that the pet parents will benefit in more diversified e-commerce settings. Last but not least to mention that to us, this is definitely our landmark partnership with the new content platforms. It will be our focus. Having that said, this partnership is not exclusive. We will also keep bracing all other social networking or new media platforms such as TikTok, Little Red Book, Bilibili, Weibo and others to optimize our reach to our customers. I hope that answers your question.

That’s great. Thanks, Kai. Another one, if I may. On the last call you talked about kind of a revamped membership strategy, kind of any updates there as it launched. If so, what kind of engagement, retention or spend metrics are you seeing from those members?

Thanks, Darren, for another good question. Yes. We’re putting some final touches on this new membership programs. We target to launch the new membership programs by the end of this quarter. As I mentioned before, it will be cost channels across offline and online system. We are confident about it, about our own product, about our own system. We will share more detailed operational numbers after in fully speed mode. On the data matrix, we will be observing would be, one, the behavior – the impact on our members behavior, which will be the absolute number of our members, as a percentage of total spending customers, each members cohort rate, Op value, AOE and I believe with all these operational matrix the data, it will boil down to the impact on our company financials. Our total revenues should increase. The sales and marketing expense as a percentage of revenue should decrease. At end of the day, we are to see platform, our revenue should be multiples spending customers and the Op value is spent that’s our ultimate target. Thank you.

Great. And just one last one, it looks like your fulfillment costs were in the 10% range, again in this quarter. How do we think about that percentage kind of going forward as your business grows, should it be stable in that 10%, go down what’s kind of your overall strategy. Can you get more efficiencies out of your fulfillment network? Thanks.

Thanks Darren. I will quickly translate for [indiscernible] [Foreign Language]

[Foreign Language]

Yeah. So Darren to answer your question. As you can see from the latest earnings release, our fulfillment costs – our fulfillment expenses as percentage of revenue was already lowered to 10.4% for the new quarter and in the coming year or the few quarters ahead, we see that as we layout our warehouses in Southwest part of China, those number can be further reduced to below 10% and we see the trend to continue align into the future. And we hope that answers your question.

Great. Thank you all.

Okay. Thank you, Darren.

[Operator Instructions] Thank you. Seeing no more questions in the queue. Let me turn the call back to Ms. Lisa for closing remarks.

Thank you operator and thank you all for participating on today’s call and the further support. We appreciate your interest and looking forward to reporting to you again as quarter progress. Thank you.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.