Ladies and gentlemen, thank you all for standing by and welcome to the LightInTheBox Fourth Quarter and Full Year 2015 Earnings Conference Call. At this time, all participants are in listen-only mode. [Operator Instructions] I must advise you this conference is being recorded today, Monday 11th of April, 2016. I would now like to hand the conference over to your first speaker today, Mr. Christian Arnell. Thank you. Please go ahead, sir.

Thank you. Hello, everyone and welcome to LightInTheBox’s fourth quarter and full year 2015 earnings conference call. The company's earnings results were released earlier today and are available on the company's IR website as well as through PR newswire. Today you will hear from LightInTheBox's Chairman and CEO, Mr. Alan Guo, who will give an overview of the company's strategy and recent developments, followed by Mr. Robin Lu, the company's Chief Financial Officer, who will address financial results in more detail. Before we proceed, I would like to remind you of our Safe Harbor statement. Please note that the discussion today may contain forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. To understand the factors that could cause results to materially differ from those in the forward-looking statements, please refer to our form 20-F filed with the US Securities and Exchange Commission on April 17, 2015. We do not assume any obligation to update any forward-looking statements except as required under applicable law. At this point, I'd like to turn the call over to LightInTheBox's Chairman and CEO, Mr. Alan Guo. Alan, please go ahead.

Thanks, Chris; and thank you, everyone, for joining us today. We had a solid finish to Q4 with a stronger than expected holiday season. Q4 sales exceeded our guidance and also resulted in a substantially improved bottom line as planned. We are also benefiting from a better macro environment in terms of currency exchange rates, as the Chinese RMB continued its moderate depreciation against the US dollar during the quarter. In a recent development, we welcomed Zall Development as a strategic partner and a large long-term shareholder during Q1, 2016. That contributed to US$76.5 million in new investment, and a further strength to our Board of Directors with the addition of two new Board members with a successful entrepreneurial track record and extensive experience and resources in supply chain. With operational efficiency improved - on track and improved global currency environment, a new strategic partner and a substantial new investment, as well as a strengthened Board of Directors, the company is on a much stronger footing now. Stronger than expected holiday sales were primarily a result of our improved supply chain management and the stronger support of our suppliers with discounts and sourcing prices for the holiday season. This led to more attractive retail prices without sacrificing our gross margin, as well as additional supplier subsidies for holiday advertising dollars. An improved cross company end-to-end promotion management process also drove strong sales for the Black Friday weekend and the Christmas sales season in general. We continued our cost efficiency improvements during the quarter with a number of initiatives. Improvements in our customer acquisition strategy and techniques led to higher marketing efficiency. This was done by optimizing the use of various acquisition channels and successfully identifying and surgically eliminating low performing ones by using more advanced channel profiling and analytical techniques.…

Thank you, Alan. Currently, productivity and debt of the euro in particular has stabilized when compared to last quarter, though the environment remains challenging. A combination of ongoing cost cutting and supply chain efficiency improvements has resulted in a significant improvement in our bottom line. We expect this trend to continue in first quarter of 2016. As I review our financial results, let me remind you about a few things. There are many comments on our first quarter numbers. You can refer to our earnings release for the full year numbers. All numbers quoted are in US dollars. All the percentage changes refer to year-over-year unless otherwise noted. Net revenues decreased 22% to $87.5 million, backing out $8.4 million unfavorable foreign exchange impact, as revenues actually were $95.9 million. Mobile revenues as a percentage of total net revenues increased to 37% from 29.7%. Total orders fell 25.9% to $2.3 million, and the total number of customers who made a purchase in the quarter decreased by 18.4% to $1.8 million. Revenues in the apparel category were down 34.7% to $27.2 million. As a percentage of total net revenues, apparel revenues was 31.1% compared to 37.2% a year ago. Revenues generated from other general merchandise were down 14.5% to $60.3 million. Looking at our business geographically, revenues from North America were increased 6.1% to $26.5 million and accounted for 30.2% of total net revenues. Revenues from Europe were down 26.2% to $52 million, representing 59.5% of total net revenues, where revenues from other countries decreased by 46.1% to $9 million, representing 10.3% of total net revenues. Gross profit was $30.8 million, and gross margin was 35.3%, in line with last year's gross margin of 35.2%. Excluding the unfavorable change in foreign exchange rates, non-GAAP gross margin would have been 40.9%. Fulfillment expenses,…

Thank you, sir. And ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] And we have our first question from the line of Rick Shea from Vardon Capital. Please ask your question.

Hi. Good evening, guys. Could you just help us understand major initiatives and focus for 2016, first in the merchandize area and then second on cost and operations?

Hey Rick, this is Alan. As we - there are two things. A is we continue to focus on the cost efficiency improvements moving to 2016. That remains unchanged. We worked on marketing, supply chain, fulfillment and generally, you know, it's really a continuing to focus carried over from 2015 to 2016. We continue to develop our merchandising strategy for the focus of the categories we stressed in the past, starts with fashions and life-center hobbies and et cetera. We certainly is working with our new strategic partner closely in very recent development in exploring new merchandising opportunities that's presented to us with their supplier networks that bring into us recently. We will update you guys further after we have more solid,-concrete plans that is out there.

Thank you

Thank you. Next question from the line of Mr. David Ellis. Please ask you question.

Yes. I was wondering why - what's going on with the revenue from Europe. I see that's down substantially. And also, the revenue from other countries is over 35%. What was the problem and how are you trying to correct this?

I think we mentioned before that the geographic composition change was primarily driven by the currency exchange rate. So since the later part of 2014 and the full year of 2015, we certainly see a stronger dollar and see a weaker euro. So that was the main – the primary reason for the European revenue drop. And for the other countries that used to be the primary driver for other countries was Brazil. We also saw a major currency fluctuation in Brazil last year. So that was the reason for drop. And at the same time, we did see revenue growth for the countries where the currency remained to be very strong, such as the United States and the United Kingdom.

Thank you.

[Operator Instructions] And next question from the line of Nan Jia from GTJA [ph] Please ask your question.

Yes, good evening. My question is I notice that there is a very significant increase about your market cost over revenue. So I noticed that former two asked - raised the similar question. So I just want to know how you achieve such a remarkable achievement.

So the question was the reason for the marketing percentage as revenue percentage decrease. I think that was one of the major achievements we achieved. There are a couple reasons for that. Number 1 is the reason I mentioned in my script which was we had better techniques in profiling and selecting marketing channels. We had a better bidding system in place in bidding a variety of channels. So we surgically eliminated a number of low-performing channels. I think those combined really improved our marketing efficiency. And I also mentioned in my script that in Q4 we had a better supply chain side collaboration, so that in the holiday season, we did gain a subsidy from suppliers for our marketing dollar. So that that will actually in turn translate into a better performance in the marketing as a percentage of revenue. There is also a side effect where we received a better procurement price for our product, so that we can maintain a stable margin, while we gain higher conversion rate, which also translated into a higher marketing efficiency. So those three things combined was the primary driver for our better performance in the marketing area. Thank you.

And next question from the line of Sun Yiping [ph] from Guangfa Securities. Please ask your question.

Thank you, operator. Alan, Robby, I see that over the past few quarters, you have successfully stabilized gross profit and increased your bottom line. Could you provide some more color on how you did this?

Thank you. I think it was a process that we continued for a couple quarters. The stabilizing and slight improvement in our gross margin was a primary result of our supply chain initiatives. We start with consolidation of supplier network. We actually have a few number of suppliers who are actually the stronger crowd within our existing supplier base, which translates into higher procurement dollar per supplier, which translates into higher bargaining power when we work with them. And we also had a initiative to cut a lot of middle men. We talked quite about in the past few quarters, so that we directly source from the original manufacturers so that we get a better sourcing price as well. We also worked with a number of branded suppliers so that - for the flash sale business, so that we help them to clean up their excessive inventories after season. For those inventories that they present to us, we also get a very attractive procurement price as well. As for the bottom line, it was a combined initiative in reducing off marketing dollar as percentage of revenue, improved labor productivity in the fulfillment sales and also a disciplined management process in the G&A sector of our business. So all those three combined actually led to a better bottom line for the last two quarters [ph]. Thank you.

Thank you.

[Operator Instructions] And there are no further questions. Please continue.

All right. Thank you. This concludes our fourth-quarter and full-year 2015 earnings conference call. Thank you for your participation and ongoing support of LightInTheBox. We look forward to providing you with updates of our business in the coming weeks and months ahead. Have a good day and a good night. Thank you.

And ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may all disconnect.