Ladies and gentlemen, thank you for standing by. And welcome to LightInTheBox Fourth Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by question-and-answer session. [Operator Instructions] I must advise you that this conference is being recorded today, Friday 29th of March, 2019. I would like to hand the conference over to your first speaker today, Mr. Christian Arnell. Thank you. Please go ahead.

Hello, everyone and welcome to LightInTheBox’s fourth quarter 2018 earnings conference call. Today, you will hear from LightInTheBox’s CEO, Mr. Jian He, who will give you an overview of the Company’s strategy and recent developments, followed by Ms. Wenyu Liu, the Company’s acting Chief Financial Officer, who will address financial results in more detail. Before we begin, 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 U.S. 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 these factors and how they could cause results to materially differ from those in the forward-looking statements, please refer to our Form 20-F filed with the Securities and Exchange Commission on March 28, 2018. We do not assume any obligation to update any forward-looking statements, as required under applicable law. At this point, I’d now like to pass the call over to Mr. He. Mr. He, please go ahead.

Yes. Thanks, Christian. Thank you everyone for joining us today. A lot has changed at the LightInTheBox over the past quarter, and I’m thrilled to have the opportunity to work with all the talented employees here who remain deeply committed to its long-term success. We truly believe in LightInTheBox’s long-term potential and the enormous growth opportunities the cross-border e-commerce presents. After carefully reviewing the business since coming on board, we immediately began implementing key initiatives which positively impact our financials for the quarter and which I believe indicates the direction we are headed in. While net revenue decreased 37% year-over-year during the quarter, we improved our gross margin improved to 34.6% from 29.7% during the same period last year and generated positive cash flow, which resulted in cash and cash equivalents increasing slightly to $38.8 million, from $37.5 million as of September 30, 2018. Our loss from operations also narrowed to $1.7 million from $2.6 million in the same quarter of 2017. These initial results are encouraging, and I'm confident that those initiatives will help build a solid base through which we can turn this business around and regain growth momentum. First, we shifted our focus from geographic markets towards generating sales in categories that have higher gross margin such as our Home & Garden, Sports & Outdoors categories. We also began integrating high-quality suppliers from ezbuy scenario, improved supply chain management and reduced procurement costs. At the same time, we optimized our product recommendation algorithms to recommend more cost efficient products to our uses, which altogether have significantly improved gross margin. Secondly, we launched a more targeted and effective marketing campaign for a number of key categories, during the Black Friday and Christmas sales period. This marketing campaign leverages ezbuy’s localized marketing experience across a number of key markets…

Okay. Thank you, Mr. He. As I review our financial results, let me remind you about few things. All numbers quoted are in U.S. dollars; all the percentage changes refer to year-over-year, unless otherwise noted. So, to start, net revenues decreased 37.2% to $50.5 million (sic) [$57.5 million] for the fourth quarter of 2018. Ezbuy contributed 20 days of revenue during the quarter. Net revenues from product sales were $55.4 million compared with $83.1 million in the fourth quarter of -- in same quarter of 2017. Net revenues from service and others were $2.1 million, compared with $8.5 million in the same quarter of 2017. As a percentage of net revenues, service and others accounted for 3.6% in the quarter. Total orders of product sales were 1.3 million compared with 1.7 million in the same quarter of 2017. Total number of product sales customers in the quarter was 1 million, compared with 1.4 million in the same quarter of 2017. Product sales in apparel category were $20.3 million, compared with $25.3 million in the same quarter of 2017. As a percentage of product sales, apparel revenue accounted for 36.6%, compared with 30.4% in the same quarter of 2017. Product sales from other general merchandise were $35.1 million for the fourth quarter of 2018. Looking at our business geographically. Product sales from Europe were $29.7 million for the fourth quarter of 2018, compared with $44.5 million in the same quarter of 2017, representing 53.6% of total product sales for the fourth quarter of 2018. Product sales from North America were $16 million, compared with $19 million in the same quarter of 2017, representing 28.8% of total product sales for the fourth quarter of 2018. Product sales in the Gulf Cooperation Council, GCC countries were $0.9 million for the fourth quarter of…

Ladies and gentlemen, we'll now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Billy Chen. [Ph] Please ask your question.

Hi. Can you please give me -- give us some more color on your cash flow in Q4? And what do you expect to see for 2019, please?

Hi. This is Wenyu Liu here. I'm going to translate the question to Mr. He.

[Foreign Language]

Okay. I'm going to translate. So, our cash flow became positive in fourth quarter of 2018 and it has been remained stable as compared to the third quarter of 2018. But, due to the impact of seasonality from Chinese New Year, we expect cash flow in the first quarter of 2019 to dip a bit but we expect to have positive cash flow again in second quarter of 2019 and for the rest of the year.

[Operator instructions] There are no further questions at this time. I would like to hand the conference back to today’s presenters. Please continue.

That concludes today’s call. Thank you everyone for joining. If you have any questions or comments, please don’t hesitate to reach out to the LightInTheBox IR team. Thank you and good night.

Ladies and gentlemen, that does conclude your conference for today. Thank you for participating. You may all disconnect.