DXF 益生科技 2015年第4季度财报电话会议文字稿中英文

Operator

欢迎大家参加中国西尼亚时尚有限公司2015年第三季度及第四季度业绩电话会议。[接线员说明]现在，请允许我介绍首席财务官吴志荣先生。您可以开始了。

Ng Chee Jiong

谢谢大家。各位参会者早上好、晚上好，欢迎参加西尼亚2015年第三季度和第四季度业绩电话会议。您可以在我们投资者关系网站的IR栏目中找到昨晚发布的业绩新闻稿副本。与我一同参加本次电话会议的有西尼亚董事长兼首席执行官徐启明先生，以及我本人——西尼亚首席财务官。请注意，我们今天将做出一些前瞻性陈述，所有这些陈述都受到风险和不确定性的影响，可能导致实际结果与今天提到的预期和假设存在重大差异，这是由于影响公司的各种因素，包括最近向美国证券交易委员会提交的20-F表格中指定的风险。现在请允许我将电话转交给徐董事长，他将做一些开场发言。我将为他翻译。徐先生，请开始。

Qiming Xu

大家早上好、晚上好，感谢各位参加本次电话会议。我想借此机会总结2015年的业绩，并谈谈我们未来的计划。除了正常的业务运营外，我们在2015年有两项重大举措：库存回购和从经销商处收购零售网络。我将详细讨论每项举措，因为它们都很重要。在深入讨论库存回购细节之前，我认为有必要先探讨经销商库存积压的成本问题。我们认为有几个主要因素导致了经销商的库存积压。其中最重要的因素之一是中国经济放缓导致消费者支出减少。中国消费者大量在线购物也影响了许多线下品牌。经济放缓同样影响了消费者的消费习惯。许多消费者倾向于购买性价比高的服装。与此同时，由于海外经济的影响，许多中国OEM厂商将过剩的制造产能转向中国国内市场，导致服装生产过剩。需求疲软和产能过剩对许多服装品牌造成了严重影响，进而导致零售渠道库存积压。为了应对这种库存过剩的局面，许多品牌试图通过大幅折扣来清理过剩库存，但效果甚微。拥有财务资源的品牌从渠道回购了过剩库存。缺乏财务实力的品牌只能退出市场，许多中小品牌被迫退出市场。过去几年，由于经济形势、行业产能过剩以及零售渠道库存积压，经销商的订单量显著下降。面对零售网络的库存过剩，我们尝试与经销商和授权零售商合作，通过折扣来减少库存，但效果甚微。面对这种情况，我们可以选择不作为。如果这样，未来几个季度可能面临零订单和零销售的风险。我们的零售门店关闭将加剧。我们很可能也会退出市场。尽管中国经济疲软且存在库存过剩问题，但我们正面临前所未有的历史机遇。许多中小品牌被迫退出市场。未来中国庞大的国内服装市场将集中在少数几个品牌手中。我们对未来充满信心。一旦我们度过这个困难时期，我们的品牌将在未来的服装市场中占有一席之地。为了克服库存过剩问题，尽管我们没有义务回购过剩库存，但我们选择帮助经销商和零售合作伙伴回购他们的过剩库存，减少他们的库存积压。通过这次回购，他们的营运资金回到了健康轨道。虽然库存被更新更好的库存所取代，但经销商和零售合作伙伴的运营开始呈现积极态势。出于增长考虑，我们在2014年第三季度和2015年第二季度分别从经销商处回购了2.86亿元人民币和2.11亿元人民币的库存。我们以10%的折扣回购了库存。您可能会问为什么是10%的折扣，而不是更大的折扣。这是因为……

Qiming Xu

Good morning and good evening to everyone and thank you for joining us this call. I would like to take this opportunity to summarize the results of 2015 and talk about our future plans. Apart from normal course of business, we have two major initiatives in 2015. They were inventory buyback and acquisition of retail network from distributors. I will talk about each initiative in great detail as they are important. Before I go into the details of inventory buyback, I think there is a need to discuss the cost of inventory buildup by our distributors. We believe there are several major factors caused the inventory buildup by our distributors. One of the most significant factors is the slowdown of China economy resulting in rich consumer spending. China consumers heavy shopping online also affect many offline brands. The slowing down in economy also affect us consumer spending habits. Many consumers are inclined to value for money apparels. At the same time, due to the impact of overseas economy, many China OEMs turned their excess manufacturing capacity to China’s domestic market resulting in excess clothing production. Weak demand and excess capacity caused a serious impact on many clothing brands, which led to excess inventory in the retail channel. In order to overcome this excess inventory situation, many brands attempt to clear their excess inventory through their heavy discount, but with very less effect. Brand with financial resources has repurchased their excess inventory from the channel. Brand without financial strength only exits the market and many small and medium brands have been forced to exit the market. For the past few years, due to economic situation, excess industry capacity, excess inventory in the retail channel, orders from distributors have been declining significantly. Faced with excess inventory in the retail network, we are trying to work with our distributors and authorized retailers to reduce their inventory by discounting, but with very little effect. Faced with this situation, we can choose to do nothing. If so, risk to have zero orders and zero sales for the next few quarters. Our retail store closure will be intensified. There is a strong possibility we may say with exiting the market. Despite the weak China economy and excess inventory situation, we are facing with an unprecedented historical opportunity. Many medium and small brands have forced to existing market. China huge domestic apparel market will be concentrated within a few brands in the future. We are very confident about our future. Once we overcome this difficult period, our brand will have a play in future apparel market. To overcome the excess inventory, although we do not have the obligation to buyback the excess inventory would choose to help our distributors and retail partners to buyback their excess inventory and reduce their excess inventory. With this buyback, their working capital is back on healthy track. Although inventory was replaced with newer and better inventories, the operation of distributors and our retail partners started positive. For growing reasons, we repurchased RMB286 million and RMB211 million of inventory from distributors during the third quarters of 2014 and second quarters of 2015 respectively. We repurchased the inventory at 10% discount. You may ask why at 10% discount, not a great discount. This is because….

Operator

各位女士、先生，我们现在与主持人失去联系。请保持在线。各位女士、先生，我是会议主持人。很抱歉让大家等待，但似乎主持人那边出了些问题。

Ng Chee Jiong

好的。

Operator

好的，抱歉。现在主持人已经重新上线，请继续。

Ng Chee Jiong

各位女士、先生，大家好。

Operator

是的。你好，CJ。请继续。

Qiming Xu

由于经济形势和产能过剩状况，我们的五家经销商成为我们发展自有品牌的关注点。终止他们建立的零售网络的计划是对计划行动规模巨大的预防措施。这将产生类似多米诺骨牌效应，可能在其他省份产生连锁反应。其他省份可能会效仿他们的做法，结束业务及其零售网络。此外，如果这五个省份及其业务和零售网络出现问题，我们可能无法在未来5年内减少与我们合作的零售网络，因为潜在零售商会对我们的品牌在这些省份突然出现表示担忧。[听不清]面对这一挑战性局面并控制局势，我们决定以1.64亿元人民币收购这五家经销商的140家零售店。这1.64亿元是与经销商协商的价格，与即将讨论的部分不同。协商价格基于这些店铺未来五年的毛利贡献。作为零售网络收购的结果，我们还需要以1.55亿元收购所有库存。在会计处理方面，采用更高专业价值的增值模型，使用折扣现金流相关模型，该价值采用未来5年店铺流失率的三年历史数据。由于我们过去两年的店铺流失率相对较高，记录的无形资产金额为4000万元。展望未来，收购经销商零售网络的预算巨大，扁平化的商业模式将使我们能够为市场带来更具性价比的服装，满足大多数消费者的需求。减少商业模式层级，我们更容易实现线上线下业务战略。2016年，我们没有计划收购更多经销商。然而，如果市场形势对我们不利，我们可能会相应调整。此外，我们理解股东最关心的是我们的市值是否会低于纽约证券交易所最低1500万美元市值要求。我们将采取何种措施来维持在纽约证券交易所的上市地位。目前，我们已积极利用这一窗口期启动某些资本市场活动，非常积极地谈判某些并购交易，最近已取得积极进展。时机成熟时，我们将向市场发布公告。我们相信这一举措将对股价产生积极影响，并为股东带来正向回报。接下来，我想把电话会议交给CJ，他将介绍我们的财务状况。谢谢。

Qiming Xu

Due to economic situation and excess capacity situation, five of our distributors became our interest in developing our brands. The plan to end the retail network build by them is a precaution of the planned action was huge. There will be a like domino effect that can cross connect in other provinces. Other provinces may follow their path ending their business and their retail network. In addition, if these five provinces and their business and their retail network, we may be unable to reduce the retail network in this cycle with us for the next 5 years as prospective retailers will have concerns why our brand appears certainly in these provinces. [indiscernible] faced with this challenging situation and contained the situation, we decided to acquire these 140 retail stores from these five distributors at RMB164 million. This RMB164 million was a negotiated price with the distributors and was different from upcoming segment. The negotiated price was based on the next five years gross margin contribution from this store. As a result of retail network acquisition, we also required to acquire all of the inventory as RMB155 million inventory. For the accounting treatment with higher professional value add to models position using discount, cash flow relation models, the value used the three-year historical store attrition rate for next 5 years store attrition. As our store attrition rate for the past two years was relative high, the recorded intangible assets amount to RMB40 million. Now, looking into the future, the budget of acquiring distributor retail network is enormous, a flattened business model will enable us to bring more value for money apparels for the market, which is catered to most consumers. Reducing business models layers we are much more easier to realize the online and offline business strategy. In 2016, we do not have plan to acquire more distributors. However, if the market situation is against us, we may make accordingly. In addition, we understand our shareholders are most concerned about our market capitalization will be below the New York Stock Exchange minimum $15 million market cap requirements. And we would take what kind of initiative to maintain our listing in New York Stock Exchange. At present, we have actively used this window period to initiate certain capital market activity, very actively in negotiating certain M&A and recently there are positive developments. But the time is right we will make announcements to the market. We believe that this initiative will have positive impact for the share price and will bring positive return to shareholders. With that, I would like to turn the call over to CJ who will go through our financials. Thank you.

Ng Chee Jiong

好的，谢谢。我相信在座的各位可能还有更多问题要问我。在我介绍完财务数据后，我们将接受大家的提问。2015年全年，我们的收入为4.72亿元人民币，而2014年为3.8亿元人民币。我们的授权零售商网络在2015年总共减少了394个零售网点。截至2015年12月，授权零售网点总数为504个。2015年净亏损为6亿元人民币，而2014年净亏损为1.17亿元人民币。这相当于每份ADS亏损6.5美元，而2014年每份ADS亏损为1.9美元。现在，转到我们的财务状况，截至2015年12月31日，公司拥有现金及现金等价物2.03亿元人民币。我们的准备发言到此结束。我们现在准备接受大家的提问。接线员？

Ng Chee Jiong

好的，谢谢。最后，我代表整个高级管理团队，感谢大家对今天电话会议的关注和参与。如果您需要任何进一步的信息，或有意访问我们在中国的公司，请告知我们。感谢大家今天的参与。我们的电话会议到此结束。

Operator

女士们、先生们，感谢大家参与希尼亚的电话会议。一小时内将有网络直播回放。请访问www.xiniya.com网站投资者关系栏目。您现在可以断开连接了。谢谢。再见。