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Good day and welcome to the Nisun International Investor Call. Today's conference is being recorded. At this time, I would like to turn the conference over to [indiscernible], Investor Relations Director. Please go ahead.

Thank you operator and a good day everyone. Welcome to Nisun International's full year 2024 financial results conference call. Joining us today are Mr. Liu Xin, Chief Executive Officer; and Ms. Liang Changjuan, Chief Financial Officer of the Company. We are excited to discuss our performance for 2024 and our outlook for the future. Before we begin, I would like to remind everyone that today's discussion may contains forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934 as amended. These statements are subject to risk, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied. For a detailed discussion of these risks, please refer to our filings with the Securities and Exchange Commission including our annual report on Form 20-F. Nisun International does not undertake any obligation to update forward-looking statements except as required by law. On behalf of the Company's management, I'm delighted to provide an operating and financial summary of the company for 2024. At Nisun International, we are proud to be a leading technology-driven integrated financial solution and supply chain solution provider aiming to transform the corporate financing landscape for small and medium sized enterprises called SMEs in China. Our mission is to empower business with innovative financing and supply chain solutions leveraging our expertise in technologies, industry integration and financial services to drive growth and efficiency. 2024 was a year of resilience and strategic focus for Nisun International. According to the National Bureau of Statistics of China, China's economy experienced a deceleration in economic growth during the second and the third quarter of 2024. Despite navigating a challenging economic environment in China marked by cautious investor sentiment and supply chain commodity market volatility, we maintained strong financial foundations and continued to invest in our long-term growth initiatives. Our robust cash position, technology driven solutions and expanding customer base while positions us exceptionally well for a rebound in market conditions. We will now walk through our financial results for 2024. In 2024, Nisun International reported total revenue of $340.2 million, a 12% decrease from $386.7 million in 2023. This decline was primarily driven by reduced activities in our SME financing solutions and supply chain trading businesses, reflecting a broad economic slowdown and market volatility in China. Despite these challenges, we achieved a net income attributable to shareholders of $5.8 million, or $1.3 per share, compared to $17.6 million, or $4.46 per share. In 2024, our ability to remain profitable in a tough environment underscores the resilience of our business model. Cost of revenue for 2024 was $309.3 million, down 11% from $346.7 million in 2023, aligning with the reduction in supply chain trading volume. Gross profit was $30.9 million, a 20% decrease from $39.9 million in the prior year, reflecting lower revenues across our key business. Income from operation was $3.6 million compared to $18.8 million in 2023 impacted by the revenue decline and our continued investment in technology and customer acquisition. Our operating expenses in 2024 included a non-cash expense of $9.2 million related to share-based compensation and $5 million provision for bad debt. On the balance sheet, we maintained a strong cash position of $45 million in cash and cash equivalents as of December 31, 2024, equivalent to approximately $11.11 per share. Net cash used in operating activities was $75.7 million, driven by strategic advance deposits to key suppliers and working capital investment to secure inventory and meet growing customer demand. These investments are critical to positioning us for future growth and higher margin opportunities as market conditions improve. The financial strength including $11.11 per share gives us the flexibility to invest strategically while weathering economic challenges. Turning to our shareholders equity, we executed a share repurchase program implemented in October 2024 resulting in 4,538,358 Class A common shares outstanding as of December 31, 2024. Additionally, in 2024 we granted 700,000 restricted Class A common shares to key executives and employees under our 2022 equity incentive share plan, reflecting our commitment to aligning key management members' contributions with long-term shareholder values. With a strong pipeline of demand, ongoing investments in digital transformation and the scalability of our integrated supply chain solutions, we are optimistic about our growth trajectory for 2025. We believe that our financial performance will be driven by strategic initiatives in our core businesses including supply chain financing solutions, SME financing and our exciting expansion into KFC franchise operations in the China market. These efforts are designed to capitalize on recovering market demand, enhanced technology platforms and our ability to deliver high margin services to our growing customer base. We believe 2025 will make a pivotal year for Nisun International as we leverage our financial strength and operational expertise to drive sustainable growth. Despite the headwind we faced in 2024, our strategic focus on technology driven solutions and integrated supply chain services has positioned us for a meaningful growth in 2025. Our comprehensive supply chain financial service platform launched in January 2020 and our supply chain trading business initiated in July 2021 are gaining traction from both existing and new customers. We are seeing steady demand from SMEs and commodity trading partners and our pipelines to show healthy growth in the second half of 2024. Our supply chain financing services expanded into the gold industry, driving an increase in demand in our supply chain financing services, which also indicated a market recovery. Our investment in technology, talent and brand recognitions are paying off. We are not just a financing provider, we are partner to businesses helping them navigate complex supply chains and unlock growth opportunities. The KFC franchise expansion is particularly exciting venture, allowing us to diversify our revenue streams while leveraging our expertise in operational efficiency and customer engagement. This initiative combined with our core financing solutions position us to capture significant market share in high growth sectors. Our management firmly believed that Nisun International stock is significantly undervalued at current levels. Our robust cash positions, scalable business model and diversified growth initiatives are not fully reflected in our market valuation. As we continue to build our reputation in integrated supply chain solutions, management is confident that our shareholders will be rewarded. In closing, we want to emphasize that Nisun International is at an inflection point. We are building a future where technology and industry coverage to create lasting value for our customers, partners and shareholders. Operation is broad, our foundation is strong and our team is energized by to make 2025 a meaningful year of progress. Thank you all for your continued support and joining us on this journey. With that I will turn the call over to the operator. Operator?

This concludes today's call. Thank you again for your participation. You may now disconnect and have a great day.

Good day, and welcome to the Nisun International Investor Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to [Brynn Nu]. Please go ahead.

Good afternoon, everyone and morning to my colleagues in China. So welcome to Nisun International Enterprise Development Group Investors conference call. My name is [Brynn Nu] and I serve as the Investor Relationship Director of the company. It's a great pleasure for me today to host today's call. So we will discuss the financial results for six months ended June 30, 2024. And before I start, I would like to extend a warm welcome to all our shareholders and potential investors joining us today. So to on this call are also our Chief Executive Officer, Mr. Huang; and our Chief Financial Officer, Ms. Liang Mr. Huang has served as a Director since September, 2020 and as our CEO since May, 2024. Mr. Huang received a bachelor degree in international business in 2012 from Shandong University of Technology. He is experienced businessman position in management scale and across border trade. Ms. Liang has been our CFO since August, 2019. Ms. Liang obtained her bachelor degree in accounting in January, 2010. So first of all, I would like to provide a cautionary statement regarding forward-looking information, as this conference call may include forward looking statement within the meaning of Section 27A of the Security Act of 1933 as a mandate and Section 21E of the Security Exchange Act of 1934 as amended. This forward-looking statements are based on the current expectation of the management of Nisun International, and are subject to a number of risks and uncertainties, including but not limited to, changing in market conditions, competitive factors, and other risks and uncertainty that could cause actual results to differ materially from laws in the forward-looking statements. These forward-looking statements are based on certain assumptions and analysis made by the company in light of their experience and their perception of historical trends, current conditions and expected future development as well as other factors that the company believes are appropriate under the circumstances. However, whether actual results will conform to these expectations and predictions is subject to a number of risks and uncertainties, many of which are beyond the control of the company. The company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. All statements in this conference call that are not historical facts are forward-looking statements. So first of all, let me give you some brief introduction of the company. I'm sure you have some understanding or maybe familiar with the company already. Nisun International is a technology driven provider of integrated supply chain solutions. So I will continue with my introduction. Founded in 2012 and headquartered in Shanghai, China, we operate primarily within China. Our business is built on two main revenue streams, one from services, including financial solutions for small and medium sized enterprises, I will call it SMEs, and the supply chain financing. And other revenue stream is from our supply chain trading business. Since entering the financial services market in 2019 through our subsidiaries and the VIEs in China, we have provided a broad range of technology driven customer wide financing solutions to SMEs, helping them gain improved access to capital. These services facilitated by financial institutions in China, allow us to offer risk free support as we only earn fees based solely on financing amount arranged for our clients. Additionally, we provide direct banking solutions to smaller banks and financial institutions to aid in managing their direct banking products. Our fintech online platform enhances asset allocation and financial planning services for institutional and individual investors, optimizing their risk control and asset management to reduce investment risks. Our technology is backed by big data, AI, IoT and blockchain technologies. We are well positioned to support the growth of SMEs and the wider industry. In January 2020, we launched our integrated supply chain financing solution through digital platforms becoming directly involved in the sales transaction. Our supply chain financing solution services include supply chain financing, trade financing and the receivables financing. Our multi-tiered supply chain financing solutions package, both core enterprise and SMEs, combining financial and operational support within our client supply chain processes. Our AI-driven platforms streamline these services by matching up upstream suppliers with downstream customers, offering operational efficiency and enhanced treating terms across China. The company maintain very strong relationships with all suppliers, supply chain suppliers, including supplier logistic partners and distribution channels that our services sent across multiple regions in China. Since the launch of our supply chain financing solution business, we have connected with supply chain participants from different sectors through our supply chain platforms and developed high-quality customers in medical industries, especially in agriculture and commodities. As our supply chain financing business grew substantially in size, we introduced our supply chain trading operations in 2021. Leveraging our technology and customer network, we build compatibility in procurement, logistic, inventory management and warehouse. Our intelligence mapping systems use AI to link suppliers with customers ensuring efficient transactions from procurement through to delivery. Now let's discuss our financial performance for the first half of 2024. For the six months ended, June 30, 2024, total revenue rose by 52% to $192.5 million compared to $126.9 million in the same period last year. The supply chain trading business shows significant growth with revenue increasing by 114% to $142.1 million from $66.2 million in the same period last year, driven by our growing market share in the gold trade trading sector. However, revenue from SME financing services decreased by 16% to $48.5 million from $58 million in the same period last year, primarily due to challenging financing market conditions resulting from China's economic slowdown. Additionally, revenue from supply chain financing solutions dropped by 30% to $1.9 million from $2.7 million in the same period the last year for similar reasons. That said, we're beginning to see signs of economic turnaround for following a government recent stimulus merit and management remain optimistic about the future of both of our SME financing and supply chain financing business as conditions improve. Cost of revenue increased by 64% to $175.3 million from $107.1 million in the same period last year, primarily due to the expansion of the lower margin supply chain trading business. Gross profit decreased by 13% to $17.2 million from $19.8 million in the same period last year, with growth margin narrowing to 9% from 15.6% in the same period last year. While the supply chain trading business operates with lower margins, it creates valuable synergies with our high margin supply chain financing services. We are actively seeking opportunities to improve profitability in this area by focusing on higher margin products and expanding into new markets. Operating expenses declined by 31% to $5.7 million from $8.2 million in the same period last year, largely due to a reduction in selling expenses, which fell by 69% to $0.8 million from $2.6 million in the same period last year, primarily driven by lower revenue from SME financing solutions, which resulted in a reduction in related channel promotion expenses. G&A expenses also fell by 14% to $4.7 million from $5.5 million in the same period last year, owing to enhanced cost controls. On the other hand, R&D expenses increased by 27% to $0.5 million from $0.4 million in the same period last year, primarily due to the amortization of technology service fees associated with the platform technology acquired by the company in June 2023. Net other income decreased to $1.2 million from $2.4 million in the prior year, driven by reduced investment income following a drop in short-term investments. For the six months ending June 30, 2024, net income totaled $10.3 million, down from $11.4 million a year earlier, primarily due to a lower gross profit. Earnings per share was $2.61 compared to $2.87 in the same period last year. Our cash position as of June 30, 2024 was $47.8 million, down from $114.6 million at the end of 2023. The primary driver of lease decline in cash was an increase in advances to suppliers, which is a strategic investment that will support future growth in sales and earnings. Additionally, a decrease in accounts payable continued -- contributed to the cash reduction. Both of these factors reflect our commitment to scaling the business efficiently and positioning ourselves for continued expansion in the second half of 2024 and into 2025. Looking ahead, we remain focused on restoring shareholder value and building investment confidence. We believe that our stocks is significantly undervalued and we are pleased to share that our largest shareholder increase their stake, but approximately $1 million during the first half of the year. Additionally, we have approved a new $15 million share buyback program, which reflects the management confidence in the main in company's future. We intend to begin repurchasing shares as soon as the trading window opens in the next couple of days. Thank you all for your continued support. And with that, we welcome any questions during the Q&A session. Operator, well, please open the questions.

[Operator Instructions] And our first question will come from [Andy Gold] with Gold Capital Ventures.

A question on the operating expenses being down 31%, is that? Can you detail cost measures you're implementing and your sustainability of continuing the cut costs?

Hi, thank you for the question. That's a very good question and we are very happy to see that our operating expenses down 34%. It shows our success in the strategies in cutting expenses. We've implanted several cost control measures in the first half of the year, including optimizing our sales channels, reducing unnecessary expenditures and improving overall efficiency in our operations. For example, as you can tell, our selling expenses significantly reduced. It is primarily driven by lower revenue from SME financing solutions, which resulted in a reduction in related channel promotion expenses. We also tightening our G&A cost. So we believe that these merits will continue to drive our operation more efficiency moving forward. And there are several other merits we are doing and we believe that you will see it reflected in our financial result in 2024.

How do you also -- how do you foresee your R&D expenses going forward? Especially with the increase you had this year. Is that just -- is that continuing or is that -- should that come down over the period of time?

Yes. R&D is related with our cutting-edge technologies that we use in our online platform. We believe that is a very important part of our strategy and one of our competitive advantages. So as you can see, our R&D expenses increase about 27% in first half of the year. These expenses are mainly related with amortization of platform technology service fee associated with agriculture focused platform technology that the company purchased in 2023. So moving forward, we plan to continue enhance our AI driven supply chain solutions and also continue developing new technologies. We believe our technology will further streamline our operations and provide value to our clients. So, we expect that investment in R&D will be a continual process and we believe that will contribute to the company's long-term growth.

And our next question will come from [Adam Fried] with Private Investor.

I'm looking at the revenues increase from your supply chain platform, almost $78 million it looks like. And I see that it's primarily in the gold trading sector. Do you -- how do you advertise that? How do you get users to use that platform? And how do you project that growth and scale it up?

That's a good question. As you can tell, both trading segment business comes for a majority part of our supply chain trading business. So that is a significant driver of our revenue growth in the first half of the year. We use online platform and try to link our suppliers and with customers since we had already built a supply chain financing service platform before. So on this platform, we have a lot of suppliers and customers. So based on our database, we use our advanced technology to link suppliers and customers. So we saw a lot of potentials in this area. And to sustain this growth, we are trying to continue to deepen our relationship with key player in this supply chain and expand our trading capabilities. In addition of that, we're also looking for adjacent market and other products to diversify our trading portfolio. For example, this year, we also see some growth in our Chinese herbs business, which is part of trading business as well. So we believe brand our product portfolio and expand our market markets in different regions in China, even overseas, will help us maintain this momentum that we build in the sector.

One follow-up question. Based on that revenue, how do you -- how is it build out? How are you making money from as a straight percentage based on sales, based on transactions or is it dependent on the size of the trade, et cetera? And also I think that's a great asset to expand into exactly. I mean, not just the gold, but all the other metals markets, you could probably outlay worldwide and double that I would expect. Is that in your growth plan as well?

Yes. You're right, because we -- for us for these products we try to for the gold business, as I mentioned we are trying to expand into new geographic area and the products market. And our newly joined CEO is a very ambitious young man, he is very experienced in international trading. And as you can see, we also get listed in us, one of the purpose is to expand our oversee market as well. So we -- for this supply chain trading business, we not only look at into higher-margin sectors. We also try to expand it beyond our core focus area as you mentioned, maybe metal industry and other industry as well. So this aligns our broader strategy to diversify our revenue stream and enhance our profitability. And I also would like to highlight, as I mentioned previously. Although the supply chain trading segment operate with lower margin currently, but it also create a very valuable synergy with our high-margin supply chain financing service. So it's a very important part of our business and we are confident in expanding this business in future.

So you guys, when you're talking about different sectors and the profitability, how is that gauged? How is that set? Is it just whatever price you can manage? Or is it preset with the buyer and seller?

Currently, we -- it depends on the market demand and it also depends on our competitive advantages. So as I mentioned we already experienced supply chain financing technology platform. So we are trying to focus on some products which have a higher margin and have higher market demand. And we are also trying to pick up certain industry that the company has competitive advantage in that. So by doing that we think we not only improve our efficiency but also we will improve our long-term margins. And at the same time, as I mentioned previously, the company trying to cut operational expenses as well, so that we can operate more efficiently and create better value for our shareholders.

[Operator Instructions] And we'll go back to Andy Gold with Gold -- we'll go back to [Jim Mill] with a Private Investor.

One of the steps, you guys are taking to help improve the profitability in the supply chain trading business, given just the overall it's the nature of the business low margin and – but congrats on the great quarter.

We realized that our supply chain trading business operates a low margin compared to our service based revenue. But we are new to this business. As you can see. We only entered this second, as this business in 2021. So currently, we are actively working to improve its profitability. Basically, we are doing trying to do two different things. One is we try to identify higher margin products. We continue looking for products that we have competitive advantage and higher demand in the market. Second is we are trying to get into expand into some new and a more lucrative market. So additionally, we are trying to leveraging our technology to streamline our operations and reduce cost. So this will contribute to better margins in future.

My second part of the question is, it appears that you guys have seen great growth in the gold trading segment. How do you plan to sustain this growth moving forward?

Gold trading business is important business for us and as this main driver for the growth of this quarter. To sustain this growth, we're trying to strengthen our relationship with key players. And also, as I mentioned, we are looking for get into different new markets, trying to expand the market shares in this business. And at the same time, we are also trying to diversify our trading portfolio. We think by diversifying our product portfolio, it will also reduce our operational risk.

And I will now turn the conference back over to you.

Is there any more questions?

We'll take a question from [Andy Gold] with Gold Capital Ventures.

I have a question on, have you guys ever thought about doing a cash dividend or it's you're not allowed to do that because of Chinese tax rules and stuff like that? Or I know you have to get some credibility in the stock, buyback is buyback, but cash is cash and lot of U.S. investors have a hard time investing in Chinese companies because of the lack of transparency on cash and I think a cash dividend to shareholders might entice a lot of investors to be interested in -- more interested in the stock going forward. I know the cash dropped because you put out money for procurement, but that cash comes back to you when you close more and more deals. That's like a cash advance right for procuring supply chain. Could you comment on that?

You're right. We do see a significant decrease in cash. And as you can see, 70% of the operating cash decrease is from advances to suppliers. So this actually is a sign that we are trying to use our cash to expand our future growth. So additionally, you can see there is a decrease in accounts payable contributed to the cash reduction. So we view these as necessary steps to position our company for future growth and expect the investment to fuel our expansion plans for the second half of 2024 and 2025. As I mentioned previously, the company has already proved the $15 million buyback plan, and because management do think our stock is undervalued as most of China stock and we are committed to improve our shareholders value. I think there are several factors influence -- impact on Chinese company talk. And, as I totally agree with you, and that there are concerns over transparency and corporate governance and internal controls, et cetera. And also U.S. investors are not familiar with Chinese business environment and there are factors, there are risk factors, like regulatory and geo politics risks, et cetera. But we still understand this concern. So that's the reason. Unfortunately we are like most of China stock is undervalued. So to improve our valuation, we think it's very important to strength to stress the investors concerns. So we plan to focus on enhancing our transparency such as conduct, more investors, outreach program, road shows, and the present presentations to strengthen our communication with investors. So today is actually a start of that. So we will continue strengthening our communication with investors.

Yes, that's definitely on the same side. That's definitely a step in the right direction. For Chinese companies because the transparency and Chinese companies have a tendency to take investment cash at any price and dilute their stocks down to nothing. Just as you know, in the U.S. we value equity more than cash and the Chinese companies seem to want cash more than they care about the stock price. But I think by you doing a conference call that's a very good, that's a good step in the right direction. And, will, does go a long way for helping people to understand what the business a little bit better. So congrats on doing that. That's a great step in the right direction for you.

Yes, you are right. And I'm sorry for, maybe some bad experience of our new U.S. investors experience with Chinese company. But I don't think all the Chinese companies are all doing that. And at least we are not doing this. So we also try to improve our governance standards and internal controls over financial reporting to comply with U.S. regulations. So the company trying to demonstrate long-term growth to our investors. So we also try to expand globally and also try to form some strategic partnerships in future when there are opportunities. So all these merits is trying to focus on long-term growth of the company and to improve our value.

That's why guys, people write short reports on companies because they're not transparent. And that's when you guys were called, I think Hebron Technology somebody wrote a really terrible piece on the company. This is going back three, four, five years ago, when it was a different company. So, but -- that I think is the company has done a much better job being much more transparent since then. So that was definitely a step in the right direction.

Thank you for the comments.

And that does conclude the question-and-answer session. I'll now turn the conference back over to you.

Do we have any more questions?

There are no further questions at this time.

Okay. Thank you, everybody for your continued support to the company and your attention to this conference call and your valuable time. And we will continue our communication with our investors and shareholders and committed to maximize our equity shareholder value. Thank you again for everybody. Bye-bye.

Thank you. And that does conclude today's conference. We do thank you for your participation. Have an excellent day.

Thank you. Bye.