So-Young International Inc. (NASDAQ:SY) Q4 2022 Earnings Call Transcript

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Xing Jin: As a new growth driver, So-Young Prime trajectory will mainly depend on the development of the non-surgical market, which will continue to expand in line with the growth of the — with a middle class female population. We will expand the network on the supply side, corporate with more institutions, enrich the product portfolio boost the number of service outlets ensure high quality service delivery and improve the user penetration rate and repurchase rate. Non-surgical medical aesthetics users used to consume a daily cosmetic, cosmetic and skincare products, which is an area of expertise for the numerous small and medium institutions. But small and medium institutions are usually weak equipment. SQ design, service delivery and brand awareness.

So-Young Prime forms and now work ensuring service delivery of high standard by empowering these institutions. In addition to benefiting small and medium institutions, these initiatives could serve large medical aesthetics, aesthetical user group and increase convenience for consumption for them. That makes us distinctive from our competitors. Therefore, only by connecting the supply chain and linked the upstream, midstream and downstream can we expand the medical aesthetics industry addressable market and provide a user with a better service experience building a safe and secure environment for customers and driving the overall growth of industry. For the second question with the environmental uncertainties indices and their consumption demands recovery there is plenty of space in the medical aesthetics market and industry outlook is clear We believe the medical aesthetic industry is driven by the supply side.

And that is where we will put more emphasizing the future. We will also integrate the core production advantages we have accumulated in terms of institutions, doctors and users, set standards for service quality and service delivery, and provide user with a premium experience. These comprehensive capabilities will enable us to build a strong competitive barrier compared with a pure internet model. We will be able to solve issues at a deeper level and create more differentiation from our competitors. In the past few years, we have provided user with our transparent and trusted information platform. So our community e-commerce business, boasting that efficiency of the medical aesthetic industry at scale. In the future, we will continue to optimize our community content, innovative new user tools leverage the scale advantage of the internet and provide a second complement of resources for offline service delivery.

Of course, we may also cooperate with other traffic platforms. We believe our integration capabilities across industrial chain and our investment in the service delivery experience will benefit users and drive the sustainable betterment of the whole industry.

Chloe Wei: Thank you

Operator: Thank you. And our next question today comes from Hugo with Securities. Please go ahead.

Unidentified Analyst: Thank you for the opportunity. My question is will the end changes in mathematic consumption demands on the user end after the COVID-19. Thank you.

Xing Jin: Thank you for asking. In the question first, as we mentioned in our prepared remarks user demands are evolving middle class medical aesthetics consumer have different demands from the traditional consumption group. As they focus more on quality, safety, Jeanne products and rational prices, demand for certain high order values SQ have increased. For example SQs in those photo electric and injection categories with average order value over 5000 RMB, are highly popular among users. Secondly, as the market recovers we believe the surgical market, which was for skewed in the past few years we experienced a wave of consumption as the economy recovers and it travels. Also with a rebound in outbound travel users will rush to the bad, the bad overseas market for medical aesthetics consumptions. Thank you. That’s all.

Operator: Ladies and gentlemen, this concludes our question-and-answer session. I’d like to turn the conference back over to management for any closing remarks.

Vivian Xu: We are not approaching the end of the conference call. Thank you for your participation in today’s conference. You may now disconnect it. Have a good day. Thank you. Bye.

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