111 (YI) Fireside Chat summary

Introduction and agenda

• The session opened with a welcome to the CEO and co-founder, focusing on recent financial results and industry context.

Current industry trends

• The industry faces macroeconomic headwinds, with reduced household healthcare spending and regulatory changes impacting both upstream and downstream partners.

• Anti-corruption campaigns and government volume purchasing have led to significant profit declines for major pharmacy chains.

• The shift of funds from personal to government-run accounts has reduced discretionary pharmacy spending.

• The aging population in China is expected to drive long-term growth in healthcare demand, referred to as the "silver economy."

Challenges and overcoming obstacles

• Despite a tough environment, the company achieved profitability and positive cash flow for three consecutive quarters, reversing significant losses from the previous year.

• The company is addressing NASDAQ non-compliance and investor concerns about share price and redeemable shares, emphasizing operational separation and new terms for redeemables.

• Measures are in place to regain NASDAQ compliance soon.