Good morning, everyone. And welcome to the Fourth Quarter and Full Year 2021 Earnings Conference Call for LightInTheBox Holding Co. Limited. Today's conference is being recorded. At this time, I will turn the call over to Mr. Rene Vanguestaine for opening remarks and introductions. Please go ahead, sir.

Thank you, everyone, and welcome to LightInTheBox's fourth quarter and full year 2021 earnings conference call. The company's earnings results were released earlier today and are available on the company's IR website as well as through PR Newswire. Today, you will hear from LightInTheBox CEO, Mr. Jian He, who will give an overview of the company's strategies and recent developments, followed by Ms. Yuanjun Ye, the company's Chief Financial Officer, who will go over financial results. They will be available for Q&A at the end. Before we proceed, I would like to remind you of our safe harbor statement. Please note that the discussion today may contain certain 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 the factors that could cause results to materially differ from those in the forward-looking statements, please refer to our Form 20-F filed with the U.S. Securities Initiative Commission on April 21, 2021. We do not assume any obligation to update any forward-looking statements, except as required under applicable law. At this point, I'd like to turn the call over to Mr. He. Mr. He, please go ahead.

Thanks, Rene. And thank you, everyone, for joining us today. Let me start by acknowledging and thanking all the team for their efforts and dedication to the company. 2021 was an eventful year for us and for the overall cross-border online retail sector. We faced various unprecedented challenges and pressures including a very competitive environment, led by decelerating economic growth, high inflation concerns, and foreign exchange fluctuations. Additionally, we faced increasing marketing spend and rising shipping costs due to new locks in Europe related to VAT and regulations on electronic products. Despite the unprecedented economic environment, we achieved 12% top-line growth year-over-year from $398 million in 2020 to $446 million in 2021, and remained stable in our bottom line. Behind these numbers, our growth strategies have been fueled by our strong mission to fulfill our customers’ needs and improve their shopping experience. Some of our highlight achievements in 2021 include the continued increase in the volume of apparel sales within our product mix, as customers shop for clothes online based on our customer reviews, competitive price matching, wide selections to choose from, and the time-saving benefits of sorting everything you need through one global platform. By the end of the fourth quarter of 2021, our apparel category reached over 70% of our total product sales. With the increase in apparel sales, our gross margin increased to 47.2% in the fourth quarter of 2021. We continue to build a regimented supply chain to drive production agility and visibility, and to provide our customers with the best value for money and globally sourced products. Investment in R&D in 2021 increased by 34% year-over-year from $15 million to $20 million, which we believe will give us the edge in retail e-commerce to stay ahead of change and capture industry insights for our suppliers and designers. Our ability to successfully leverage the challenges of 2021 is a testament to the effectiveness of our proven growth strategies. After years of building a solid foundation, serving over 140 countries, the fundamentals of our business are healthy and sustainable. Looking ahead, although there are still uncertainties and various factors that may impact our business, we have proven that we have the long haul to stay in the middle of these challenges. We will continue to improve on operational efficiency and value-added services for our customers. With the easing of travel restrictions around the world and many countries resuming economic activities, we are well-positioned to capture more growth opportunities with our deep expertise in cross-border e-commerce. I believe we achieved sustainable growth and better sales across the evolving needs of our customers in 2022. I will now turn the call over to Yuanjun to go through the financial results.

Thank you, Mr. He. And thank you, everyone, for joining the call. I'll now review our financial results for the fourth quarter. Please be reminded that all numbers quoted are in U.S. dollars. Total revenues were $113.2 million, down 14.8% year-over-year from $132.7 million. Product sales were $110.5 million versus $129.5 million in the same period of 2020. Revenues from services and others were $2.7 million, compared with $3.2 million a year ago. Included in product sales, revenue from apparel increased 25.2% to $77.9 million in the fourth quarter of 2021, compared with $62.2 million in the same quarter of 2020. Revenue from apparel as a percentage of total product sales improved to 70.5% from 48.1% in the same quarter of 2020. Gross profit was $53.4 million compared with $59.6 million during the same period of 2020. Gross margin was 47.2%, up from 44.9% a year ago, primarily due to our continued efforts to optimize our product mix. Total operating expenses were $60.9 million, compared with $62.3 million during the same quarter of 2020. Fulfillment expenses were $7.5 million, compared with $8.8 million in the same quarter of 2020. As a percentage of total revenue, fulfillment expenses were 6.7%, the same as the previous year and down from 7.3% in the third quarter of 2021. Selling and marketing expenses were $41.1 million, compared with $44 million in the same quarter of 2020. As a percentage of total revenue, selling and marketing expenses were 36.3%, compared with 33.1% in the same quarter of 2020 and 34.4% in the same quarter of 2021. G&A expenses were $12.5 million compared with $10.5 million in the same quarter of 2020. As a percentage of total revenues, G&A expenses were 11.1%, compared with 7.9% in the same quarter of 2020 and 9.4% in the third quarter of 2021. Included in the G&A expenses, R&D expenses were $4.9 million compared with $4.8 million in the same quarter of 2020 and $5.5 million in the third quarter of 2021. Adjusted EBITDA, which represents income loss from operations before share-based compensation expense, interest income, interest expense, income tax expense, and depreciation and amortization expenses, was income of $16.2 million in the fourth quarter of 2021 compared with the loss of $0.5 million in the same quarter of 2020. Net income was $8.7 million, compared with a net loss of $3.2 million in the same quarter of 2020. Net income per ADS was $0.08 compared with a net loss per ADS of $0.03 in the same quarter of 2020. As of December 31, 2021, we had cash and cash equivalents and restricted cash of $59.6 million compared with $55.5 million as of December 31, 2020. Now let me walk you through our 2021 full year financial results very briefly. Total revenues increased by 12% year-over-year to $446.1 million. Revenues generated from product sales were $435.2 million compared with $382.1 million in 2020. Revenues from services and others were $10.9 million compared with $16.1 million in 2020. Included in product sales, revenues from apparel increased by 73.6% to $274.2 million for 2021 compared with $157.9 million in 2020. Revenues from apparel represented 63% of total product sales for 2021 compared with 41.3% in 2020. Gross profit for the full year of 2021 was $206.7 million, compared with $176.2 million in 2020. Gross margin was 46.3% for 2021 compared with 44.2% in 2020. Adjusted EBITDA was $27.9 million for 2021 compared with $22.8 million in 2020. Net income was $13.5 million compared with $13.3 million in 2020. Net income per ADS was $0.12 for both 2021 and 2020. This concludes our prepared remarks. At this point, we are ready to take some questions.

Thank you. We will now start the question-and-answer session. Our first question comes from Matthew Larson from National Securities. Please go ahead with your question.

Okay. Good evening. Thanks for taking my call. Listen, I just - the questions I have are similar to the previous ones, though I've been probably the only person on the conference call. You're a company that you did $446 million in revenues. Your market value is only $126 million. So it's very unusual for an online merchandise like yourself to trade at almost a quarter of the revenues, particularly when half the market cap, just about $59 million out of $126 million is in cash. And one of the problems is you guys have - even though you've doubled your revenues, have done very well since the COVID pressures and you changed your merchandise makeup and what have you, and put more apparel, it sounds like. You still lose money on an operating basis. So you've doubled your revenues and you still haven't made any money. Now you do have this equity investments, which depending on how that's valued when you do either a profit or a loss, can significantly impact your bottom line. So I have two questions. What is this equity investment, if you could tell me? Because it is a pretty substantial part of your market cap. It's the $36 million that swung up or down really was the difference between you all making $0.07 and losing money in previous quarters. Can you answer that for me, please?

Thank you for your question, Matthew. I think for the equity investment, we cannot comment too much at the moment. The stock price is quite volatile and really out of our control. But you know, our vision for management is always to bring long-term value for the company, and we are very much focused on the fundamentals of our business. You have seen for the past we have been through a lot of difficulties in the markets, including higher marketing spending, very high shipping delivery costs, and new regulations in VAT and regulations in electronic products. At the same time, the US dollar has depreciated quite a lot. These have created pressures on the company's operations. And even though we have been making significant progress, you have seen that our margin continues to increase since apparel takes a larger portion of the whole product mix. It’s always our focus to drive a sustainable strategy for the company. But on the other hand, we can't really comment on the stock market side. I don’t know if I answered your question.

Not really. I mean, again, why can you not identify what the equity investment is? Is it in investing in stocks in the Shanghai market? Is it an investment with – I have no idea. I mean, that is such an important part of your business and as a percentage of your market value, why can't that be identified? Because an investor can't very well make a confident investment in your firm unless they would know something about that. Is it off balance sheet or I mean, I don't really understand it. I mean, why can't you identify it?

Well, we will convey this message to the Board, and we will seriously consider your suggestion. For this equity investment part, I think we will engage with the Board and discuss. But I assure you, our management team is focused on building a strong foundation and a strong business for the company and for the shareholders. Yes. I hope you’re not too disappointed.

Of course, I'm disappointed. The stock's at $1, all right? And 10 years after you went public, it's at $1. And you're in the right space at the right time, which is online merchandise sales, and your stock is at $1, all right? And if you call that building wealth for shareholders, that’s just not true. So I'll leave it there. Listen, I mean, you're not the only company domiciled in the PRC that is trading at $1 or two. People have thrown in the towel here in the United States because they'd rather buy stocks domestically that they can get better transparency. So that’s just my advice. If you ever want to grow your wealth, just consider taking it private and making an offer at a significant premium.

Mr. Matthew, we really cannot comment on the decisions to take the company private or regarding share buybacks. However, we will take your advice to the Board and see what actions could be considered. Our mission is to build a strong foundation and a strong business for the company and for the shareholders. Yes. I hope you're not too disappointed.

Well, thanks for your time. I appreciate it. It's tough to get really, really confident about investing significantly when there are these questions. So thanks for your time. Good luck, nice quarter.

Thank you.

Thank you. As there are no further questions, I'll turn the call back to Mr. Rene Vanguestaine for closing remarks. Please continue.

Thank you. This concludes our earnings call. Thank you for your participation and ongoing support of LightInTheBox. We look forward to providing you with updates on our business in the coming weeks and months ahead. Have a good day.

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