Hello, ladies and gentlemen, and welcome to participate in IT Tech Packaging's Third Quarter of 2018 Earnings Conference Call. At this time, I would like to inform you that this conference is being recorded. [Operator Instructions] Joining us today are Mr. Zhenyong Liu, IT Tech Packaging's Chairman and Chief Executive Officer; and Ms. Jing Hao, the Company's Chief Financial Officer. Remarks from both Mr. Liu and Ms. Hao will be delivered in English by interpreters. IT Tech Packaging announced its third quarter of 2018 financial results via press release yesterday, which can be found on the company's website at www. itpackaging.cn. First, Mr. Liu will brief you on the company's key operational highlights over the third quarter of 2018 and then Ms. Hao will review the company's financial results. Before we start, I would like to draw your attention to our safe harbor statement. Management's prepared remarks contain forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact in its announcement, are forward-looking statements, including, but not limited to, anticipated revenues from the corrugating medium paper, tissue paper, offset printing paper and digital photo paper business segments; the actions and initiatives of current and potential competitors; the company's ability to introduce new products; the company's ability to implement capacity expansion; market acceptance of new products; general economic and business conditions; the ability to attract or retain qualified senior management personnel and research and development staff; and other risks detailed in the company's filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the company and the industry. The company undertakes no obligation to update forward-looking statements to reflect subsequent or current events or circumstances or to changes in its expectation except as may be required by law. Although the company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that this expectation will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. There is a presentation document featuring management's prepared remarks, and it is now available for download from the company's website at www.itpackaging.cn. Please note that there will be discussions on non-GAAP financial measure or EBITDA or earnings before interest, taxes, depreciation and amortization. Please refer to our press release for a complete reconciliation of EBITDA to net income. As a kind reminder, all members -- all numbers in our presentation are quoted in U.S. dollars, and all comparisons refer to year-over-year comparisons unless otherwise stated. I would now like to turn the call over to Mr. Liu. His comments will be delivered in English by Dan McCarron from Weitian Investor Relations. Mr. McCarron, please go ahead, sir.

Thank you, operator. Good morning, everyone. Thanks for joining our Third Quarter 2018 Earnings Conference Call. With decreases in both revenues and margins, our third quarter results highlighted continued challenges facing our business. Our total revenue decreased by 20.2% to $26.7 million, and gross profit decreased by 82.6% to $1.3 million. Production of regular CPM (sic) [ CMP ] was suspended in September 2018 due to equipment maintenance. Our production of offset printing paper was temporarily restricted in August and September 2018 for the same reason. As a result, the sales quantities of regular CPM (sic) [ CMP ] and offset printing paper products significantly decreased in the third quarter of 2018. Looking ahead, with the heightened government efforts on environmental protection, the paper industry faces significant risks and uncertainties. As a result, our financial performance could be volatile in the near term. Now I will turn the call over to our CFO, Ms. Jing Hao, who will review and comment on the third quarter financial results. Her comments will be delivered in English by my colleague, Janice Wang. Janice, please go ahead.

Thanks, Dan. Thanks, everyone, for being on the call. Next, on behalf of the management team, I will summarize some key financial results for the third quarter of 2018. Also, I will occasionally refer to specific production lines associated with various products. I will make clear which products I am referring to. For reference, the numbering system for our production line is provided on Slide #17. Now let's look at our financial performance for the third quarter of 2018. Please turn to Slide #7. For the third quarter of 2018, total revenue decreased 20.2% to $26.7 million due to a decrease in sales volume across regular CMP and offset printing paper, partially offset by increases in ASPs across all product categories. Turning to Slide 8. For the third quarter of 2018, the CMP segment, including both regular CMP and lightweight CMP, generated revenue of $26.1 million, representing 97.5% of total revenue. $19.2 million of revenue was from our regular CMP products and $6.9 million was from lightweight CMP. CMP segment volume decreased by 13.4% to 46,247 tonnes, of which 33,928 tonnes were regular CMP and 12,319 tonnes were lightweight CMP. Average selling price, or ASP, for regular CMP increased by 9.3% to $566 per tonne, while ASP for lightweight CMP increased 13.2% to $556 per tonne. Turning to Slide 9. For the third quarter of 2018, our offset printing paper segment generated revenue of $0.7 million, representing 2.5% of total revenue. We shipped 902 tonnes offset printing paper in the third quarter, a decrease of 88.8% from the same period last year. Average selling price for offset printing paper increased 7.1% to $727 per tonne. Turning to Slide 10. We recognized 0 net revenue from tissue paper products for the third quarter of 2018 compared to $0.7 million from sales of 493 tonnes at an ASP of $1,339 per tonne for the third quarter of 2017. Production of tissue paper was suspended in September and October 2017 due to the replacement of coal boilers. We expect to resume with increased production of tissue products once market conditions become more favorable. In June 2016, we suspended the production of digital photo paper due to low market demand for our products and now are considering renovating the line to produce more competitive products. We expect that our digital photo paper production will remain suspended for the near future. Slide #11 summarizes the changes in our revenue mix. For the third quarter of 2018, total cost of sales decreased by $0.8 million to $25.5 million, leading to total gross profit of $1.3 million, down from $7.2 million for the same period last year, and overall gross margin of 4.7%, a decrease of 16.9% from last year. For the third quarter of 2018, SG&A expenses decreased by 0.7% to $2.8 million, and losses from operations were $1.6 million compared to income from operations of $2.7 million for the same period last year. Operating loss margin was 5.9% compared to operating profit margin of 8.1% for the same period last year. For the third quarter of 2018, net loss was $1.4 million, resulting in net loss of $0.07 per basic and diluted share. This compared to net income of $1.6 million, or net earnings of $0.07 per basic and diluted share, for the same period last year. For the third quarter of 2018, EBITDA decreased by $4.6 million to $1.9 million from $6.5 million for the same period last year. Now shifting gear to year-to-date financial results. For the 9 months ended September 30, 2018, total revenue decreased 24.3% to $61.7 million as a result of decreases in sales volumes across all product categories. This was partially offset by increases in ASPs of all products. For the 9 months ended September 30, 2018, our CMP segment, including both regular and lightweight CMP, generated revenue of $56.5 million, representing 91.5% of total revenue. $43.4 million in revenue was from our regular CMP products and $13.1 million was from lightweight CMP. Volume for the CMP segment decreased by 36.6% to 97,255 tonnes, of which 74,141 tonnes were regular CMP and 23,114 tonnes were lightweight CMP. ASP for regular CMP increased by 35.7% to $586 per tonne, while ASP for lightweight CMP increased by 32.5% to $567 per tonne. For the 9 months ended September 30, 2018, our offset printing paper segment generated revenue of $5.2 million, representing 8.4% of total revenue. We shipped 6,191 tonnes of offset printing paper for the 9 months ending September 30, 2018, a decrease of 69.2% from the same period last year. ASP for offset printing paper decreased by 27.2% to $842 per tonne. For the 9 months ended September 30, 2018, we sold 0 tonnes of tissue paper products as opposed to 1,619 tonnes in the same period of 2017. Production was suspended from last January 2018 to mid-March 2018 due to a government-mandated restriction on the natural gas supply and production due to volatility with tissue paper prices. Revenue generated from digital photo paper was $13,822 for the 9 months ended September 30, 2018. For the 9 months ended September 30, 2018, total cost of sales decreased by $7.1 million to $58.2 million, leading to total gross profit of $3.6 million and a decrease of 78.1% from last year. Overall gross margin of 5.8% reflects a decrease of 14.2 percentage points from last year. For the 9 months ended September 30, 2018, SG&A expenses were $9.7 million compared to $8.3 million for the same period last year. For the 9 months ended September 30, 2018, income from operations decreased from $6.4 million to negative $6.1 million. Operating loss margin was 9.9% compared to operating profit margin of 7.8% for the same period last year. For the 9 months ended September 30, 2018, net loss was $5.4 million, or $0.25 loss per basic and diluted share, compared to net income of $3.3 million, or earnings of $0.15 per basic and diluted share, for the same period last year. For the 9 months ended September 30, 2018, EBITDA decreased from $17.4 million to $5.1 million for the same period last year. Moving to slides 19 and 20, let's look at the balance sheet and liquidity. As of September 30, 2018, the company had cash and bank balances, short-term debt, including bank loans, current portion of long-term loans from credit union and related-party loans, notes payable and long-term debt, including related-party loans of $5.5 million, $15.5 million, $3.6 million and $9.4 million, respectively, compared to $2.9 million, $13.6 million, $6.1 million and $11.9 million, respectively, at the end of 2017. Net accounts receivable was $1.2 million as of September 30, 2018, compared to $1.8 million as of December 31, 2017. Net inventory was $4.7 million as of September 30, 2018, compared to $8.5 million at the end of 2017. As of September 30, 2018, the company had current assets of $19 million and current liabilities of $20.8 million, resulting in a working capital deficit of $1.8 million. This compared to current assets of $20 million, current liabilities of $21.8 million and working capital deficit of $1.8 million at the end of 2017. Net cash provided by operating activities was $1.8 million for the 9 months ending September 30, 2018, compared to $16.8 million for the same period of the prior year. Net cash used in investing activities was $1.8 million for the 9 months ending September 30, 2018, compared to $7.6 million for the same period prior year. Net cash provided by financing activities was $1.8 million (sic) [ $0.76 million ] for the 9 months ended September 30, 2018, compared to net cash used in financing activities of $1.8 million for the same period prior year. Now if you have any questions, please contact us through e-mail at ir@itpackaging.cn. Management will respond to your questions through e-mails as soon as possible. Operator, please go ahead.

Certainly, ma'am. Thank you for attending IT Tech Packaging's Third Quarter 2018 Earnings Conference Call. This concludes our call today, and we thank you all for listening in. Goodbye.