Greetings and welcome to Fuwei Films’ Second Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. I would now like to turn the conference over to Shiwei Yin, Grayling. Please go ahead.

Thanks, Rob. Before we start, I would like to remind you that certain statements that are not of historical facts made during the course of this conference call about future events and projected financial results constitute forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Security Litigation Reform Act of 1995. You should note that the company’s actual results may differ materially from those projected in these statements due to a variety of factors affecting the business. Forward-looking statements are subject to risks and uncertainties. And discussion of the factors that may affect future results is contained in our filings with the U.S. Securities and Exchange Commission. We undertake no obligation to correct or update any forward-looking statements provided as a result of new information, future events or changes in our expectations. Joining us on today’s call is Mr. Yong Jiang, Corporate Secretary. Before I walk you through our financial results, Mr. Jiang will deliver his opening remarks and I will translate Mr. Zengyong’s remarks. Sir, please go ahead.

[Interpreted] Our second quarter results reflect the intense competition as a result of excess capacity in the BOPET industry. In spite of this, I’m pleased to share that our differentiated product strategy is showing results and sales of specialty films continued to grow. Riding on this positive momentum, we will work toward expanding our customer base through introducing innovative products and exploring overseas markets. We believe that capturing opportunities in new and emerging markets will help strengthen our competitive position. Now I will provide an overview of the company’s financial results for the second quarter and first six months of 2018, then we’ll begin the Q&A session. Our net sales during the second quarter were RMB79.6 million, US$12.0 million, compared to RMB70.1 million during the same quarter – same period in 2017, representing an increase of RMB9.5 million, or 13.6%. The increase of average sales price caused an increase of RMB8.1 million and the sales volume increase caused an increase of RMB1.4 million. In the second quarter, sales of specialty films were RMB30.7 million, US$4.6 million, or 38.6% of our total revenues, as compared to RMB25.6 million, or 36.5% in the second – in the same period of 2017, which was an increase of RMB5.1 million, or 19.9% as compared to the same period in 2017. The increase of average sales price caused an increase of RMB0.3 million and the increase in the sales volume caused an increase of RMB4.8 million. The increase was largely attributable to the increase in sales volume. Overseas sales were RMB16.6 million, or US$2.5 million, or 20.9% of total revenues, compared with RMB15.8 million, or 22.5% of total revenues in the second quarter of 2017. The increase of average sales price caused an increase of RMB1.4 million and the decrease in sales volume resulted in a decrease of RMB1.4 million [sic] [RMB0.8 million]. Our gross profit was RMB6.8 million, US$1.0 million for the second quarter, representing a gross profit rate of 8.5%, as compared to a gross profit rate of 7.2% for the same period in 2017. Correspondingly, gross profit rate increased by 1.3 percentage point compared to the same period in 2017. Our average product sales prices increased by 11.3% compared to the same period last year, while the average cost of goods sold increased by 9.7% compared to the same period last year. Consequently, the amount of increase in average cost of goods sold was lower than that in average product sales prices during the second quarter ended June 30, 2018 compared with the same period in 2017, which resulted in an increase in our gross profit. Operating expenses for the second quarter were RMB13.3 million, US$2.0 million, compared to RMB14.2 million for the same period in 2017. Net loss attributable to the company was RMB8.7 million, US$1.3 million, compared to net loss attributable to the company of RMB11.6 million during the same period in 2017, representing a decrease of RMB2.9 million for the same period in 2017. Moving on to our first six months financial results. Net sales during the first six months were RMB156.5 million, US$23.7 million, compared to RMB138.0 million in the same period in 2017, representing an increase of RMB18.5 million, or 13.4%. The increase in average sales price caused an increase of RMB17.1 million and the increase in the sales volume caused an increase of RMB1.4 million. In the first six months, sales of specialty films were RMB63.7 million, US$9.6 million, or 40.7% of our total revenues, as compared to RMB47.3 million, or 34.3% in the same period of 2017, which was an increase of RMB16.4 million, or 34.7% as compared to the same period in 2017. The increase was mainly due to the increase of sales volume. Overseas sales during the first six months were RMB27.6 million, or US$4.2 million, or 17.6% of total revenues, compared with RMB29.0 million, or 21% of total revenues in the same period last year. And this was RMB1.4 million lower than the same period in 2017. The decrease in sales volume resulted in a decrease of RMB3.6 million and the increase in average sales price caused an increase of RMB2.2 million. Our gross margin was RMB16.3 million, US$2.5 million for the first six months, representing a gross margin rate of 10.4%, as compared to 6.4% for the same period last year. Correspondingly, gross margin rate increased by 4.0 percentage points. Our average product sales prices increased by 12.3% compared to the same period last year, while the average cost of goods sold increased by 7.4% compared to the same period last year. Consequently, the amount of increase in average product sales prices was higher than that in cost of goods sold during the first six months ended June 30, 2018 compared from a year ago, which resulted in an increase in our gross margin. Operating expenses for the first six months were RMB29.2 million, US$4.4 million, compared to RMB28.0 million in the same period in 2017, which was RMB1.2 million, or 4.3% higher than the same period in 2017. This increase was mainly due to increased expenses on R&D. Net loss attributable to the company was RMB16.9 million, US$2.5 million, compared to net loss attributable to the company of RMB23.8 million during the same period in 2017, representing a decrease of RMB6.9 million from the same period in 2017 due to the factors described above. Cash, cash equivalent and restricted cash totaled RMB62.9 million, or US$9.5 million as of June 30, 2019 – 2018. Total shareholders’ equity was RMB202.1 million, or US$30.5 million. As of June 30, 2018, the company had 3,265,837 basic and diluted total ordinary shares outstanding. In conclusion, we would like to thank our shareholders for their continued loyalty and support. And we believe that we’re well-positioned to face the current challenges and are committed to providing value to our shareholders and customers. We will keep you informed of our progress. With that, we’ll be happy to answer your questions. We require your patience, as we translate the question-and-answer. Rob, please begin the Q&A.

Thank you. [Operator instructions] Thank you. At this time, I’ll turn the floor back to Shiwei Yin for further remarks.

Thanks, Rob. Thank you for joining us today on the conference call, and we look forward to being in touch with you in the next quarter and will keep you updated about our progress. Thank you all, and have a good day.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.