The Zhitong Finance App learned that on May 21, BOSS Direct Recruitment-W (02076) held the 2024 first quarter results meeting. The company said that the company's payment rate is related to job supply and demand, and when the supply of job seekers is insufficient, the company's payment rate will increase accordingly. The company's current strategy is to increase the market share of paying users. The company notes that gross profit margin will continue to increase as revenue continues to increase. Sales expenses will remain stable, marketing expenses will show a downward trend, and the company's profit margin will increase as a result. The increase in AI costs will not affect the company's profit margins.

In terms of performance, BOSS Direct Hire achieved cash revenue of 2.05 billion yuan in the first quarter, net profit of 240 million yuan, and net profit after deducting equity incentives of 130 million yuan, an increase of 117% over the previous year. The company's MAU was 46.62 million, up 17% year over year. The enterprise side is growing even more rapidly. In March, the number of monthly active users of the app surpassed 50 million for the first time, reaching 55 million, an increase of 24% over the previous year.

DAU/MAU remained stable. In the first quarter, 17 million new and improved users were added, totaling more than 190 million, and more than 14 million enterprise users. As of March 31, 2024, the company had 5.7 million corporate recruiters, distributed 3.5 million companies, and paid users for the enterprise.

The company said that there are more than 40 million enterprises in China, and there is still huge room for growth in the number of companies that pay for online recruitment services in China every year. Currently, the average annual payment per enterprise is no more than 2,000 yuan. As companies increase their willingness to pay for high-quality ToB services, the customer unit price will gradually increase. As for the online recruitment industry in China, there is plenty of room for growth in terms of volume and customer unit price.

Regarding the characteristics of this year's spring recruitment, blue-collar users and revenue scale grew rapidly. The growth rate in the first quarter surpassed that of white-collar workers, accounting for more than 35% of revenue. The boom in the manufacturing and logistics industry has improved markedly, maintaining a steady upward trend, and the average number of new jobs added per day is over 40% year on year. In terms of enterprise size, the white-collar industry is recovering, and the recovery in recruitment demand from large enterprises is superior to that of small enterprises. At the city level, Tier 2 cities and below have maintained an upward trend in user and revenue growth, and Tier 1 cities have also recovered. Manufacturing, logistics, high-end manufacturing, and finance are currently industries with higher recruitment needs.

In addition, the company completed the acquisition project of the talent exchange platform “My Job Network”. Meanwhile, the conch project continues to advance. In the first quarter, Conch Preferred Online Jobs exceeded 26w, covering 2,700w job seekers. Based on the experience of “My Job Network”, combined with BOSS direct recruitment, to provide good blue collar services, the model and revenue will develop even more in the future.

Q & A:

Q: What is the trend of domestic recruitment demand in the first quarter? Changes compared to the same period last year and the previous quarter?

A: The number of job postings in the company is growing faster than last year, and the number of Nikkoku recruiters and companies continues to rise. From an inventory perspective, there was a marked improvement in activity compared to 2023. Demand for blue-collar jobs is growing rapidly, mainly from manufacturing and supply chain logistics, and service industry performance is average. In terms of enterprise size, it was predicted that small and micro enterprises would recover faster last year, but after the recovery of large enterprises, their performance will be even stronger, and currently it seems to be in line with expectations. In April, the average number of new jobs added per day for enterprises with more than 500 employees grew by more than 10% month-on-month.

Q: The company's own business development, growth drivers, and expectations for the second quarter? Growth expectations for the full year? What impact will the increase in the service sector base in April-May have on full-year expectations?

A: The number of new users, user activity, and the manufacturing and supply chain industries are the main drivers of the company's revenue growth. At the same time, new jobs in first-tier cities are also an important driving force for growth. At present, regardless of the number of enterprises, number of users, or regional conditions, the situation is relatively stable. Meanwhile, the Q2 situation is related to Q1. The Q1 situation is better than the same period and exceeds the guidelines. This performance meeting is still in the early Q2 period, and Q2 will maintain strong growth, reaching a growth rate of 28-32%.

Q: The company's paid users have maintained rapid growth. What is the company's current payment rate? Can revenue growth be further split?

A: In the past year, the number of paying companies was 350w, less than 10% of China's. The company's model is highly adaptable, and it is hoped that more companies will become paying users in the future. Based on the strategy of increasing market share, currently the company will not adopt aggressive strategies for new users and will not easily charge fees. When companies need to recruit, they will add new users. The company's payment rate is related to job supply and demand. When the supply of job seekers is insufficient, the company's payment rate will increase accordingly. The company's current strategy is to increase the market share of paying users.

Q: The graduation season is coming soon. Last year's graduation season brought a huge increase in user supply. What is the company's outlook for the graduation season?

A: Last year, due to the pandemic, two-year graduates were stepped on. The reluctance of college students to work outside the home last year was also quite serious. This was due to few job opportunities and too long time at home. As the number of jobs on the platform continues to reach new heights, and the number of white-collar jobs created by large enterprises and jobs in big cities increases, it is expected that the job search situation for students will improve this year. From after the Spring Festival to mid-May this year, the platform took the initiative to contact students for full-time jobs, an increase of 30%. BOSS Direct Hiring will continue to work hard to help new graduates find their dream jobs.

Q: In terms of the blue-collar market, has there been any change in the company's current business philosophy after the acquisition of “My Part-Time Job Network”? What are your thoughts on the service situation of this group of users in the future?

A: “My Job Network” is a survivor in the recruitment market. They pioneered reforms suited to digital capabilities and Chinese factory stores, built a service platform centered around users and job seekers, and became regional leaders. As a merger and acquisition case disclosed for the first time by BOSS Direct Employment, it shows the acquisition strategy of BOSS Direct Employment -- the core capabilities of the target company through mergers and acquisitions, which helps the company to take fewer detours and quickly achieve success in the target field.

Q: User growth has been good this year. What is the future marketing strategy?

A: The company evolves to maintain the stability of investment costs, and will carefully adopt strategies for future Olympics. In the absence of large marketing, the number of users in the company has also reached an objective level, and the number of new users added this year is also quite sufficient, so there is no need to increase marketing excessively.

Q: Has the competitive landscape changed since spring recruitment?

A: At the time of the spring recruitment, the company's main peers were more aggressive in the market. Due to the predictable increase in revenue, competition will be more intense when the company buys a location. After the first quarter, the April data showed that the company's competitive landscape remained stable, and some of them achieved leading positions in the industry.

Q: Regarding the marketing strategy, if major companies increase their AI expenses, will their profit margins be adjusted in a targeted manner in the future.

A: Due to the continuous increase in revenue, the gross profit margin will continue to increase. Sales expenses will remain stable, marketing expenses will show a downward trend, and the company's profit margin will increase as a result. The increase in AI costs will not affect the company's profit margins.