Operator: Thank you for standing by and welcome to the SunCar Technology Group Fiscal Year 2023 Earnings Call. Please note, that today’s call is being recorded. I will now turn the meeting over to Jennifer Jiang, Director of Investor Relations for SunCar Technology Group. Please go ahead.

Jennifer Jiang: Thank you and thanks to everyone joining us today for SunCar’s fiscal year 2023 earnings call, our first as a public company.

Please note that our earnings press release was issued yesterday and our annual report on Form 20-F was filed with the Securities and Exchange Commission yesterday. Those are available in the Investor Relations section of our website

at https://suncartech.com. Joining us on today’s call is; Mr. Zaichang Ye, Founder, Chairman and CEO of SunCar and; Stanley Yang, Chief Strategy Officer. The format of our call will consist of comments provided by Mr.

Ye and Mr. Yang, followed by a question-and-answer session, addressing the questions that were submitted by investors. We thank everyone for submitting these questions. Before we get started, I’m going to review the Safe Harbor statement. Please note that today’s discussion will contain forward-looking statements made under the Safe Harbor provision of the US Private Securities Litigation Reform Act of 1995.

Forward-looking statements involve inherent risks and uncertainties. As such, our result may differ materially from the views expressed today. Further information regarding this and other risks and uncertainties are included in the company’s annual report on Form 20-F for the fiscal year ended December 31, 2023, and in other documents filed with the US Securities and Exchange Commission. SunCar Technology does not assume any obligation to update any forward-looking statements except as required under applicable law. With that, I would like to turn over the call to our first speaker, Mr.

Zaichang Ye, Chairman and CEO of SunCar.

Zaichang Ye: Good afternoon and thank you all for joining us. This is our first earnings call as a public company, following the closing of our business combination with Goldenbridge Acquisition Limited, and listing of our shares on the NASDAQ in May 2023. Our public listing was an important milestone, but it was just one step in our vision to establish SunCar as the largest technology platform for Auto Services and e-Insurance. We are using technology to transform the customer experience for Auto Services and Auto e-Insurance in China, the largest and fastest growing passenger vehicle market in the world.

At SunCar, we offer a leading cloud-based technology platform that seamlessly connects our owners with a wide range of Auto Services and e-Insurance policy options through a nationwide network of Auto Service providers and sales partners. I would like to thank our employees, partners and customers, as well as our loyal shareholders for your continued support and belief in our vision. We look forward to another year of growth in 2024. Now, I will turn it back to Jennifer Jiang, Director of Investor Relations for SunCar Technology Group, to provide an overview of our operational and financial performance.

Jennifer Jiang: Thank you.

Since our inception in 2007, our commitment to innovation has allowed us to grow with China’s rapidly expanding technology landscape. In our Auto Service segment, we provided a technology platform to book Auto Services for the end clients of our enterprise customers. In recent years, we have significantly expanded our offerings of Auto Service providers to over 47,000 across more than 350 cities and all 33 provinces in China. In our Auto e-Insurance segment, we have seen substantial growth with our network of insurance sales partners increasing to over 64,000 as of December 31, 2023. We have continued to factor strong relationships with more than 80 leading insurance companies.

This includes all of the top 10 insurance companies who hold over 90% market share in auto insurance in China. This has significantly enhanced our capabilities in offering a comprehensive range of insurance products. As Chairman Ye began to discuss, we leverage a cloud-based technology platform that is the backbone of our business offerings. This includes an easy-to-use mobile application for our customers and sales partners. Our platform provides seamless API integrations, user-friendly management tools and our AI-powered e-Insurance buying process that delivers real-time quotations and policy management tools.

The interconnected nature of our Auto Service and Auto e-Insurance businesses creates many synergies for our platform. For example, our extensive network of Auto Service providers serve as a direct sales channel for our e-Insurance products. Similarly, our relationships with insurance companies often result in new clients for our Auto Service segment. Aligning with the automotive industry shift towards electric and smart vehicles, we have expanded our collaboration with electric vehicles and smart car manufacturers, which is the fastest growing segment of auto sales in China. In addition, with our advanced cloud-based technology, we work with the top 20 electric vehicles’ OEMs in China, embedding our solutions directly into their platforms.

This enhances our market presence and creates new avenues for growth. In an effort to further highlight our deep relationships, we have formed a strategic partnership with many major electric vehicle manufacturers in China, including Tesla, NIO, XPeng, Li Auto and BYD. We will now transition to our financial performance, all of which will be presented in US dollars. For the fiscal year ended December 31, 2023, we are pleased to report total revenue of $364 million, up 29% from $282 million in 2022. This growth underscores our leading position in the Auto Service and e-Insurance sectors and highlights the effective synergy between these two core segments of our business.

Our Auto Service segment reported a revenue of $215 million in fiscal year 2023, an increase of 8% from $199 million in fiscal year 2022. This segment consist of SunCar’s technology platform which facilitates Auto Services such as car wash, maintenance, driving services and road assistance. These services are provided to the end customers of our enterprise clients in the form of coupons or discounts. Our Auto e-Insurance segment reported a revenue of $149 million in fiscal year 2023, an increase of 79% from $83 million in fiscal year 2022. This segment consists of e-Insurance Intermediation and Technology Service.

Our e-Insurance Intermediation business generated $118 million in fiscal year 2023, a 75% increase over fiscal year 2022. This growth was driven by an increase in gross premiums written and the numbers of insurance policies issued compared to the year ended December 31, 2022. Specifically, we experienced over 100% year-on-year revenue growth driven by our strong relationships with electric vehicle manufacturers including Tesla, NIO, XPeng and Li Auto. Our Technology Service business generated a revenue of $31 million for the year ended December 31, 2023, a 98% increase over 2022. Our net losses were $18 million and $12 million for the year ended December 31, 2023 and 2022, respectively.

We continue to strategically invest in technology and business development as we increase our presence with some of the largest enterprise customers in China. We believe that adjusted EBITDA, a non-GAAP metric which excludes certain non-recurring items and non-cash expenses, is useful in evaluating our operational performance in addition to the GAAP metrics. Our adjusted EBITDA increased by $7.2 million from year ended December 31, 2022 to a positive $1.6 million in year ended December 31, 2023. In conclusion, 2023 has been a year of significant progress and strategic expansion for SunCar. We are well positioned to continue our growth and capitalize on the opportunities ahead.

Thanks to our robust cloud-based technology platform provided services and the trust of our customers and partners. We will now transition to the question-and-answer portion of this call. Thank you, everyone who has submitted questions. A - Unidentified

Company Representative: Our first question, why and how do banks, insurance companies and enterprise clients use SunCar Auto Service?

Stanley Yang: Hi, I’m Stanley Yang, and I am the Chief Strategy Officer of SunCar. Our key customers such as banks, insurance companies, airlines use our cloud based platform to offer various services to their clients.

Our clients, such as banks and insurance companies aligns use our cloud-based platforms for also various services to their clients. Our clients such as banks and insurance companies operate in a highly competitive B2C markets in China. In order to separate themselves from their competitors, these enterprises offer Auto Services to retain their key clients. We are engaged with some of the largest private and state-owned enterprises in China. Our apps integrates with these customers, allowing their end clients seamless access to a wide range of Auto Service nationwide.

And with a network of over 47,000 suppliers across our 350 cities, we ensure that our customers can offer their end clients a broad selection of services to enhance their experiences and increase loyalty. Unidentified

Company Representative: What differentiates you and why do people choose you over your competitors?

Stanley Yang: We are one of the few cloud-based technology platforms in China offering both e-Insurance and access to Auto Service. Unlike our competitors, who often operate on a regional basis, we provide nationwide coverage. Additionally, our competitors use a highly manual process for Auto Service and e-Insurance. We have technology integrations with most of the largest insurance companies in China and this allows us to deliver an e-Insurance policy to end customers in less than two minutes.

Unidentified

Company Representative: Which business is the more profitable? Services or insurance?

Stanley Yang: Currently, our Auto Service segment is more profitable than our e-Insurance segment. The Auto e-Insurance market is rapidly growing and we are investing in growth to continue gain market share across China. We have partnerships with major electric vehicle manufacturers in China including Tesla, NIO, XPeng, Li Auto, Xiaomi to provide professional auto insurance system and the technical services. The company is still prioritizing top line expansion in this segment and as business grows, e-Insurance profitability will be the key area of focus. And as Jennifer mentioned earlier in the call, the business reported positive adjusted EBITDA of $1.6 million for the year ended December 31, 2023.

Unidentified

Company Representative: Thank you. Given the growth in the Insurance business, do you expect it to be the bigger, more dominant portion of the company?

Stanley Yang: Our e-Insurance business is currently in a stage of rapid growth led by increased vehicle sales in China and adoption of electric vehicles. We expect our e-Insurance segment to become the larger portion of our business in the future. However, due to the synergetic nature between our two business segments, growth in one segment will positively impact the other. Unidentified

Company Representative: Thank you.

What is your go-to market strategy for insurance?

Stanley Yang: Our go-to market strategy for our e-Insurance segment is focused on leveraging our over 64,000 sales partners to deliver cloud-based insurance solutions to end customers. These sales partners include a large Auto Service network with frequent exposure to the car owners and auto manufacturers who offers our solutions directly to car buyers and owners. Our cloud-based platform allows us to deliver insurance policies to car owners in under two minutes. Unidentified

Company Representative: And our last question, what is driving the growth of the business?

Stanley Yang: The growth has been driven by continued adoption of our Auto e-Insurance technology cross over 64,000 sales partners in China. This has helped contribute to a 29% year-over-year increase in total revenue for year 2023 as discussed earlier in the call.

Our Auto e-Insurance segment grew at a rate of 79% year-over-year ended December 31, 2023 and this growth was primarily driven by an increase in our gross premiums written and the numbers of insurance policy issued. Additionally, as electric vehicle sales in China continue to increase, we have deepened our relations with electric vehicle manufacturers. So thank you, everyone for participating on today’s call. We look forward to providing additional updates in the near future. In the meantime, we can reach at the ir@suncartech.com.

Thank you.

Operator: Thank you. Ladies and gentlemen, that concludes our conference for today. Thank you for your participation. You may now disconnect your lines.