Summary of the Conference Call for Three Gorges Tourism Company Overview - Three Gorges Tourism is a listed platform under the state-owned assets of Yichang City, primarily focusing on tourism services after divesting from low-relevance transportation businesses, including a 40% stake in an automotive sales company and 100% of a logistics subsidiary [2][3]. Key Points Business Structure and Revenue Forecast - From 2024, tourism comprehensive services will become the primary business, with the core product being the "Two Dams and One Gorge" sightseeing cruise [2]. - The forecasted net profit attributable to shareholders for 2025 is between 56 million to 72 million yuan, representing a year-on-year decline of 39% to 52% due to tax payments and impairment losses affecting 50 million to 60 million yuan [2][3]. - Excluding non-operating factors, the operating profit for 2025 is estimated to be around 120 million to 130 million yuan, providing a low base for future growth [2][3]. New Developments in Interprovincial Cruise Business - The company plans to launch its first two luxury interprovincial cruise ships in 2026, with two additional ships expected in 2028 [2][4]. - The interprovincial cruise industry is characterized by strict regulatory policies, leading to stable supply, with approximately 50 vessels currently in operation [4]. - The company’s cruise model includes a capacity of over 600 passengers, with ticket prices ranging from 4,000 to 5,000 yuan, and projected annual revenue per ship in the range of 100 million to 200 million yuan, with a net profit margin of about 20% [2][4]. Industry Trends and Competitive Landscape - The industry is experiencing a trend of mergers and acquisitions, with potential consolidation of underperforming private enterprises by state-owned platforms [4]. - The current operational landscape includes 13 entities, with Three Gorges Tourism being one of the two state-owned enterprises in the sector [4]. - The company anticipates that the four new ships could contribute an additional 200 million yuan in profits, alongside existing business profits, targeting a mid-term performance goal of 350 million yuan [2][5]. Important Considerations - The actual operational metrics such as occupancy rates and ticket prices post-launch will be critical for validating the business model and future profitability [5].

Group 1: Company Growth and Strategy - The company aims to become the leader in tourism in the Yangtze River Three Gorges area and a pioneer in domestic river cruise tourism, leveraging the "One Area Drives" and "One Belt Links" strategies [2][3]. - The first two inter-provincial cruise ships are set to launch in June and December 2026, with a projected annual revenue of CNY 395 million and a net profit of CNY 100 million upon reaching full capacity [3][4]. Group 2: Financial Performance - During the "May Day" holiday in 2025, the company received 122,200 visitors, a 16.83% increase compared to 2024, achieving a new record for daily and overall visitor numbers [5][14]. - In 2024, the company reported a total revenue of CNY 741.32 million, a decrease of 53.68% year-on-year, while net profit fell by 9.29% to CNY 117.59 million. However, excluding the impact of divested businesses, revenue increased by 9.74% and profit rose by 37.94% [10][13]. Group 3: Market Expansion and Product Development - The company is constructing inter-provincial cruise ships to operate routes from Yichang to Chongqing, with future plans to consider additional routes based on market demand [3][4]. - The company has been actively expanding its product matrix, including plans for educational tourism and wellness cruises, having already served over 60,700 students in educational trips by 2024 [11][12]. Group 4: Shareholder and Asset Management - The company has completed the divestiture of non-core assets, such as automotive sales, to focus on its main business of cruise tourism [7][10]. - The indirect controlling shareholder, Hubei Three Gorges Cultural Tourism Holdings, acquired 100% of Hubei Three Gorges Cultural Tourism Co. through a non-compensatory transfer of state-owned equity, maintaining the company's direct controlling shareholder and actual controller [3][4]. Group 5: Safety and Compliance - The company has implemented comprehensive safety measures for its cruise operations, including regular inspections and emergency drills, to ensure passenger safety [11][12]. - The company is committed to adhering to regulatory requirements and enhancing operational management in response to safety incidents in the tourism sector [11][12].