Joining us today is our Chief Executive Officer, Mr. Chunlin Wang, and Chief Financial Officer, Mr. Peng Ge. They will walk you through our second quarter and first half of 2012 financial and operating results and discussed the progress of our strategic transaction. We will take your questions after the prepared remarks. Now I will turn the call over to Mr. Wang.
Dear shareholders, investors, analysts, good morning. Thank you for joining us on today's conference call. Mr. Peng Ge and I will begin today's call with a review of our second quarter and first half of 2012 financial and operating performance followed by an update on the progress of our strategic transaction. Then we will go into the Q&A session.
The global and domestic macroeconomic situation were increasingly challenging in the first half 2012. China’s GDP growth was estimated to be below 8%, reaching an eight years low. Against this backdrop, the growth slowdown in China’s insurance industry continued into the first half 2012, [with this] to go single digit year-over-year growth of 5.9% in terms of total premiums. P&C insurance sector grew 14.4% from the first half 2011 but the market competition among insurers intensified and insurers had to increase incentives and telemarketing campaigns, which eroded some of their underwriting profits.Life insurance sector on the other hand only grew 0.23% year-over-year in terms of premiums in the first half of 2012, as insurers continue to face difficulty in agent recruitment and retention, (inaudible) a weak insurance base. Impacted by the macroeconomic situation and structural changes of the China’s insurance industry, our total net revenues was up 2.3% year-on-year in the second quarter of 2012. Cost increases however, offset the revenue growth due to the challenging operating environment. As a result our net income attributable to the company's shareholders for the second quarter of 2012 was down 67.2% and non-GAAP net income attributable to the company's shareholders which excluded share-based compensation expenses, was down 34.2% year-over-year.