ZTO EXPRESS-W(02057) announces its third quarter performance with a net profit of 2.379 billion yuan, an increase of 1.25% year-on-year, and a parcel volume of 8.723 billion pieces.

ZTO EXPRESS-W (02057) released its performance for the third quarter of 2024, with revenue of 10.675 billion yuan, a year-on-year increase of 17.62%; net profit was 2.379 billion yuan, a year-on-year increase of 1.25%; net profit attributable to ZTO Express (Cayman) Limited was 2.396 billion yuan, a year-on-year increase of 2.18%; basic earnings per share attributable to ordinary shareholders were 2.98 yuan. In the first three quarters, revenue was 31.361 billion yuan, a year-on-year increase of 12.81%; net profit was 6.441 billion yuan; net profit attributable to ZTO Express (Cayman) Limited was 6.434 billion yuan; basic earnings per share attributable to ordinary shareholders were 7.99 yuan. In the third quarter of 2024, parcel volume was 8.723 billion pieces, a 15.9% increase compared to the same period in 2023. As of September 30, 2024, there were over 31,000 pickup/delivery points. As of September 30, 2024, the number of direct network partners was over 6,000. As of September 30, 2024, there were over 10,000 self-owned line-haul vehicles. Out of over 10,000 self-owned vehicles, over 9,700 were high-capacity models with a length of 15 to 17 meters as of September 30, 2024, compared to over 9,300 vehicles as of September 30, 2023. As of September 30, 2024, the number of line-haul transportation routes between sorting centers was over 3,900, compared to over 3,800 as of September 30, 2023. As of September 30, 2024, there were 95 sorting centers, with 91 operated by the company and 4 by the company's network partners. Lai Meisong, founder, chairman, and CEO of ZTO, said, "In the third quarter, ZTO continued to maintain high-quality service and customer satisfaction, achieving a parcel volume of 8.72 billion pieces and an adjusted net profit of 2.39 billion yuan. This quarter, with our systematic deepening of cooperation with major e-commerce platforms in reverse logistics, delivery to remote areas, and value-added services, our express delivery volume achieved over 40% year-on-year growth. Our strategy of optimizing business structure has also made a very positive contribution to revenue and operating profit margins." Lai Meisong added, "Since becoming a leading player in the industry nearly a decade ago, leading in business volume has always been one of our key strategic focuses. The recent stimulus policies issued by the central government have sent a strong signal of its commitment to supporting China's economic recovery and long-term growth. Meanwhile, before the economic situation truly turns around, downgrade in consumption may continue for some time. Leading in business volume is the cornerstone of our business. We are actively initiating plans to regain market share, expand our leading edge in business volume, and achieve reasonable profitability while maintaining high-quality service and customer satisfaction." Yan Huiping, Chief Financial Officer of ZTO, said, "ZTO's core single ticket revenue increased by 1.8% this quarter, benefiting from the continuous optimization of customer structure, with the increase in direct customer revenue offsetting the negative impact from the decrease in single parcel weight and the increase in incremental subsidies. At the same time, thanks to continuous cost reduction and efficiency improvement initiatives, our single ticket sorting and transportation costs decreased by 8.4%, namely 6 cents. The proportion of operating expenses to revenue remained stable at around 5%. Operating cash flow was 3.1 billion yuan, with capital expenditures of 1.8 billion yuan." Yan Huiping added, "The express delivery industry has achieved high-speed growth despite the weak macroeconomic environment. Based on our anticipation of the next few months, we have lowered the annual business volume target. The continuous increase in the proportion of low-value e-commerce parcels presents a challenge to our overall strategy of achieving simultaneous growth in service quality, business volume, and profitability. We are making adjustments to rebalance our resource allocation and network pricing strategy in order to regain momentum in business volume growth and expand our existing market share lead. Our profitability will remain stable, and we are confident in maintaining a leading position in profitability in the industry."