Parcel Volume and Adjusted Net Income Exceeded
Guidance and Market Consensus
Company Reiterates Market Share Focus with Profitable Volume
Growth
SHANGHAI, Aug. 8, 2018 /PRNewswire/ -- ZTO Express
(Cayman) Inc. (NYSE: ZTO) ("ZTO" or the "Company"), a leading
and fast-growing express delivery company in China, today announced its unaudited financial
results for the second quarter ended June
30, 2018[1].
Parcel volume grew 41.7% to 2,116 million for the second quarter of
2018, surpassing industry average growth rate by 16.7 percentage
points. Adjusted net income was RMB1,095.7
million representing an increase of 50.0% year over year.
Management reaffirms its strategic focus on steady market share
increase with profitable parcel growth achieving systemic margin
expansion.
Financial Highlights for Second Quarter 2018
- Revenues[2] were
RMB4,197.9 million (US$634.4 million), an increase of 41.3% from
RMB2,971.4 million in the same period
of 2017.
- Gross profit was RMB1,457.3
million (US$220.2 million), an
increase of 29.7% from RMB1,123.9
million in the same period of 2017.
- Net income was RMB1,492.2 million
(US$225.5 million), an increase of
108.1% from RMB716.9 million in the
same period of 2017.
- Adjusted EBITDA[3]
was RMB1,520.2 million (US$229.7 million), an increase of 37.6% from
RMB1,104.6 million in the same period
of 2017.
- Adjusted net income[4] was RMB1,095.7 million (US$165.6 million), an increase of 50.0% from
RMB730.4 million in the same period
of 2017.
- Basic and diluted earnings per American depositary share
("ADS"[5]) were
RMB2.07 (US$0.31), an increase of 107.4% from
RMB1.00 in the same period of
2017.
- Net cash provided by operating activities was RMB1,475.8 million (US$223.0 million), compared with RMB903.2 million in the same period of 2017.
Operational Highlights for Second Quarter 2018
- Parcel volume was 2,116 million, an increase of 41.7% from
1,493 million in the same period of 2017.
- Number of pickup/delivery outlets was approximately 29,500 as
of June 30, 2018.
- Number of network partners was over 9,400, which included over
4,000 direct network partners and over 5,400 indirect network
partners as of June 30, 2018.
- Number of line-haul vehicles was over 4,700 as of June 30, 2018, which included over 3,800
self-owned vehicles and over 900 vehicles owned and operated by
Tonglu Tongze Logistics Ltd., a transportation operator that works
exclusively for ZTO.
- Number of self-owned trucks increased to around 3,800 as of
June 30, 2018 from 3,500 as of
March 31, 2018. Among the self-owned
trucks, over 2,070 were high capacity 15-17 meter long models as of
June 30, 2018, compared to over 1,900
as of March 31, 2018.
- Number of line-haul routes between sorting hubs was over 1,860
as of June 30, 2018.
- Number of sorting hubs was 83 as of June
30, 2018, among which 76 are operated by the Company and 7
by the Company's network partners.
[1]
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An investor relations
presentation accompanies this earnings release and can be found at
ir.zto.com.
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[2]
|
Starting from January
1, 2018, the Company adopted a newly enacted revenue accounting
standard (ASC 606), which requires its delivery services revenue to
be recognized over time, and uses a modified retrospective approach
to adopt this standard. The January 1, 2018 balance of retained
earnings was not adjusted due to the immaterial cumulative net
impact of adopting ASC 606. The impact of applying ASC 606 as
compared with previous guidance applied to revenues and costs was
not material for the three months ended June 30, 2018.
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[3]
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Adjusted EBITDA is a
non-GAAP financial measure, which is defined as net income before
depreciation, amortization, interest expenses and income tax
expenses, and further adjusted to exclude the shared-based
compensation expense and non-recurring items such as the gain on
disposal of equity investees which management believes better
represents underlying business operations.
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|
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[4]
|
Adjusted net income
is a non-GAAP financial measure, which is defined as net income
before share-based compensation expense and non-recurring items
such as gain on disposal of equity investees which management
believe better represents underlying business
operations.
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[5]
|
One ADS represents
one Class A ordinary share.
|
Mr. Meisong Lai, Founder,
Chairman and Chief Executive Officer of ZTO, commented "ZTO has
never deviated from its for-profit philosophy and is committed to
the shared-success system that benefits everyone operating under
the ZTO brand. Our near-term primary focus on parcel volume growth
and market share expansion is predicated on generating systemic
profit increase while maintaining the high quality of service and
customer satisfaction. Our second quarter results are consistent
with this overall strategy in which our existing margin is well
protected, and our incremental parcel volume growth is also
profitable."
Mr. Lai added, "We remain optimistic on the growth potential for
China's express delivery industry
over the next two to three years. Short-term market conditions
could remain competitive, however, our competitive advantage in
scale and operational efficiency, superior earnings quality and
stability of our partner network will ensure ZTO's sustainable
growth and long-term leadership."
Ms. Huiping Yan, Chief Financial
Officer of ZTO, added, "According to statistics published by the
China Postal Bureau, the express delivery industry in China grew by 27.5% in the first half of 2018.
With parcel volume increasing by 39.2% during the same period, ZTO
outpaced the industry average by 11.7 percentage points. Meanwhile,
initiatives to improve operating efficiencies resulted in
13 cents decrease in combined
transportation and hub operation cost per parcel year over year for
the second quarter, which helped to largely offset the impact of
pricing pressure. We also maintained operating leverage in
corporate SG&A. We generated 50% adjusted net income growth
against 41.3% revenue growth in the quarter which demonstrated the
effectiveness of our strategy and our ability to execute."
Second Quarter 2018 Financial Results
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
RMB
|
|
%
|
|
RMB
|
|
US$
|
|
%
|
|
RMB
|
|
%
|
|
RMB
|
|
US$
|
|
%
|
|
(in thousands,
except percentages)
|
Express delivery
services
|
2,837,699
|
|
95.5
|
|
3,664,535
|
|
553,798
|
|
87.3
|
|
5,348,367
|
|
95.7
|
|
6,751,532
|
|
1,020,316
|
|
87.2
|
Freight forwarding
services
|
-
|
|
-
|
|
301,789
|
|
45,607
|
|
7.2
|
|
-
|
|
-
|
|
595,063
|
|
89,928
|
|
7.7
|
Sale of
accessories
|
133,735
|
|
4.5
|
|
209,219
|
|
31,618
|
|
5.0
|
|
237,661
|
|
4.3
|
|
360,062
|
|
54,414
|
|
4.7
|
Others
|
-
|
|
-
|
|
22,376
|
|
3,382
|
|
0.5
|
|
-
|
|
-
|
|
35,666
|
|
5,390
|
|
0.4
|
Total
revenues
|
2,971,434
|
|
100.0
|
|
4,197,919
|
|
634,405
|
|
100.0
|
|
5,586,028
|
|
100.0
|
|
7,742,323
|
|
1,170,048
|
|
100.0
|
Revenues were RMB4,197.9
million (US$634.4 million), an
increase of 41.3% from RMB2,971.4
million in the same period of 2017. Revenue from express
delivery services increased by 29.1% compared to the same period of
2017, mainly driven by a 41.7% increase in parcel volume which was
partially offset by a decrease in unit price per parcel as a result
of decrease in weight per parcel and an increase in incremental
volume incentives. Freight forwarding services acquired during the
fourth quarter of 2017 contributed revenue of RMB301.8 million during the second quarter of
2018. The increase in revenue from sales of accessories was mainly
due to the increase in sales of thermal paper used for the printing
of digital waybills. Other revenues are composed of exploratory new
service offerings such as financing services, advertising services
and cloud warehousing solutions.
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
|
|
%
of
|
|
|
|
|
|
%
of
|
|
|
|
%
of
|
|
|
|
|
|
%
of
|
|
RMB
|
|
revenues
|
|
RMB
|
|
US$
|
|
revenues
|
|
RMB
|
|
revenues
|
|
RMB
|
|
US$
|
|
revenues
|
|
(in thousands,
except percentages)
|
Line-haul
transportation cost
|
1,062,504
|
|
35.8
|
|
1,272,267
|
|
192,269
|
|
30.3
|
|
2,182,592
|
|
39.1
|
|
2,455,904
|
|
371,145
|
|
31.7
|
Sorting hub
cost
|
527,868
|
|
17.8
|
|
701,961
|
|
106,083
|
|
16.7
|
|
1,084,054
|
|
19.4
|
|
1,388,398
|
|
209,820
|
|
17.9
|
Freight forwarding
cost
|
-
|
|
-
|
|
288,348
|
|
43,576
|
|
6.9
|
|
-
|
|
-
|
|
572,018
|
|
86,445
|
|
7.4
|
Cost of accessories
sold
|
83,685
|
|
2.8
|
|
125,724
|
|
19,000
|
|
3.0
|
|
146,134
|
|
2.6
|
|
214,441
|
|
32,407
|
|
2.8
|
Other
costs
|
173,468
|
|
5.8
|
|
352,365
|
|
53,251
|
|
8.4
|
|
318,690
|
|
5.7
|
|
622,182
|
|
94,027
|
|
8.0
|
Total cost of
revenues
|
1,847,525
|
|
62.2
|
|
2,740,665
|
|
414,179
|
|
65.3
|
|
3,731,470
|
|
66.8
|
|
5,252,943
|
|
793,844
|
|
67.8
|
Total cost of revenues was RMB2,740.7 million (US$414.2 million), an increase of 48.3% from
RMB1,847.5 million in the same period
last year. Total cost of revenues includes RMB288.3 million in costs associated with the
freight forwarding business acquired during the fourth quarter of
2017, which is mainly composed of shipping, last-mile delivery, and
cargo handling costs.
- Line haul transportation cost was RMB1,272.3 million (US$192.3 million), an increase of 19.7% from
RMB1,062.5 million in the same period
last year. As a percentage of revenues, line-haul transportation
cost decreased to 30.3% from 35.8% in the same period last year,
mainly driven by (i) a decrease in weight per parcel, (ii)
increased usage of self-owned and more efficient high capacity
trailer trucks, and (iii) improved route planning. The total
transportation cost of self-owned trucks accounted for 61.8% of the
total truck transportation cost in this quarter, compared to 52.6%
in the same period last year.
- Sorting hub operating cost was RMB702.0 million (US$106.1
million), an increase of 33.0% from RMB527.9 million in the same period last year. As
a percentage of revenues, sorting hub cost decreased to 16.7% from
17.8% in the same period last year, mainly due to the increased
level of automation in the Company's sorting facilities which
offset a portion of the continuous increase in labor cost per
headcount. As of June 30, 2018, 64
sets of automation sorting equipment are in service, compared to 22
sets as of June 30, 2017. As a
result, the average number of headcount of sorting hub workers
increased by 16.7% when compared to the second quarter of 2017,
significantly less than the 41.7% increase in parcel volume during
the second quarter of 2018.
- Cost of accessories was RMB125.7
million (US$19.0 million), an
increase of 50.2% from RMB83.7
million in the same period last year. The increase was in
line with the increase in the sale of thermal paper for waybill
printing by 65.4% compared to the same period last year.
- Other costs were RMB352.4
million (US$53.3 million),
increased by RMB178.9 million
compared to the same period last year, primarily due to (i) an
increase of RMB111.4 million
(US$16.8 million) in dispatching
costs associated with serving enterprise customers, (ii) an
increase of RMB38.9 million
(US$5.9 million) in tax surcharges,
and (iii) an increase of RMB35.8
million (US$5.4 million) in
expenses related to IT and technology development.
Gross Profit was RMB1,457.3
million (US$220.2 million), an
increase of 29.7% from RMB1,123.9
million in the same period last year. Gross margin decreased
to 34.7% from 37.8% in the same period last year, mainly driven by
parcel volume growth and cost of goods sold efficiency gain which
was offset by price decrease. In addition, freight forwarding
business and other early stage business development caused minor
gross margin dilution.
Total Operating Expenses were RMB268.4 million (US$40.6
million), compared to RMB202.6
million in the same period last year.
- Selling, general and administrative expenses were
RMB269.2 million (US$40.7 million), compared to RMB202.7 million in the same period last year.
The increase was mainly due to (i) an increase in share-based
compensation expenses from RMB13.5
million in the second quarter of 2017 to RMB28.0 million (US$4.2
million) in the second quarter of 2018, (ii) an increase of
salary and accrued bonus of RMB11.2
million, (iii) an increase in technology related
professional service fees by RMB12.3
million, and (iv) an increase of RMB6.4 million of depreciation and amortization
expenses as well as an increase of RMB5.1
million in rental cost. As a percentage of revenue, selling,
general and administrative expenses accounted for 6.4%, compared to
6.8% during the same period last year.
- Other operating income, net includes RMB0.8 million (US$0.1
million) in the second quarter of 2018. Other operating
income mainly includes subsidy income of RMB1.3 million (US$0.2
million) and RMB10.7 million
received in the second quarter of 2018 and 2017, respectively.
Income from operations was RMB1,188.8 million (US$179.7 million), an increase of 29.0% from
RMB921.3 million in the same period
last year. Operating margin decreased to 28.3% from 31.0% in the
same period last year, mainly affected by the decrease in gross
margin by 3.1%.
Interest income was RMB70.7
million (US$10.7 million),
compared with RMB39.6 million in the
same period in 2017, primarily due to the increased amount of cash
and interest-earning bank deposits which included Alibaba-Cainiao's
investment in June 2018.
Interest expense was nil on bank borrowings, compared
with RMB5.0 million in the same
period in 2017.There was no borrowing during the second quarter of
2018.
Gain on disposal of equity investees was RMB549.7 million (US$83.1
million), mainly composed of the share disposal of the Hive
Box investment for cash consideration of RMB697.9 million (US$105.5
million) which is scheduled to be received in the third
quarter of 2018.
Foreign currency exchange gain, before tax was
RMB35.9 million (US$5.4 million), which was mainly due to the
appreciation of the U.S. dollar against the Chinese renminbi in the
second quarter of 2018.
Income tax expenses were RMB350.9
million (US$53.0 million),
representing the effective income tax rate of 19.0% in the second
quarter of 2018, which was mainly due to the one-time income tax
expense of RMB125.1 million
(US$18.9 million) for the disposal
gain on the Hive Box investment.
Net income was RMB1,492.2
million (US$225.5 million),
and increased 108.1% from net income of RMB716.9 million in the same period last
year.
Basic and diluted earnings per ADS were RMB2.07 (US$0.31),
compared with basic and diluted earnings per ADS of RMB1.00 in the same period last year.
Adjusted net income was RMB1,095.7
million (US$165.6 million),
compared with adjusted net income of RMB730.4 million during the same quarter last
year.
EBITDA was RMB2,042.0
million (US$308.6 million),
compared with RMB1,091.1 million in
the same period last year.
Adjusted EBITDA was RMB1,520.2
million (US$229.7 million),
compared to RMB1,104.6 million in the
same period last year.
Net cash provided by operating activities was
RMB1,475.8 million (US$223.0 million), compared with RMB903.2 million in the same period last year.
The increase mainly included (1) a tax refund of RMB301.0 million (US$45.5
million) related to the reduced income tax rate applicable
for high and new technology enterprises, and (2) increased deposits
for last-mile delivery fees.
Business Outlook
Based on current market conditions and current operations, the
Company's parcel volume for the third quarter of 2018 is expected
to be in the range of 2,073 million to 2,020 million, representing
a 35.0% to 38.0% increase year over year, and the Company's
adjusted net income is expected to be in the range of RMB1,000 million to RMB1,050 million, representing a 36.9% to 43.7%
increase from the same period of 2017. These estimates represent
management's current and preliminary view, which are subject to
change.
Company Share Purchase
On May 21, 2017, the Company
announced a share repurchase program whereby ZTO is authorized to
repurchase its own Class A ordinary shares in the form of ADSs with
an aggregate value of up to US$300
million during the 12-month period thereafter. As of
June 30, 2018, the Company has
purchased an aggregate of 15,625,375 ADSs at an average purchase
price of US$14.42, including
repurchase commissions.
The Company believes that the share repurchase program
represents ZTO's confidence in its cash flow, and in the long-term
outlook for the express delivery industry in China. ZTO's fast-growing strategy,
asset-light business model and solid operation have demonstrated
strong capability for cash generating. The Company believes that
the share repurchase program is consistent with the goal of
increasing shareholders' value.
Alibaba and Cainiao Make Strategic Investments ("Alibaba's
Investment")
On May 29, 2018, Alibaba Group
Holding Limited ("Alibaba") and its logistic arm Cainiao Network
("Cainiao"), and the Company announced a strategic agreement in
which investors led by Alibaba and Cainiao invested US$1.38 billion in the Company in exchange for an
approximately 10% equity stake in the company. The transaction was
closed by the end of June, 2018.
The investment will see Cainiao and the Company deepen their
collaboration in the transformation of China's logistics industry amid the growth of
New Retail, a concept developed by Alibaba that promotes seamless
integration between online and offline commerce. The investment
will further support both Cainiao and the Company's focus on
building up first and last-mile pickup and delivery capabilities,
warehouse management, cross-border logistics and technology-driven
smart solutions.
Exchange Rate
This announcement contains translation of certain Renminbi
amounts into U.S. dollars at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Renminbi to U.S. dollars were made at the exchange rate of
RMB6.6171 to US$1.00, the noon buying rate on June 30, 2018 as set forth in the H.10
statistical release of the Board of Governors of the Federal
Reserve Systems.
Use of Non-GAAP Financial Measures
The Company uses adjusted EBITDA and adjusted net income, each a
non-GAAP financial measure, in evaluating ZTO's operating results
and for financial and operational decision-making purposes.
Reconciliations of the Company's non-GAAP financial measures to
its U.S. GAAP financial measures are shown in tables at the end of
this earnings release, which provide more details about the
non-GAAP financial measures.
The Company believes that adjusted EBITDA and adjusted net
income help identify underlying trends in ZTO's business that could
otherwise be distorted by the effect of the expenses and gains that
the Company includes in income from operations and net income. The
Company believes that adjusted EBITDA and adjusted net income
provide useful information about its operating results, enhance the
overall understanding of its past performance and future prospects
and allow for greater visibility with respect to key metrics used
by ZTO's management in its financial and operational
decision-making.
Adjusted EBITDA and adjusted net income should not be considered
in isolation or construed as an alternative to net income or any
other measure of performance or as an indicator of the Company's
operating performance. Investors are encouraged to review the
historical non-GAAP financial measures to the most directly
comparable GAAP measures. Adjusted EBITDA and adjusted net income
presented here may not be comparable to similarly titled measures
presented by other companies. Other companies may calculate
similarly titled measures differently, limiting their usefulness as
comparative measures to ZTO's data. ZTO encourages investors and
others to review the Company's financial information in its
entirety and not rely on a single financial measure.
Conference Call Information
ZTO's management team will host an earnings conference call at
9:00 PM U.S. Eastern Time on
Wednesday, August 8, 2018 (9:00
AM Beijing Time on August 9,
2018).
Dial-in details for the earnings conference call are as
follows:
United
States:
|
1-888-317-6003
|
Hong
Kong:
|
852-5808-1995
|
China:
|
4001-206115
|
International:
|
1-412-317-6061
|
Passcode:
|
5815930
|
Please dial in ten minutes before the call is scheduled to begin
and provide the passcode to join the call.
A replay of the conference call may be accessed by phone at the
following numbers until August 15,
2018:
United
States:
|
1-877-344-7529
|
|
|
International:
|
1-412-317-0088
|
|
|
Passcode:
|
10122646
|
Additionally, a live and archived webcast of the conference call
will be available at http://zto.investorroom.com.
About ZTO Express (Cayman) Inc.
ZTO Express (Cayman) Inc. (NYSE: ZTO) ("ZTO" or the "Company")
is a leading and fast-growing express delivery company in
China. ZTO provides express
delivery service as well as other value-added logistics services
through its extensive and reliable nationwide network coverage in
China.
ZTO operates a highly scalable network partner model, which the
Company believes is best suited to support the significant growth
of e-commerce in China. The
Company leverages its network partners to provide pickup and
last-mile delivery services, while controlling the mission-critical
line-haul transportation and sorting network within the express
delivery service value chain.
For more information, please visit
http://zto.investorroom.com.
Safe Harbor Statement
This news release contains "forward-looking" statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the Private Securities Litigation Reform
Act of 1995. These forward-looking statements include but are not
limited to the Company's unaudited results for the first quarter of
2018, ZTO management quotes and the Company's financial
outlook.
These forward-looking statements are not historical facts but
instead represent only the Company's belief regarding expected
results and events, many of which, by their nature, are inherently
uncertain and outside of its control. The Company's actual results
and other circumstances may differ, possibly materially, from the
anticipated results and events indicated in these forward-looking
statements. Announced results for the first quarter of 2018 are
preliminary, unaudited and subject to audit adjustment. In
addition, the Company may not meet its financial outlook included
in this news release and may be unable to grow its business in the
manner planned. The Company may also modify its strategy for
growth. In addition, there are other risks and uncertainties that
could cause the Company's actual results to differ from what it
currently anticipates, including those relating to the development
of the e-commerce industry in China, its significant reliance on the Alibaba
ecosystem, risks associated with its network partners and their
employees and personnel, intense competition which could adversely
affect the Company's results of operations and market share, any
service disruption of the Company's sorting hubs or the outlets
operated by its network partners or its technology system. For
additional information on these and other important factors that
could adversely affect the Company's business, financial condition,
results of operations, and prospects, please see its filings with
the U.S. Securities and Exchange Commission.
All information provided in this press release and in the
attachments is as of the date of the press release. The Company
undertakes no obligation to update any forward-looking statement,
whether as a result of new information, future events or otherwise,
after the date of this release, except as required by law. Such
information speaks only as of the date of this release.
UNAUDITED CONSOLIDATED FINANCIAL DATA
Summary of Unaudited Consolidated Comprehensive Income
Data:
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
RMB
|
|
RMB
|
|
US$
|
|
(in thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
2,971,434
|
|
4,197,919
|
|
634,405
|
|
5,586,028
|
|
7,742,323
|
|
1,170,048
|
Cost of
revenues
|
(1,847,525)
|
|
(2,740,665)
|
|
(414,179)
|
|
(3,731,470)
|
|
(5,252,943)
|
|
(793,844)
|
Gross
profit
|
1,123,909
|
|
1,457,254
|
|
220,226
|
|
1,854,558
|
|
2,489,380
|
|
376,204
|
Operating income
(expenses):
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative
|
(202,664)
|
|
(269,178)
|
|
(40,679)
|
|
(364,638)
|
|
(684,801)
|
|
(103,490)
|
Other
operating income, net
|
18
|
|
773
|
|
117
|
|
88,057
|
|
82,680
|
|
12,495
|
Total operating
expenses
|
(202,646)
|
|
(268,405)
|
|
(40,562)
|
|
(276,581)
|
|
(602,121)
|
|
(90,995)
|
Income from
operations
|
921,263
|
|
1,188,849
|
|
179,664
|
|
1,577,977
|
|
1,887,259
|
|
285,209
|
Other income
(expenses):
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
39,573
|
|
70,708
|
|
10,686
|
|
68,197
|
|
131,029
|
|
19,802
|
Interest
expense
|
(5,029)
|
|
(3)
|
|
—
|
|
(10,737)
|
|
(776)
|
|
(117)
|
Gain on
disposal of equity investees
|
—
|
|
549,733
|
|
83,078
|
|
—
|
|
549,733
|
|
83,078
|
Foreign
currency exchange gain/(loss), before tax
|
(2,872)
|
|
35,901
|
|
5,425
|
|
(5,844)
|
|
(852)
|
|
(129)
|
Income before income
tax, and share of loss in equity method investments
|
952,935
|
|
1,845,188
|
|
278,853
|
|
1,629,593
|
|
2,566,393
|
|
387,843
|
Income
tax expense
|
(233,323)
|
|
(350,858)
|
|
(53,023)
|
|
(399,932)
|
|
(505,138)
|
|
(76,339)
|
Share of
loss in equity method investments
|
(2,689)
|
|
(2,104)
|
|
(318)
|
|
(9,868)
|
|
(11,574)
|
|
(1,749)
|
Net income
|
716,923
|
|
1,492,226
|
|
225,512
|
|
1,219,793
|
|
2,049,681
|
|
309,755
|
Net loss (income)
attributable to noncontrolling interests
|
(88)
|
|
(1,141)
|
|
(172)
|
|
593
|
|
(1,837)
|
|
(278)
|
Net income
attributable to ZTO Express (Cayman) Inc.
|
716,835
|
|
1,491,085
|
|
225,340
|
|
1,220,386
|
|
2,047,844
|
|
309,477
|
Change in redemption
value of convertible redeemable preferred shares
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Net income
attributable to ordinary shareholders
|
716,835
|
|
1,491,085
|
|
225,340
|
|
1,220,386
|
|
2,047,844
|
|
309,477
|
Net earnings per
share/ADS attributable to ordinary shareholders
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
1.00
|
|
2.07
|
|
0.31
|
|
1.69
|
|
2.86
|
|
0.43
|
Diluted
|
1.00
|
|
2.07
|
|
0.31
|
|
1.69
|
|
2.86
|
|
0.43
|
Weighted average
shares used in calculating net earnings per ordinary
share/ADS
|
|
|
|
|
|
|
|
|
|
|
Basic
|
719,716,569
|
|
721,183,933
|
|
721,183,933
|
|
720,138,244
|
|
715,978,664
|
|
715,978,664
|
Diluted
|
719,908,261
|
|
722,033,183
|
|
722,033,183
|
|
720,614,499
|
|
716,706,186
|
|
716,706,186
|
Other comprehensive
income, net of tax of nil:
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
(144,409)
|
|
554,487
|
|
83,796
|
|
(233,422)
|
|
287,984
|
|
43,521
|
Comprehensive
income
|
572,514
|
|
2,046,713
|
|
309,308
|
|
986,371
|
|
2,337,665
|
|
353,276
|
Comprehensive loss
(income) attributable to noncontrolling interests
|
(88)
|
|
(1,141)
|
|
(172)
|
|
593
|
|
(1,837)
|
|
(278)
|
Comprehensive income
attributable to ZTO Express (Cayman) Inc.
|
572,426
|
|
2,045,572
|
|
309,136
|
|
986,964
|
|
2,335,828
|
|
352,998
|
Unaudited Consolidated Balance Sheets Data:
|
As
of
|
|
December
31,
|
|
June
30,
|
|
2017
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
(in thousands,
except for share and per share data)
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and
cash equivalents
|
5,425,024
|
|
6,064,054
|
|
916,422
|
Restricted cash
|
348,710
|
|
109,603
|
|
16,564
|
Accounts
receivable, net of allowance for doubtful accounts of RMB13,798 and
RMB13,793 at December 31, 2017 and June 30, 2018,
respectively
|
287,835
|
|
378,620
|
|
57,218
|
Financing receivables
|
64,030
|
|
303,898
|
|
45,926
|
Short-term investment
|
5,224,559
|
|
9,601,412
|
|
1,451,000
|
Inventories
|
34,231
|
|
40,224
|
|
6,079
|
Advances
to suppliers
|
263,574
|
|
284,496
|
|
42,994
|
Prepayments and other current assets
|
719,983
|
|
976,669
|
|
147,598
|
Consideration receivable from disposal of long term
investment
|
—
|
|
787,850
|
|
119,063
|
Amounts
due from related parties
|
9,900
|
|
24,600
|
|
3,718
|
Total current assets
|
12,377,846
|
|
18,571,426
|
|
2,806,582
|
Investments in equity investees
|
610,160
|
|
1,541,739
|
|
232,993
|
Property and equipment, net
|
6,473,010
|
|
7,255,304
|
|
1,096,448
|
Land use rights, net
|
1,602,908
|
|
1,858,080
|
|
280,800
|
Intangible assets, net
|
60,424
|
|
57,325
|
|
8,663
|
Goodwill
|
4,241,541
|
|
4,241,541
|
|
640,997
|
Deferred tax assets
|
152,763
|
|
273,812
|
|
41,379
|
Other non-current assets
|
308,986
|
|
499,060
|
|
75,420
|
TOTAL
ASSETS
|
25,827,638
|
|
34,298,287
|
|
5,183,282
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
Short-term bank borrowing
|
250,000
|
|
—
|
|
—
|
Accounts
payable
|
889,139
|
|
933,799
|
|
141,119
|
Advances
from customers
|
258,965
|
|
341,283
|
|
51,576
|
Income
tax payable
|
221,926
|
|
322,466
|
|
48,733
|
Amounts
due to related parties
|
114,913
|
|
58,013
|
|
8,767
|
Acquisition consideration payable
|
130,004
|
|
23,256
|
|
3,515
|
Dividends payable
|
—
|
|
1,635
|
|
247
|
Other
current liabilities
|
2,281,067
|
|
2,251,828
|
|
340,306
|
Total current liabilities
|
4,146,014
|
|
3,932,280
|
|
594,263
|
Deferred tax liabilities
|
157,320
|
|
154,903
|
|
23,409
|
Acquisition consideration payable
|
22,942
|
|
22,942
|
|
3,467
|
Other non-current liabilities
|
60,045
|
|
61,068
|
|
9,229
|
TOTAL
LIABILITIES
|
4,386,321
|
|
4,171,193
|
|
630,368
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
December
31,
|
|
June
30
|
|
2017
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary
shares (US$0.0001 par value; 10,000,000,000 shares authorized,
731,406,440 shares issued and 710,804,716 shares outstanding as of
December 31, 2017; 811,267,551 shares issued and 787,163,859 shares
outstanding as of June 30, 2018)
|
471
|
|
523
|
|
79
|
Additional paid-in capital
|
15,975,979
|
|
24,092,253
|
|
3,640,908
|
Treasury
shares, at cost
|
(914,611)
|
|
(1,359,404)
|
|
(205,438)
|
Subscription receivables
|
—
|
|
(1,323,420)
|
|
(200,000)
|
Retained
earnings
|
6,669,370
|
|
8,717,214
|
|
1,317,376
|
Accumulated other comprehensive (loss)
income
|
(295,896)
|
|
(7,913)
|
|
(1,196)
|
ZTO Express
(Cayman) Inc. shareholders' equity
|
21,435,313
|
|
30,119,253
|
|
4,551,729
|
Noncontrolling interests
|
6,004
|
|
7,841
|
|
1,185
|
Total
Equity
|
21,441,317
|
|
30,127,094
|
|
4,552,914
|
TOTAL LIABILITIES
AND EQUITY
|
25,827,638
|
|
34,298,287
|
|
5,183,282
|
Summary of Unaudited Consolidated Cash Flow Data:
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
RMB
|
|
RMB
|
|
US$
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
903,248
|
|
1,475,795
|
|
223,027
|
|
1,234,756
|
|
1,689,970
|
|
255,392
|
Net cash used in
investing activities[6]
|
(1,137,348)
|
|
(5,649,363)
|
|
(853,753)
|
|
(6,443,242)
|
|
(7,246,921)
|
|
(1,095,180)
|
Net cash provided
by/(used in) financing activities[7]
|
(706,390)
|
|
6,620,184
|
|
1,000,466
|
|
(456,390)
|
|
5,815,067
|
|
878,794
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(70,009)
|
|
231,350
|
|
34,965
|
|
(194,189)
|
|
141,807
|
|
21,433
|
Net
increase/(decrease) in cash, cash equivalents and restricted
cash
|
(1,010,499)
|
|
2,677,966
|
|
404,705
|
|
(5,859,065)
|
|
399,923
|
|
60,439
|
Cash, cash
equivalents and restricted cash at beginning of period
|
7,074,589
|
|
3,495,691
|
|
528,281
|
|
11,923,155
|
|
5,773,734
|
|
872,547
|
Cash, cash
equivalents and restricted cash at end of period
|
6,064,090
|
|
6,173,657
|
|
932,986
|
|
6,064,090
|
|
6,173,657
|
|
932,986
|
|
[6] The amount of
cash used in investing activities mainly includes purchases of the
fixed term bank deposits with an original maturity of six months to
one year. For the second quarter of 2017 and 2018, the amounts of
net cashflow out for purchasing the short-term investment are
approximately RMB440.6 million and RMB3,736.7 million (US$564.7
million) of such deposits, respectively.
[7] The amount of
cash provided by/(used in) financing activities mainly includes the
proceeds from Alibaba's investment, which are approximately RMB7.6
billion (US$1.2 billion) received before June 30, 2018, while the
rest of approximately RMB1.3 billion (US$0.2 billion) were received
in early July 2018.
|
Reconciliations of GAAP and Non-GAAP Results
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
RMB
|
|
RMB
|
|
US$
|
|
RMB
|
|
RMB
|
|
US$
|
|
(in thousands,
except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
716,923
|
|
1,492,226
|
|
225,512
|
|
1,219,793
|
|
2,049,681
|
|
309,755
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
13,492
|
|
27,983
|
|
4,229
|
|
13,743
|
|
227,727
|
|
34,415
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
Gain on
disposal of equity investees, net of income taxes
|
—
|
|
(424,521)
|
|
(64,155)
|
|
—
|
|
(424,521)
|
|
(64,155)
|
Adjusted net
income
|
730,415
|
|
1,095,688
|
|
165,586
|
|
1,233,536
|
|
1,852,887
|
|
280,015
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
716,923
|
|
1,492,226
|
|
225,512
|
|
1,219,793
|
|
2,049,681
|
|
309,755
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
127,083
|
|
186,200
|
|
28,139
|
|
249,094
|
|
362,397
|
|
54,767
|
Amortization
|
8,702
|
|
12,693
|
|
1,918
|
|
16,297
|
|
23,363
|
|
3,531
|
Interest
expenses
|
5,029
|
|
3
|
|
—
|
|
10,737
|
|
776
|
|
117
|
Income
tax expenses
|
233,323
|
|
350,858
|
|
53,023
|
|
399,932
|
|
505,138
|
|
76,339
|
EBITDA
|
1,091,060
|
|
2,041,980
|
|
308,592
|
|
1,895,853
|
|
2,941,355
|
|
444,509
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
13,492
|
|
27,983
|
|
4,229
|
|
13,743
|
|
227,727
|
|
34,415
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
Gain on
disposal of equity investees, before income taxes
|
—
|
|
(549,733)
|
|
(83,078)
|
|
—
|
|
(549,733)
|
|
(83,078)
|
Adjusted
EBITDA
|
1,104,552
|
|
1,520,230
|
|
229,743
|
|
1,909,596
|
|
2,619,349
|
|
395,846
|
For investor and media inquiries, please contact:
ZTO
Investor Relations Department
E-mail: ir@zto.com
Christensen
In China
Mr. Christian Arnell
Phone: +86-10-5900-1548
E-mail: carnell@christensenir.com
In US
Mr. Tip Fleming
Phone: +1-917-412-3333
Email: tfleming@Christensenir.com
View original
content:http://www.prnewswire.com/news-releases/zto-reports-second-quarter-2018-unaudited-financial-results-300694327.html
SOURCE ZTO Express (Cayman) Inc.