ZTO Express (Cayman) Inc.

3Q21 Financial Details for Earnings Call

November 18, 2021

Financial Performance

3Q21

3Q20

V%

Comments

Parcel package volume in Billion

5.70

4.62

23.3%

0.3pts above industry avg.; secured 20.8% market share (20.8% @3Q20)

(RMB in Million)

7.05bn from core express delivery business, increased 14.4%

Revenues

7,391

6,639

11.3%

1.14bn from KA customers, increased 19.0% on 17.6% KA volume growth

COGS

-5,822

-5,248

10.9%

5.52bn from core express delivery business, increased 15.0%

1)

Line haul transportation costs increased 16.1% to 2.84bn

2)

Sorting hub operation costs increased 20.8% to 1.64bn

3)

618mn KA costs increased 0.8%

Gross profit

1,568

1,391

12.7%

1.52bn from core business, increased 12.4%

Gross profit %

21.2%

21.0%

0.2pts

21.6% for core express delivery business (22.0% @3Q20)

SG&A

-389

-374

4.2%

5.3% of revenues (5.6% @3Q20)

Other operating income/(loss), net

182

152

66.0mn gov't subsidies and tax rebates (24.5mn @3Q20), 139.3mn VAT super

deduction (43.5mn @3Q20)

Income from operations

1,360

1,169

16.4%

Operating profit %

18.4%

17.6%

0.8pts

Income from operations excluding SBC (Non GAAP)

1,360

1,169

16.4%

Operating profit % excluding SBCNon GAAP

18.4%

17.6%

0.8pts

Interest income (net)

40

83

-52.3%

Fair value change at financial instruments

5

-

Foreign currency exchange gain/(loss)

-8

-64

Income before income tax and equity pickup

1,397

1,188

Income tax expenses

-230

28

Equity pickup

-20

-5

Net income

1,148

1,210

-5.2%

Net income%

15.5%

18.2%

-2.7pts

Adjusted net income (Non GAAP)

1,148

1,210

-5.2%

Adjusted net income (Non GAAP)%

15.5%

18.2%

-2.7pts

EBITDA

1,968

1,675

17.4%

Adjusted EBITDA (Non GAAP)

1,968

1,675

17.4%

Adjusted Basic EPS (Non GAAP) (RMB in Yuan)

1.43

1.53

-6.5%

3Q20 received 200.7mn tax credit for being recognized as a "Key Software Enterprise" for tax year 2019

* may contain rounding differences

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ZTO Express (Cayman) Inc.

3Q21 Financial Details for Earnings Call

November 18, 2021

Unit Economics (RMB per parcel)

3Q21

3Q20

Impact (+/-) Comments (+positive/-negative impact)

ASP (excluding COE)

1.24

1.33

-9 cents

Core ASP declined 7.2%: avg. parcel weight declined ~5 cents(-), volume incentives

increased ~4 cents(-)

Cost of Revenue (excluding COE)

0.97

1.04

+7 cents

Core express delivery unit cost decreased 7.3%

-

transportation cost per parcel

0.50

0.53

+3 cents

Main drivers:

1) ~81% of self-owned trucks were high-capacity trucks (~80% @3Q20) (+)

2) Diesel price returned to pre-pandemic level, increased ~4 cents (-)

-

sorting hub cost per parcel

0.29

0.29

0 cents

Main drivers:

1) 370 sets of automated sorting equipment in use (300 sets @ 3Q20) (+)

2) ~81% of volume processed by automation (~77% @3Q20) (+)

Gross profit (excluding COE)

0.27

0.29

-2 cents

ASP decline partially offset by scale leverage and cost productivities

SG&A excluding SBC (Non GAAP)

0.07

0.08

+1 cents

Highly efficient corporate cost structure

Adjusted income from operations (Non GAAP)

0.24

0.25

-1 cents

Cash and Capex (RMB in Million)

3Q21

3Q20

Diff

Comments

Operating cash flow

1,787

1,480

307

CapEx

2,570

2,201

369

Approx.2050mn land use rights acquisition and sorting hub construction

80mn self-owned trucks

400mn automation equipment

Cash and Cash Equivalents

12,753

21,222

-8469

Excluding 1.51bn cash on deposits maturing in one year or longer

* may contain rounding differences

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ZTO Express (Cayman) Inc. published this content on 17 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 November 2021 08:51:07 UTC.