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OFFON

ZTO EXPRESS (CAYMAN) INC.

(ZTO)
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ZTO Express Cayman : Reports Second Quarter 2021 Unaudited Financial Results Adjusted Net Income Reached RMB1.27 Billion 5.8 Billion Parcels Attained 21.0% Market Share (Form 6-K)

08/19/2021 | 06:24am EDT

ZTO Reports Second Quarter 2021 Unaudited Financial Results

Adjusted Net Income Reached RMB1.27 Billion

5.8 Billion Parcels Attained 21.0% Market Share

SHANGHAI, Aug. 18, 2021/PRNewswire/ - ZTO Express (Cayman) Inc. (NYSE: ZTO and SEHK: 2057), a leading and fast-growing express delivery company in China ('ZTO' or the 'Company'), today announced its unaudited financial results for the second quarter ended June 30, 2021[1]. The Company delivered a parcel volume growth of 25.6% while maintaining high quality of service and customer satisfaction. Adjusted net income reached RMB1,272.2 million. Cash generated from operating activities was RMB1,932.4 million.

Second Quarter 2021 Financial Highlights

· Revenues were RMB7,325.1 million (US$1,134.5 million), an increase of 14.4% from RMB6,402.4 million in the same period of 2020.
· Gross profit was RMB1,673.6 million (US$259.2 million), a decrease of 5.4% from RMB1,769.2 million in the same period of 2020.
· Net income was RMB1,272.2 million (US$197.0 million), a decrease of 12.5% from RMB1,453.6 million in the same period of 2020.
· Adjusted EBITDA[2] was RMB2,125.7 million (US$329.2 million), a decrease of 2.8% from RMB2,187.0 million in the same period of 2020.
· Adjusted net income[3] was RMB1,272.2 million (US$197.0 million), a decrease of 12.5% from RMB1,453.6 million in the same period of 2020.
· Basic and diluted net earnings per American depositary share ('ADS'[4]) were RMB1.56 (US$0.24), a decrease of 15.7% from RMB1.85 in the same period of 2020.
· Adjusted basic and diluted net earnings per American depositary share[5] attributable to ordinary shareholders were RMB1.56 (US$0.24), a decrease of 15.7% from RMB1.85 in the same period of 2020.
· Net cash provided by operating activities was RMB1,932.4 million (US$299.3 million), compared with RMB1,252.3 million in the same period of 2020.

Operational Highlights for Second Quarter 2021

· Parcel volume was 5,772 million, an increase of 25.6% from 4,595 million in the same period of 2020.
· Number of pickup/delivery outlets was over 30,100 as of June 30, 2021.
· Number of direct network partners was over 5,450 as of June 30, 2021.
· Number of line-haul vehicles was approximately 10,300 as of June 30, 2021, which included approximately 10,100 self-owned vehicles and approximately 200 vehicles owned and operated by Tonglu Tongze Logistics Ltd., a transportation operator that works exclusively for ZTO.
· Out of the approximately 10,100 self-owned trucks, approximately 8,150 were high capacity 15 to 17-meter-long models as of June 30, 2021, compared to over 8,100 as of March 31, 2021.
· Number of line-haul routes between sorting hubs was approximately 3,600 as of June 30, 2021, compared to over 3,650 as of March 31, 2021.
· Number of sorting hubs was 96 as of June 30, 2021, among which 85 are operated by the Company and 11 by the Company's network partners.
(1) An investor relations presentation accompanies this earnings release and can be found at http://zto.investorroom.com.

(2) 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 investment and subsidiary which management aims to better represent the underlying business operations.

(3) 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 investment and subsidiary in which management aims to better represent the underlying business operations.

(4) One ADS represents one Class A ordinary share.

(5) Adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders is a non-GAAP financial measure. It is defined as adjusted net income attributable to ordinary shareholders divided by weighted average number of basic and diluted shares, respectively.

1

Mr. Meisong Lai, Founder, Chairman and Chief Executive Officer of ZTO, commented 'ZTO's consistent strategy to balance competing priorities of service quality, volume growth and earnings withstood the test of shifting policy environment and evolving market dynamics during the quarter. Our customer satisfaction scores ranked top of the peer group with a widening lead. The slight retreat in our market share for the quarter was a direct result of reemphasizing profitable volume when it was neither sensible nor sustainable to trade profits for short-term market share gain. We achieved strong corporate earnings. Meanwhile, our network policies and protective initiatives enabled thousands of our entrepreneurial partners including couriers to feel safe and secured, and they maintained high quality operations amidst persisted competition and diminishing profits.'

Mr. Lai added, 'At the current rate of medium to high level of growth, China's express delivery industry will likely grow daily volume to surpass 400 million or more parcels in the next 2-3 years. Capacity and operational efficiencies will set apart the winners and the rest. ZTO has undoubtedly established infrastructure advantages with years of consistent investments and innovations. Our network will further evolve with volume growth to become less layered and more streamlined generating greater cost efficiencies. Furthermore, our distinct shared-success philosophy and long-term practice are consistent with recent regulatory interventions aimed to establish fairness and restore healthy competition. ZTO stands to benefit because we have been relying on our operational edge to profit while allowing our network partners their fair share so that they can flourish. That is why ZTO's network is more stable, and going forward, our network partners will be more resilient and will invest with greater confidence to develop their own capabilities that are in synch with our expanding transit and sorting operations, so together, we can continue to thrive.'

Ms. Huiping Yan, Chief Financial Officer of ZTO, commented, 'We achieved RMB1.27billion net income in the second quarter by focusing on effectively priced volume that contributed profit instead of loss-making. Normalized for one-time benefits from pandemic fee waivers and low oil prices last year, our combined transportation and sorting costs per unit generated positive productivity gains despite operating below the optimal capacity level.'

Ms. Yan added, 'We generated RMB1.93 billion net operating cash flow which increased 54.3% from last year. Capital expenditures totaled RMB 2.2 billion for the quarter with nearly 70% used for acquisition of land use rights and sorting hub construction and upgrades. We are strengthening infrastructure for the core express delivery and developing comprehensive logistic service capabilities to form competitive edge for the long run.'

2

Second Quarter 2021 Financial Results

Three Months Ended June 30, Six Months Ended June 30,
2020 2021 2020 2021
RMB % RMB US$ % RMB % RMB US$ %
(in thousands, except percentages)
Express delivery services 5,540,664 86.5 6,652,936 1,030,409 90.8 8,947,074 86.7 12,325,745 1,909,015 89.3
Freight forwarding services 467,095 7.3 313,553 48,563 4.3 762,571 7.4 806,540 124,917 5.8
Sale of accessories 321,189 5.0 314,131 48,653 4.3 498,214 4.8 574,311 88,949 4.2
Others 73,473 1.2 44,440 6,882 0.6 110,451 1.1 91,001 14,095 0.7
Total revenues 6,402,421 100.0 7,325,060 1,134,507 100.0 10,318,310 100.0 13,797,597 2,136,976 100.0

Total Revenues were RMB7,325.1 million (US$1,134.5 million), an increase of 14.4% from RMB6,402.4 million in the same period of 2020. Revenue from the core express delivery business increased by 18.1% compared to the same period of 2020, as a combined result of a 25.6% increase in parcel volume and a 5.9% decrease in parcel unit price mainly driven by per parcel weight decline. Revenue from freight forwarding services decreased by 32.9% compared to the same period of 2020 as cross border e-commerce demand and pricing gradually returned to normal post COVID-19 recovery. Revenue from sales of accessories, largely consisted of sales of thermal paper used for digital waybills' printing, decreased by 2.2%. Other revenues were mainly derived from financing services and advertising services.

Three Months Ended June 30, Six Months Ended June 30,
2020 2021 2020 2021
% of % of % of % of
RMB revenues RMB US$ revenues RMB revenues RMB US$ revenues
(in thousands, except percentages)
Line-haul transportation cost 1,996,562 31.2 2,763,264 427,975 37.7 3,293,979 31.9 5,297,177 820,428 38.4
Sorting hub operating cost 1,254,278 19.6 1,612,704 249,776 22.0 2,220,035 21.5 3,124,074 483,857 22.6
Freight forwarding cost 416,659 6.5 266,229 41,234 3.6 704,273 6.8 702,621 108,822 5.1
Cost of accessories sold 112,483 1.8 98,141 15,200 1.3 186,958 1.8 172,716 26,750 1.3
Other costs 853,276 13.3 911,080 141,108 12.6 1,325,242 12.9 1,730,834 268,073 12.5
Total cost of revenues 4,633,258 72.4 5,651,418 875,293 77.2 7,730,487 74.9 11,027,422 1,707,930 79.9

Total cost of revenues was RMB5,651.4 million (US$875.3 million), an increase of 22.0% from RMB4,633.3 million in the same period last year.

Line haul transportation cost was RMB2,763.3 million (US$428.0 million), an increase of 38.4% from RMB1,996.6 million in the same period last year. Other than incremental volume driven, the increase reflected (i) expiration of federal toll road fee waiver policy from mid-February to early May 2020 during the pandemic, and (ii) lower domestic diesel price during the pandemic outbreak last year. Line-haul transportation cost per parcel increased by 10.2% to RMB0.48 due to the combined effect of absence of one-time benefits existed last year and efficiency gains from increased usage of more self-owned high-capacity vehicles. There were approximately 1,050 more high-capacity vehicles in our fleet compared to the same period last year.

Sorting hub operating cost was RMB1,612.7 million (US$249.8 million), an increase of 28.6% from RMB1,254.3 million in the same period last year. The increase was primarily consisted of (i) RMB251.3 million (US$38.9 million) increase in labor-associated costs resulted from wage increases offset by automation-driven headcount productivity gain, and (ii) RMB68.5 million (US$10.6 million) increase in depreciation and amortization costs from increased number of installed automated sorting equipment and facilities. Sorting hub operating cost per unit increased 2.4%. As of June 30, 2021, 361 sets of automated sorting equipment were in service, compared to 282 sets as of June 30, 2020.

Cost of accessories sold was RMB98.1 million (US$15.2 million), decreased 12.8% compared with RMB112.5 million in the same period last year.

Other costs were RMB911.1 million (US$141.1 million), an increase of RMB57.8 million (US$9.0 million) compared to the same period last year. The increase was mainly consisted of (i) an increase of RMB36.4 million (US$5.6 million) in expenses related to the development of technology platform, (ii) an increase of RMB35.8 million (US$5.5 million) in tax surcharge, and (iii) a decrease of RMB29.4 million (US$4.6 million) in the costs of the advertising services.

3

Gross Profit was RMB1,673.6 million (US$259.2 million), decreased 5.4% from RMB1,769.2 million in the same period last year as a combined result of increased volume at a lower price and increased costs absent one-time benefits during COVID-19 outbreak. Gross margin rate was 22.8% compared to 27.6% in the same period last year. Average selling price declined 5.9% for the core express delivery business and unit cost increased 1.7%.

Total Operating Expenses were RMB218.0 million (US$33.8 million), compared to RMB122.6 million in the same period last year.

Selling, general and administrative expenses were RMB394.0 million (US$61.0 million), increased by 26.1% from RMB312.4 million in the same period last year, mainly from increases of compensation and benefits, office expenditures, depreciation and write-off of obsolete assets.

Other operating income, net was RMB176.0 million (US$27.3 million), compared to RMB189.9 million in the same period last year. Other operating income mainly consisted of (i) RMB95.8 million (US$14.8 million) of VAT super deduction, and (ii) government subsidies and tax rebates of RMB38.5 million (US$6.0 million).

Income from operations was RMB1,455.7 million (US$225.5 million), a decrease of 11.6% from RMB1,646.6 million for the same period last year. Operating margin rate decreased to 19.9% from 25.7% in the same period last year, mainly driven by a 4.8 percentage points decrease in gross margin.

Interest income was RMB102.4 million (US$15.9 million), compared with RMB114.3 million in the same period last year.

Interest expenses was RMB33.8 million (US$5.2 million), compared with RMB9.1 million in the same period last year.

Gain from fair value changes of financial instruments was RMB32.3 million (US$5.0 million), which reflected fair value changes, assessed using market-based redemption prices estimated by selling banks, on dual currency deposits, foreign currency options and forward contracts. There were no similar financial instruments in the same period last year.

Income tax expenses were RMB254.9 million (US$39.5 million) compared to RMB298.3 million in the same period last year.

Net income was RMB1,272.2 million (US$197.0 million), which decreased by 12.5% from RMB1,453.6 million in the same period.

Basic and diluted earnings per ADS attributable to ordinary shareholders were RMB1.56 (US$0.24), compared to basic and diluted earnings per ADS of RMB1.85 in the same period last year.

Adjusted basic and diluted earnings per ADS attributable to ordinary shareholders were RMB1.56 (US$0.24), compared with RMB1.85 in the same period last year.

Adjusted net income was RMB1,272.2 million (US$197.0 million), compared with RMB1,453.6 million during the same period last year.

EBITDA was RMB2,125.7 million (US$329.2 million), compared with RMB2,187.0 million in the same period last year.

Adjusted EBITDA was RMB2,125.7 million (US$329.2 million), compared to RMB2,187.0 million in the same period last year.

Net cash provided by operating activities was RMB1,932.4 million (US$299.3 million), compared with RMB1,252.3 million in the same period last year.

Business Outlook

Based on current market and operating conditions, the Company maintains its previously stated annual guidance. Parcel volume for 2021 is expected to be in the range of 22.95 billion to 23.80 billion, representing a 35% to 40% increase year over year. Such estimates represent management's current and preliminary view, which are subject to change.

4

Company Share Purchase

On November 15, 2018, the Company announced a share repurchase program whereby ZTO was authorized to repurchase its own Class A ordinary shares in the form of ADSs with an aggregate value of up to US$500 million during an 18-month period thereafter. On March 13, 2020, the board of directors of the Company approved the extension of the active share repurchase program to June 30, 2021. On March 31, 2021, the board of directors has approved changes to the share repurchase program, increasing the aggregate value of shares that may be repurchased from US$500 million to US$1 billion and extending the effective time by two years through June 30, 2023. The Company expects to fund the repurchases out of its existing cash balance. As of June 30, 2021, the Company has purchased an aggregate of 17,519,583 ADSs at an average purchase price of US$23.17, including repurchase commissions.

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 RMB6.4566 to US$1.00, the noon buying rate on June 30, 2021 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, adjusted net income, adjusted net income attributable to ordinary shareholders and adjusted basic and diluted earnings per American depositary share, 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, adjusted net income, adjusted net income attributable to ordinary shareholders and adjusted basic and diluted earnings per American depositary share 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, adjusted net income, adjusted net income attributable to ordinary shareholders and adjusted basic and diluted earnings per American depositary share 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, adjusted net income, adjusted net income attributable to ordinary shareholders and adjusted basic and diluted earnings per American depositary share 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 compare the historical non-GAAP financial measures to the most directly comparable GAAP measures. Adjusted EBITDA, adjusted net income, adjusted net income attributable to ordinary shareholders and adjusted basic and diluted earnings per American depositary share 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.

5

Conference Call Information

ZTO's management team will host an earnings conference call at 8:30 PM U.S. Eastern Time on Wednesday, August 18, 2021 (8:30 AM Beijing Time on August 19, 2021).

Dial-in details for the earnings conference call are as follows:

United States: 1-888-317-6003
Hong Kong: 852-5808-1995
Mainland China: 4001-206-115
Singapore: 800-120-5863
International: 1-412-317-6061
Passcode: 4725527

Please dial in 15 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 25, 2021:

United States: 1-877-344-7529
International: 1-412-317-0088
Passcode: 10158503

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 and SEHK:2057) ('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.

6

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 second quarter of 2021, 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 second quarter 2021 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.

7

UNAUDITED CONSOLIDATED FINANCIAL DATA

Summary of Unaudited Consolidated Comprehensive Income Data:

Three Months Ended June 30, Six Months Ended June 31,
2020 2021 2020 2021
RMB RMB US$ RMB RMB US$
(in thousands, except for share and per share data)
Revenues 6,402,421 7,325,060 1,134,507 10,318,310 13,797,597 2,136,976
Cost of revenues (4,633,258 ) (5,651,418 ) (875,293 ) (7,730,487 ) (11,027,422 ) (1,707,930 )
Gross profit 1,769,163 1,673,642 259,214 2,587,823 2,770,175 429,046
Operating income (expenses):
Selling, general and administrative (312,421 ) (394,006 ) (61,024 ) (872,472 ) (1,014,230 ) (157,084 )
Other operating income, net 189,867 176,019 27,262 303,270 332,590 51,512
Total operating expenses (122,554 ) (217,987 ) (33,762 ) (569,202 ) (681,640 ) (105,572 )
Income from operations 1,646,609 1,455,655 225,452 2,018,621 2,088,535 323,474
Other income (expenses):
Interest income 114,258 102,400 15,860 240,485 177,882 27,550
Interest expense (9,135 ) (33,798 ) (5,235 ) (9,426 ) (49,380 ) (7,648 )
Gain from fair value changes of financial instruments - 32,331 5,007 - 48,130 7,454
Foreign currency exchange gain/(loss), before tax 2,594 (25,751 ) (3,988 ) 19,047 (26,084 ) (4,040 )
Income before income tax, and share of loss in equity method 1,754,326 1,530,837 237,096 2,268,727 2,239,083 346,790
Income tax expense (298,302 ) (254,859 ) (39,473 ) (428,074 ) (404,497 ) (62,649 )
Share of loss in equity method investments (2,453 ) (3,753 ) (581 ) (16,109 ) (28,835 ) (4,466 )
Net income 1,453,571 1,272,225 197,042 1,824,544 1,805,751 279,675
Net (income)/loss attributable to noncontrolling interests (5,217 ) 19,947 3,089 (1,490 ) 20,046 3,105
Net income attributable to ZTO Express (Cayman) Inc. 1,448,354 1,292,172 200,131 1,823,054 1,825,797 282,780
Net income attributable to ordinary shareholders 1,448,354 1,292,172 200,131 1,823,054 1,825,797 282,780
Net earnings per share attributed to ordinary shareholders
Basic 1.85 1.56 0.24 2.33 2.21 0.34
Diluted 1.85 1.56 0.24 2.33 2.21 0.34
Weighted average shares used in calculating net earnings per ordinary share/ADS
Basic 783,894,733 827,015,267 827,015,267 783,124,385 827,755,090 827,755,090
Diluted 783,894,733 827,015,267 827,015,267 783,224,329 827,755,090 827,755,090
Other comprehensive (expenses)/income, net of tax of nil:
Foreign currency translation adjustment (23,558 ) (102,171 ) (15,824 ) 153,368 (84,260 ) (13,050 )
Comprehensive income 1,430,013 1,170,054 181,218 1,977,912 1,721,491 266,625
Comprehensive income attributable to noncontrolling interests (5,217 ) 19,947 3,089 (1,490 ) 20,046 3,105
Comprehensive income attributable to ZTO Express (Cayman) Inc. 1,424,796 1,190,001 184,307 1,976,422 1,741,537 269,730

8

Unaudited Consolidated Balance Sheets Data:

As of
December 31,
2020 June 30, 2021
RMB RMB US$
(in thousands, except for share data)
ASSETS
Current assets:
Cash and cash equivalents 14,212,778 12,098,453 1,873,812
Restricted cash 133,196 51,716 8,010
Accounts receivable, net 746,013 767,851 118,925
Financing receivables 492,159 984,796 152,525
Short-term investment 3,690,402 3,138,782 486,135
Inventories 53,070 39,589 6,132
Advances to suppliers 589,042 695,319 107,691
Prepayments and other current assets 2,334,688 2,746,873 425,436
Amounts due from related parties 73,278 71,951 11,144
Total current assets 22,324,626 20,595,330 3,189,810
Investments in equity investee 3,224,463 3,293,405 510,083
Property and equipment, net 18,565,161 21,370,865 3,309,926
Land use rights, net 4,360,673 4,922,064 762,331
Intangible assets, net 41,832 38,733 5,999
Operating lease right-of-use assets 876,259 852,270 132,000
Goodwill 4,241,541 4,241,541 656,931
Deferred tax assets 720,561 929,866 144,018
Long-term investment 1,842,000 2,140,160 331,469
Long-term financing receivables 1,970,340 1,540,859 238,649
Other non-current assets 537,294 821,750 127,273
Amounts due from related parties-non current 500,000 521,000 80,693
TOTAL ASSETS 59,204,750 61,267,843 9,489,182
LIABILITIES AND EQUITY
Current liabilities
Short-term bank borrowing 1,432,929 3,391,472 525,272
Accounts payable 1,635,888 1,596,483 247,264
Notes payable 326,200 351,107 54,380
Advances from customers 1,119,666 1,191,605 184,556
Income tax payable 48,628 80,192 12,420
Amounts due to related parties 16,655 21,495 3,329
Operating lease liabilities 246,394 226,037 35,009
Acquisition consideration payable 22,942 22,942 3,553
Dividends payable 11,198 2,438 378
Other current liabilities 4,487,084 4,409,817 682,994
Total current liabilities 9,347,584 11,293,588 1,749,155
Non-current operating lease liabilities 502,481 549,690 85,136
Deferred tax liabilities 254,987 256,346 39,703
TOTAL LIABILITIES 10,105,052 12,099,624 1,873,994
Shareholders' equity
Ordinary shares (US$0.0001 par value; 10,000,000,000 shares authorized, 855,301,115 shares issued and 828,869,972 shares outstanding as of December 31, 2020; 845,497,968 shares issued and 827,002,948 shares outstanding as of June 30, 2021) 553 546 85
Additional paid-in capital 30,613,948 29,096,081 4,506,409
Treasury shares, at cost (2,578,870 ) (2,018,504 ) (312,626 )
Retained earnings 21,038,753 22,160,492 3,432,223
Accumulated other comprehensive loss (95,571 ) (179,831 ) (27,852 )
ZTO Express (Cayman) Inc. shareholders' equity 48,978,813 49,058,784 7,598,239
Noncontrolling interests 120,885 109,435 16,949
Total Equity 49,099,698 49,168,219 7,615,188
TOTAL LIABILITIES AND EQUITY 59,204,750 61,267,843 9,489,182

9

Summary of Unaudited Consolidated Cash Flow Data:

Three Months Ended June 30, Six Months Ended June 30,
2020 2021 2020 2021
RMB RMB US$ RMB RMB US$
(in thousands)
Net cash provided by operating activities 1,252,270 1,932,405 299,291 1,430,061 2,409,357 373,162
Net cash used in investing activities (1,097,851 ) (184,468 ) (28,570 ) (1,812,554 ) (4,556,458 ) (705,705 )
Net cash provided by/ (used in) financing activities 65,298 (943,506 ) (146,130 ) 362,952 50,462 7,816
Effect of exchange rate changes on cash cash equivalents and restricted cash 2,145 (133,881 ) (20,736 ) 19,460 (100,613 ) (15,584 )
Net increase / (decrease) in cash, cash equivalents and restricted cash 221,862 670,550 103,855 (81 ) (2,197,252 ) (340,311 )
Cash, cash equivalents and restricted cash at beginning of period 5,055,471 11,492,290 1,779,929 5,277,414 14,360,092 2,224,095
Cash, cash equivalents and restricted cash at end of period 5,277,333 12,162,840 1,883,784 5,277, 333 12,162,840 1,883,784

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows:

As of
June 30, June 30,
2020 2021
RMB RMB US$
(in thousands)
Cash and cash equivalents 5,261,920 12,098,453 1,873,812
Restricted cash, current 1,300 51,716 8,010
Restricted cash, non-current 14,113 12,671 1,962
Total cash, cash equivalents and restricted cash 5,277,333 12,162,840 1,883,784

10

Reconciliations of GAAP and Non-GAAP Results

Three Months Ended June 30, Six Months Ended June 30,
2020 2021 2020 2021
RMB RMB US$ RMB RMB US$
(in thousands, except for share and per share data)
Net income 1,453,571 1,272,225 197,042 1,824,544 1,805,751 279,675
Add:
Share-based compensation expense (1) - - - 264,154 248,027 38,414
Adjusted net income 1,453,571 1,272,225 197,042 2,088,698 2,053,778 318,089
Net income 1,453,571 1,272,225 197,042 1,824,544 1,805,751 279,675
Add:
Depreciation 408,426 530,874 82,222 801,006 1,026,582 158,997
Amortization 17,602 33,928 5,255 33,250 59,579 9,228
Interest expenses 9,135 33,798 5,235 9,426 49,380 7,648
Income tax expenses 298,302 254,859 39,473 428,074 404,497 62,649
EBITDA 2,187,036 2,125,684 329,227 3,096,300 3,345,789 518,197
Add:
Share-based compensation expense - - - 264,154 248,027 38,414
Adjusted EBITDA 2,187,036 2,125,684 329,227 3,360,454 3,593,816 556,611

(1) Net of income taxes of nil

11

Reconciliations of GAAP and Non-GAAP Results

Three Months Ended June 30, Six Months Ended June 30,
2020 2021 2020 2021
RMB RMB US$ RMB RMB US$
(in thousands, except for share and per share data)
Net income attributable to ordinary shareholders 1,448,354 1,292,172 200,131 1,823,054 1,825,797 282,780
Add:
Share-based compensation expense (1) - - - 264,154 248,027 38,414
Adjusted Net income attributable to ordinary shareholders 1,448,354 1,292,172 200,131 2,087,208 2,073,824 321,194
Weighted average shares used in calculating net earnings per ordinary share/ADS
Basic 783,894,733 827,015,267 827,015,267 783,124,385 827,755,090 827,755,090
Diluted 783,894,733 827,015,267 827,015,267 783,224,329 827,755,090 827,755,090
Net earnings per share/ADS attributable to ordinary shareholders
Basic 1.85 1.56 0.24 2.33 2.21 0.34
Diluted 1.85 1.56 0.24 2.33 2.21 0.34
Adjusted net earnings per share/ADS attributable to ordinary shareholders
Basic 1.85 1.56 0.24 2.67 2.51 0.39
Diluted 1.85 1.56 0.24 2.66 2.51 0.39

(1) Net of income taxes of nil

12

For investor and media inquiries, please contact:

ZTO Express (Cayman) Inc.

Investor Relations

E-mail: ir@zto.com

Phone: +86 21 5980 4508

13

Disclaimer

ZTO Express (Cayman) Inc. published this content on 19 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 August 2021 10:23:07 UTC.


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Last Close Price 202,39 CNY
Average target price 223,49 CNY
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Mei Song Lai Chairman & Chief Executive Officer
Hui Ping Yan Chief Financial Officer
Jing Xi Zhu Vice President-Information Technology
Hong Qun Hu Chief Operating Officer
Xing Liu Independent Director
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