BRIEF: ZTO’s profit rises 5% as company cuts full-year volume guidance

Logistics provider ZTO Express (Cayman) Inc. (ZTO.US; 2057.HK) reported on Wednesday that its revenue rose 11.1% year-on-year in the third quarter to 11.9 billion yuan ($1.67 billion), while its net profit rose 5.3% to 2.52 billion yuan.

For the first nine months of the year, its revenue increased 10.29% to 34.6 billion yuan, and its net profit edged up 0.33% to 6.455 billion yuan.

ZTO’s parcel volume in the latest quarter reached 9.57 billion pieces, up 9.8% from a year earlier. That volume growth, combined with a 1.7% increase in parcel unit prices, drove an 11.6% increase in the company’s core express service revenue. Revenue from direct-sales customers surged 141.2%, as the company benefitted from higher e-commerce returns. But its gross margin declined by 6.3 percentage points to 24.9%.

ZTO also lowered its full-year outlook to 38.2 billion to 38.7 billion pieces, down from a previous 38.8 billion to 40.1 billion pieces, representing year-on-year growth of 12.3% to 13.8%.

ZTO’s stock opened higher on Thursday in Hong Kong, closing up 0.61% at HK$148.4 by the midday break.

By Lee Shih Ta

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