Jitu's first-half performance turned around and it shut down its cross-border small parcel business
2024-08-20
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On August 19, Jitu released its first-half financial report showing that the company's revenue in the first half of 2024 was approximately US$4.86 billion, a year-on-year increase of 20.6%; adjusted net profit was approximately US$63.25 million, compared with a loss of US$264 million in the same period last year, turning losses into profits.
The turnaround was mainly due to the company's declining operating costs. Jitu said in its financial report that the cost per parcel in Southeast Asia fell by 15.5% year-on-year in the first half of 2024, and the cost per parcel in the Chinese market fell from US$0.34 in the first half of 2023 to US$0.32 in the first half of 2024. This was mainly due to the scale effect brought about by the company's business volume growth and the refined operation and management of various cost links.
In terms of business, Jitu Express's express service revenue increased by 33.7% from US$3.55 billion in the first half of 2023 to US$4.74 billion in the first half of 2024. The growth of this business was mainly due to the company's total parcel volume in Southeast Asia, China and new markets increasing by 38.3% from 7.97 billion pieces in the first half of 2023 to 11.01 billion pieces in the first half of 2024. The company's cross-border service revenue decreased by 88.4% from US$450 million in the first half of 2023 to US$51.9 million in the first half of 2024. This change was mainly due to the company's business transformation and adjustment, and the closure of its cross-border small parcel business.
The financial report shows that Jitu handled 8.84 billion parcels in the domestic market in the first half of 2024, a year-on-year increase of 37.1%, and its business volume accounted for 11% of China's express delivery market, an increase of 1.1%. Jitu said that this was due to the company's continued development of business in the sinking market, cooperating with multiple e-commerce platforms to carry out groupage business for remote areas. Its parcel volume in the Southeast Asian market was 2.04 billion pieces, a year-on-year increase of 42%.
As of June 30, 2024, the number of Jitu's outlets in the Southeast Asian and Chinese markets has decreased by 100 and 400, respectively, compared to the end of 2023.
The domestic express delivery industry is still developing at a high speed. According to the State Post Bureau of China, the express delivery industry's business volume in the first half of 2024 totaled 80.16 billion pieces, a year-on-year increase of 23.1%. From the industry's perspective, Jitu is not the only one with positive profit indicators. According to the semi-annual performance forecast of Shentong in 2024, the net profit attributable to shareholders of listed companies in the first half of the year was between 375 million yuan and 475 million yuan, with a year-on-year growth rate of between 71.78% and 117.59%.
In terms of business volume, Jitu currently has a certain gap with other leading express delivery companies in China. As of June 30, 2024, Jitu's business volume in China was 8.84 billion pieces. According to Frost & Sullivan, ZTO Express's parcel business volume in the first half of 2024 was about 15.9 billion pieces, and the express business completion volumes of other leading express delivery companies were 12.2 billion pieces, 10.92 billion pieces, 10.23 billion pieces, and 9.28 billion pieces, respectively. Jitu currently ranks sixth.
In terms of low-price competition, from the perspective of per-ticket revenue, Jitu, once the "volume king", currently has higher per-ticket revenue than other express delivery companies. The financial report shows that Jitu's per-ticket revenue in the first half of 2024 was US$0.34 (about RMB 2.42), which is relatively stable compared to US$0.34 in the first half of 2023. Jitu said that this is mainly due to the company's continuous optimization of the parcel volume structure of different e-commerce platforms, the promotion of full-network marketing to obtain more high-quality customers and brand customers, and its commitment to improving the category of goods. At the same time, the steady development of reverse pieces and scattered pieces has further stabilized the company's overall per-ticket revenue.
This figure is higher than that of several other express delivery companies. The operating briefing shows that the single-ticket revenue of express delivery companies such as STO, Yunda, and Yuantong is still declining. Taking June as an example, the single-ticket revenue of STO was 2.01 yuan, a year-on-year decline of 9.05%. The single-ticket revenue of Yunda Express Service was 2 yuan, a year-on-year decline of 13.79%. The single-ticket revenue of Yuantong was 2.25 yuan, a year-on-year decline of 4.85%.
On the other hand, Jitu's per-ticket express delivery cost continues to decline. The financial report shows that the company's per-ticket express delivery cost has dropped from US$0.34 in the first half of 2023 to US$0.32 in the first half of 2024. Jitu believes that this is mainly due to the scale effect brought about by the company's business volume growth and the continuous refined operation and management of various cost links.
Jitu's closing price today was HK$7.23, down nearly 40% from its issue price of HK$12.
(This article comes from China Business Network)
