UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of August 2019

 


 

Commission File Number: 001-37922

 


 

ZTO Express (Cayman) Inc.

 

Building One, No. 1685 Huazhi Road

Qingpu District

Shanghai, 201708

People’s Republic of China

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F    x               Form 40-F    o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

 

 

 


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

ZTO Express (Cayman) Inc.

 

 

 

 

 

By:

/s/ Huiping Yan

 

Name:

Huiping Yan

 

Title:

Chief Financial Officer

 

 

 

 

Date: August 20, 2019

 

 

2


 

Exhibit Index

 

Exhibit 99.1 — Press Release

 

3


Exhibit 99.1

 

3.1 Billion Parcels Expanded Market Share to 19.9%

Adjusted Net Income Increased 25.6% to Reach RMB1.38 Billion

 

ZTO Reports Second Quarter 2019 Unaudited Financial Results

 

Shanghai, August 16, 2019 — ZTO Express (Cayman) Inc. (NYSE: ZTO), 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, 20191. The Company beat market expectations by generating parcel volume growth of 46.8%, 18.5 percentage points higher than the industry average. Market share in terms of parcel volume expanded to 19.9% during the second quarter of 2019. Adjusted net income increased 25.6% to reach RMB1,375.9 million.

 

Second Quarter 2019 Financial Highlights

 

·                                        Revenues were RMB5,423.6 million (US$790.0 million), an increase of 29.2% from RMB4,197.9 million in the same period of 2018

·                                        Gross profit was RMB1,768.6 million (US$257.6 million), an increase of 21.4% from RMB1,457.3 million in the same period of 2018

·                                        Net income was RMB 1,365.1 million (US$198.8 million), a decrease of 8.5% from RMB 1,492.2 million in the same period of 2018

·                                        Adjusted EBITDA2 was RMB1,962.8 million (US$285.9 million), an increase of 29.1% from RMB1,520.2 million in the same period of 2018

·                                        Adjusted net income3 was RMB 1,375.9 million (US$200.4 million), an increase of 25.6% from RMB1,095.7 million in the same period of 2018

·                                        Basic and diluted earnings per American depositary share (“ADS”4) attributable to ordinary shareholders were RMB1.73 (US$0.25), a decrease of 16.4% from RMB2.07 in the same period of 2018

·                                        Adjusted basic and diluted earnings per American depositary share5 attributable to ordinary shareholders were RMB1.74 (US$0.25), an increase of 14.5% from RMB1.52 in the same period of 2018

·                                        Net cash provided by operating activities was RMB1,992.8 million (US$290.3 million), compared with RMB1,475.8 million in the same period of 2018

 

Operational Highlights for Second quarter 2019

 

·                                        Parcel volume was 3,106.6 million, an increase of 46.8% from 2,115.6 million in the same period of 2018

·                                        Number of pickup/delivery outlets was approximately 30,000 as of June 30, 2019, while the number of direct network partners was approximately 4,650 as of June 30, 2019

·                                        Number of line-haul vehicles was over 5,800 as of June 30, 2019, which included over 4,950 self-owned vehicles and over 850 vehicles owned and operated by Tonglu Tongze Logistics Ltd., a transportation operator that works exclusively for ZTO. Among the 4,950 self-owned vehicles, over 3,150 were high capacity 15-to-17-meter-long trailer trucks compared to over 3,000 as of March 31, 2019

·                                        Number of line-haul routes between sorting hubs was over 2,200 as of June 30, 2019

·                                        Number of sorting hubs was 87 as of June 30, 2019, among which 78 are operated by the Company and the other nine by the Company’s network partners

 


(1)             An investor relations presentation accompanies this earnings release and can be found at ir.zto.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 investees 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 investees 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 net income attributable to ordinary shareholders per weighted average number of basic and diluted shares before share-based compensation expense and non-recurring items such as gain on disposal of equity investees and subsidiary in which management aims to better represent the underlying business operations.

 

1


 

Mr. Meisong Lai, Founder, Chairman and Chief Executive Officer of ZTO, commented “ZTO’s market share by parcel volume expanded 2.5 percentage points to 19.9% during the second quarter of 2019. Our consistent strategy has been continuous market expansion based on high quality of services and targeted net earnings. Second quarter’s performance reflected the soundness of our overall strategy and solid execution.”

 

Mr. Lai added, “Chinese express delivery industry is likely to maintain steady growth in the near term. While innovations in commerce impacting consumption and manufacturing are changing supply chain management, including logistics, express delivery industry is facing new demands and challenges. To maintain our competitive edge, ZTO must continue to focus on strengthening our core competencies as well as widening our business moat to sustain future growth. In addition to continued improvements in productivity and cost efficiencies, we will further advance our initiatives on industry-leading courier pay and last mile capabilities going forward in order to maintain a healthy growth momentum and be well prepared for the long run.”

 

Ms. Huiping Yan, Chief Financial Officer of ZTO, added, “ZTO’s performance adds to our confidence in our ability to deliver on our corporate strategy. Year-over-year ASP decline for the quarter was more than previously planned, however, it was kept level with the market, and we achieved higher volume increase as well as targeted earnings growth through scale leverage and effective resource planning. Combined sorting hub and line-haul transportation costs per parcel declined 8.6% year over year, and corporate SG&A, excluding share-based compensation, was 5.4% of total revenues compared to that of 5.7% last year. Adjusted net income rose 25.6% to RMB1.38 billion, and cash from operating activities rose 35.0% to RMB1.99 billion.”

 

2


 

Second Quarter 2019 Financial Results

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

%

 

RMB

 

US$

 

%

 

RMB

 

%

 

RMB

 

US$

 

%

 

 

 

(in thousands, except percentages)

 

Express delivery services

 

3,664,535

 

87.3

 

4,763,902

 

693,940

 

87.8

 

6,751,532

 

87.2

 

8,823,274

 

1,285,255

 

88.3

 

Freight forwarding services

 

301,789

 

7.2

 

350,088

 

50,996

 

6.5

 

595,063

 

7.7

 

639,402

 

93,139

 

6.4

 

Sale of accessories

 

209,219

 

5.0

 

292,570

 

42,618

 

5.4

 

360,062

 

4.7

 

501,407

 

73,038

 

5.0

 

Others

 

22,376

 

0.5

 

17,080

 

2,488

 

0.3

 

35,666

 

0.4

 

33,588

 

4,893

 

0.3

 

Total revenues

 

4,197,919

 

100.0

 

5,423,640

 

790,042

 

100.0

 

7,742,323

 

100.0

 

9,997,671

 

1,456,325

 

100.0

 

 

Revenues were RMB5,423.6 million (US$790.0 million), an increase of 29.2% from RMB4,197.9 million in the same period of 2018. Revenue from express delivery services increased by 30.0% compared to the same period of 2018, mainly driven by a 46.8% increase in parcel volume and partially offset by a 11.3% decrease in unit price per parcel largely for incremental volume incentives in response to competition. Revenue from freight forwarding services increased 16.0% when compared to the same period of 2018. The increase in revenue from sales of accessories was in-line with the increase in the sale of thermal paper used for the printing of digital waybills. Other revenues are mainly associated with financing services and advertising services.

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

% of
revenues

 

RMB

 

US$

 

% of
revenues

 

RMB

 

% of
revenues

 

RMB

 

US$

 

% of
revenues

 

 

 

(in thousands, except percentages)

 

Line-haul transportation cost

 

1,272,267

 

30.3

 

1,695,866

 

247,031

 

31.3

 

2,455,904

 

31.7

 

3,289,873

 

479,224

 

32.9

 

Sorting hub cost

 

701,961

 

16.7

 

953,901

 

138,952

 

17.6

 

1,388,398

 

17.9

 

1,844,970

 

268,750

 

18.5

 

Freight forwarding cost

 

288,348

 

6.9

 

345,283

 

50,296

 

6.4

 

572,018

 

7.4

 

628,397

 

91,536

 

6.3

 

Cost of accessories sold

 

125,724

 

3.0

 

156,371

 

22,778

 

2.9

 

214,441

 

2.8

 

276,057

 

40,212

 

2.8

 

Other costs

 

352,365

 

8.4

 

503,651

 

73,364

 

9.2

 

622,182

 

8.0

 

930,214

 

135,502

 

9.2

 

Total cost of revenues

 

2,740,665

 

65.3

 

3,655,072

 

532,421

 

67.4

 

5,252,943

 

67.8

 

6,969,511

 

1,015,224

 

69.7

 

 

Total cost of revenues was RMB3,665.1 million (US$ 532.4million), an increase of 33.4% from RMB2,740.7 million in the same period last year.

 

·                  Line haul transportation cost was RMB1,695.9 million (US$247.0 million), an increase of 33.3% from RMB1,272.3 million in the same period last year. Higher usage of self-owned fleet with increasing number of higher-capacity trailer trucks, improved line-haul route planning and better load rate enhanced the transportation cost leverage

 

·                  Sorting hub operating cost was RMB953.9 million (US$139.0 million), an increase of 35.9% or RMB 251.9 million from RMB702.0 million in the same period last year. Of this increase: (i) RMB178.5 million (US$26.0 million) was associated with sorting hub labor costs, the headcount of sorting hub workers increased 18.6% year over year, which was much slower than the parcel volume increase; and (ii) RMB50.1 million (US$7.3 million) came from depreciation costs associated with the newly installed automated sorting equipment. As of June 30, 2019, 155 sets of automated sorting equipment have been put into use, compared to 64 sets as of June 30, 2018

 

·                  Cost of accessories was RMB156.4 million (US$22.8 million), an increase of 24.4% from RMB125.7 million in the same period last year. The increase was in line with the increase in the sale of accessories for thermal paper

 

·                  Other costs were RMB503.7 million (US$73.4 million), an increase of RMB151.3 million (US$22.0 million) compared to the same period last year, which mainly resulted from (i) an increase of RMB117.7 million (US$17.2 million) in dispatching costs associated with serving enterprise customers, (ii) an increase of RMB47.7 million (US$6.9 million) in expenses related to IT and technology development and (iii) a decrease of RMB 5.5 million (US$0.8 million) in tax surcharges

 

3


 

Gross Profit was RMB1,768.6 million (US$257.6 million), an increase of 21.4% from RMB1,457.3million in the same period last year. Gross margin rate decreased to 32.6% from 34.7% year over year, which resulted from combined effects of increase in volume incentives, parcel volume increase, and cost productivity gains.

 

Total Operating Expenses were RMB275.8 million (US$40.2 million), compared to RMB268.4 million in the same period last year.

 

·                  Selling, general and administrative expenses were RMB305.4 million (US$44.5 million), compared to RMB269.2 million in the same period last year. The increase was mainly due to an increase in salaries and accrued bonuses from RMB132.4 million (US$19.3 million) to RMB177.7 million (US$25.9 million). Selling, general and administrative expenses, excluding share-based compensation expense accounted for 5.4% of total revenues compared to 5.7% during the same period last year

 

·                  Other operating income, net was RMB29.5 million (US$4.3 million) for the quarter. Other operating income mainly consisted of government subsidies and tax rebates of RMB24.6 million (US$3.6 million) received in the second quarter of 2019

 

Income from operations was RMB1,492.7 million (US$217.4 million), an increase of 25.6% from RMB1,188.8 million for the same period last year. Operating margin rate decreased by 0.8 percentage point to 27.5% year over year while the gross margin rate decreased by 2.1 percentage points. This reflects sound corporate cost control and healthy scale leverage.

 

Interest income was RMB144.5 million (US$21.0 million), compared with RMB70.7 million in the same period in 2018 primarily due to an increase in the amount of cash and interest-bearing bank deposits. In June 2018, the company received majority portion of the proceeds from the US$1.38 billion strategic investment led by Alibaba.

 

Foreign currency exchange gain, before tax was RMB22.3million (US$3.2 million) in the second quarter of 2019, resulted from the appreciation of the U.S. dollar against the Chinese renminbi in the second quarter of 2019.

 

Income tax expenses were RMB288.8 million (US$42.1 million) and the effective income tax rate was 17.4% for the second quarter of 2019.

 

Net income was RMB1,365.1 million (US$198.8 million), a decrease of 8.5% from RMB1,492.2 million in the same period last year, which included one-time gains on disposal of equity investees of RMB424.5 million (net of income taxes), mainly composed of the share disposal of Shenzhen Feng Chao Technology Ltd. associated with the Hive Box operations.

 

Basic and diluted earnings per ADS attributable to ordinary shareholders were RMB1.73 (US$0.25), compared with basic and diluted earnings per ADS attributable to ordinary shareholders of RMB2.07 in the same period last year.

 

Adjusted basic and diluted earnings per ADS attributable to ordinary shareholders were RMB1.74 (US$0.25), compared with adjusted basic and diluted earnings per ADS attributable to ordinary shareholders of RMB1.52 in the same period last year.

 

Adjusted net income was RMB1,375.9 million (US$200.4 million), compared with adjusted net income of RMB1,095.7 million during the same period last year.

 

EBITDA was RMB1,952.0 million (US$284.3 million), compared with RMB2,042.0 million in the same period last year which included one-time gains on disposal of equity investees of RMB549.7 million.

 

Adjusted EBITDA was RMB1,962.8 million (US$285.9 million), compared to RMB1,520.2 million in the same period last year.

 

Net cash provided by operating activities was RMB1,992.8 million (US$290.3 million), compared with RMB1,475.8 million in the same period last year.

 

4


 

Business Outlook

 

The Company makes no changes to its previously stated annual guidance: parcel volume for 2019 is expected to be in the range of 11.51 billion to 11.93 billion, representing a 35% to 40% increase year over year, and the Company’s adjusted net income is expected to be in the range of RMB4.8 billion to RMB5.2 billion, representing a 14.3% to 23.8% increase from the same period of 2018. Above estimates are subject to change.

 

5


 

Company Share Purchase

 

On November 15, 2018, the Company announced a new 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. The Company expects to fund the repurchase out of its existing cash balance. As of June 30, 2019, the Company has purchased an aggregate of 7,549,423 ADSs at an average purchase price of US$17.32, including repurchase commissions.

 

The Company believes that the share repurchase program represents ZTO’s confidence in the overall market opportunities as well as ZTO’s solid operating fundamentals and financial strength for sustained profitable growth and value creation for its shareholders.

 

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 RMB6.8650 to US$1.00, the noon buying rate on June 28, 2019 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, and adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders, 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 and adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders 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 and adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders 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 and adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders 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, adjusted net income and adjusted basic and diluted earnings per American depositary share attributable to ordinary shareholders 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.

 

6


 

Conference Call Information

 

ZTO’s management team will host an earnings conference call at 9:00 P.M. U.S. Eastern Time on Thursday, August 15, 2019 or 9:00 A.M. Beijing Time on Friday, August 16, 2019.

 

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

 

United States:

1-888-317-6003

Hong Kong:

852-5808-1995

China:

4001-206-115

International:

1-412-317-6061

Passcode:

9994827

 

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 accessible through August 22, 2019 by dialing the following numbers:

 

United States:

1-877-344-7529

International:

1-412-317-0088

Passcode:

10133925

 

A live and archived webcast of the conference call will also be available at the Company’s investor relations website 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.

 

7


 

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 2019, 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. The financial results to which this news release is related 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.

 

8


 

UNAUDITED CONSOLIDATED FINANCIAL DATA

 

Summary of Unaudited Consolidated Comprehensive Income Data:

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(in thousands, except for share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

4,197,919

 

5,423,640

 

790,042

 

7,742,323

 

9,997,671

 

1,456,325

 

Cost of revenues

 

(2,740,665

)

(3,655,072

)

(532,421

)

(5,252,943

)

(6,969,511

)

(1,015,224

)

Gross profit

 

1,457,254

 

1,768,568

 

257,621

 

2,489,380

 

3,028,160

 

441,101

 

Operating income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

(269,178

)

(305,350

)

(44,479

)

(684,801

)

(863,128

)

(125,729

)

Other operating income, net

 

773

 

29,531

 

4,302

 

82,680

 

87,633

 

12,765

 

Total operating expenses

 

(268,405

)

(275,819

)

(40,177

)

(602,121

)

(775,495

)

(112,964

)

Income from operations

 

1,188,849

 

1,492,749

 

217,444

 

1,887,259

 

2,252,665

 

328,137

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

70,708

 

144,470

 

21,044

 

131,029

 

290,941

 

42,380

 

Interest expense

 

(3

)

 

 

(776

)

 

 

Gain/(loss) on disposal of equity investees

 

549,733

 

 

 

549,733

 

(529

)

(77

)

Foreign currency exchange gain/(loss), before tax

 

35,901

 

22,293

 

3,247

 

(852

)

(3,662

)

(533

)

Income before income tax, and share of loss in equity method investments

 

1,845,188

 

1,659,512

 

241,735

 

2,566,393

 

2,539,415

 

369,907

 

Income tax expense

 

(350,858

)

(288,803

)

(42,069

)

(505,138

)

(480,661

)

(70,016

)

Share of loss in equity method investments

 

(2,104

)

(5,614

)

(818

)

(11,574

)

(12,013

)

(1,750

)

Net income

 

1,492,226

 

1,365,095

 

198,848

 

2,049,681

 

2,046,741

 

298,141

 

Net income attributable to noncontrolling interests

 

(1,141

)

(5,614

)

(818

)

(1,837

)

(6,547 

)

(954

)

Net income attributable to ZTO Express (Cayman) Inc.

 

1,491,085

 

1,359,481

 

198,030

 

2,047,844

 

2,040,194

 

297,187

 

Net income attributable to ordinary shareholders

 

1,491,085

 

1,359,481

 

198,030

 

2,047,844

 

2,040,194

 

297,187

 

Net earnings per share attributable to ordinary shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

2.07

 

1.73

 

0.25

 

2.86

 

2.60

 

0.38

 

Diluted

 

2.07

 

1.73

 

0.25

 

2.86

 

2.59

 

0.38

 

Weighted average shares used in calculating net earnings per ordinary share

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

721,183,933

 

786,106,219

 

786,106,219

 

715,978,664

 

786,069,533

 

786,069,533

 

Diluted

 

722,033,183

 

786,385,711

 

786,385,711

 

716,706,186

 

786,262,099

 

786,262,099

 

Other comprehensive income, net of tax of nil:

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

554,487

 

293,376

 

42,735

 

287,984

 

(50,852

)

(7,407

)

Comprehensive income

 

2,046,713

 

1,658,471

 

241,583

 

2,337,665

 

1,995,889

 

290,734

 

Comprehensive income attributable to noncontrolling interests

 

(1,141

)

(5,614

)

(818

)

(1,837

)

(6,547

)

(954

)

Comprehensive income attributable to ZTO Express (Cayman) Inc.

 

2,045,572

 

1,652,857

 

240,765

 

2,335,828

 

1,989,342

 

289,780

 

 

9


 

Unaudited Consolidated Balance Sheets Data:

 

 

 

As of

 

 

 

December 31,
2018

 

June 30, 2019

 

 

 

RMB

 

RMB

 

US$

 

 

 

(in thousands, except for share and per share data)

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

4,622,554

 

7,111,684

 

1,035,934

 

Restricted cash

 

400

 

979

 

143

 

Accounts receivable, net of allowance for doubtful accounts of RMB13,996 and RMB16,347 at December 31, 2018 and June 30, 2019, respectively

 

596,995

 

573,624

 

83,558

 

Financing receivables, net of allowance for doubtful accounts of RMB4,139 and RMB6,739 at December 31, 2018 and June 30, 2019, respectively

 

517,983

 

507,096

 

73,867

 

Short-term investment

 

13,599,852

 

9,260,975

 

1,349,013

 

Inventories

 

43,813

 

35,354

 

5,150

 

Advances to suppliers

 

337,874

 

328,199

 

47,808

 

Prepayments and other current assets

 

1,507,996

 

2,124,817

 

309,512

 

Amounts due from related parties

 

6,600

 

79,625

 

11,599

 

Total current assets

 

21,234,067

 

20,022,353

 

2,916,584

 

Investments in equity investees

 

2,207,410

 

2,200,334

 

320,515

 

Property and equipment, net

 

9,035,704

 

9,671,468

 

1,408,808

 

Land use rights, net

 

1,969,176

 

2,169,262

 

315,989

 

Intangible assets, net

 

54,227

 

51,128

 

7,448

 

Right-of-use assets6

 

 

656,653

 

95,652

 

Goodwill

 

4,241,541

 

4,241,541

 

617,850

 

Deferred tax assets

 

318,063

 

324,548

 

47,276

 

Other non-current assets

 

622,669

 

1,194,426

 

173,986

 

TOTAL ASSETS

 

39,682,857

 

40,531,713

 

5,904,108

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

 

1,311,807

 

1,185,274

 

172,655

 

Advances from customers

 

436,710

 

902,012

 

131,393

 

Income tax payable

 

405,683

 

167,105

 

24,342

 

Amounts due to related parties

 

132,216

 

67,324

 

9,807

 

Lease liabilities6

 

 

232,067

 

33,804

 

Acquisition consideration payable

 

19,581

 

22,942

 

3,342

 

Dividends payable

 

1,699

 

3,723

 

542

 

Other current liabilities

 

2,833,769

 

2,729,341

 

397,573

 

Total current liabilities

 

5,141,465

 

5,309,788

 

773,458

 

Lease liabilities6

 

 

385,183

 

56,108

 

Deferred tax liabilities

 

157,940

 

155,470

 

22,647

 

Acquisition consideration payable

 

22,942

 

 

 

Other non-current liabilities

 

90,961

 

90,822

 

13,230

 

TOTAL LIABILITIES

 

5,413,308

 

5,941,263

 

865,443

 

 


(6)                                 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and lease liability on their balance sheet for all leases. The Group adopted this ASU on January 1, 2019 using the modified retrospective approach and will not restate comparative periods.

 

 

 

As of

 

 

 

December 31,
2018

 

June 30, 2019

 

 

 

RMB

 

RMB

 

US$

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ordinary shares (US$0.0001 par value; 10,000,000,000 shares authorized, 811,267,551 shares issued and 785,463,859 shares outstanding as of December 31, 2018; 803,718,128 shares issued and 782,114,477 shares outstanding as of June 30, 2019)

 

523

 

518

 

75

 

Additional paid-in capital

 

24,137,681

 

22,337,619

 

3,253,841

 

Treasury shares, at cost

 

(1,545,077

)

(1,438,257

)

(209,506

)

Retained earnings

 

11,052,395

 

13,092,589

 

1,907,150

 

Accumulated other comprehensive income

 

571,716

 

520,864

 

75,872

 

ZTO Express (Cayman) Inc. shareholders’ equity

 

34,217,238

 

34,513,333

 

5,027,432

 

Noncontrolling interests

 

52,311

 

77,117

 

11,233

 

Total Equity

 

34,269,549

 

34,590,450

 

5,038,665

 

TOTAL LIABILITIES AND EQUITY

 

39,682,857

 

40,531,713

 

5,904,108

 

 

10


 

Summary of Unaudited Consolidated Cash Flow Data:

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

1,475,795

 

1,992,804

 

290,285

 

1,689,970

 

2,626,074

 

382,532

 

Net cash provided by/(used in) investing activities7

 

(5,649,363

)

1,498,752

 

218,318

 

(7,246,921

)

2,394,117

 

348,742

 

Net cash provided by/(used in) financing activities

 

6,620,184

 

(2,493,043

)

(363,153

)

5,815,067

 

(2,507,052

)

(365,193

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

231,350

 

21,803

 

3,177

 

141,807

 

(23,430

)

(3,413

)

Net increase in cash, cash equivalents and restricted cash

 

2,677,966

 

1,020,316

 

148,627

 

399,923

 

2,489,709

 

362,668

 

Cash, cash equivalents and restricted cash at beginning of period

 

3,495,691

 

6,092,347

 

887,450

 

5,773,734

 

4,622,954

 

673,409

 

Cash, cash equivalents and restricted cash at end of period

 

6,173,657

 

7,112,663

 

1,036,077

 

6,173,657

 

7,112,663

 

1,036,077

 

 


(7) The amount of cash provided by investing activities mainly includes mature of the fixed term bank deposits with an original maturity of three months to one year. For the second quarter of 2019, the amounts of cash flow in for receiving the short-term investment are approximately RMB2,288.6 million (US$333.4 million), and the amounts of cash flow out for purchasing the short-term investment are approximately RMB3,736.7 million in the same period last year.

 

11


 

Reconciliations of GAAP and Non-GAAP Results

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(in thousands, except for share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

1,492,226

 

1,365,095

 

198,848

 

2,049,681

 

2,046,741

 

298,141

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

27,983

 

10,800

 

1,573

 

227,727

 

295,065

 

42,981

 

(Gain)/loss on disposal of equity investees, net of income taxes

 

(424,521

)

 

 

(424,521

)

529

 

77

 

Adjusted net income

 

1,095,688

 

1,375,895

 

200,421

 

1,852,887

 

2,342,335

 

341,199

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

1,492,226

 

1,365,095

 

198,848

 

2,049,681

 

2,046,741

 

298,141

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation

 

186,200

 

283,409

 

41,283

 

362,397

 

554,832

 

80,820

 

Amortization

 

12,693

 

14,676

 

2,138

 

23,363

 

25,969

 

3,783

 

Interest expenses

 

3

 

 

 

776

 

 

 

Income tax expenses

 

350,858

 

288,803

 

42,069

 

505,138

 

480,661

 

70,016

 

EBITDA

 

2,041,980

 

1,951,983

 

284,338

 

2,941,355

 

3,108,203

 

452,760

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

27,983

 

10,800

 

1,573

 

227,727

 

295,065

 

42,981

 

(Gain)/loss on disposal of equity investees, before income taxes

 

(549,733

)

 

 

(549,733

)

529

 

77

 

Adjusted EBITDA

 

1,520,230

 

1,962,783

 

285,911

 

2,619,349

 

3,403,797

 

495,818

 

 

12


 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2018

 

2019

 

2018

 

2019

 

 

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(in thousands, except for share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ordinary shareholders

 

1,491,085

 

1,359,481

 

198,030

 

2,047,844

 

2,040,194

 

297,187

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense

 

27,983

 

10,800

 

1,573

 

227,727

 

295,065

 

42,981

 

(Gain)/loss on disposal of equity investees, net of income taxes

 

(424,521

)

 

 

(424,521

)

529

 

77

 

Adjusted net income attributable to ordinary shareholders

 

1,094,547

 

1,370,281

 

199,603

 

1,851,050

 

2,335,788

 

340,245

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares used in calculating net earnings per ordinary share

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

721,183,933

 

786,106,219

 

786,106,219

 

715,978,664

 

786,069,533

 

786,069,533

 

Diluted

 

722,033,183

 

786,385,711

 

786,385,711

 

716,706,186

 

786,262,099

 

786,262,099

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to ordinary shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

2.07

 

1.73

 

0.25

 

2.86

 

2.60

 

0.38

 

Diluted

 

2.07

 

1.73

 

0.25

 

2.86

 

2.59

 

0.38

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net earnings per share attributable to ordinary shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1.52

 

1.74

 

0.25

 

2.59

 

2.97

 

0.43

 

Diluted

 

1.52

 

1.74

 

0.25

 

2.58

 

2.97

 

0.43

 

 

13


 

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Investor Relations Department

Phone: +86-21-6978 7037

E-mail: ir@zto.com