The pattern of the express delivery industry is accelerating and the price war is gradually easing.
As of November 18, SF Holdings (002352.SZ), Zhongtong Express (ZTO.N, 2057.HK), YTO Express (600233.SH), Six express companies, Shentong Express (002468.SZ), Yunda (002120.SZ), and Best Group (BEST.N), have successively released their third-quarter financial reports for 2021.
According to the financial report, the total operating income of the six express companies in the third quarter was 89.05 billion yuan. Except for Best’s revenue of 6.812 billion yuan, a year-on-year decrease of 14.6%, the remaining five companies all achieved year-on-year revenue growth. Among them, SF Express had the highest revenue in the third quarter, reaching 47.517 billion yuan. YTO’s revenue has the highest year-on-year growth, reaching 24.98%.
In terms of net profit attributable to shareholders of listed companies, SF Express, Zhongtong, YTO and Yunda achieved profitability. Among them, Zhongtong achieved the highest net profit, reaching 1.167 billion yuan, a year-on-year decrease of 2.83%. Among them, Shentong and Best had net losses of 92 million yuan and 655 million yuan respectively, and their net losses increased by 39.9% and 15.72% year-on-year.
Regarding the factors affecting the profitability during the reporting period, SF Express stated that in order to cope with the high Increase resource input in aspects such as transportation capacity. In addition, in the same period last year, the country launched a series of tax reduction and exemption policies in response to the impact of the epidemic, effectively alleviating cost pressures, and there are no relevant preferential policies this year.
Yuantong stated that the increase in operating income in the third quarter was mainly due to the increase in business volume. The development trend is constantly changing, and with the effect of the cancellation of various preferential policies issued by the state during the new crown pneumonia epidemic and the rebound of refined oil prices, the decline in the company’s express product single ticket revenue is higher than the decline in single ticket cost, and the gross profit rate of express products is Due to the drop.
According to the third quarterly report of Zhongtong, the core express service revenue was 6.696 billion yuan, an increase of 14.4% year-on-year. This is due to the combined effect of a 7.2% drop in the price of a single ticket caused by the drop and conventional incremental subsidies.
The third quarterly report of Best Group shows that the main reason for the decline in revenue is the express and freight business sectorThe average selling price (ASP) fell. Best’s operating revenue was 6.812 billion yuan, of which domestic express revenue was 3.988 billion yuan, accounting for 58.5% of total revenue, a year-on-year decrease of 21.7%. The main reason was that ASP per package fell by 12.0% year-on-year, and the number of packages dropped by 10.9% year-on-year. The decline was mainly due to fierce market competition.
As of the close of US stocks on November 17, Zhongtong Express reported US$28.82, a decrease of 0.62%; Best Group reported US$1.16, a decrease of 4.13%. As of the close of November 18, SF Holdings reported 65.34 yuan, an increase of 3.27%; YTO Express reported 15.7 yuan, an increase of 6.8%; Shentong Express reported 7.78 yuan, an increase of 2.77%; Yunda shares reported 18.98 yuan, an increase of 2.87%.
Comparison of the performance of six express companies in the third quarter. Journalist Shao Bingyan Drawing
Express delivery pattern: Accelerated industry concentration
According to the economic operation data of the postal industry in the first three quarters of 2021 released by the State Post Bureau, in the third quarter, The revenue growth rate has changed from negative to positive, a year-on-year increase of 2.3%, and business volume has increased by 8.7% year-on-year. In the third quarter, the growth rate of express delivery business volume fell. Compared with the second quarter, the business volume growth rate dropped by 5.7 percentage points, and the growth rate fell below 20% in September. Seasonal fluctuations have been “smoothed”, affected by the rapid development of live e-commerce, online consumer demand has been diverted, the effect of e-commerce platform holiday promotions has been weakened, and the monthly distribution of shipments has become more balanced.
According to the data of express delivery volume and market share compiled by news reporters, the top three express delivery companies in the third quarter were Zhongtong, Yunda, and Yunda. YTO, the express delivery volume was 5.7 billion, 4.706 billion, and 4.23 billion respectively. The fastest year-on-year growth in express delivery volume was SF Express, reaching 29.22%. YTO followed by 25.71%. Among them, only Best’s express delivery volume showed a year-on-year decline, reaching 2.103 billion pieces, a year-on-year decrease of 10.9%.
In addition, the six express companies have a market share of 80.9%. Among them, the top three market shares are Zhongtong, Yunda, and YTO, which are 20.82%, 17.19%, and 15.4, respectively.5%.
On October 29, Best Group transferred its domestic express delivery business to J&T Extreme Rabbit Express at a price of approximately 6.8 billion yuan (approximately US$1.1 billion).
In the third quarter conference call of Zhongtong Express on November 18, Lai Meisong, chairman of Zhongtong Express, said, “The current competitive landscape of the express industry is clear, and the future will More stable, the market share will become more concentrated, the head effect will be more prominent, and the growth of leading companies will be significantly higher than the growth of the industry. In the future, it is unlikely that new entrants in the industry like Jitu will have an impact on the industry. “
Regarding how to view the development of the industry by Jitu’s acquisition of Best China’s express delivery business, Lai Meisong said that this is good news for companies in the express delivery industry. The merger of the two is equal to one less competitor, and it also signifies that the market share is becoming more and more concentrated. It is even more favorable for companies that have competitive advantages in the industry.
Previously, delivery expert Zhao Xiaomin said in an interview with a news reporter that according to the current market share, Extreme Rabbit will not be able to enter the top three of the express delivery market after its successful acquisition. In the future, whether or not all express delivery networks can be managed well will have extremely high requirements on the team, organizational system and talents. After the acquisition, whether customers agree with Jitu’s operations and services is a very critical indicator.
The price war has eased, but it has not yet returned to its original level.
According to the six companies’ express single ticket prices compiled by journalists Except for Shentong’s single express ticket price, which dropped by 4.74% from the previous month, the prices of the other five companies’ express single ticket all achieved a month-on-month increase.
Among them, SF Express’s single-ticket price increased the most month-on-month, reaching 4.63%, followed by Zhongtong, whose single-ticket price increased by 2.48% month-on-month. However, in the third quarter of last year, the single ticket prices of the six express delivery companies still showed a downward trend. Among them, Best had the highest year-on-year decline of 12.04%, followed by SF Express, with a year-on-year decline of 7.35%, and again by Zhongtong, with a year-on-year decline of 6.77%.
From the perspective of industry competition, the State Post Bureau’s report on the economic operation of the postal industry in the first three quarters of 2021 shows that since the third quarter, it has been affected by rising end distribution fees and rising costs. Affected by other factors, the unit price of express delivery showed a month-on-month increase. Among them, the same city rose from 5.4 yuan in July to 5.7 yuan in September, and in different places from JulyThe price rose from 5.5 yuan to 5.6 yuan in September, and international/Hong Kong, Macao and Taiwan rose from 61.7 yuan in July to 63.2 yuan in September. From a regional perspective, Zhejiang, Guangdong, Hebei, Fujian, and Henan all saw increases, among which Zhejiang express prices rose for three consecutive months.
Lai Meisong, chairman of ZTO Express, said on the third-quarter conference call, “At present, the second- and third-rate express companies have basically withdrawn, and the leading companies are becoming more differentiated. The competition is partially returning to rationality and becoming orderly. Express delivery prices are expected to stabilize in 2022. At the same time, it is observed that the growth rate of the e-commerce market has slowed down. The issue facing express companies is how to deal with the new market and policy environment. Stay ahead, continue to grow, and realize the transition from high-speed to high-quality development.”
For the expectation of subsequent price trends, the executives of YTO Express delivered a conference call in the third quarter. Said that the price competition in the industry was fierce before, and the overall network stability and profitability of various express companies have been under greater pressure. Recently, the state and some local governments have issued a series of regulatory policies and guidance. The price competition in the express delivery industry has slowed down, and the competition strategy has gradually changed from price competition to value-driven. The company believes that under the premise that the price competition in the industry returns to rationality and the focus of competition gradually changes, the price increase policy this peak season will have a certain degree of sustainability, and the overall revenue and profitability of the industry will gradually improve.
Yunda executives stated at the investor exchange event on November 9th that for the formulation of express delivery price policies, the first thing to do is to meet market demand and according to local customers’ goods Differentiate pricing for commodity structure; second, it must conform to the company’s own capabilities, improve service timeliness, and ensure network stability. Previously, Yunda set prices based on business volume, but in the future it will set prices based on service quality, service quality and service products. In the future, the difference in the income of express delivery companies will mainly depend on the implementation of strategies such as customer grouping and product stratification.