Bond.az -- ZTO Express shares slipped despite the Chinese parcel delivery group posting 5.2% growth in first-quarter adjusted net income and recording a second consecutive quarter of market share gains.
The company reported adjusted net income of Rmb2.38 billion, while total revenue climbed 22% to Rmb13.3 billion, driven by 13.2% volume growth and an 8.2% increase in core average selling price (ASP).
This marks a strong performance relative to peers, which saw ASP changes ranging from -2% to +14%, Morgan Stanley highlighted.
Gross profit grew 20.3% to Rmb3.24 billion, while operating profit rose a more modest 5.8% to Rmb2.55 billion, with the operating margin contracting 2.9 percentage points to 19.2%.
The standout positives were on market share and unit economics. ZTO’s share of the Chinese express parcel market rose 1.3 percentage points year-on-year to 20.3% — its second consecutive quarter of gains after a prolonged period of losses — and unit gross profit expanded 6.3% to Rmb0.33, the first such expansion in five quarters.
This marks “a second quarter of market share gain after its multi-year share loss. Market share gain accelerated,” Morgan Stanley analyst Qianlei Fan said.
“Unit GP realized expansion after contractions in the previous four quarters,” he highlighted.
Operating cash flow improved to Rmb2.8 billion from Rmb2.4 billion a year earlier, while capital expenditure fell 8% to Rmb1.8 billion. Full-year guidance was left unchanged, with parcel volume expected in the range of 42.4-43.5 billion units, implying 10-13% growth.
