ZTO Express (Cayman) Inc. (NYSE:ZTO) Q1 2022 Earnings Conference Call May 24, 2022 8:30 PM ET Company Participants Huiping Yan - CFO Meisong Lai - CEO Conference Call Participants Thomas Chong - Jefferies Tian Hou - TH Data Capital Parash Jain - HC Hong Kong Operator Good day. And welcome to the ZTO Express First Quarter Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operat ...

Financial Performance - Revenue for Q1 2022 was RMB 7,904.1 million (USD 1,246.8 million), a 22.1% increase from RMB 6,472.5 million in Q1 2021[4] - Adjusted net profit grew by 34.9% to RMB 1,054.5 million (USD 166.3 million) compared to RMB 781.6 million in the same period last year[4] - Gross profit rose by 47.7% to RMB 1,619.5 million (USD 255.5 million), up from RMB 1,096.5 million year-over-year[4] - Basic and diluted earnings per American Depositary Share (ADS) were RMB 1.12 (USD 0.18), a 75.0% increase from RMB 0.64 in Q1 2021[4] - Operating profit rose by 76.4% to RMB 1,116.3 million (USD 176.1 million), with an operating margin increase from 9.8% to 14.1%[12] - Net profit for Q1 2022 was RMB 875.5 million (USD 138.1 million), a 64.1% increase compared to RMB 533.5 million in Q1 2021[13] - Total revenue for Q1 2022 was RMB 7,904.1 million (USD 1,246.8 million), an increase of 22.1% compared to RMB 6,472.5 million in Q1 2021[7] - Core express service revenue grew by 26.6% year-over-year, driven by a 16.8% increase in package volume and an 8.5% increase in average price per shipment[7] Operational Metrics - Package volume increased by 16.8% to 5.226 billion pieces, with market share rising to 21.6%[3] - The company operated over 30,700 collection/delivery points as of March 31, 2022[5] - The number of sorting centers reached 99, with 88 operated by the company and 11 by network partners[5] - The number of automated sorting equipment in operation increased to 422 units as of March 31, 2022, up from 349 units a year earlier[9] Cash Flow and Expenditures - Operating cash flow increased by 131.8% to RMB 1,105.4 million (USD 174.4 million) from RMB 477.0 million in Q1 2021[4] - Capital expenditures for the quarter were RMB 1.8 billion[6] - Other costs increased by 29.2% to RMB 1,059.4 million (USD 167.1 million), primarily due to increased taxes and costs associated with serving enterprise clients[10] - The net cash generated from operating activities increased from RMB 476,952 thousand in 2021 to RMB 1,105,395 thousand in 2022, representing a growth of approximately 132.5%[31] - The net cash used in investing activities decreased from RMB (4,371,990) thousand in 2021 to RMB (3,314,751) thousand in 2022, indicating a reduction of about 24.2%[31] - The net cash generated from financing activities rose significantly from RMB 993,968 thousand in 2021 to RMB 2,580,645 thousand in 2022, marking an increase of approximately 160%[31] Share Repurchase and Financial Policies - The company announced a share repurchase plan on November 14, 2018, authorizing the repurchase of up to $500 million of its Class A ordinary shares over 18 months[17] - On March 31, 2021, the board approved an increase in the total value of shares that could be repurchased from $500 million to $1 billion, extending the plan until June 30, 2023[17] - As of March 31, 2022, the company had repurchased a total of 36,074,242 American Depositary Shares at an average purchase price of $25.21, including repurchase commissions[17] - The company uses non-GAAP financial metrics such as EBITDA, adjusted EBITDA, and adjusted net income to assess operational performance and inform financial decisions[19] - The company emphasizes that non-GAAP financial metrics should not be considered in isolation from net income or other performance indicators[20] - The company encourages investors to review its financial information comprehensively rather than relying on a single financial metric[20] Future Outlook - The company expects to benefit from supportive government policies and anticipates a phased economic rebound despite challenges from the Omicron variant[6] - The company expects full-year package volume to grow by 12%-16%, projecting a total of 24.96 billion to 25.86 billion packages for 2022[15] - The company may face risks and uncertainties that could cause actual performance to differ significantly from forward-looking statements[28] Balance Sheet Highlights - Total assets as of March 31, 2022, amounted to RMB 65,347,355, an increase from RMB 62,772,343 as of December 31, 2021, representing a growth of approximately 4%[30] - Total liabilities as of March 31, 2022, were RMB 16,705,701, compared to RMB 13,844,762 as of December 31, 2021, indicating an increase of about 20%[30] - Cash and cash equivalents as of March 31, 2022, were RMB 9,900,970, up from RMB 9,721,225 as of December 31, 2021, showing a growth of approximately 2%[30] - The company’s total current assets as of March 31, 2022, were RMB 20,035,662, compared to RMB 18,666,359 as of December 31, 2021, indicating an increase of about 7%[30] - The company’s total equity as of March 31, 2022, was RMB 48,641,654, slightly down from RMB 48,927,581 as of December 31, 2021, reflecting a decrease of about 0.6%[30] Earnings Conference Call - The management team will hold an earnings conference call on May 25, 2022, at 8:30 PM Eastern Time[22]

Share Structure and Voting Rights - As of March 31, 2022, the voting power of different voting rights beneficiaries accounted for approximately 77.7% of the total voting rights in the company, with 206,100,000 Class B shares and 8,431,230 Class A shares held[2]. - Each Class B share can be converted into one Class A share, which would result in the issuance of 206,100,000 Class A shares, representing about 34.1% of the total outstanding Class A shares as of March 31, 2022[2]. - The company operates under a dual-class share structure, where Class A shares have one vote per share and Class B shares have ten votes per share, allowing certain beneficiaries to exert significant control over shareholder decisions[1]. - As of December 31, 2021, the company had 808,448,289 shares of common stock outstanding, consisting of 602,348,289 Class A shares and 206,100,000 Class B shares[6]. Revenue and Financial Performance - Revenue contribution from Zhongtong Express for the fiscal years 2019, 2020, and 2021 was 97.1%, 94.1%, and 97.7% of total revenue, respectively[10]. - Total revenue for the year reached RMB 30,405,839, with a gross profit of RMB 6,589,377, resulting in a gross margin of approximately 21.7%[55]. - Operating profit for the year was RMB 5,503,011, reflecting an increase of 863,542 compared to the previous year[55]. - Net profit attributable to shareholders was RMB 4,754,827, representing a year-over-year increase of 746,136[55]. - Basic earnings per share for the year was RMB 5.80, while diluted earnings per share was also RMB 5.80[55]. - Total revenue for the year ended December 31, 2021, was RMB 30,405,839 thousand, an increase from RMB 25,214,290 thousand in 2020, representing a growth of approximately 20.0%[99]. - Net profit for the year ended December 31, 2021, was RMB 4,701,327 thousand, compared to RMB 4,326,446 thousand in 2020, reflecting an increase of about 8.7%[99]. Risks and Regulatory Environment - The company faces significant risks related to its contractual arrangements with Zhongtong Express, which may be deemed non-compliant with Chinese laws[11]. - Regulatory uncertainties in China could severely impact the company's ability to execute its business model and may lead to substantial financial losses[12]. - The company is subject to various legal and operational risks associated with conducting business in China, including foreign investment approvals and cybersecurity regulations[12]. - The company has not undergone PCAOB inspections for its auditors, which poses additional risks to its operations[12]. - The company’s structure may prevent direct ownership interests in Zhongtong Express, raising concerns about potential penalties or loss of business interests[11]. - The company’s American Depositary Shares (ADS) may significantly decline in value or become worthless due to regulatory actions in China[11]. - The company is subject to risks related to doing business in China, which could significantly impact investment value[13]. Operational Structure and Subsidiaries - The company operates as a Cayman Islands holding company, with its business primarily conducted through subsidiaries in China[10]. - The company operates through a variable interest entity structure, which may face regulatory scrutiny from the Chinese government, potentially impacting financial performance[26]. - The company has established a series of agreements to ensure operational control over its subsidiary, which includes a service agreement that entitles it to 100% of the net profits from ZTO Express[32]. - The company operates primarily through its Chinese subsidiary, ZTO Express, which has obtained necessary licenses and permits from the Chinese government, including express delivery and road transport operating licenses[36]. Cash Flow and Dividends - The total cash transfers from the parent company to its subsidiaries amounted to RMB 10,011 million in 2020 and RMB 1,250 million in 2021, while the cash transfers from the Hong Kong subsidiary to the Chinese subsidiary were RMB 6,041 million in 2020 and RMB 3,671 million in 2021[45]. - Dividends paid to the parent company shareholders were USD 189.1 million, USD 233.5 million, and USD 208.4 million for the years ending December 31, 2019, 2020, and 2021, respectively[14]. - The company's ability to pay dividends may depend on future dividends from its Chinese subsidiaries[14]. - The parent company has cumulatively contributed RMB 15,080.5 million as of December 31, 2021, with no shareholder loans provided to the Chinese subsidiary during 2019, 2020, and 2021[45]. Market and Competitive Landscape - The company relies heavily on the development of the e-commerce industry and the rise of new retail in China for its business growth[105]. - The company faces intense competition, which may adversely affect its operating performance and market share[105]. - The company’s technology systems are crucial for its operations, and failure to optimize or develop new technologies could harm its business and growth prospects[105]. - The company is sensitive to macroeconomic conditions, with potential adverse effects on consumer confidence and spending during economic downturns[113]. - The company may face challenges in managing indirect network partners, as it does not have direct agreements with them, potentially affecting service delivery[116]. Compliance and Legal Challenges - The company is required to comply with various regulations regarding its express delivery operations, including timely registration of delivery points and proper handling of user information[138]. - Non-compliance with the proposed overseas issuance regulations could result in fines ranging from RMB 1 million to 10 million, or even suspension of operations[37]. - The company faces significant uncertainties regarding compliance with current and future Chinese laws and regulations, which could adversely impact its operational performance[146]. - The company must ensure that its network partners comply with local laws to protect its brand reputation and financial stability[143]. Technology and Innovation - The company plans to expand its market presence and invest in new technologies to enhance operational efficiency[56]. - The company has increased its technology spending significantly, but this may not be sufficient to meet the growing business demands, potentially leading to economic losses[123]. - The company’s operational performance is highly dependent on the reliability and performance of its integrated technology systems[123]. Labor and Human Resources - As of December 31, 2021, the company employed 23,865 employees and over 57,000 outsourced personnel, indicating a labor-intensive operational model[124]. - The company anticipates continued increases in labor costs due to a tightening labor market, with rising salaries and employee benefits expected[124]. - Labor disputes have occurred with network partners, but none have had a significant adverse impact on the company; however, future disputes could disrupt operations and reduce revenue[126]. Environmental and Safety Concerns - Transportation safety risks are inherent in the company's operations, including potential accidents that could result in personal injury and property loss[130]. - The company faces potential damage to its reputation and business due to unethical or anti-competitive behavior within its network, which may lead to increased compliance costs or business losses if the Chinese government intensifies its crackdown on such practices[176]. International Expansion and Strategic Investments - The company plans to explore international expansion, which may involve risks such as changes in local economic and political conditions, and potential impacts on profitability[173]. - The company made a strategic investment of approximately $168 million to acquire about 15% equity in Cainiao Station, enhancing its delivery network capabilities[171]. Economic Impact and COVID-19 - The ongoing COVID-19 pandemic continues to negatively affect both the Chinese and global economies, with uncertainties persisting since before the outbreak[163]. - The company’s financial performance is significantly dependent on the future developments of the COVID-19 pandemic, which remains unpredictable[190].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to OR ☐ SHELL COMPANY REPORT PURSUANT TO S ...

ZTO Express (Cayman) Inc. (NYSE:ZTO) Q4 2021 Earnings Conference Call March 16, 2022 8:30 PM ET Company Participants Huiping Yan - Chief Financial Officer Meisong Lai - Founder, Chairman and Chief Executive Officer Conference Call Participants Qianlei Fan - Morgan Stanley Tian Hou - TH Data Capital Gangxian Liu - CICC Fan Tso - Bank of America Merrill Lynch Operator Good day, and welcome to the ZTO Conference Call and Webcast to announce the Fourth Quarter and Full-Year 2021 Financial Results. All participa ...

Exhibit 99.1 ZTO Reports Fourth Quarter 2021 and Fiscal Year 2021 Unaudited Financial Results 22.3 Billion Annual Parcels Increased Market Share to 20.6% Adjusted Net Income Reached RMB4.9 Billion while Price Competition Cooled US$0.25 per Share Dividend Announced for 2021 SHANGHAI, March 16, 2022/PRNewswire/ — ZTO Express (Cayman) Inc. (NYSE: ZTO and SEHK: 2057), a leading and fastgrowing express delivery company in China ("ZTO" or the "Company"), today announced its unaudited financial results for the fou ...

Financial Data and Key Metrics Changes - In Q3 2021, ZTO achieved a parcel volume of 5.7 billion, representing a 23.3% year-over-year growth and securing a market share of 20.8% [6][12] - Total revenue increased by 11.3% to RMB 7.4 billion, while adjusted net income rose by 13.7% year-over-year to RMB 1.15 billion [12][13] - The average selling price (ASP) for the core express delivery business declined by 7.2%, attributed to normal parcel weight drop and volume incentives [13] Business Line Data and Key Metrics Changes - The cost of revenue increased by 10.9% to RMB 5.8 billion, but the overall unit cost of revenue decreased by 7.3% [13] - Gross profit increased by 12.7% to RMB 1.6 billion, with a gross profit margin of 21.2% [13][14] - SG&A expenses rose by 4.2% to RMB 389 million, but as a percentage of revenue, it dropped to 5.3% [14] Market Data and Key Metrics Changes - The express delivery industry is expected to stabilize pricing by 2022, with a shift towards profitability among top players [7][18] - The market dynamics indicate that second and third-tier express delivery companies have exited, leading to clearer distinctions among top players [7] Company Strategy and Development Direction - ZTO's strategy focuses on maintaining high-quality customer service while achieving targeted profits and expanding market share [8][10] - The company plans to invest in capacity expansion and improve operational efficiency through digitization and data analytics [9][10] - ZTO aims to develop a comprehensive logistics ecosystem, including LTL, cloud warehouse, and other services to enhance brand value [9][34] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth prospects of the express delivery industry, despite a slowdown in e-commerce growth [10][37] - The company anticipates that earnings growth will exceed revenue growth, with adjusted net income expected to grow no less than 30% year-over-year for 2021 [15][20] Other Important Information - Capital expenditures for 2021 are projected to be around RMB 9 billion, with expectations for a decrease in 2022 [22] - The VAT super deduction policy is expected to expire by the end of 2021, which will remove its positive impact on earnings [22] Q&A Session Summary Question: Impact of J&T and Best M&A on competitive landscape - Management noted that the integration of J&T and Best may present challenges and does not guarantee a stronger competitive position, allowing ZTO to leverage its strengths [18] Question: Earnings growth faster than revenue growth - Management explained that ASP decline is due to market developments and incentives, but expects ASP to stabilize and increase as competition becomes more rational [19][20] Question: CapEx guidance for next year - Management indicated that capital spending will focus on land use rights and facility construction, with expectations for a decrease in total spending next year [22] Question: Industry pricing trends in 2022 - Management believes that ASP will increase in line with market trends, driven by a more sensible pricing environment [25] Question: Fourth quarter earnings guidance - Management confirmed that fourth quarter earnings growth is expected to be no less than 30% year-on-year [27] Question: Market share performance during Double 11 Shopping Festival - Management reported strong performance during the festival, achieving significant order and delivery volumes, and emphasized ZTO's competitive advantages [28][29] Question: New growth drivers beyond e-commerce - Management acknowledged the slowdown in e-commerce growth but highlighted opportunities in community grocery shopping and international expansion [37][39]