ZTO EXPRESS(ZTO) - 2023 Q4 - Quarterly Results

Financial Performance - Full Year Adjusted Net Income reached RMB9.0 billion, growing 32.3% year over year[1] - Fourth Quarter Revenues were RMB10,619.4 million (US$1,495.7 million), a 7.6$440.6 million), up 12.8% from RMB2,772.6 million in the same period last year[2] - Net income for Q4 was RMB2,209.8 million (US$311.2 million), reflecting a 3.8$1,987.0 million), a 25.0% increase from RMB11,289.1 million in 2022[3] - Total Revenues increased by 8.6% to RMB38,418.9 million (US$5,411.2 million) from RMB35,376.9 million last year, driven by a 9.8$1,233.0 million) compared to RMB6,659.0 million in the previous year[24] - Basic and diluted earnings per ADS attributable to ordinary shareholders were RMB10.83 (US$1.53), up from RMB8.41 last year, reflecting a significant increase[25] - Adjusted EBITDA reached RMB14,107.3 million (US$1,987.0 million), compared to RMB11,289.1 million last year, indicating strong operational performance[25] - Operating margin improved to 26.0%, up from 21.9% in the previous year, showcasing enhanced profitability[22] Expenses and Income - Total Operating Expenses were RMB1,654.6 million (US$233.0 million), an increase from RMB1,302.8 million last year, primarily due to higher compensation and benefit expenses[21] - Interest income increased to RMB706.8 million (US$99.5 million) from RMB503.7 million last year, reflecting improved financial management[22] - Gross Profit increased by 29.0% to RMB11,662.5 million (US$1,642.6 million), with a gross margin rate improvement to 30.4$108.5 million), slightly down from RMB774.6 million last year, indicating stable supplementary income sources[22] - Interest expenses for Q4 2023 decreased to RMB61,804 from RMB76,147 in Q4 2022, a reduction of 18.7%[47] - Income tax expenses for the year ended December 31, 2023, were RMB1,938,600, up from RMB1,633,330 in 2022, reflecting an increase of 18.7%[47] Dividends and Shareholder Returns - The company approved a regular dividend policy starting with US$0.62 per share for 2023, with a minimum payout ratio of 40$0.62 per ADS, representing a 68% increase compared to the previous fiscal year[26] - The Company has approved a semi-annual regular cash dividend policy starting from 2024, with a minimum of 40% of distributable profit to be distributed each year[27] - The share repurchase program has been increased to US$2.0 billion, with US$437.0 million remaining available for repurchase as of December 31, 2023[28] Operational Metrics - Annual parcel volume increased to 30.2 billion, expanding market share to 22.9%[1] - The number of parcel delivery outlets exceeded 31,000, with over 10,000 self-owned line-haul vehicles as of December 31, 2023[4] - The core express average selling price (ASP) declined by 11.3% in 2023, primarily due to intense price competition[7] - The parcel volume for 2024 is expected to be between 34.73 billion and 35.64 billion, reflecting a year-over-year increase of 15% to 18%[29] Cash Flow and Assets - Capital spending for 2023 was RMB6.7 billion, with operating cash flow growing 16.4% to RMB13.4 billion[7] - Total current assets increased to RMB 26,953,548 as of December 31, 2023, from RMB 24,475,027 as of December 31, 2022, representing an increase of 10.1%[43] - Cash and cash equivalents at the end of the period were RMB 12,333,884, up from RMB 11,692,773 at the end of 2022, indicating an increase of 5.5%[46] - Total liabilities increased to RMB 28,184,813 as of December 31, 2023, from RMB 24,051,116 as of December 31, 2022, marking an increase of 17.2%[43] - Net cash provided by operating activities for the year ended December 31, 2023, was RMB 13,360,967, an increase of 16.4% from RMB 11,479,308 in 2022[44] - Total equity increased to RMB 60,280,408 as of December 31, 2023, from RMB 54,472,470 as of December 31, 2022, reflecting an increase of 10.5%[43] - Short-term bank borrowing rose to RMB 7,765,990 as of December 31, 2023, compared to RMB 5,394,423 as of December 31, 2022, an increase of 43.9%[43] Earnings and Share Metrics - Basic earnings per share for the year ended December 31, 2023, was RMB 10.83, down from RMB 10.60 in 2022, reflecting a decrease of 1.9%[41] - Basic earnings per share for Q4 2023 was RMB 2.72, up from RMB 2.67 in Q4 2022, indicating a 1.9% increase[48] - Diluted earnings per share for the year ended December 31, 2023, was RMB 10.60, compared to RMB 8.36 in 2022, marking a 26.8% increase[48] - The weighted average shares used in calculating diluted earnings per share for Q4 2023 was 837,291,253, slightly down from 841,226,602 in Q4 2022[48] Other Financial Metrics - Adjusted net income for the year ended December 31, 2023, reached RMB 9,005,920, up 32.5% from RMB 6,805,999 in 2022[47] - EBITDA for Q4 2023 was RMB 3,647,210, a 7.1% increase compared to RMB 3,406,549 in Q4 2022[47] - Adjusted EBITDA for the year ended December 31, 2023, was RMB 14,107,290, reflecting a 25.5% growth from RMB 11,289,073 in 2022[47] - The Company reported an income from operations of RMB 10,007,924 for the year ended December 31, 2023, compared to RMB 7,736,481 in 2022, marking an increase of approximately 29.5%[40] - Interest income for the three months ended December 31, 2023, was RMB 201,383, compared to RMB 111,768 for the same period in 2022, reflecting an increase of approximately 80%[40] - The company reported a foreign currency translation adjustment of RMB 70,677 for the three months ended December 31, 2023, compared to RMB 35,752 for the same period in 2022, indicating a significant increase[41] - The effective exchange rate used for translating Renminbi amounts into U.S. dollars was RMB 7.0999 to US$1 as of December 29, 2023[30] - The Company emphasizes the importance of non-GAAP financial measures for understanding underlying business trends and operational performance[32]