Investment Rating - The investment rating for the company is "Buy" (maintained) [1][18]. Core Views - The company demonstrates resilient growth under diversified operations, with expectations for profit margin recovery to enhance earnings elasticity [2][14][15]. - The company has achieved a year-on-year revenue increase of 9.26% in H1 2025, reaching 1468.58 billion yuan, and a net profit increase of 19.37%, totaling 57.38 billion yuan [6][12]. - The report highlights the company's strategic focus on cost reduction and operational efficiency improvements through multi-network integration and operational model transformation [14][15]. Financial Performance Summary - In H1 2025, the company reported a gross margin of 13.22%, a decrease of 0.64 percentage points year-on-year, while the net profit margin increased to 3.91%, up 0.33 percentage points [8][11]. - The company processed 7.813 billion parcels in H1 2025, reflecting a 25.73% increase year-on-year, although the average revenue per parcel decreased by 12.32% to 13.97 yuan [7][12]. - The company’s revenue from various segments showed robust growth, with express delivery, economic express, and same-city instant delivery increasing by 6.8%, 14.4%, and 38.9% respectively [12][14]. Profitability and Forecast - The company is projected to achieve revenues of 3170.76 billion yuan, 3512.63 billion yuan, and 3899.48 billion yuan for the years 2025, 2026, and 2027, respectively, with a consistent growth rate of 11% [16][17]. - The forecasted net profit for the same years is 117.73 billion yuan, 136.68 billion yuan, and 158.68 billion yuan, reflecting a growth rate of 16% [17]. - The report anticipates that ongoing cost reduction initiatives and profit margin recovery will significantly enhance the company's earnings elasticity [15][17].

Investment Rating - The investment rating for the company is "Buy" (maintained) with a target price of HKD 57.90 and RMB 57.50 [7][8]. Core Views - The company reported a revenue of RMB 146.86 billion for the first half of 2025, representing a year-on-year increase of 9.3%, and a net profit attributable to shareholders of RMB 5.74 billion, up 19.4% year-on-year [1]. - The company is focusing on operational transformation and resource investment to enhance logistics volume and revenue, achieving a year-on-year growth of 31.2% in logistics volume and 13.2% in revenue in Q2 2025, both exceeding industry averages [1][2]. - The company is strategically positioning itself to capture opportunities in international logistics and supply chain restructuring, aiming to become a comprehensive logistics leader [1][3]. Domestic Operations - In the domestic market, the core express business volume increased by 25.7% to 7.85 billion parcels, while the average revenue per parcel decreased by 12.2% to RMB 14.00 [2]. - Revenue from same-city instant delivery surged by 38.9% to RMB 5.49 billion, driven by high external demand and internal efficiency improvements [2]. - The cold chain and pharmaceutical segments also saw revenue growth of 15.3% to RMB 5.84 billion [2]. International Operations - Despite external trade policy disruptions, the company's supply chain and international business revenue grew by 9.7% to RMB 34.23 billion, with a significant reduction in losses compared to the previous year [3]. - The company achieved a net profit of RMB 4.3 billion on a comparable basis, marking a year-on-year increase of 178% after excluding certain losses [3]. Management and Employee Initiatives - The company implemented a "shared growth" employee stock ownership plan, aiming to enhance operational engagement and align long-term goals among key personnel [4]. - The logistics and freight forwarding business gross profit increased by 3.9% to RMB 18.74 billion, although the gross margin declined by 0.8 percentage points to 13.1% due to increased resource investments [4]. Profit Forecast and Valuation - The company adjusted its net profit forecasts for 2025-2027 to RMB 11.78 billion, RMB 14.18 billion, and RMB 16.00 billion, respectively, with corresponding EPS estimates of RMB 2.34, RMB 2.81, and RMB 3.17 [5]. - The company is assigned an EV/EBITDA multiple of 8.0x for A-shares and 7.4x for H-shares, reflecting its competitive positioning and growth potential [5].

顺丰控股：综合物流龙头，业绩再创新高。公司通过"1 到N"的扩张战略，从中国领先的时效快递服务 商快速转型为全球领先的综合物流服务商。受益于时效快递稳步发展、多元化战略持续推进、新业务利 润改善、降本增效成果显著等因素，公司业绩再攀新高峰，2024 年实现归母净利润101.70 亿元，同比 增长23.51%。公司强竞争优势奠定发展基础，业务拓展打开成长空间，长期增长值得期待。 竞争优势奠定发展基础。 （一）商业模式具备先天优势。公司具有独特的商业模式——直营、综合物流、独立第三方。（1）服 务质量领先。公司以端到端直营实现强大的物流网络控制和优质服务，连续16 年（2009-2024 年）位列 快递服务公众满意度第一，领先同行的高品质服务与口碑使公司产品能够保有溢价。（2）资源优势显 著。直营模式通常要求更多的前期投资和运营经验，公司深耕物流服务行业30 多年，建立了高效、可 靠、协同的物流基础设施网络，具备难以复制的资源护城河；鄂州货运枢纽具有战略价值和稀缺性，公 司依托其打造"轴幅式"网络，带来量、质、成本的改善，同时缓解时刻瓶颈。（3）增长空间较大。"直 营+综合物流+独立第三方"构建差异化竞争力，有望 ...

Investment Rating - The report assigns an "Outperform" rating to the company with a target price of 59.31 CNY, representing a 22% upside from the current price of 50.29 CNY [1][11][16]. Core Insights - The company is transitioning from a leading express delivery service to a comprehensive logistics provider, leveraging its strong operational capabilities and extensive logistics network to maintain a competitive edge in the high-end market [1][18]. - The report highlights the company's ability to reduce costs through resource integration and operational transformation, which has led to a steady improvement in profitability [1][3]. - The company is expected to achieve significant revenue growth driven by high demand in the logistics sector, with projected revenues of 318.56 billion CNY in 2025, reflecting a 12% year-on-year increase [9][10]. Financial Summary - Revenue projections for the company are as follows: 258.41 billion CNY in 2023, 284.42 billion CNY in 2024, 318.56 billion CNY in 2025, 349.37 billion CNY in 2026, and 376.84 billion CNY in 2027, with respective growth rates of -3.4%, 10.1%, 12.0%, 9.7%, and 7.9% [3][9]. - Net profit attributable to the parent company is forecasted to be 8.23 billion CNY in 2023, 10.17 billion CNY in 2024, 11.84 billion CNY in 2025, 13.64 billion CNY in 2026, and 15.34 billion CNY in 2027, with growth rates of 33.4%, 23.5%, 16.5%, 15.2%, and 12.4% respectively [3][9]. - The earnings per share (EPS) are projected to be 1.65 CNY in 2023, 2.04 CNY in 2024, 2.37 CNY in 2025, 2.73 CNY in 2026, and 3.07 CNY in 2027 [3][9]. Business Diversification - The company has diversified its operations from express delivery to a comprehensive logistics model, which includes express, freight, cold chain, and supply chain services, achieving a compound annual growth rate (CAGR) of 35.8% in emerging business segments from 2019 to 2024 [1][40][44]. - The report emphasizes the company's strong market position, with a 64% market share in high-end express delivery and 51% in mid-to-high-end economic delivery as of 2024 [1][26][28]. Cost Optimization and Profitability - The company has successfully implemented cost reduction strategies, achieving over 3.8 billion CNY in cost savings since 2021, with a projected gross margin of 13.8% in 2025 [1][3][50]. - The report indicates that the company's net profit margin is expected to improve, with a return on equity (ROE) forecasted to reach 11.0% in 2024, up from 8.9% in 2023 [3][51].

Summary of SF Express Conference Call Company Overview - **Company**: SF Express (顺丰控股) - **Industry**: Express Delivery and Logistics Key Points and Arguments Business Performance and Strategy - SF Express has significantly increased its express delivery volume by refining its large parcel business, expanding air resources, and establishing a heavy cargo transport team, effectively responding to market changes following JD's acquisition of Debon and Kuaixue [2][3] - The increase in e-commerce return parcels has compensated for the decline in single-ticket revenue from business parcels, with SF Express handling nearly half of the industry's return parcels due to its one-hour pickup capability, creating a differentiated competitive advantage [2][3] - The company has undergone organizational transformation, shifting its headquarters' functions to service-oriented operations, promoting a results-driven approach, and implementing a partner-like model to enhance employee motivation and overall operational efficiency [2][5][7] Cost Control and Management - SF Express has implemented various measures for internal management and cost control, including reducing low-end outlets and focusing on the mid-to-high-end market after a loss of 1 billion yuan in Q1 2021 [5][10] - The company has streamlined its management structure by reducing the number of regions and optimizing back-office functions, leading to significant labor cost savings [9][10] Financial Performance and Projections - Capital expenditures have decreased from 20 billion yuan in 2021 to 9.9 billion yuan in 2024, with a forecast of 9 to 10 billion yuan for 2025, while free cash flow has improved from a negative 3.8 billion yuan in 2021 to 22.3 billion yuan in 2024 [4][12] - Revenue is expected to maintain a double-digit growth rate of around 10% in 2025, with a projected net profit margin increase of 0.2-0.3 percentage points to 3.8%-3.9% [4][14] - The company anticipates net profits of 11.7 billion yuan and 13.6 billion yuan for 2025 and 2026, respectively, both showing a year-on-year growth of 16% [4][14] Competitive Landscape - SF Express has capitalized on the market changes following the acquisition of Debon and Kuaixue by JD, focusing on the growth of its large parcel business and adjusting pricing strategies to enhance market competitiveness [6][14] - The company has expanded its collaboration with SF Same City to improve efficiency in last-mile delivery and urban express products [2][5] Global Expansion and Innovation - SF Express is exploring global expansion by adopting strategies from companies like Jitu in Southeast Asia and South America, utilizing flexible equity incentives to support future international operations [8] - The introduction of unmanned vehicles is expected to significantly reduce costs, with potential savings of 7,000 to 8,000 yuan per vehicle per month compared to traditional vehicles [11] Investment Opportunities - The company’s stock is perceived to be undervalued in the Hong Kong market, with a target market capitalization of 280 billion yuan by the end of the year and a mid-term target of 350 to 400 billion yuan [4][14] Additional Important Information - The company has committed to increasing its dividend payout ratio from 20% in 2022 to 40% in 2024, with a promise of steady increases in the following years [12][13] - The pilot program for easy pickup and drop-off stations in the southwest region has improved courier income stability and customer satisfaction [9]

Investment Rating - The investment rating for the company is "Buy" (maintained) for both HK and CH shares [8] Core Views - The company is focusing on operational activation to drive high growth in time-sensitive deliveries, with operational model transformation and network optimization enhancing efficiency and reducing costs [1] - The company aims to continue its initiatives in multi-network integration, AI empowerment, and automation in transfer stations to further reduce costs in 2025 [1] - The international business is expected to benefit from the trend of Chinese manufacturing companies expanding overseas, positioning the company as a leading international logistics provider [4] Summary by Sections Domestic Operations - The company has seen significant growth in delivery volumes, with year-on-year increases of 18.7%, 25.4%, and 30.0% for January-February, March, and April 2025 respectively [2] - The average delivery price has decreased, with year-on-year declines of 9.6%, 10.5%, and 13.9% for the same periods [2] - The revenue growth in express logistics for April was 11.8%, outpacing the industry average of 10.8% [2] Cost Optimization - In the first quarter, the company achieved a structural cost reduction, with gross margin increasing by 0.1 percentage points to 13.3% and gross profit rising by 8.0% to 9.29 billion RMB [3] - The company has invested over 800 unmanned vehicles and established the industry's first unmanned transfer center, which is expected to enhance profitability through ongoing cost reduction initiatives [3] International Business - From January to April, the revenue from supply chain and international business reached approximately 22.41 billion RMB, a year-on-year increase of 11.9%, which is faster than the express logistics business growth of 8.3% [4] - The company is well-positioned to benefit from the rapid growth of the logistics market in Asia due to the regionalization of trade and the expansion of Chinese enterprises [4] Profit Forecast and Valuation - The company maintains its net profit forecasts for 2025-2027 at 11.80 billion, 14.18 billion, and 16.03 billion RMB respectively, with corresponding EBITDA of 34.90 billion, 38.53 billion, and 41.31 billion RMB [5] - The target prices are set at 51.10 RMB for A shares and 52.80 HKD for H shares, with respective EV/EBITDA multiples of 8.0x and 7.7x for 2025 [5]

Core Viewpoint - In 2024, the company achieved significant revenue and profit growth, driven by its express logistics and supply chain businesses, with a focus on cost reduction and efficiency improvement [1][2][3]. Financial Performance - The company reported a total revenue of 284.42 billion yuan in 2024, representing a year-on-year increase of 10.1% [1][2]. - The net profit attributable to shareholders reached 10.17 billion yuan, up 23.5% year-on-year, marking a historical high [3][4]. - The adjusted net profit was 9.15 billion yuan, reflecting a 28.2% increase compared to the previous year [3]. Business Volume and Pricing - The total business volume for 2024 was 13.26 billion parcels, an increase of 15.5% year-on-year, with an average price per parcel of 15.5 yuan, down 6.2% [1][2]. - In Q4 2024, the business volume reached 3.83 billion parcels, up 17.8% year-on-year, with an average price of 14.6 yuan, down 8.2% [1][2]. Cost and Profitability - The gross profit margin for 2024 was 13.9%, an increase of 1.1 percentage points year-on-year [3][4]. - The net profit margin improved from 3.2% to 3.6% year-on-year, driven by cost optimization efforts [3][4]. Shareholder Returns - Capital expenditures decreased by 27% to 9.9 billion yuan, representing 3.5% of revenue [5]. - Free cash flow increased by 70% to 22.3 billion yuan, providing a solid foundation for dividends and share buybacks [5]. - The dividend payout ratio for 2024 was 40%, with a one-time dividend accounting for 47% of net profit [6][7]. Future Outlook - Revenue projections for 2025-2027 are 319.06 billion yuan, 354.32 billion yuan, and 390.61 billion yuan, with expected year-on-year growth rates of 12%, 11%, and 10% respectively [8]. - The company is expected to maintain a focus on cost reduction and efficiency improvements, which will support steady profit growth and shareholder returns [8].

Investment Rating - The report maintains a "Buy" rating for the company, indicating a potential relative price increase of over 15% in the next six months [5]. Core Insights - The company benefited from rising international shipping rates and stable cargo volumes, leading to a 17% year-on-year growth in supply chain and international segments, contributing to a total revenue increase of 10.1% [1][2]. - Cost optimization measures have resulted in a significant improvement in gross margin, reaching 13.9%, the highest level in five years, supporting over 10 billion yuan in net profit attributable to shareholders [1][19]. - The company has reduced capital expenditures to below 10 billion yuan, marking a historical low of 3.3% of revenue, reflecting a focus on core logistics operations and efficient resource management [28]. Financial Information - In 2024, the company achieved total revenue of 284.42 billion yuan, a year-on-year increase of 10.1%, with net profit attributable to shareholders approximately 10.17 billion yuan, up 23.5% [2][25]. - Operating costs increased by only 8.7%, resulting in a gross profit of 39.6 billion yuan, a significant year-on-year growth of 19.5% [20][25]. Business Highlights - The total volume of packages handled reached 13.26 billion, a year-on-year increase of 11.4%, with a notable growth of 15.3% when excluding divested businesses [3][4]. - The international freight and agency business saw substantial revenue growth, driven by increased demand for international air freight and stable shipping volumes [1][3]. Revenue Structure - The core express delivery segment generated revenue of 206 billion yuan, growing by 7.7%, while the supply chain and international business segments experienced a significant revenue increase of 17.5% [13][18]. - The international freight forwarding segment grew by over 30%, and international express services saw growth exceeding 20% [13]. Cost Management - The company implemented effective cost control measures, resulting in a gross margin of 13.9%, an increase of 1.1 percentage points from the previous year [19][20]. - Operating expenses for 2024 were 26 billion yuan, reflecting a growth of 4.9%, with a comprehensive expense ratio decreasing to 9.2% [25][26]. Capital Expenditure and Cash Flow - The company reported a significant improvement in operating cash flow, which increased by 21.1% year-on-year, with free cash flow reaching 22.3 billion yuan [28][30]. - Capital expenditures were reduced to 9.34 billion yuan, representing a 25.1% decrease and the lowest proportion of revenue in history [28]. Shareholder Returns - The company allocated 10.66 billion yuan for dividends and share buybacks in 2024, with a 42% increase in regular dividends [32]. - The share buyback program is ongoing, with a significant portion of previously repurchased shares already canceled, indicating a commitment to enhancing shareholder value [32].

Business Overview - In 2024, the total business volume reached 13.33 billion parcels, a year-on-year increase of 11.3% [2] - Revenue for 2024 was CNY 284.4 billion, up 10.1% year-on-year [2] - International revenue growth outpaced domestic, with express logistics revenue at CNY 205.8 billion (up 7.7%) and supply chain & international revenue at CNY 70.5 billion (up 17.5%) [2] Financial Performance - EBITDA profit reached CNY 32.7 billion, a year-on-year increase of 11.0%, with an EBITDA margin of 11.5% [2] - Net profit attributable to shareholders was CNY 10.2 billion, up 23.5%, with a net profit margin of 3.6% [2] - The company returned CNY 10.66 billion to shareholders through dividends and share buybacks [2][17] Operational Efficiency - Labor costs as a percentage of revenue (excluding KLN) increased by 0.8 percentage points [10] - Transportation costs as a percentage of revenue (excluding KLN) decreased by 0.8 percentage points [10] - Other operating costs as a percentage of revenue (excluding KLN) decreased by 1.2 percentage points [10] Strategic Initiatives - The company aims to enhance operational agility by empowering frontline decision-making and transitioning from management to service-oriented headquarters [3] - Focus on industry transformation and expanding supply chain capabilities to improve market penetration [3] - Emphasis on cross-border logistics and tailored solutions for clients [3] Growth Segments - Time-sensitive express revenue grew by 5.8%, with a parcel volume increase of 12% [5] - Economic express revenue (excluding Fengwang) increased by 11.8%, with parcel volume up 18% [5] - Fast freight revenue grew by 13.8%, with a volume increase exceeding 20% [6] International Expansion - The international business is positioned as a second growth curve, with international revenue growth exceeding domestic growth by over 2 times in 2024 [28] - The company has secured over 100 overseas supply chain projects, enhancing its cross-border capabilities [7][29] ESG Commitment - The company improved carbon efficiency by 9.3% in 2024, with a 12% reduction in carbon footprint per parcel [18] - Recognized for its ESG practices, ranking high in various international ratings [18] Future Outlook - The company plans to maintain a dual focus on high-end express and economic segments to drive growth [20] - Continuous investment in technology and operational efficiency to enhance service quality and reduce costs [22] - Anticipates stable revenue growth and profitability improvements in 2025 [25]