This conference call announced ZTO Express's financial results for the first quarter of 2026. The CEO outlined the company's operations and highlights. The CFO explained the financial data and future prospects in detail, and then opened a question-and-answer session to answer investors' questions.

The meeting reviewed the express delivery industry in the first quarter of 2026 in the context of macroeconomic stability and improvement, the overall growth trend, business volume increased by 5.8. The company seized the opportunity of the industry, completed 9.67 billion pieces of business, an increase of 13.2 over the same period last year, and increased its market share by 1.4 percentage points. Adjusted net profit was 2.38 billion billion yuan, up 5.2 year on year. The company has achieved a steady improvement in profitability by optimizing product structure, reducing costs and improving operational efficiency. Looking ahead, the company will focus on high-quality development, deepen network management, protect the rights and interests of practitioners, continue to improve shareholder returns, and pursue long-term value with the market, shareholders win-win situation.

In the first quarter of 2026, China's express delivery industry maintained its overall growth trend under the background of stable progress of micro economy and continuous growth of consumer demand. The volume of express delivery increased by 5.8 year-on-year, prices returned to stability, and the quality of industry operations improved significantly, creating favorable conditions for the high-quality development of leading enterprises. During the period, the company seized industry opportunities and achieved strong performance in the team matrix. The parcel volume reached 9.67 billion, an increase of 13.2 year-on-year, and the market share expanded by 1.2 percentage points, further consolidating its leading position. Adjusted net profit rose 5.2 percent YoY, and adjusted operating profit rose 22 percent YoY, reflecting improved profitability. Retail parcel volume increased by 65% year-on-year, the product portfolio continued to be optimized, the unit cost of transportation and sorting was reduced by 6 cents, and the digital and link management achieved substantial results, further strengthening the cost advantage. Strong corporate performance, thanks to a favorable policy environment, strategic focus, operational efficiency improvements and product innovation. In the future, the company will continue to prioritize high-quality development, deepen core business capabilities, optimize network management, protect the well-being of frontline employees, continuously improve shareholder returns, and strive to become a value-driven industry leader.

In the first quarter, the company achieved revenue 1.33 billion, up 22% year-on-year, ASP of core express delivery business increased by 8.2, unit cost was optimized, gross profit margin decreased slightly, operating cash inflow 0.28 billion, up 18%, capital expenditure 0.18 billion, capital expenditure forecast 0.6 billion for the whole year, maintaining the 10%-13% package volume growth rate predicted for the whole year last year.

This paper discusses the reasons why cost optimization exceeds the target at the beginning of the year and the adjustment of the target for the whole year, paying special attention to the impact of diesel price increase on the cost, and analyzes the continuity of the anti-inward policy and the prospect of industry price level, and discusses whether the industry price change can absorb the cost pressure brought about by oil price.

In the first quarter, the cost of transportation and decomposition was effectively reduced through automation, deepening the application of digital tools and fine management. The anti-roll policy significantly reduces low-price competition, protects the profitability of outlets and the rights and interests of couriers, and promotes the development of the industry in the direction of healthy and orderly competition. Costs are expected to fall further throughout the year, with network optimization and automation equipment investment continuing to reduce end-of-line costs.

This paper discusses the initiatives of Zhongtong Express in the AI era, including electronic face sheets, intelligent customer service, end-of-line scheduling optimization, and the construction of the future multi-intelligent architecture, which aims to consolidate the leading edge of technology, realize cost and timeliness optimization, and create long-term value for shareholders.

Discussed the express industry under the influence of anti-roll policy, the industry growth rate is expected to shift from extensive scale expansion to high-quality development, the competitive landscape accelerated differentiation, market share to the head of the enterprise concentration. At the same time, it shared the development of bulk business, especially reverse logistics business, and pointed out that although price competition led to price decline, through scale effect and fine cost control, the profit contribution of single ticket was higher than that of ordinary e-commerce lines, effectively improving the overall profitability.

This paper discusses the progress of legislation to promote the protection of the rights and interests of distribution workers in Guangdong, Shandong and other places, and looks forward to the pace of social security policy landing in the second half of the year and its impact on the cost of the whole network. Emphasize that social security payment is consistent with the anti-roll policy, aiming to protect the rights and interests of the grassroots and promote the healthy and stable development of the industry. In the long run, although the cost of single ticket is increased, the establishment of a stable employment system will help reduce the turnover rate and improve the quality of service. Head companies will play an exemplary role in responding to the government's call to help implement policies, while helping network partners comply and reduce costs.