Sinotrans discloses 2023 annual report
Sinotrans disclosed its 2023 annual report. In 2023, the company's revenue was 101.70 billion yuan, down 6.9% year on year, achieving net profit of 4.22 billion yuan, up 3.5% year on year. Among them, revenue for the fourth quarter was 28.93 billion yuan, up 1.8% year on year, and realized net profit of 1.06 billion yuan, up 101.4% year on year.
Service volumes in various chains grew steadily, and revenue declined due to falling freight rates. Among the company's three major business segments, professional logistics service volumes rose, but due to falling transportation prices in the domestic market, service revenue was 27.522 billion yuan, up 0.25% year on year; in terms of agency business, the company's overall business volume increased in 2023, but due to falling shipping and air freight costs, agent-related business revenue was 61.92 billion yuan, down 11.5% year on year; e-commerce business volume increased significantly, with business revenue of 12.26 billion yuan, up 3.3% year on year .
Focus on customer demand and lean operation to overcome falling freight rates and steady profit growth. Although the overall decline in shipping and air freight rates had a negative impact in 2023 due to intense competition in the industry and dragged down the company's revenue performance, the company maintained steady growth by focusing on customer needs and refined operations to overcome the adverse factors of falling freight rates. Among them, the profits of the professional logistics, agency business, and e-commerce business segments were 1.06 billion yuan, 2.31 billion yuan, and 200 million yuan respectively, up 15.2%, 16.2%, and 12.4% year-on-year respectively.
Subsidies increased, investment income declined slightly, and annual performance surpassed market expectations that company expenses would remain basically stable in 2023, but due to declining revenue combined with reduced exchange income, the overall cost level increased. Among them, sales, management, R&D, and finance expenses were 1.06%, 3.32%, 0.23%, and 0.25%, respectively, up 0.11pct, 0.23pct, 0.05pct, and 0.29pct, respectively.
Due to factors such as the net profit of Sinotrans DHL falling 6.2% to 3.50 billion yuan, the company's investment income fell 9.8% to 2.33 billion yuan. Furthermore, due to a significant increase in revenue from financial subsidies in the logistics industry to 2.13 billion yuan, the company's other revenue increased 70% to 2.45 billion yuan.
In other categories, due to the increase in the fair value of the company's investment in China Southern Airlines logistics equity, the company's fair value change income was 267 million yuan, which was corrected year-on-year; due to the company's calculation of the impairment of KLG Group's goodwill, the company's asset impairment losses increased to 327 million yuan. Overall, the company's annual performance was stable, exceeding market expectations in the fourth quarter.
Profit forecasts and investment advice
The company has a wide range of business, and logistics services run through all aspects of sea, land, air and rail. Judging from the performance of the past few years, the company has continued to expand its business chain with a perfect service network, abundant logistics resources and leading professional logistics capabilities, and has achieved steady growth in performance in the face of sharp fluctuations in air and sea freight rates. The company's revenue for 2024-2026 is expected to be 102.59 billion yuan, 109.90 billion yuan, and 117.81 billion yuan respectively, up 0.9%, 7.1%, and 7.2% year-on-year respectively. Net profit to mother is 4.46 billion yuan, 4.66 billion yuan, and 4.98 billion yuan respectively, up 5.6%, 4.5%, and 6.8% year-on-year respectively.
The total dividends of the company's mid-term and annual reports in 2023 reached $210 billion, accounting for 49.8% of net profit returned to mother in fiscal year 2023. Including Hong Kong stock repurchases, it reached 50.4%, and the dividend ratio increased. Considering that China's economy will remain within a reasonable growth rate range, the scale of social logistics traffic will continue to grow, the company has a broad business chain and strong ability to withstand pressure, and its performance is expected to maintain steady growth. In 2023, the company's cumulative dividend was 2.10 billion yuan. Based on the closing price on March 29, 2024, the dividend ratio was 4.89%, which was covered for the first time to give it an “gain” rating.
Risk warning:
The macroeconomic economy declined, business development fell short of expectations, and industry competition intensified.