Key topics of the sub-qualification:
Incident: Debon Co., Ltd. announced its results for the first half of 2024. The company achieved operating income of 18.45 billion yuan (+17.5% YoY), achieved net profit of 0.33 billion yuan (YoY +37%), and net profit of non-return to mother 0.2 billion yuan (+51.0% YoY). Among them, single 24Q2 revenue was 9.15 billion yuan, +10.6% year-on-year, and realized net profit to mother of 0.24 billion yuan, or +41.1% year-on-year.
Network integration continues to advance, focusing on express delivery services. The core business of 24H1 Express achieved 6.034 million tons of cargo volume, +7.7% (new caliber). Judging from the revenue situation, under the new caliber, 24H1 achieved revenue of 16.64 billion yuan of express delivery, +21.1%, accounting for 90.2% of revenue; express delivery business revenue of 1.07 billion yuan (-23.9% year on year), accounting for 5.8% of revenue. Other businesses (mainly warehousing and supply chain business), operating revenue of 0.74 billion yuan, compared with +34.3% The ratio is 4.0%.
Expense control continues, and profitability has improved markedly. The company's 24H1 operating cost was 17.04 billion yuan, +19.2% year-on-year, with labor costs, transportation costs, rent and right-of-use asset depreciation, depreciation and amortization costs, and other costs as a share of revenue (-6.4 pp/ +9.7 pp/ -0.0pp/-0.7 pp, respectively). The increase in transportation costs is mainly due to changes in the business structure, network integration with high freight costs and low labor, and an increase in business volume such as vehicles, which continue to increase investment in transportation resources. The company achieved gross profit of 1.41 billion yuan in 24H1, with a gross profit margin of 7.6% (-1.3pp); period expenses of 1.13 billion yuan, -3.6% year-on-year, with a period expense ratio of 6.1%, year-on-year -1.3pp; realized net profit to mother of 0.33 billion yuan, +37.1% year-on-year; realized net profit of 0.2 billion yuan (YoY), +51.0% YoY.
Improve the network system and optimize the facility layout. By the end of 24H1, the company's operation and management terminal had distributed 3,2574 four-wheelers and other business vehicles. At the same time, during the sorting process, it continued to increase investment in automation equipment, while strengthening site management, strict control of sorting quality, and achieving simultaneous improvement in sorting efficiency and quality. As of 24H1, the company had 48 automated equipment sites and 97 ready-to-load and unload equipment sites. During the reporting period, the damage rate of main products continued to improve, down 28.3% from the previous year; in the transportation process, through model upgrades, branch line integration, capacity collection, and line optimization initiatives, etc. Improve vehicle transportation efficiency, improve transportation timeliness and quality stability. By the end of the reporting period, the company operated 15,511 branch line vehicles. During the reporting period, the overall compliance rate increased by 3.8 pp over the same period last year.
Profit forecasting and investment advice. The company is deeply involved in high-end direct management networks and insists on promoting refined cost control to reduce costs and increase efficiency. The competitive pattern in the express shipping industry continues to improve, but the growth rate of the industry declined slightly. We adjusted the company's net profit from 2024-25 to 1.11/1.35 billion yuan (previous value 1.23/1.46 billion yuan), added a 26-year net profit of 1.55 billion yuan, and maintained a “buy” rating.
Risk warning: risk of macroeconomic fluctuations, risk of price fluctuations of upstream factors of production, risk of worsening industry competition pattern, risk of company integration.