Yunda Co., Ltd. announces 2024 interim report

Yunda Co., Ltd. announced its 2024 mid-year report. The company's revenue for the first half of the year was 23.25 billion yuan, up 7.8% year on year, achieving net profit to mother of 1.04 billion yuan, up 19.8% year on year. In the second quarter, the company's revenue was 12.1 billion yuan, up 9.0% year on year, and net profit to mother was 0.63 billion yuan, up 23.2% year on year.

Unit volume outperformed the industry, with unit prices declining, and revenue growth. The e-commerce express delivery business volume continued to grow rapidly in the first half of the year. The company consolidated the service quality of the entire network, close to consumer service needs and platform service rules, enhanced service initiative, improved time-efficiency services, and seized the high growth opportunities of the industry to complete the express delivery business volume of 10.924 billion tickets, an increase of 30.0% year on year, far exceeding the industry average. Among them, the express delivery business volume in the second quarter was 5.982 billion tickets, an increase of 30.8% year on year. The unit price of the company's express delivery business fell 15.3% year on year to 2.08 yuan in the first half of the year due to the sinking of the express delivery market, the average weight decline, continued competition, and the company actively reduced the share of direct customers, with a year-on-year decrease of 16.7% to 2.02 yuan in the second quarter. Thanks to the volume drive, the company's revenue grew.

Core costs continue to decrease, and gross profit increased year over year

On the cost side, the company gave full play to its advantages of scale to improve fleet operation efficiency and loading rate. The average loading rate increased by 7 pct in the first half of the year, while improving the per capita efficiency of the transit center. The unit cost dropped significantly. Among them, the core operating cost of a single ticket fell 24.6% year on year in the second quarter. The company's gross profit increased year on year. The gross profit for the first half of the year was 2.46 billion yuan, up 4.1% year on year, of which gross profit for the second quarter was 1.31 billion yuan, up 4.2% year on year.

Cost pressure continues to drop, and increased return on investment drives improved performance

On the cost side, the company continued to rationally shrink the surrounding business and optimize resources to optimize capital structure costs. The sales, management, R&D, and financial expenses in the first half of the year were 0.56%, 2.71%, 0.63%, and 0.59%, respectively, down 0.29pct, 0.33pct, 0.17pct, and 0.37pct, respectively. In terms of other categories, thanks to the proceeds from the disposal of shares, the company's investment income in the first half of the year reached 0.33 billion yuan, a significant increase over the previous year, but changes in the value-added tax deduction policy affected the company's other income. Overall, the company's performance exceeded market expectations thanks to reduced cost pressure and return on investment.

Investment advice

We believe that the e-commerce express delivery industry is expected to continue to maintain double-digit growth. The company will actively promote cost reduction and fee control at the headquarters, empower franchisees, enhance network operation capabilities, and achieve long-term development.

We expect the company's net profit to be 2.01 billion yuan, 2.4 billion yuan, and 2.74 billion yuan respectively in 2024-2026, with year-on-year increases of 23.5%, 19.8%, and 13.9%, respectively. Currently, the company's PE valuation is at a low level. As anti-domestic sales in the express delivery industry continue to advance, the peak season is approaching, which is expected to positively stimulate stock prices and maintain a “buy” rating.

Risk warning:

The macroeconomic economy declined, the growth rate of e-commerce express delivery fell short of expectations, and the company's business growth fell short of expectations.