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1、1Q 20241Q 2024INVESTOR INVESTOR PRESENTATIONPRESENTATIONMay 20241Safe Harbor Statement and DisclaimerSafe Harbor Statement and DisclaimerThis presentation contains statements that may constitute“forward-looking”statements pursuant to the“safe harbor”provisions of theU.S.Private Securities Litigation

2、 Reform Act of 1995.These forward-looking statements can be identified by terminology such as“will,”“expects,”“anticipates,”“aims,”“future,”“intends,”“plans,”“believes,”“estimates,”“likely to,”and other similarexpressions.Among other things,the business outlook and quotations from management in this

3、 presentation contain forward-lookingstatements.ZTO may also make written or oral forward-looking statements in its periodic reports to the U.S.Securities and ExchangeCommission(the“SEC”)and The Stock Exchange of Hong Kong Limited(the“HKEX”),in its interim and annual report to shareholders,in announ

4、cements,circulars or other publications made on the website of the HKEX,in press releases and other written materials,and in oralstatements made by its officers,directors,or employees to third parties.Statements that are not historical facts,including but not limited tostatements about ZTOs beliefs,

5、plans,and expectations,are forward-looking statements.Forward-looking statements involve inherent risksand uncertainties.A number of factors could cause actual results to differ materially from those contained in any forward-looking statement,including but not limited to the following:risks relating

6、 to the development of the e-commerce and express delivery industries in China;itssignificant reliance on certain third-party e-commerce platforms;risks associated with its network partners and their employees andpersonnel;intense competition which could adversely affect the Companys results of oper

7、ations and market share;any service disruption ofthe Companys sorting hubs or the outlets operated by its network partners or its technology system;ZTOs ability to build its brand andwithstand negative publicity,or other favorable government policies.Further information regarding these and other ris

8、ks is included in ZTOsfilings with the SEC and the HKEX.All information provided in this presentation is as of the date of this presentation,and ZTO does not undertake any obligation to update anyforward-looking statement,except as required under applicable law.2IndexIndexCOMPANY OVERVIEWCOMPANY OVE

9、RVIEW01013 3Leading Express Delivery Company in ChinaOur Business:Past and PresentOur Distinct Network Partner Business Model(“NPM”)Our Core Competitive Advantages4567OUR CORE COMPETITIVE ADVANTAGESOUR CORE COMPETITIVE ADVANTAGES02021111Significant Market Growth OpportunitiesDistinct Partner Network

10、 Built Upon a“Shared-Success”PhilosophySuperior Scale&ReachBest-in-Class Operational Capabilities and Cost Efficiencies Enabled by TechnologyExperienced Leadership&Sound ExecutionConsistent Achievements in Strategic Focus Adjacent Expansion Beyond Express DeliveryESG Practices1213141619202122FINANCI

11、AL OVERVIEWFINANCIAL OVERVIEW0404Strong Unit EconomicsRobust Parcel Volume and Revenue GrowthStrong Profitability and MarginsContinuous Cost Efficiencies and Productivity GainsStrong Operating Cash Flow Supports Continued Investment in GrowthReconciliation of GAAP to Adjusted/Non-GAAP MeasuresOUR ST

12、RATEGIESOUR STRATEGIES0303272732323334353637380101COMPANY COMPANY OVERVIEWOVERVIEW4Source:Public filings.Data as of 1Q24 unless otherwise indicatedNotes:1.“Parcels”or“Parcel volume”in any given period is defined as the number of parcels picked up using ZTO waybills2.In terms of parcel volume calcula

13、ted based on data from State Post Bureau.From the beginning of 2024,the statistic scope of industry data has been revised to include China postal small packages,hence statistic base has expanded3.Includes about 10,000 self-owned vehicles with approximately 9,100 high capacity 15-17 meter trailer tru

14、cks4.Line-haul routes between sorting hubs only5.Includes 88 self-operated sorting hubs,and 8 sorting hubs operated by our network partners6.ZTO,YUNDA,YTO and STO are commonly known as TongdasLeading Express Delivery Company in ChinaLeading Express Delivery Company in China96 96 Sorting HubsSorting

15、Hubs5 599%County99%County-Level Cities Level Cities CoveredCovered11110,0000,000LastLast-Mile PostsMile Posts461461 Automation LinesAutomation LinesIndicates#1 in Industry#1#17.2 bn Parcels7.2 bn Parcels1 1in 1Q24in 1Q2419.3 19.3%Market Share%Market Share2 2 in 1Q24in 1Q2410,00010,000LineLine-haul h

16、aul VehiclesVehicles3 33,8003,800LineLine-haulhaulRoutesRoutes4 46 6,000,000 Direct NetworkDirect NetworkPartnersPartners31,00031,000Pickup/DeliveryPickup/DeliveryOutletsOutletsTop ranking consumer satisfaction among“Tongdas通達”6since 2014#1 market share by parcel volume in Chinas express delivery in

17、dustry since 2016The most profitable among“Tongdas通達”#1#15Note:1.Numbers may not add up due to roundingOur Business:Past and PresentOur Business:Past and Present20022005200820092011201220132014201520162017201820192020202120222023Present:Pursuing and SurpassingPresent:Pursuing and SurpassingPast:Foll

18、owing the LeadPast:Following the Lead Founded in May 2002，being the youngestyoungest of Tongdas First line-haul to truck across truck across provincesprovinces in 2005 First to effectively implement“paid paid deliverydelivery”andprepaymentprepayment-settlement settlement practice with proprietary sy

19、stemEarly adoption of E E-WaybillWaybillAcquired 8 regional 8 regional network partnersnetwork partnersbusinessesbusinessesAcquired an additional 16 16 networknetworkpartnerspartners to form a centrally managed nationwide network1stgeneration automated sorting equipment jointly developed with Chines

20、Chinese eAcademy of SciencesAcademy of SciencesBecame No.1 in ChinaNo.1 in China by parcel volumeNYSE listed in 2016,first among first among TongdasTongdas to become publicly to become publicly listed abroadlisted abroadCertified as a National High and National High and NewNewTechnology Technology E

21、nterpriseEnterprise高新技術企業高新技術企業Achieved 90%90%digital waybill adoptionAlibaba led US$1.38bn US$1.38bn strategic equity investmentEarly mover on lastlast-mile mile postpostInvested in CainiaoCainiao PostPostIncluded in the MSCI MSCI Global Standard IndexGlobal Standard IndexCertified as a National Ke

22、y National Key Software EnterpriseSoftware Enterprise1.7bn1.7bn1.6bn1.6bn1.1bn1.1bn0.7bn0.7bn0.6bn0.6bn0.2bn0.2bn2.3bn2.3bnIncremental Incremental Parcel VolumeParcel Volume1 13.6bn3.6bnTotal Parcel Total Parcel VolumeVolume0.3bn0.3bn12.1bn12.1bn0.5bn0.5bn1.1bn1.1bn1.8bn1.8bn3.0bn3.0bn4.5bn4.5bn6.2b

23、n6.2bn8.5bn8.5bn4.9bn4.9bn17.0bn17.0bn7.6%7.6%15.5%15.5%14.4%14.4%14.3%14.3%13.0%13.0%11.6%11.6%9.3%9.3%16.8%16.8%Market ShareMarket Share19.1%19.1%20.4%20.4%PRC Postal Law(Revised in PRC Postal Law(Revised in 2009)2009)新郵政法新郵政法 legalized express delivery companies to operate alongside Postal Servic

24、es Shanghai Zhongtongji Express commenced operationsCompleted secondary secondary listing on listing on HKEXHKEX22.3bn22.3bn5.3bn5.3bn20.6%20.6%24.4bn24.4bn2.1bn2.1bn22.1%22.1%Completed US US$1 billion$1 billion convertible convertible senior notes senior notes offeringoffering30.2bn30.2bn5.8bn5.8bn

25、22.9%22.9%Dual primaryDual primary-listed listed on the HKEX and the NYSE48%48%2011-2023CAGR6Our Distinct Network Partner Business Model(Our Distinct Network Partner Business Model(“NPMNPM”)NPM Gaining Share in Express Delivery MarketNPM Gaining Share in Express Delivery Market(Market share by parce

26、l volume)66%78%34%22%20112023Network Partner ModelDirect ModelKey Advantages of a Network Partner Model(Key Advantages of a Network Partner Model(“NPMNPM”)FlexibilityFlexibility Localized decision-making Capital EfficiencyCapital Efficiency Lower costs for first/last-mile buildoutOur Our NPM:NPM:“Be

27、st of Both WorldsBest of Both Worlds”“SharedShared-successsuccess”philosophyphilosophyBuild cohesiveness,align interests,share risks,assure rewardsMilestone event:converting major network partners into shareholdersCentralized proprietary IT Infrastructure and wellCentralized proprietary IT Infrastru

28、cture and well-integrated peripherals integrated peripherals Technology backbone for effective end-to-end collaboration with network partners“Best of both worlds”:NPM organization yet vertically managed through digitalization Network ScalabilityNetwork Scalability Rapid geographic coverage expansion

29、Delivery Delivery OutletsOutletsSortingSortingHubsHubsSortingSortingHubsHubsLineLine-haulhaulTransportationTransportationPickupPickupOutletsOutletsCore Express Delivery NetworkCore Express Delivery NetworkNetwork Network PartnersPartnersFirstFirst-Mile PickupMile PickupLastLast-Mile DeliveryMile Del

30、iveryNetwork Network PartnersPartnersParcel flowFund flowZTO revenuesFee in blueFee in bluePayment to Pickup Network Partner Payment to Pickup Network Partner Full express service fee Payment to ZTO Express Payment to ZTO Express LineLine-haul transit feehaul transit fee Waybill fee Waybill fee Last

31、Last-mile delivery feemile delivery feePayment to Delivery Network Partner Payment to Delivery Network Partner LastLast-mile delivery fee mile delivery fee 1Sources:iResearch,public filings Note：1.Include SF,EMS,China Post,JD,and other express delivery companies that use direct model.Some express de

32、livery companies market share based on assumptions LastLast-Mile Post and LockboxMile Post and LockboxSendersSendersLastLast-Mile Post and LockboxMile Post and LockboxRecipientsRecipients7OurOur Core Competitive AdvantagesCore Competitive Advantages5 54 46 61 1 2 23 37 7Our Our“sharedshared-successs

33、uccess”philosophy,our focus on profitability and our disciplined investment approach philosophy,our focus on profitability and our disciplined investment approach greatly contributed to our distinct leadership in the industry and cannot be easily replicatedgreatly contributed to our distinct leaders

34、hip in the industry and cannot be easily replicated8 88Next-generation hybrid drones improving accessibility while reducing logistics costs and delivery time“”9SelfSelf-driving vehicles optimizing the driving vehicles optimizing the efficiency of lastefficiency of last-mile deliverymile delivery“”10

35、RealReal-time data monitoring and analytics time data monitoring and analytics powering operational excellencepowering operational excellence“”0202OUR CORE OUR CORE COMPETITIVE COMPETITIVE ADVANTAGESADVANTAGES1222.9%22.9%14.3%16.1%13.3%11.6%9.0%12.9%1Sources:iResearch,National Bureau of Statistics o

36、f China,State Post Bureau of China,CNNIC,Ministry of Commerce of the Peoples Republic of China,public filingsNotes:1.On Jan 7th 2022,State Post Bureau announced Measures for the Administration of Express Delivery Market (Draft)2.BEST sold its express delivery business in China to J&T in 4Q2021.Signi

37、ficant Market Growth OpportunitiesSignificant Market Growth OpportunitiesExpress Delivery Market in China Becoming More ConsolidatedExpress Delivery Market in China Becoming More Consolidated(Market share by parcel volume)TongdasStable Volume Growth with More Sustainable Pricing LevelStable Volume G

38、rowth with More Sustainable Pricing LevelHigh Internet and Digital Commerce PenetrationHigh Internet and Digital Commerce Penetration1,01,09292mmmm915915mmmmInternet users in Chinaas of Dec 2023Online shoppers in Chinaas of Dec 2023Increasing Demand for Diversified ServicesIncreasing Demand for Dive

39、rsified ServicesExpress Delivery IndustryExpress Delivery IndustryNEWNEWE-commerce formatsStable and Healthy Volume GrowthStable and Healthy Volume Growth40bn+incremental parcel volume from 2021 to 2025Continued economic growth with higher e-commerce penetrationShift focus towards quality and differ

40、entiated products and servicesConstructive regulatory environment that supports sensible competition and curtails below-cost pricing1More Sustainable Pricing LevelMore Sustainable Pricing LevelCrossCross-border border OpportunitiesOpportunitiesAgriculture&Agriculture&Rural DemandRural DemandTimeTime

41、-definite definite ProductsProducts2B Supply Chain 2B Supply Chain ManagementManagementMarket OpportunitiesMarket Opportunities20112023ZTOYUNDAYTOSTOBESTJ&TSFOthers2CR6=71.4%CR6=71.4%CR6=87.1%CR6=87.1%7.6%7.6%8.2%15.3%20.4%2.5%17.4%28.6%132Distinct Partner Network Built Upon a Distinct Partner Netwo

42、rk Built Upon a“SharedShared-SuccessSuccess”PhilosophyPhilosophyFee Sharing MechanismFee Sharing MechanismAcquired an additional16 16 networknetwork partnerspartners to form a centrally-managed nationwide networkZTO introduced delivery service fee sharing mechanismZTO introduced delivery service fee

43、 sharing mechanismLastLast-mile delivery is free of chargemile delivery is free of chargeConsolidated Shanghai Zhongtongji Express and certain network partnersnetwork partnersto form ZTO Express201320132015201520142014Acquired 8 regional 8 regional network partnersnetwork partnersZTO founded inSucce

44、ssfully Convert Major Network Partners to ShareholdersSuccessfully Convert Major Network Partners to Shareholders20022002Our Our“sharedshared-successsuccess”philosophy inspired us to enhance and transform the network partner model,philosophy inspired us to enhance and transform the network partner m

45、odel,and has underpinned our successand has underpinned our success Major network partners became shareholders of ZTO and united under a common goal Share-swap transactions fairly priced and with transparency The reorganization aligned interests,built trust and forged loyalty,and laid the foundation

46、 for network stability Pickup outlets pay last-mile outlets for delivery based on pre-set formulae Sharing mechanism facilitated by implementation of our proprietary operating system Today,the fee sharing mechanism continues to serve as a balancing function across our network Outlets earn revenue on

47、ly on pick-up Outlets with higher delivery volumes relative to pickup volumes(e.g.due to geographic disparity,uneven nature of economic development)are less profitable or loss making Negatively impacted outlets service quality and network stabilityBefore 2008:Before 2008:After 2008:After 2008:Chairm

48、an Lai Chairman Lai currently currently holds holds 26.026.0%1 1Note:1.Data as of Mar 31,202414Our leading network has been built through time,investments and innovations Our leading network has been built through time,investments and innovations such scale and capabilities cannot be built overnight

49、such scale and capabilities cannot be built overnightSource:public filings,ZTO official websites media coverageNotes:Data as of 1Q24 unless otherwise indicatedData quoted are approximate and not precise1.In terms of parcel volume for 1Q24 calculated based on data from State Post Bureau.From the begi

50、nning of 2024,the statistic scope of industry data has been revised to include China postal small packages,hence statistic base has expanded1.According to iResearch in terms of parcel volume2.Daily volume calculated by 1Q24 parcel volume divided by 91 days3.88 self-operated sorting hubs and 8 networ

51、k partner-operated sorting hubs4.According to iResearch5.Land area for self-operated sorting hubs including self-owned land and leased from third-parties6.Delayering refers to reducing the number of stops a package must be aggregated and segregated across the transit network3Trusted Partner to Trust

52、ed Partner to Customers,Merchants Customers,Merchants&E&E-Commerce Commerce PlatformsPlatformsLargestLargest5 5SelfSelf-Operated Modern Operated Modern Facilities SpaceFacilities Space6 6 of of 7 7.0mm m.0mm m2 2&SelfSelf-Owned LineOwned Line-Haul Haul Fleet of Fleet of 1010,000,000Stable Partner St

53、able Partner NetworkNetwork5%churn5%churn“DeDe-layeringlayering7 7”StrategyStrategyAverage NumberAverage Number of of Parcel Parcel Transit TimesTransit Times HasHas Been Been DecreasingDecreasingLoyal,CustomerLoyal,Customer-Centric&ResultsCentric&Results-Driven PeopleDriven People23,000+23,000+Empl

54、oyeesEmployees8 8Superior Scale&ReachSuperior Scale&ReachLargestExpress Delivery Company in China with 1919.3%.3%market share1&Globally299%99%County-Level City Coverage9696Sorting Hubs431,000 31,000 Service Outlets110,000 110,000 Last-Mile Posts7 78.88.8mm mm Daily Parcel Volume396%96%Village-Level

55、City CoverageNetwork partner-operated sorting hubSelf-operated sorting hubLine haul routes for illustrativePurpose only153Superior Scale&Reach(ContSuperior Scale&Reach(Contd)d)Our MultiOur Multi-Functional LastFunctional Last-Mile PostsMile PostsRetail StoreSelf Pick-Up and Drop-Off Delivering andRe

56、ceivingPackagesCustomer ServiceStrategic Importance of Strategic Importance of LastLast-Mile PresenceMile PresenceOperating SoftwareMobile ApplicationsMerchandiseSourcingRetail TrainingCompetitive Financing SupportEarlyEarly-Mover Mover in establishing last-mile posts in strategic locations with cus

57、tomer access110,000 110,000 posts as of 1Q2024Process Packages for Couriers for FeesStorage SpaceWe support our network partners in multiple ways to invest earlyand secure last-mile physical presenceSolution to increasing delivery cost Solution to increasing delivery cost due to volume surgedue to v

58、olume surge“Express+Express+”opportunities to create opportunities to create additional incomeadditional incomeAlternative to doorAlternative to door-to to-door door pickup and deliverypickup and deliveryMaintain and improve network Maintain and improve network profitability and stabilityprofitabili

59、ty and stabilityEnhance customer reach and Enhance customer reach and connectivityconnectivityLargest Service ProviderLargest Service Provideramong logistic players in ChinaCovering AllAllprovinces1and 300300citiesNote:1.Not including Hong Kong,Macau and Taiwan164BestBest-in in-Class Operational Cap

60、abilities and Cost Efficiencies Enabled Class Operational Capabilities and Cost Efficiencies Enabled by Technologyby TechnologyCost leadership with high operational efficiencies driven by continuous innovationsCost leadership with high operational efficiencies driven by continuous innovationsDECREAS

61、ING COST PER PARCELDECREASING COST PER PARCEL0.770.770.680.680.620.620.510.510.520.520.510.510.450.450.390.390.380.380.340.340.310.310.30 0.30 0.32 0.32 0.27 0.27 20172017 20182018 20192019 20202020 20212021 20222022 20232023Transportation CostTransportation CostSorting CostSorting Cost(RMB)461 461

62、automated sorting linesautomated sorting lines in service as of 1Q24Joint collaborations with Chinese Academy of Sciences Chinese Academy of Sciences to develop several generations of automated sorting technologies(e.g.cross-belt sorting equipment,line shaft diverter,dynamic weighting machines)Devel

63、oped and continuously re-engineered sophisticated software sophisticated software to support high-speed sorting(e.g.data-enabled algorithm,real-time analytics and recalibration)Largest selfLargest self-owned lineowned line-haul fleet haul fleet of 10,000 vehicles among TongdasSystematic upgrade with

64、 highhigh-capacity trailerscapacity trailersData-driven route planning and safety monitoringPatented curved trailer Patented curved trailer with higher load capacity and improved fuel economy RFIDRFID-equipped tires equipped tires to allow real-time monitoring of operating conditions and schedule ne

65、eded maintenanceLineLine-Haul TransportationHaul TransportationSorting TechnologiesSorting Technologies1Note:1.Transportation cost per parcel in 2020 affected by national toll road fee waiver policy and lower domestic diesel price 17Source:public filingsNotes:Data as of 1Q24 unless otherwise indicat

66、ed1.According to public filings.Net profit for ZTO and BEST represent adjusted net income;otherwise,represent net profit after deducting nonrecurring profit or loss attributable to shareholders of the parent company2.BEST sold its express delivery business in China to J&T in 4Q2021.4BestBest-in in-C

67、lass Operational Capabilities and Cost Efficiencies Enabled Class Operational Capabilities and Cost Efficiencies Enabled by Technology(Contby Technology(Contd)d)Our culture of innovation and technological focus will continue to drive value creation going forwardOur culture of innovation and technolo

68、gical focus will continue to drive value creation going forwardContinuous Breakthrough in Continuous Breakthrough in Autonomous TechnologyAutonomous TechnologyNext-generation automation with faster throughput and smarter,more precise dispatch Testing unmanned vehiclesunmanned vehicles,selfself-d dri

69、ving carsriving cars,hybrid hybrid dronesdronesDigital and Digital and Innovative CultureInnovative CultureEstablish datadata-drivendriven and value-add operational management framework;digitize business know-how and make processes calculable“Problem-solving”to“Problem PreventionProblem Prevention”S

70、trong InStrong In-house R&D Capabilitieshouse R&D CapabilitiesData Analytics CapabilitiesData Analytics CapabilitiesINDUSTRY LEADING PROFITSINDUSTRY LEADING PROFITSNet Profit Market ShareNet Profit Market Share1 1Achieved 63%63%net profit share among Tongdas with 34%34%parcel volume share in 2023Col

71、lect vast volume of data from all aspects of operation Analyze with AI and deep learningAchieve optimal performance with data learningOptimize routing planning based on data insightsCertified as“High and New Technology EnterpriseHigh and New Technology Enterprise”since 2017 with significant tax bene

72、fits1,400 1,400 tech talents2 25656 software copyrights732732 trademarks 197197 patents50%80%80%60%263%2019202020212022202318EnablingEnabling TechnologyTechnologyIntegratedIntegrated LogisticsLogisticsWarehouseWarehouse-DeliveryDeliveryBestBest-in in-Class Operational Capabilities and Cost Efficienc

73、ies Enabled Class Operational Capabilities and Cost Efficiencies Enabled by Technology(Contby Technology(Contd)d)Provide varied yet integrated logistic services Provide varied yet integrated logistic services by implementing more efficient timeby implementing more efficient time-space operational de

74、sign at Smart Logistic Parksspace operational design at Smart Logistic Parks4Offer comprehensive one-stop servicesAddress the demand of diversified 2B customersOptimize resources utilizationAdopt customized equipment:automated sorting lines,self-driving vehicles,solar energyStandardize operations th

75、rough process digitization Optimize routing planning based on data insightsEnable zero-distance pickup for new e-commerce formatsExtend order placement hoursCross-sell other logistics services(express delivery,cold chain,LTL,and more)ZTO Smart Logistics ParksZTO Smart Logistics ParksCompletedComplet

76、edUnder Under ConstructionConstructionLess Less thanthan-TruckloadTruckload“快運”“快運”Express DeliveryExpress Delivery“快遞”快遞”Cold ChainCold Chain“冷鏈”冷鏈”Maintenance StationMaintenance Station“維保站”維保站”Cloud WarehousingCloud Warehousing“云倉”云倉”195Experienced Leadership&Sound ExecutionExperienced Leadership

77、&Sound ExecutionSound Execution Driven by Clear Accountability&Fair Measurement of PerformanceSound Execution Driven by Clear Accountability&Fair Measurement of PerformancePerformance MetricsPerformance MetricsResults-oriented KPIsProcess-driven OKRsAdvancements&EliminationsAdvancements&Eliminations

78、Emphasis on internal promotionFair competition with true talentsIncentive ProgramsIncentive ProgramsEquitable incentives to reward performance Talent DevelopmentTalent DevelopmentZTO Academy and fast-trackOn-the-job trainingMentorshipStable and Entrepreneurial Management Team with Deep Industry Know

79、ledge&ExperienceStable and Entrepreneurial Management Team with Deep Industry Knowledge&Experience17 years of experience in express delivery industryFormer deputy general manager of ZTOs network partner in Beijing22 years of experience in express delivery industryDeputy chairman of the China Express

80、 Delivery AssociationFounder,Chairman&Chief Executive OfficerFounder,Chairman&Chief Executive OfficerDirector and Vice President of Infrastructure Director and Vice President of Infrastructure ManagementManagementMeisongMeisong LaiLaiJileiJilei WangWang32 years of experience in financial services in

81、dustryFormer chairman of Zhejiang Tonglu Rural Commercial BankOver 32 years of experience in corporate and financial management11 years at GE in US and Asia,8 years in public accounting and tax consultingDirector and Chief Operating OfficerDirector and Chief Operating OfficerChief Financial OfficerC

82、hief Financial OfficerHongqunHongqun HuHuHuipingHuiping YanYanOver 22 years of managerial experience in logistics and 9 years of experience in overseas operationFormer manager of ZTO Network PartnerVice President of Overseas OperationVice President of Overseas OperationJianchangJianchang LaiLaiOver

83、21 years of experience in logistics technology managementVP of Information Technology and Digital OperationVP of Information Technology and Digital OperationJingxiJingxi ZhuZhuSources:public filings and media coverage20Sources:1.According to State Post Bureau2.Adjusted net income is defined as net i

84、ncome before(i)share-based compensation expense,(ii)gain on disposal of equity investees,(iii)impairment of equity investments and(iv)unrealized gain from investment in equity investee6Consistent Achievements in Strategic FocusConsistent Achievements in Strategic Focus17,00322,28924,38930,2022020202

85、120222023Expanding Market ShareExpanding Market ShareSuperior Service Quality Superior Service Quality Sustained ProfitabilitySustained ProfitabilityL Leading Positioneading Positionof of c customer satisfaction(2014 ustomer satisfaction(2014-2023)amongst Tongdas2023)amongst Tongdas1 11 1 per millio

86、n per million Monthly average effective complaint Monthly average effective complaint rate rate 1 1in three consecutive years in three consecutive years 4,7545,5037,73610,008202020212022202319%19%Operating Income Margin%20.4%20.6%22.1%22.9%2020202120222023(Parcel volume in mm)(%)4,5904,9476,8069,006

87、2020202120222023Parcel VolumeParcel VolumeIncome from OperationsIncome from OperationsMarket ShareMarket ShareNonNon-GAAP Adjusted Net IncomeGAAP Adjusted Net Income2 2We have simultaneously maintained our superior service quality,grown our market share,and sustained our profitabilityWe have simulta

88、neously maintained our superior service quality,grown our market share,and sustained our profitability18%18%18%18%16%16%Increase in Market Share Non-GAAP Adjusted Net Income Margin%31%31%40%40%YoY Growth%1.31.3%0.2%0.2%1.5%1.5%22%22%9%9%19%19%(RMB mm)(RMB mm)0.8%0.8%26%26%24%24%23%23%21Adjacent Expa

89、nsion Beyond Express DeliveryAdjacent Expansion Beyond Express Delivery7Systemically develop an ecosystem with diversified product and services Systemically develop an ecosystem with diversified product and services leveraging core express infrastructure and ability to access and consolidate resourc

90、esleveraging core express infrastructure and ability to access and consolidate resourcesInternational/CrossInternational/Cross-Border(Since 2014)Border(Since 2014)Diversified products:freight forwarding,dedicatedroutes,centralized shipping,international express delivery,overseas warehousing,etc.Inte

91、rnational express delivery service coverage in Southeast Asia and Africa“Belt and road”initiatives and RCEP LastLast-Mile Posts(Since 2018)Mile Posts(Since 2018)110k last-mile postsCovering all provinces1and 300 cities in ChinaStandardized last-mile service posts with commercial and community servic

92、esEstablished strategic foothold for enhanced end-to-end linkageCold Chain/Air Freight(Since 2020)Cold Chain/Air Freight(Since 2020)Extend the business presence into cold chain market,optimize express,LTL freight,cloud warehouse,air express with integrated temperature-controlled solutions Cold Chain

93、:existing network coverage across 300 citiesAir Freight:collaboration with 30 airportsWarehouseWarehouse-Delivery(Since 2018)Delivery(Since 2018)Diversified products including B2C,B2B,cross-border and temperature-controlled warehousing Self or franchisee-operated warehousing totalling 2mm m2 in area

94、Integrated warehousing,processing and delivery fulfillmentFinanceFinanceD Digital igital MarketingMarketingLess Less thanthan-Truckload(Since 2016)Truckload(Since 2016)Focus on heavy cargoCargo volume ranking top 5 among network partner model competitors299%County/township-level coverage in China21k

95、 service outletsSources:Yunlian Research,public filings,ZTO official websiteNote:data quoted are approximate and not precise1.Not including Hong Kong,Macau and Taiwan2.According to Yunlian Research Top 12 Players with Network Partner Model in LTL Industry in 2023Eco friendlyEco friendlyPackagingPack

96、agingFleetFleetMaintenanceMaintenanceStationsStations22ESG PracticesESG Practices-Responding to Climate Change and Carbon ReductionResponding to Climate Change and Carbon Reduction8 Strengthening the identification and management of climate change risks and opportunities with reference to the framew

97、ork of the Task Force on Climate-related Financial Disclosures(TCFD)GovernanceStrategyRisk managementIndicatorsand targets5.00 30.00 40.15 202120222023Photovoltaic power generationPhotovoltaic power generationCumulative input of green Cumulative input of green recycling transit bagsrecycling transit

98、 bags1,856 3,225 4,415 202120222023Cumulative investment of green Cumulative investment of green recycling devicesrecycling devices24,000 25,327 26,683 2021202220230.077 0.073 0.064 202120222023（kg CO2e per parcel）-1111%Continuous decrease in greenhouse gas emissions intensity+34+34%(million kWh)(10

99、,000 pieces)The BoD is responsible for climate change-related risks and opportunities,and authorizes the ESG Committee to oversee risk identification,assessment and management(Units)Automated sorting linesAutomated sorting lines385 458 464 202120222023(Set)+37+37%Carbon emission target(2023-2028)CO2

100、20%20%Reductionin GHG emissions intensity per parcel produced by the Company in five yearsin five yearsRisksRisksPhysical risks(acute and chronic risks,e.g.,extreme weather and rising sea levels)Transition risks(policy and regulations,market,technology and reputation)Resource efficiencyTypes of ener

101、gyProducts and servicesClimate resilienceOpportunitiesOpportunitiesIncorporatingIncorporating ClimateClimate ChangeChange intointo GovernanceGovernance andand StrategicStrategic FrameworkFrameworkSettingSetting CarbonCarbon ReductionReduction TargetsTargets andand ContinuouslyContinuously PromotingP

102、romoting GreenGreen TransformationTransformationNote:For details of 2023 ESG report:https:/ 6%23 0 major delivery safety accidents in 2023 Utilization rate of privacy waybill further improved to 76%through the whole network and 100%through self-owned channels.Efficient customer service system,multi-

103、channel feedback mechanismOverall satisfaction rate of 94%,+3 pts yoyService qualityDelivery safetyNote:For details of 2023 ESG report:https:/ PracticesESG Practices-Contributing Social Value and Optimizing Corporate GovernanceContributing Social Value and Optimizing Corporate GovernanceEmpowering e

104、mployee development and protecting the rights and Empowering employee development and protecting the rights and interests of couriersinterests of couriersTraining systemCourier welfareIncome policy guaranteeCare and concern guaranteeEntrepreneurship empowerment guaranteeRisk prevention guaranteeinno

105、vation and talent pipeline trainingregions,functions and frontlinersOnline and offline training 3 talent programs3 empowerment initiatives1 major platformSupporting the development of Supporting the development of network partnersnetwork partnersActively participated in programs such as“Dream Fulfil

106、lment 1+1”,science popularization in schools and“Reuniting Families with Tape”Proactively assisting outlets in operation optimization,accelerating the delayering to reduce costsActive participation in community and rural revitalizationActive participation in community and rural revitalizationAssisti

107、ng the promotion of rural products and stimulating rural industrial developmentCreating a moral culture and enhancing supplier managementCreating a moral culture and enhancing supplier managementStandardizing reporting channels,and proactively carrying out risk assessmentContinuously implementing“In

108、tegrity and Honesty”initiatives0 related litigation casesEmployees,Employees,partners,and partners,and communitiescommunitiesProduct Product servicesservicesIntegrity Integrity governancegovernanceUpgraded comprehensive express productsUpgraded comprehensive express productsHalf-day delivery by air

109、and landZTO FeikuaiGuarantee pre-delivery call,door-to-door delivery,and overtime compensationZTO HaokuaiStandard servicesZTO StandardCompetitive priceOrdinary ParcelStandardize reporting channelsStandardize reporting channelsRisk assessment implementationRisk assessment implementationSupplier Guidi

110、ng PrinciplesReleasing a supplier management policy,and incorporating ESG into the supplier selection and evaluation processEntryEntryEval.Eval.ExitExit24Accelerating the transition towards Accelerating the transition towards green and lowgreen and low-carbon transportationcarbon transportation“”25A

111、doption of solar energy in transit centersAdoption of solar energy in transit centers“”26Enhancing life quality and Enhancing life quality and supporting common prosperitysupporting common prosperity“”0303OUR OUR STRATEGIESSTRATEGIES28Our StrategiesOur StrategiesMaintaining high quality of service a

112、nd customer satisfaction Maintaining high quality of service and customer satisfaction Maximize earnings upon achieving targeted volume growthMaximize earnings upon achieving targeted volume growthInvest in the logistics ecosystem to Invest in the logistics ecosystem to integrate resources in logist

113、ics value chainintegrate resources in logistics value chainEnhance the scale and capability of Enhance the scale and capability of logistics operationslogistics operationsFurther green initiatives by introducing clean-energy transportation capacityBuild information&technology platform to enable cros

114、s-selling,information sharing,and management know-howPurchase and upgrade of self-owned and operated fleet driving further efficiencyAdd and upgrade facilities with more efficient layout,automation and digitized process managementExpand last-mile presence and consolidate strategic resourcesTest and

115、implement differentiated product and services to meet diversifying customer demandFurther develop each key logistics segments(LTL,cloud warehousing,international,cold-chain,last-mile)and integrate support functions such as financingEstablish brand-level coordinated planning to improve integration&co

116、llaboration and maximize resource utilization 29Promoting rural revitalization Promoting rural revitalization and serving the rural marketand serving the rural market“”30Towards a topTowards a top-tier global integrated tier global integrated logistics service providerlogistics service provider“”31L

117、astLast-mile posts enhancing customer mile posts enhancing customer reach and network efficiencyreach and network efficiency“”0404FINANCIAL FINANCIAL OVERVIEWOVERVIEWNotes:1.Adjusted net income is defined as net income before(i)share-based compensation expense,(ii)gain on disposal of equity investee

118、s,(iii)impairment of equity investments and(iv)unrealized gain from investment in equity investee2.Adjusted EBITDA is defined as net income before depreciation,amortization,interest expenses and income tax expenses,and further adjusted to exclude(i)shared-based compensation expense,(ii)gain on dispo

119、sal of equity investees,(iii)impairment of equity investments and(iv)unrealized gain from investment in equity investee3.Excluding freight forwarding business4.Including other operating income and excluding SBCStrong Unit EconomicsStrong Unit EconomicsASPASP3 3Unit Cost of RevenueUnit Cost of Revenu

120、e3 3Total OpexTotal Opex4 4NonNon-GAAP Operating ProfitGAAP Operating ProfitNonNon-GAAP Adjusted Net IncomeGAAP Adjusted Net Income1 1NonNon-GAAP Adjusted EBITDAGAAP Adjusted EBITDA2 2=-(RMB/Unit)330.250.250.320.320.340.340.37 0.37 0.350.350.370.370.320.320.320.320.360.36Q1 2022 Q2 2022 Q3 2022 Q4 2

121、022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20241.451.451.341.341.361.361.461.461.40 1.40 1.241.241.171.171.191.191.361.36Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20240.200.200.280.280.290.290.320.320.30 0.30 0.33 0.33 0.31 0.31 0.25 0.25 0.31 0.31 Q1 2022 Q2 2022 Q3 2022 Q4 202

122、2 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20241.141.140.990.990.980.981.041.041.00 1.00 0.810.810.820.820.830.830.940.94Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20240.380.380.470.470.47 0.47 0.520.520.50 0.50 0.51 0.51 0.46 0.46 0.42 0.42 0.51 0.51 Q1 2022 Q2 2022 Q3 2022 Q4 202

123、2 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20240.060.060.040.040.040.040.050.050.050.050.060.060.040.040.040.040.060.06Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 202434Robust Parcel Volume and Revenue Growth Robust Parcel Volume and Revenue Growth Parcel VolumeParcel VolumeTotal Re

124、venueTotal RevenueQuarterly Parcel VolumeQuarterly Parcel VolumeQuarterly RevenueQuarterly Revenue(RMB million)(Parcel volume in millions)(RMB million)(Parcel volume in millions)9%9%YoY YoY GrowthGrowth16%16%YoY YoY GrowthGrowth24%24%YoY YoY GrowthGrowth9%9%YoY YoY GrowthGrowth22,28924,38930,2022021

125、2022202330,406 35,377 38,419 2021202220237,904 8,657 8,945 9,871 8,983 9,740 9,076 10,619 9,960 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20245,226 6,203 6,368 6,593 6,297 7,677 7,523 8,705 7,171 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 20244%17%8%1

126、2%21%22%18%7%14%20%24%13%18%1.5%32%8%14%11%Year-over-Year GrowthYear-over-Year GrowthNotes：1.Adjusted EBITDA is a non-GAAP financial measure,which is defined as net income before depreciation,amortization,interest expenses and income tax expenses,and further adjusted to exclude(i)shared-based compen

127、sation expense;(ii)gain on disposal of equity investees,(iii)impairment of equity investments and(iv)unrealized gain from investment in equity investee2.Adjusted net income is a non-GAAP financial measure,which is defined as net income before(i)share-based compensation expense,(ii)gain on disposal o

128、f equity investees,(iii)impairment of equity investments and(iv)unrealized gain from investment in equity investee3.Included a one-time impairment of 478 million from the sale of Cainiaos equity35Strong Profitability and MarginsStrong Profitability and MarginsIncome from Operations and MarginIncome

129、from Operations and MarginNet Income and MarginNet Income and MarginAdjusted Net IncomeAdjusted Net Income2 2and Marginand MarginYear-over-Year GrowthYear-over-Year GrowthAdjusted EBITDAAdjusted EBITDA1 1and Marginand Margin(RMB million)(RMB million)(RMB million)(RMB million)Year-over-Year GrowthYea

130、r-over-Year Growth1,116 1,986 2,175 2,460 1,950 2,879 2,424 2,755 2,267 14.1%14.1%22.9%22.9%24.3%24.3%24.9%24.9%21.7%21.7%29.6%29.6%26.7%26.7%25.9%25.9%22.8%22.8%Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024Operating profitOperating margin%11%76%36%60%20%75%45%12%16%876 1,7

131、59 1,895 2,129 1,665 2,530 2,350 2,210 1,448 11.1%11.1%20.3%20.3%21.2%21.2%21.6%21.6%18.5%18.5%26.0%26.0%25.9%25.9%20.8%20.8%14.5%14.5%Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024Net incomeNet profit margin%364%38%65%22%90%44%24%4%-13%2,002 2,892 2,998 3,397 3,133 3,884 3,

132、439 36523,660 25.3%25.3%33.4%33.4%33.5%33.5%34.4%34.4%34.9%34.9%39.9%39.9%37.9%37.9%34.4%34.4%36.8%36.8%Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024Adjusted EBITDAAdjusted EBITDA margin%36%36%52%24%56%34%15%8%17%1,055 1,759 1,873 2,120 1,920 2,531 2,341 22142,224 13.3%13.3

133、%20.3%20.3%20.9%20.9%21.5%21.5%21.4%21.4%26.0%26.0%25.8%25.8%20.9%20.9%22.3%22.3%Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024Adjusted net incomeAdjusted net income margin%22%35%38%63%82%44%25%4%16%Note：1.Cost of revenues per parcel is calculated based on cost of revenues d

134、ivided by the number of parcels handled in a given quarter36Continuous Cost Efficiencies and Productivity GainsContinuous Cost Efficiencies and Productivity GainsKey Observations Key Observations onon 1 1Q Q 2024 Results2024 Results LineLine-haul transportation cost haul transportation cost Better e

135、conomies of scale(+)Improved load rate(+)Real-time data monitoring and analytics to optimize route planning(+)Sorting hub costSorting hub costBetter economies of scale(+)Improved standardization in operating procedures with improved labor productivity(+)Increased automation,461 sets of automated sor

136、ting equipment in use(454 sets 1Q23)(+)Gross profitGross profitGross profit increased as the result of increased revenue and cost productivity gainCost of Revenues Cost of Revenues-BreakdownBreakdown(RMB million)Gross Profit Gross Profit andand MarginMargin(RMB million)Cost of Revenues per ParcelCos

137、t of Revenues per Parcel1 1(RMB)2,954 3,030 3,102 3,394 3,182 3,200 3,246 3,964 3,371 1,880 1,891 1,934 2,140 2,013 1,935 2,048 2,257 2,168 83 120 113 148 107 127 117 162 188 1,059 1,106 1,068 1,179 974 952 736 880 1,097 308 307 284 238 183 222 222 228 133 Q1 2022Q2 2022Q3 2022Q4 2022Q1 2023Q2 2023Q

138、3 2023Q4 2023Q1 2024Line-Haul Transportation CostSorting Hub CostCost of Accessories SoldOther CostsFreight Forwarding Cost1,620 2,203 2,444 2,773 2,523 3,304 2,706 3,128 3,002 20.5%20.5%25.4%25.4%27.3%27.3%28.1%28.1%28.1%28.1%33.9%33.9%29.8%29.8%29.5%29.5%30.1%30.1%Q1 2022Q2 2022Q3 2022Q4 2022Q1 20

139、23Q2 2023Q3 2023Q4 2023Q1 2024Gross ProfitGross Margin0.53 0.57 0.49 0.49 0.51 0.51 0.42 0.43 0.46 0.47 0.32 0.36 0.30 0.30 0.32 0.32 0.25 0.27 0.26 0.30 0.01 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.03 0.19 0.20 0.18 0.18 0.18 0.15 0.12 0.10 0.10 0.15 0.05 0.06 0.05 0.05 0.04 0.03 0.03 0.03 0.03 0

140、.02 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024Line-Haul Transportation CostSorting Hub CostCost of Accessories SoldOther CostsFreight Forwarding Cost11,479 11,479 13,361 13,361 3,923 3,923 2,031 2,031 20222023Q4 2023Q1 2024Notes：1.Including cash and cash equivale

141、nts,restricted cash and short-term&long-term investments37Strong Operating Cash Flow Supports Continued Investment in GrowthStrong Operating Cash Flow Supports Continued Investment in GrowthOperating Cash FlowOperating Cash FlowCapital ExpenditureCapital ExpenditureCash and Cash EquivalentCash and C

142、ash Equivalent1 1(RMB million)(RMB million)(RMB million)16%16%GrowthGrowth8%8%DeclineDecline27%27%GrowthGrowth2%2%GrowthGrowth48%48%DeclineDecline6,812 6,529 840 1,575 422 141 55 117 20222023Q4 2023Q1 2024Purchases of Land Use RightsPurchases of Property,Equipment and Vehicles7,2347,2346,6706,6701,6

143、921,69289589589%89%GrowthGrowth11,693 12,334 12,334 12,584 89568668627213,076 19,626 19,626 20,489 20222023Q4 2023Q1 2024Short-term&long-term investmentsRestricted cashCash and cash equivalents32,64632,64632,64632,64633,34533,34525,66425,664Note:Numbers may not add up due to rounding38Reconciliation

144、 of GAAP to Adjusted/NonReconciliation of GAAP to Adjusted/Non-GAAP MeasuresGAAP MeasuresMar 31,Mar 31,Jun 30,Jun 30,Sep 30,Sep 30,Dec 31,Dec 31,Mar 31,Mar 31,Jun 30,Jun 30,Sep 30,Sep 30,Dec 31,Dec 31,Mar 31,Mar 31,Jun 30,Jun 30,S Sepep 30,30,Dec 31,Dec 31,Mar 31,Mar 31,20212021202120212021202120212

145、021202220222022202220222022202220222023202320232023202320232023202320242024Adjusted EBITDAAdjusted EBITDARMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000Net IncomeNet Income533,5261,272,2251,147,8901,747,686875,5241,758,7021,895,455 2,129,2851,664,821 2,530,2132,3

146、49,6102,209,8131,447,747 1,447,747 Add:Depreciation495,708530,874508,464 567,265601,643640,577633,279665,400651,685671,283712,734705,117752,119 752,119 Add:Amortization25,65133,92829,525 30,353 31,05431,39232,00235,19934,79333,79131,951 33,855 33,980 33,980 Add:Interest Expenses15,58233,79852,27124,

147、85259,63523,10231,637 76,14771,71072,21883,801 61,08483,916 83,916 Add:Income Tax Expenses149,638254,859229,525371,429255,219438,205439,388 500,518455,007575,585271,387 636,621566,305 566,305 EBITDAEBITDA1,220,1052,125,6841,967,6752,741,5851,823,0752,891,9783,031,7613,406,5492,878,0163,883,0903,449,

148、4833,647,2102,884,067 2,884,067 Add:Share-based Compensation Expense248,027-178,980-254,976-298,387 298,387 Add:Impairment of the investments-26,328-478,364 478,364 Less:Gain on Deemed Disposal of Equity Method Investments-2,357-60,515-9,083-764-10,8384,589-451451Unrealized gain from investment in e

149、quity investee-Adjusted EBITDAAdjusted EBITDA1,468,1322,125,6841,967,6752,739,2282,002,0552,891,9782,997,574 3,397,4663,132,9923,883,8543,438,6453,651,7993,660,367 3,660,367 Adjusted EBITDA marginAdjusted EBITDA margin22.68%29.02%26.62%29.72%25.33%33.41%33.51%34.42%34.88%39.87%37.89%34.39%36.75%36.7

150、5%Adjusted Net IncomeAdjusted Net IncomeRMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMB000RMBRMB000000Net IncomeNet Income533,5261,272,2251,147,890 1,747,686875,5241,758,7021,895,455 2,129,2851,664,821 2,530,2132,349,6102,209,8131,447,747 1,447,747 Add:Share-based Compensation

151、Expense248,027-178,980-254,976-298,387 298,387 Add:Impairment of the investments-26,328-478,364 478,364 Less:Gain on Deemed Disposal of Equity Method Investments-2,357-49,192-9,083-764-8,866459-451451Unrealized gain from investment in equity investee-Adjusted Net IncomeAdjusted Net Income781,5531,272,2251,147,8901,745,329 1,054,5041,758,7021,872,591 2,120,2021,919,797 2,530,9772,340,7442,214,4022,224,047 2,224,047 Adjusted Net Income MarginAdjusted Net Income Margin12.07%17.37%15.53%18.93%13.34%20.3%20.93%21.48%21.37%25.98%25.79%20.85%22.33%22.33%39THANK YOUTHANK YOU