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1、S.F.Holding Co.,Ltd.2022 Semi-Annual Report1S.F.Holding Co.,Ltd.2022 Semi-Annual Report2S.F.Holding Co.,Ltd.2022 Semi-Annual ReportAugust 2022S.F.Holding Co.,Ltd.2022 Semi-Annual Report3S.F.Holding Co.,Ltd.2022 Semi-Annual Report4Chapter 1 Important Information,Table of Contents and DefinitionsThe C

2、ompanys Board of Directors,Supervisory Committee,directors,supervisors,and seniormanagement hereby guarantee that the contents of the Semi-Annual Report are true,accurate,and complete,and that there are no misrepresentations,misleading statements,or material omissions,and shall assumeindividual and

3、joint legal liabilities.Wang Wei,the Companys legal representative,Ho Chit,the chief financial officer(the person in charge offinance),and Hu Xiaofei,the accounting officer,hereby declare and warrant that the financial report within theSemi-Annual Report is true,accurate and complete.All directors h

4、ave attended the Board meeting approving the Semi-Annual Report.In this Semi-Annual Report,the Company details the possible risk factors that may occur in the future andcountermeasures.For more information,please refer to“Section X.Possible Risks and Countermeasures”under“Chapter 3 Management Discus

5、sion and Analysis”.Investors should refer to such information.The Company is required to comply with the disclosure requirements on“express delivery service industry”presented in the Self-Regulatory Guidelines No.3 for Companies Listed on the Shenzhen Stock Exchange-Industrial Information Disclosure

6、.The Company does not plan to issue cash or equity dividends,nor to convert equity reserve into sharecapital of the Company.S.F.Holding Co.,Ltd.2022 Semi-Annual Report5Table of ContentsChapter 1 Important Information,Table of Contents and Definitions.4Chapter 2 Company Profile and Key Financial Indi

7、cators.8Chapter 3 Management Discussion andAnalysis.16Chapter 4 Corporate Governance.66Chapter 5 Environmental and Social Responsibilities.69Chapter 6 Significant Events.72Chapter 7 Share Changes&Shareholder Details.87Chapter 8 Preferred Shares.93Chapter 9 Bonds.94Chapter 10 Financial Statements.95S

8、.F.Holding Co.,Ltd.2022 Semi-Annual Report6List of DocumentsAvailable for Inspection(1)Financial statements signed and sealed by the legal representative,the chief financial officer(the person in charge of finance)andthe accounting officer of the Company.(2)The original copies of all documents and a

9、nnouncements of the Company which have been publicly disclosed in newspapersdesignated by the China Securities Regulatory Commission during the reporting period.(3)The original copies of the 2022 Semi-Annual Report signed by the chairman of the Board of Directors.(4)The place where the above documen

10、ts are maintained:the office of the Companys Board of Directors.S.F.Holding Co.,Ltd.2022 Semi-Annual Report7DefinitionsTermDescriptionReporting periodJanuary 1,2022 to June 30,2022The same period ofprevious yearJanuary 1,2021 to June 30,2021The Company,The listedCompany,SF Holding,SFS.F.Holding Co.,

11、Ltd.RMBRenminbi yuanTaisen HoldingShenzhen S.F.Taisen Holding(Group)Co.,Ltd.,a wholly-owned subsidiary of S.F.Holding Co.,Ltd.Mingde HoldingShenzhen Mingde Holding Development Co.,Ltd.,the controlling shareholder ofS.F.Holding Co.,Ltd.Kerry LogisticsKerry Logistics Network Limited,a company listed o

12、n the Main Board of the StockExchange of Hong Kong Limited(00636.HK)and a controlled subsidiary of S.F.Holdings Co.,Ltd.SF Intra-city,Intra-cityIndustrialHangzhou SF Intra-city Industrial Co.,Ltd.,a company listed on the Main Board ofthe Stock Exchange of Hong Kong Limited(09699.HK)and a controlled

13、subsidiaryof S.F.Holdings Co.,Ltd.SF REITSF Real Estate Investment Trust,a company listed on the Main Board of the StockExchange of Hong Kong Limited(02191.HK)and an associate of S.F.Holding Co.,Ltd.CSRCChina Securities Regulatory CommissionSZSEShenzhen Stock ExchangeHK Stock ExchangeThe Stock Excha

14、nge of Hong Kong LimitedS.F.Holding Co.,Ltd.2022 Semi-Annual Report8Chapter 2 Company Profile and Key Financial IndicatorsI.Company InformationCompany ProfileStockAbbreviationSF HoldingStock Code002352Listed Stock ExchangeShenzhen Stock ExchangeChinese Name of the Company順豐控股股份有限公司Chinese Name Abbre

15、viation of theCompany(if any)順豐控股English Name of the Company(ifany)S.F.Holding Co.,Ltd.English Name Abbreviation of theCompany(if any)SF HoldingLegal Representative of theCompanyWang WeiContacts and Contact MethodsBoard SecretarySecuritiesAffairs RepresentativeNameLing GanJing ZengAddressBlock B,TK

16、Chuangzhi Tiandi Building,Keji South 1stRoad,NanshanDistrict,Shenzhen,GuangdongProvince,P.R.ChinaBlock B,TK Chuangzhi Tiandi Building,Keji South 1stRoad,NanshanDistrict,Shenzhen,GuangdongProvince,P.R.ChinaTel No.0755-363953380755-36395338Fax0755-366466880755-36646688Emailsfirsf-sfirsf-Other Informat

17、ion1.Corporate contact informationWere there any changes to the Companys registered address,office address or postal code,Company website,or to the emailaddress during the reporting period?Yes NoThere were no changes to the Companys registered address,office address or postal code,Company website an

18、d the email addressduring the reporting period.Refer to the Companys 2021Annual Report for details.2.Information disclosure and place of inspectionWere there any changes to information disclosure and place of inspection during the reporting period?Yes NoThere were no changes to the name of the newsp

19、aper designated for information disclosure,to the address of website designatedby the CSRC for semi-annual report publication,nor to the storage location of Companys Semi-Annual Report during thereporting period.Please refer to the Companys 2021Annual Report for details.S.F.Holding Co.,Ltd.2022 Semi

20、-Annual Report93.Other relevant informationWere there any changes to other relevant information during the reporting period?Yes NoS.F.Holding Co.,Ltd.2022 Semi-Annual Report10II.Key Operating and Financial DataResults Overview for 2022H1Total parcel volume15.13billionFlatRevenueRMB130.1billion47.2%G

21、ross profitRMB16.3billion82.5%Net profit attributable to theparent company2RMB2.51billion231%Net profit attributable to theparent company after deductingnon-recurring profit or loss3RMB2.15billion550%Basic earnings per shareRMB0.51/share200%Total assetsRMB212.5billion1.22%Net assets attributable to

22、theparent company4RMB81.7billion1.48%Notes：1.The total parcel volume does not include the express delivery volume of Kerry Logistics,nor includes business volume of internationalfreight and freight forwarding and supply chain2.Net profit attributable to the parent company refers to the net profit at

23、tributable to the shareholders of the listed company3.Net profit attributable to the parent company after deducting non-recurring profit or loss refers to the net profit attributable to theshareholders of the listed company after deducting non-recurring profit or loss4.The net assets attributable to

24、 the parent company refers to the net assets attributable to the shareholders of the listed companyS.F.Holding Co.,Ltd.2022 Semi-Annual Report11S.F.Holding Co.,Ltd.2022 Semi-Annual Report12S.F.Holding Co.,Ltd.2022 Semi-Annual Report13Financial summary1.Major accounting data and financial indicatorsD

25、oes the Company need to adjust its financial information retrospectively or restate its previous year accounting information?Yes NoUnit:RMB000Current reporting periodThe same period of previousyearIncrease/Decrease over thesame period of previous yearRevenue130,064,13388,343,93047.22%Cost of revenue

26、113,778,31079,421,35443.26%Gross profit16,285,8238,922,57682.52%Net profit attributable toshareholders of the parentcompany2,512,397759,921230.61%Net profit attributable toshareholders of the parentcompany after deducting non-recurring profit or loss2,147,856-477,089550.20%Net cash flow generated fr

27、omoperating activities16,712,8144,331,631285.83%End of the current reportingperiodEnd of previous yearIncrease/Decrease overprevious year endTotal assets212,467,377209,899,9821.22%Total liabilities118,069,551111,984,7355.43%Net assets94,397,82697,915,247-3.59%Net assets attributable toshareholders o

28、f the parentcompany81,718,39782,943,226-1.48%Gearing ratio(%)55.57%53.35%Up by 2.22 percentage pointsCurrent reporting periodThe same period of previousyearIncrease/Decrease over thesame period of previous yearBasic earnings per share(RMB/share)0.510.17200.00%Diluted earnings pershare(RMB/share)0.51

29、0.17200.00%Weighted average return on netassets(%)3.00%1.34%Up by 1.66 percentage pointsS.F.Holding Co.,Ltd.2022 Semi-Annual Report142.Major financial data of operating segmentsSegment external incomeUnit:RMB000Current reporting periodThe same period of previousyearIncrease/Decrease over thesame per

30、iod of previous yearExpress segment63,969,17763,144,3691.31%Freight segment15,057,83713,398,87412.38%Intra-city segment2,938,2742,293,46228.12%Supply chain and internationalsegment47,545,2048,790,434440.87%Undistributed units553,641716,791-22.76%Total130,064,13388,343,93047.22%Segment net profitUnit

31、:RMB000Current reporting periodThe same period of previousyearIncrease/Decrease over thesame period of previous yearExpress segment2,110,588801,604163.30%Freight segment8,744-580,252101.51%Intra-city segment-143,940-406,58864.60%Supply chain and internationalsegment1,689,467-65,9572661.47%Undistribu

32、ted units-368,555661,893-155.68%Inter-segment elimination4715,090-90.75%Total3,296,775415,790692.89%Notes:(1)The Company continues to promote multi-network integration.The large parcel(generally goods heavier than 20KG,withrestricted flow direction and distance)business of time-definite express and

33、economy express operated by the direct network ofexpress segment was included in the responsibility of the freight organization step by step.Accordingly,the freight segment dataincluded data from the above large parcel business.(2)The corresponding relationship between the operating segments and the

34、 Companys main business segments was:the expresssegment included time-definite express and economy express businesses other than large parcel business(included in theresponsibility of the freight organization)mentioned in item(1),as well as cold shipping and pharmaceutical businesses;thefreight segm

35、ent included the above-mentioned large parcel business,and freight business;the intra-city segment was mainly intra-city on-demand delivery business;the supply chain and international segment included international express business,international freight business and freight forwarding business,and s

36、upply chain business;the undistributed units mainly includedsegments of non-principal logistics and freight forwarding businesses,including investment,industrial parks and other functionalsegments of the headquarters.S.F.Holding Co.,Ltd.2022 Semi-Annual Report153.Non-recurring profit or loss items a

37、nd amountsUnit:RMB000AmountDescriptionInvestment income from disposal of subsidiaries32,314Gains or losses on disposals of non-current assets(includingthe write-off part of the provision for impairment of assets)20,464Government grants recognized in the current profit or loss(excluding continuous go

38、vernment grants that are closelyrelated to the Companys normal business operations,withfixed quotas or amounts in accordance with nationalpolicies)392,099It mainly represents fiscal appropriation,transportation capacity subsidies,taxrefunds and employment stabilizationsubsidies,etc.Gains or losses f

39、rom changes in fair value of held-for-trading financial assets and held-for-trading financialliabilities,and investment gains or losses arising from thedisposal of held-for-trading financial assets and held-for-trading financial liabilities,excluding hedging activitiesrelated to the Companys normal

40、business operations15,933Reversal of provision for impairment of receivables thathave been separately assessed for impairment64,090Other non-operating income and expenses other than theabove-16,465Less:Income tax effect102,319Profit or loss attributable to minority shareholders(after tax)41,575Total

41、364,541Note:The Company does not have other profit or loss items that meet the definition of non-recurring profit or loss;the Companydoes not define the non-recurring profit or loss items listed in the Explanatory Announcement No.1 on Information Disclosure ofCompanies Offering Securities to the Pub

42、lic-Non-recurring Profit or Loss as recurring profit or loss items.4.Differences in accounting data under domestic and foreign accounting standards1.During the reporting period,there was no difference in the net profit and net assets in the financial reports disclosed inaccordance with the Internati

43、onalAccounting Standards and the ChineseAccounting Standards.2.During the reporting period,there was no difference in the net profit and net assets in the financial reports disclosed inaccordance with overseas accounting standards and in accordance with the ChineseAccounting Standards.S.F.Holding Co

44、.,Ltd.2022 Semi-Annual Report16Chapter 3 Management Discussion and AnalysisI.Business Development of the Company()Industry review1.Chinas economy rebound in the first half of 2022after a slowdown caused by the Covid-19 pandemic.As Covid-19 variants are becoming more transmissible,the difficulty of p

45、revention and control also increases.InChina,sporadic outbreaks of the pandemic exerted anegativeimpacton economic activities.According toNational Bureau of Statistics of China,in the first half of2022,Chinas GDP hit RMB56.3 trillion,up 2.5%year-on-year as calculated using constant prices;and GDP fo

46、r thesecond quarter was RMB29.2 trillion,up 0.4%year-on-year.In addition,the total retail sales of consumer goods wereRMB21.0 trillion,down 0.7%year-on-year;as the pandemicalso reinforced peoples habits to consume online,the onlineretail sales of physical commodities came in at RMB5.4trillion,up 5.6

47、%year-on-year,accounting for 25.9%of thetotal retail sales of consumer goods with an increase inmarket penetration.During May and June,with the improvement of thepandemic situation,the government introduced a series ofpolicies to help enterprises ride out the tough time and speeduptheresumptionofwor

48、kandproduction.Chinaseconomic activities saw an uptick.In June,major economicindicators demonstrated positive trends.The added value ofindustries above designated size increased by 3.9%year-on-year;the growth rate of total retail sales of consumer goodsturned positive,increasing by 3.1%year-on-year.

49、With thecontinuous rollout of policiesconduciveto economicstability,China is supposed to continue its economy reboundin the second half of the year.2.Policies were launched to ensure the smooth flowand overall development of logistics,obtaining significanteffect.When the pandemic hit in the first ha

50、lf of 2022,thelogistics industry facedgreaterpressure due to locallockdowns and control measures,which adversely affectedthe supply of livelihood materials and the normal operationof industrial and supply chains.To alleviate the pressure,the government has launcheda number of policies to ensure smoo

51、th logistics and reducebusiness costs of enterprises.On 11 April,the State Councilissued the Notice on Ensuring the Smooth Freight andLogistics(關于切實做好貨運物流保通保暢工作的通知),calling for efforts from all regions and departments toensure smoothtransportationofgoodsandmaterials,especiallymedicalandothermaterial

52、sforepidemicprevention and control,daily necessities,government reservematerials,postal express,and other important productionmaterials such as agriculture,energy,and raw materials.On27 April,the State Council proposed at an executive meetingthat from 1 May to the end of the year,eligible expressdel

53、ivery services will be exempted from VAT;RMB100billion of refinancing loans will be offered as soon aspossibletofundthetransportation,logisticsandwarehousingindustries,andallow reasonabledeferredrepayment of car loans,etc.Benefiting from above measures,the logistics industryaccelerated its recovery

54、after this wave of Covid infectionsreceded.In the first half of 2022,the nationwide totallogistics expenses(the total value of goods in social mobility)rose by 3.1%year-on-year to approximately RMB160trillion;nationwide business volume of express serviceenterprises amounted to 51.2 billion pieces,up

55、 3.7%year-on-year;business income accumulated to RMB498.2 billion,up 2.9%year-on-year.The logistics industry has shown itsresilience under the impact of the pandemic.It can beanticipated that in the second half of the year,with themitigation of the pandemic and recovery of economicactivities,the exp

56、ress logistics industry will also speed up itsrecovery.3.Both policy regulation and market changes areS.F.Holding Co.,Ltd.2022 Semi-Annual Report17boosting thelogistics industrytowardshigh-qualitydevelopment.The Development Planning on the Post Industry for the“14th Five-Year Plan”Period（”十四五”郵政業發展規

57、劃）introduced in late 2021,proposed that during the14th Five-Year Plan period we should focus on promotingthe high-quality development of the post industry,whilesetting five major objectives in terms of scale strength,basicnetwork,innovation capability,service and governanceeffectiveness,as well as 1

58、2 related indicators.The planningprovides a clear and concrete direction for the expressdelivery industry to improve its service and developmentquality.Additionally,the government tightened regulationtowards market competition to protect deliverymens rightsand interests.Under the dual action of poli

59、cy guidance andcontinuous governance,price-oriented competition in theexpress delivery industry is easing.While express deliverycompanies gradually getting rid of the“price war”haze,theunit price per shipment elevates continuously.Meanwhile,with the slowing e-commerce consumptiongrowth,e-commerce mo

60、del innovations,decentralized trafficand a competitive e-commerce platform landscape,therivalry over consumer service experience has becomeparticularly significant.Therefore,the merchants and e-commerce platforms have placed greater emphasis on thetimeliness and quality of logistics performance.Impr

61、ovingservices and the quality of development has become themainstreamtrendintheindustry.Expressdeliverycompaniesactivelypromoteservicestratificationandproduct classification,optimize service models and refineoperational processes.They also make efforts to improveterminal delivery service quality and

62、 enhance customerexperience amid a shift in the express delivery industrytowards orderly competition.Furthermore,international geopolitical conflicts madecrude oil prices continue rising in the first half of the year,driving domestic refined oil prices to a five-year high.Asone of a key cost element

63、 for the logistics industry,the costof fuel has been on the rise,bringing great pressure on theoperational efficiency of express logistics companies whilereducing the possibility of price war.Rising fuel cost alsotested the companies capabilities of intensive management.Leading express delivery and

64、logistics companies haveestablished complete logistics networks,and set up effectivebarriers to entry based on economies of scale.They will havemore space to improve the efficiency of transportationcapacity resources by several measures such as adjustingoperating models and optimizing network planni

65、ng,so as tohedge against the pressure of rising fuel cost.Higher barriersto entry and uncertainties in the business environment haveled to a gradual shift among logistics enterprise competitionaway from disorderly expansion to LEAN and sustainabledevelopment.4.With resilience in import and export tr

66、ade,Chinahas seen an enormous development potential in cross-border logistics in the Asia-Pacific region given itsgrowth potential in consumption and trade.Since the beginning of 2022,the overall global tradegrowth has been slowing down.However,China hasovercome several adverse effects such as the t

67、ighteningexternal environment and the short-term impact of thepandemic,and still saw a relatively fast growth of foreigntrade imports and exports,attesting to the high degree oftenacity in the Chinese foreign trade industry.In the first halfof 2022,Chinas total imports and exports of goodsamounted t

68、o RMB19.8 trillion,up 9.4%year-on-year;exports of goods amounted to RMB11.1 trillion,up 13.2%year-on-year.As the Covid-19 pandemic abated gradually inChina,resumption of work and production activities at thesocial level continued to advance,and the logistics chain andsupply chain have been continuou

69、sly restored.Besides,China introduced more policies to help stabilize foreigntrade,which brought about impressive export figures in June exports soared by 22%year-on-year to RMB2.2 trillion,beating market expectations.The Regional Comprehensive Economic Partnership(RCEP)agreement,which entered into

70、force on 1 January2022,is the largest and most important free trade agreementin the Asia-Pacific region.RCEP promotes the developmentof cross-border trade between China and Southeast Asia interms of reducing cross-border transaction costs,improvingcustomsclearanceandlogisticsefficiency,reducingcompl

71、iance risks,accelerating the digital upgrade of cross-border e-commerce as well as improving infrastructure andsupportingservices.ItwillalsoencourageChineseenterprisesto getinvolvedin industrialshaping andS.F.Holding Co.,Ltd.2022 Semi-Annual Report18expanding on a more extensive scale,bringing enorm

72、ousdevelopment opportunities for the international supply chainbusiness of Chinas express delivery and logistics enterprises.Moreover,as the emerging markets in Southeast Asiahave a large population,including great numbers of youngandlow-costworkforce,theseregionshavehigherconsuming power and theref

73、ore have attracted substantialinflows of foreign capital.Driven by investment,the valueof merchandise exports to major ASEAN countries also grewto varying degrees.Southeast Asian is committed to low-endindustries and the terminal assembly and production links oftheindustrialchain,whileChinahasthemos

74、tcomprehensive industrial chains and the most advancedsupply chain infrastructure.The above strong and effectivecomplementarities,and in-depth cooperation between themin the future will effectively contribute to a new integratedsupply chain pattern of“China+Southeast Asia”.Asia Pacifics strategic po

75、sition in the global tradenetwork and the rise of local markets in the region areexpected to lead to long-term growth in cross-borderlogistics,contract logistics and freight forwarding market.Having taken the lead in establishing their own servicenetworks in Southeast Asian,and acquired the ability

76、toprovide logistics and freight services global wide with Asiaas the pivot,Chinese logistics companies are better equippedto grasp the development chances of the market in the bigpicture of industrial chain upgrading and migration.Theywill join hands with more Chinese brands to go abroad andhelp res

77、hape the supply chain of multinational brands.Theyaim to create a stable,efficient,end-to-end internationalsupply chain and build the global presence for logisticsnetwork.S.F.Holding Co.,Ltd.2022 Semi-Annual Report19(II)The Companys Primary Business SegmentsSF Holding is the largest integrated expre

78、ss logistics service provider in China and the fourth largest in the world.Focusingon the ecosystem of the logistics industry,the Company continuously built on its service capabilities,and diversified its businesslines to include sub-sectors such as time-definite express,economy express,expedite del

79、ivery,cold-chain and pharmaceuticaltransportation,intra-city delivery,international express,international freight and freight forwarding and supply chain logistics,enabling it to provide customers with domestic and international end-to-end one-stop supply chain services.Furthermore,drawingon its exc

80、eptional technological research and development capabilities,SF is committed to building a digital supply chainecosystem and establishing itself as the global leader in smart supply chain logistics.S.F.Holding Co.,Ltd.2022 Semi-Annual Report20(III)An Overview of Business Development1.Working togethe

81、r to defeat the Covid-19 pandemicSince March 2022,the Covid-19 pandemic has posedgreat challenges to normal order in work and life and expressdelivery and logistics operations.Despite the severe pandemic,leveraging self-owned strong transportation infrastructure andefficient arrangement and deployme

82、nt,SF spares no efforts tomaintain a smooth and complete logistics service chain for bothtransporting and delivering daily necessities and anti-epidemicsupplies and for the normal operations of society and economy,attesting to its exceptional business resilience and technologicalinnovation capabilit

83、ies.We provide reliable and secure servicesespecially for high-priority operations such as last lag(e.g.“lastmile”and“last 100 meter”)delivery,making customerssatisfied and building trustworthiness in our communities.Leveragingairtransportcapacitytosupportpandemic-struck areas:As the Covid-19 outbre

84、ak hit Jilin inMarch,the Company urgently started“Chongqing-Changchun”flight to promptly deliver nearly 300,000 disposable virussampling tubes to Changchun.After the Covid-19 outbreak inHong Kong,the Company mobilized 747 and 767 seriesairplanes to travel the shortest route from Shenzhen to HongKong

85、,transporting and delivering over 5,500 tonnes of anti-epidemic and living supplies for Hong Kong.In addition,asShanghai was under a lockdown in April,the Companylaunched an emergency air route to provide fresh food forShanghai,transporting and delivering 400 tonnes of beef andmutton from Inner Mong

86、olia to Shanghai.In addition,theCompany also started an airline route from Chongqing toShanghai to transport anti-epidemic supplies,including nearly5 million Covid-19 testing reagents.By the time of Shanghaislockdown was lifted,41 flights of SF had traveled to Shanghai,transporting over 900 tonnes o

87、f materials.Mobilizing transport capacity to carry donations fromall over China:SF assembled large fleets of over 100 vehiclesto transport donations from Fujian,Anhui,Qinghai,Hainan,Hebei,Jiangsu,Ningxia,Hubei and other areas to citiesaffected by Covid lockdowns.Such vehicle fleets ran aroundthe clo

88、ck to ensure the end-to-end cold transportation of freshfood.Making positive commitments to guarantee supplylogistics for peoples livelihood:In mid-April,SF,as alogistics enterprise committed to ensuring the supply ofmaterials in Shanghai,set up four transfer stations,includingPinghu in Zhejiang,Kun

89、shan in Jiangsu,Xijiao and Jiangqiaoin Shanghai,with the support of the government.Materialsfrom various areas were transferred to designated places inShanghai through“contactless drop and pull”transportation attransfer stations.During the period,a total of 1,777 vehiclesand 29,500 tonnes of materia

90、ls were transferred.Meanwhile,SF helped Shanghai Vegetable Group(上海蔬菜（集團）有限公司)to deliver supplies directly to 16 districts in Shanghai ona point-to-point basis,completing the transportation of nearly1,500 tonnes involving over 160 trips.Besides,SF Cold Chainalso connected and cooperated with eight d

91、omestic vegetablebases,utilizingresourcesofcoldchaintoensurethetransportation and delivery of various types of vegetablesupplies.Flexibly coordinating with network resources to ensuresupply chain operations:Against the background of frequentresurgence of the pandemic,brand customers tend to have ahi

92、gherdemandforcoordinationofnationalwarehouseS.F.Holding Co.,Ltd.2022 Semi-Annual Report21networks for warehouse transfer and distribution.By virtue ofstrongnationalwarehousenetworks,SFcouldhelpe-commerce customers to complete a shift in delivery model intime,and minimized the risk of business suspen

93、sion forcustomers through immediate warehouse transfer and flexiblewarehouse distribution.By the end of June,we had guaranteedsmooth delivery for more than 180 e-commerce customersaffected by the pandemic.Moreover,as the first enterprise to resume businessoperations in Shanghai Waigaoqiao Free Trade

94、 Zone,SF DSCmobilized more than 800 front-line employees working on site.During the period over 70 days under closed-loop management,SF DSC supported more than 50 major customers specializingin pharmaceutics,daily necessities,automobile,high-tech andother businesses to operate continuously and smoot

95、hly,andthus received appreciation and praise from global customers formore than 40 times.Besides,in order to ensure customersfoodcold chain supply,New Havi started the national emergencycoordination mechanism and mobilized resources from Jiangsu,Fujianandotherprovincesandcitiestocompletethedistribut

96、ion in areas previously served by Shanghai LogisticsCentre with high quality.New Havi was also praised bycustomers for its flexible and quick emergency supportcapability.Persevering with last mile delivery to meet peopleslivelihood needs:Whenever lockdowns caused by unexpectedCovid-19 outbreaks,some

97、 delivery staffs of SF would alwaysvolunteer to set up teams or actively respond to the call forvolunteers.They worked in harms way to support nucleic acidtests,loading,unloading and sorting of daily necessities,anddeliver packages for the last mile.Sometimes they had to sleepon the ground and live

98、in cars,but they still struggled day andnight with a fearless heart.They made continued efforts toprovide services for citizens in need,and even purchased anddelivered living materials for the community at their ownexpense.These courageous and unsung heroes are real andvivid examples that reflect wh

99、at culture,values and belief allthe staff of SF adhere to.In fighting against the pandemic,nearly 10,000 volunteersfrom SF successively joined the supply and delivery teams invarious areas affected by Covid lockdowns.To support front-line staff,the Company provided logistics support,includingfood an

100、d accommodation,and additionalincentives andsubsidies.Acting as the“blood vessels”in the cities,SF Intra-Citycollaboratedwithlocalgovernmentsandsupplycompanies to sort and distribute subsistence supplies in Covid-affected areas,supported the distribution of food,dailynecessities medicines,and person

101、al items to local residents,andassisted in the collection and transportation of testing reagentsfrom community nucleic acid sampling points.Moreover,thepersonalerrands,countersigningservicesandbusinessdocument distribution provided by SF Intra-City effectivelysupport the normal work and meet the liv

102、ing needs of theepidemic sealing and control areas.Developing the high-tech anti-pandemic 2.0 model:1Unmanned aerial vehicles:The Company developedmultiple air transportation lines for unmanned aerial vehicles torealize contactless transportation of nucleic acid samples,emergency medicine,fresh food

103、 and othermaterials.Acomplete set of fully standardized operating procedures wererolled out based on trial operations in Shenzhen,and were thenappliedinShenzhen,Taizhou,Zhejiang,HangzhouandShanghai,etc.Theunmannedaerialvehiclesprovidedtransportation supports on a 24/7 basis to fight the pandemic.Inp

104、articular,more than 30 unmanned aerial vehicles weredeployed to help fight the pandemic in Shanghai,flying about700 hours and transporting more than 7,000 kg materials.S.F.Holding Co.,Ltd.2022 Semi-Annual Report22Unmannedvehicles:Anunmannedvehicledistribution solution covering three application scen

105、arios buildings,industrial parks and transit depots was developedto provide automatic delivery services for terminal logistics.Featuring industrial-grade mapping and positioning technology,the UAVs are capable of autonomously avoiding obstacles withhigh precision.The vehicles are interconnected and

106、coordinatewith each other,enabling automatic scheduling and recharging24 hours a day,and they can also ride lifts to perform in-building delivery.During the critical period of the pandemic,we provided safe and convenient logistics services for teachers,students and local residents through“contactles

107、s”delivery.“Fangyikong”:“Fangyikong”operations based onblockchaintechnologywerelaunchedtohelpsharedisinfection data of millions of waybills per day across thelogistic chain.In cooperation with official authorities,thedisinfection data of each package in the entire process fromcollection to delivery

108、is notarized and uploaded to the chainand recorded.Furthermore,electronic data is cured in real timeto ensure the credibility of the records,allowing consumers toview the disinfection and information uploaded on the chain.This measure irons out users concerns over Covid-19 infectionin receiving and

109、sending packages.Implementing end-to-end package disinfection on acomprehensive scale:“Full stack”disinfection management for epidemicprevention:Gantries were used to disinfect vehicles at transitdepots and automatic disinfection spray equipment was used todisinfect shipments one-by-one Disinfection

110、 systems coveringimplementation,earlywarning,visualmonitoringandinformation traceability operations were built at terminaloutlets,focusing on four aspects that is,people,packages,vehicles and sites.In particular,the task implementation rate ofdaily pandemic-prevention disinfection is 100%,and 100%of

111、outlets are equipped with backpack sprayers and automaticdisinfection machines.Tighteningtheclosed-loopmanagementandcontrol of international packages:International shipmentsimported are stored for disinfection at their first station afterentry.In the 13 first transit depots,special areas are arrange

112、dfor centralized disinfection at least twice per day.Parcels arestored for more than 168 hours before they can be released.Inaddition,with 16 flow lines sorted out and determined,anoverall arrangement is made for international bulk cargoes toensure centralized management for international parcels af

113、terarriving at the port in various regions and minimize in-transitrisks.Withimprovedcapabilitytodealwithvariousemergencies amid the pandemic,SF has precipitated a morediverseandenhancedmechanism,pushingforwardtheCompanys standardized business operations and intensivemanagement.S.F.Holding Co.,Ltd.20

114、22 Semi-Annual Report232.Customer operation1TheCompanycontinuestoimproveitscustomermanagementsystembasedoncustomerstratificationtoenhance its differentiated service competitiveness and operationefficiency.I)Credit account clients(corporate clients)As of the first half of 2022,the number of active cr

115、editaccount clients2amounted to approximately 1.75 million,anincrease of over 100,000 from the beginning of the year.(1)SKA(strategic key accounts):We focus on team basebuilding,differentiatedassurancemechanismaswellascapability improvement and reuse to achieve operating resultswhile improving servi

116、ce quality at the same time,driving ashift in our strategic customer teams from management towardoperation.Strengthening team base:We continue to improve theSKA exclusive service team by bringing in human resourcesfrom external sources and through internal selection,and createan iron triangle operat

117、ion mode combining business,operationand maintenance,and solution.Moreover,we continuouslyimprove the supporting and monitoring mechanisms to promotethebusinessofSKAcustomerbase.Developingdifferentiatedassurancemechanism:Weintegratetheadvantageous resources across various organizations within theGro

118、up,and establish differentiated assurance mechanisms forSKA covering various aspects such as operation capacity,serviceguaranteeduringpeakperiods,technologyempowerment and green channel,so as to promote the overallcapabilityoftheGrouptoserveSKA customers.Improvingandreusingcapabilities:Byrefiningand

119、extracting the operation and maintenance,solution,technologyand business capabilities in serving SKA customers,weacquired multiple exceptional capabilities and reused them onmore customers,leading the overall improvement of theGroups capability.Exploring in-depth core businessscenarios:By sorting ou

120、t the business scenarios of SKAcustomer base,we expand and deepen the existing corebusiness scenarios and reproduce them among customers of the1The statistics in this section do not include the customer data of SF DSC,New Havi and Kerry Logistics,which are acquired by the Company.2The number of acti

121、ve credit account customers is derived from the numberof customers with whom the Company has signed credit account agreementsand who had business cooperation with us as of June 2022.same type.We also prepare resources to facilitate core supplychain scenario development for certain customers,and prom

122、otebreakthroughs in some new projects by value guidance andactive participation.(2)KA(key accounts):In respect of mechanismimprovement,we promote the implementation of CRMmechanism,standardize the customer decision review process,andgraduallypromotethestandardizationofbusinessopportunity management

123、and healthy delivery.As regardsbusiness expansion,we focus on major customer bases,analyze customers status in complex scenarios and identifybusinessopportunitiesbasedonthemulti-dimensionalcustomer review model and KA customer operation planningtools.Moreover,we fully leverage the Groups resources a

124、ndcapabilities to support multi-scene portfolio sales by buildingan iron triangle and developing solutions,as well as to achievecontrollable and predictable business opportunity delivery,soas to enlarge our customer base.In respect of managementimprovement,we continue to build on our four primarycap

125、abilities “customer management,demand management,risk management and team management”,to support ouroverall work.(3)SME(small and medium-sized enterprises):Inrespect of sales capability,we improve our comprehensivecapabilities of SME customer managers and implement a saleselitism strategy on a regio

126、nal basis to achieve a significantincrease in per capita revenue generation,while ensuring ourmarket share at the same place;In respect of businessexpansion,we have a clear lead in new business and multi-scenario development,and acquired 45,000 new contractualSME customers,contributing 12.8%of total

127、 revenue generation.We also explore the upstream and downstream supply chainand multi-scenario business of our existing customers to helpthem grow,which improves customer loyalty and satisfaction,and our existing customers have achieved better revenuegrowth year-on-year.Through exploring new busines

128、ses andnew application scenarios,and expanding business field,wehave improved our customer loyalty,and our efforts to developcustomers into high-value potential customers have contributedlong-term value to the Company.II)Retail customers(individual customers)As of the first half of 2022,the number o

129、f individualmembers amounted to 537 million,adding more than 46S.F.Holding Co.,Ltd.2022 Semi-Annual Report24million from the beginning of the year.We increased touchpoints with retail customers through multiple channels,onlineand offline,to ensure the growth of our retail business:(1)Online:SFoperat

130、esmultiplecontactchannelsincluding Wechat/Alipay/Baidu app,etc.and each mobile brandapp.On the one hand,the Company continuously improve itscoverage of external cooperation channels,expanding morecooperation scenarios and functions such as student zone andnew version of gift delivery,among which new

131、 users onWechat/Alipay/Baidu have reached 33 million in the first halfof 2022,with over 14 million daily active users.On the otherhand,the Company focuses on building the channel of SFExpress app,launching multi-language and senior-friendlyversions and integrating more service capabilities.As of the

132、end of June 2022,the daily active app users of amounted to2.356 million,up 11.1%from the beginning of the year,and theaccumulated registered app users amounted to over 65 million,adding more than 13 million from the beginning of the year,with daily active users reached 2.35 million.SF Express App is

133、gradually becoming one of the most preferred core channels forusers.(2)Offline:Scenarios:We provide a diverse range ofservices based on the needs of customers daily consumptionscenarios,including return service for online shopping,homedelivery service,luggage delivery,family delivery,publicwelfare d

134、elivery,airport/high-speed railway station self-serviceand Hive Box laundry,etc.Channels:We expand offlinechannels such as self-owned outlets,urban stations,ruralstations and regional agents to improve the density of endchannels,and as of the first half of 2022,there were over152,000 various co-oper

135、ated terminal outlets.In particular,theoutlet coverage rate in rural areas rose by 0.6 percentage pointsyear-on-year.Through online and offline management system,we reachcustomers through online channels in a well-targeted fashion,and strengthen the attraction of new customers and theretention of re

136、turned customers,enlarging our customer pool;in offline channels,we segment business scenarios and expandoffline channels to stimulate individual user activity andincrease package-delivery frequency.S.F.Holding Co.,Ltd.2022 Semi-Annual Report253.Business developmentI)Time-definite expressAs of the f

137、irst half of 2022,the Companys time-definite express business achieved tax-exclusive operatingrevenue of RMB49.26 billion,up 5.1%year-on-year.Time-definite business was under pressure from March to May due tothe substantial impact of the pandemic in first-tier cities such asBeijing,Shanghai and Shen

138、zhen.However,as society resumedwork and production,the growth rate of time-definite expressrevenue increased in June and gradually recovered since then.In the first half of the year,the Company continued toconsolidate and improve the competitiveness of time-definiteservice,optimizing the order fulfi

139、lment rate of time-definiteserviceandreducingcoststhroughair-groundnetworkintegration,optimization of transit mode and collection anddistribution mode,and improvement of operation capabilities inbothcollectionanddistributionoperations.Despitethelockdown during the pandemic,the order fulfilment rate

140、oftime-definite service still increased by 1.1 percentage pointsyear-on-yearThe Company continues to expand the ultimate time-definite service and fully promotes“exclusive expedite delivery”to achieve cross-provincial delivery within 7 hours nationwideso as to meet customers needs for bulk air trans

141、portation underthe high-end industrial chain and JIT production and circulationmode.Such service has been rolled out in 73 cities.In addition,based on the competitive advantage of bulk collection scenario,the time-definite express business was expanded to coverreverse logistics and e-commerce return

142、s.The Companyactively expanded cooperation with major mainstream andemerging e-commerce platforms,leading to rapid growth of thereturns delivery business and enhanced stickiness of bulkorders.Ezhou Huahu Airport was put into operation on 17 July.For freight transport,two routes,namely Ezhou-Shenzhen

143、 andEzhou Shanghai,have been launched in the first phase.Forinternational routes,Ezhou-Osaka and Ezhou-Frankfurt,willbe launched later this year.The future operation of the airportdistribution hub will enhance the Companys domestic time-definite service coverage and international air freight network

144、,bringing more business growth.II)Economy expressAs of the first half of 2022,the Companys economyexpress business achieved tax-exclusive operating income ofRMB11.81billion,down7.3%year-on-year.Thee-commerce-oriented concessionary special delivery businesswith a low gross profit margin has been grad

145、ually phased outamid product restructuring carried out based on the Companysdifferentiated competition strategy.After the optimization,theservice and pricing tier of the products and the distinction ofthe operating model are clearer,promoting the profitability ofeconomy express.(1)Directly operated

146、brand serviceWe continuously optimize the product structure of directe-commerce express service focusing on“e-commerce standardexpress”,and continuously improve the performance capabilitythrough optimizing our operation mode.The order fulfilmentrate of time commitment of e-commerce standard expressi

147、ncreased by 2.6 percentage points year-on-year.In the context of slowing consumption growth andintensifying competition resulting from the pandemic,variouse-commerce platforms are increasingly aware of the importanceof the stable operation of the logistics system and excellent userexperience.By segm

148、enting business scenarios,using multi-level e-commerce warehousing resources combined with thehigh-quality and time-efficient performance capability of e-commerceexpressproductsandindependentmarketpositioning,the Company partnered up with major e-commerceplatformsinwarehousinganddistribution,andstea

149、dilyimproved the scale of e-commerce express business.In termsof product efficiency,through internal intensive management,the Company maintained the healthy development of the e-commerce express business,and continuously improved theprofitofitse-commerceexpressproducts,improvingprofitability signifi

150、cantly year-on-year.(2)Franchise brand serviceIn the first half of 2022,Fengwang Express built on itsnetwork roll-out,with operations in 229 cities of 19 provinces,and two municipalities directly under the central government,1,671 franchised outlets established,attesting to solid growth inits busine

151、ss volume.S.F.Holding Co.,Ltd.2022 Semi-Annual Report26Fengwang produces strategic synergies and businessintegration with SFs directly operated network.In respect ofsales,thetwosidesprovideeachotherwithbusinessopportunities and traffic generation,and Fengwang takesadvantage of the high density of fr

152、anchise terminal outlets inrural areas to help quickly generate revenue for the freshagricultural product express business.In respect of branchroute,the Company promotes branch route integration in 76cities,reusing the resources of directly operated branch routesto increase the frequency of Fengwang

153、s bulk delivery,andfranchisees pick up goods at the nearest directly operatedoutlets.In doing so,the distance of the branch route toFengwang has been shortened,and the loading rate of operatedbranch routes has increased.In respect of distribution,duringcollection,we use certain distribution sites of

154、 Fengwang on atrial basis to help collect and deliver packages in SFs directlyoperated network,the integration and collectively planningroutes of trunk lines,and the reuse of the resources of expresssites in bulk delivery.In respect of delivery,Fengwangstrengthens the terminal outlet self-delivery r

155、ate the self-deliveryratewascontinuouslyincreased,reducingthedependence on direct-operated network delivery and theCompanys delivery costs.The overall operating efficiency ofFengwang has improved consistently.(3)Integrated warehousing and distributionSFprovidesmulti-levelnationalwarehousingandwareho

156、using-distributionservices,includingcustomizedwarehouses,standard warehouses and economic warehouses,catering to the needs of clients at different levels in the e-commerce market.Through the self-operated network andfranchising,the Company operates more than 390 e-commerceclass warehouses in nearly

157、100 cities across China,with a totalfloor area of more than 5.6 million sqm.Meanwhile,with theassistance of digital technology,we helped clients conductautomated warehouse allocations nationwide to improve theirwarehousing and ensure highly efficient fulfilment of orders.During the“18 June”e-commerc

158、e shopping season this year,the number of warehouse orders received exceeded 28 million.Despite the peak orders 10 times higher than regular number,more than 90%of orders were accurately delivered within 24hours.In the first half of 2022,we focused on enhancingwarehousenetworkservicecapabilitiesandi

159、mprovingefficiencyofwarehouseanddistributionoperations:Network coordination:continuously optimizing the structureof the warehouse network and promoting the integration ofsites,having integrated more than half of the self-operatedwarehouse sites with the sites of express,freight and FengwangExpress;M

160、ulti-level services:combine different internaland external warehousing+distribution resources to meetcustomerslayereddeliveryfulfillmentandcostneeds;Improvingoperationalefficiency:Throughinitiativesaimed at improving operational efficiency,introducing newbusinesses to use empty warehouses and retiri

161、ng inefficientequipment,wecontinuedtooptimizelabor,spaceandequipment costs and improve the cost effectiveness of ourproducts and the profitability of warehousing services.III)FreightIn the first half of 2022,the Company registered tax-exclusive revenue of RMB13.15 billion from economyexpress busines

162、s,representing a year-on-year increase of1.6%.As affected by the pandemic in China and globalgeopoliticalconflicts,themanufacturingindustryfacedpressure from rising prices of raw materials,disruptions togoods flow and weaker demand for goods flow in the first halfof 2022.In addition,energy prices re

163、mained high and fuel costsrose significantly.The economy express was confronted withvarious challenges including decreased market volume,highercost and lower profit.Against such severe external environment,SF Expressemphasizes self-improvement more than ever:With dedicatedefforts to provide“fast,div

164、erse and professional”services,weclassify large-size parcels and improve delivery efficiency,broaden service scenarios around B2B clients,build ourprofessional capacity in large-size parcels service,and improveour overall competitiveness and customer experience.In thefirst half of the year,our NPS(c

165、ustomer net promoter score)increased,ranking No.1 in the industry.(1)Focusing on“quick”to ensure punctuality-basedcompetitive In terms of products,the“standard express service”has been upgraded to SF Trucks,a type of truck transportationS.F.Holding Co.,Ltd.2022 Semi-Annual Report27service offering m

166、ore reliable delivery time and faster speed;the special route regular shipment products have been mergedwith SF Express truck-road transportation products(classifiedas economy express services),focusing on bulk shipmentorders such as e-commerce home appliances and furniture andspecialized large-size

167、 products.By splitting the collection anddistribution schedules of distribution sites and distributionstations,we collect goods in advance and increase thefrequency of trunk routes-based service,shortening the deliverytime by 20%for short-distance transportation;Arrangingvehicles depictured in advan

168、ce and serving core customers viadirect routes,we increase efficiency at every step,shorteningthe delivery time by 4%for the transportation of large-sizeparcels through trunk routes.The overall delivery time of large-size products has been shortened to less than 40 hours,givingthe Company a lead in

169、the industry.(2)Buildingourstrengthinserving“broader”scenariosWe extend the scope of large-size parcels services to coverpersonal and commercial scenarios as well as manufacturing,agricultural,raw material fields and other scenarios,whileexpanding other business scenarios,including full-truck-loadtr

170、ansportation,urbandistribution,andwarehousinganddistribution of large-size parcels to provide one-stop service forcustomersby combining multiple products to meetthepersonalized and differentiated logistics delivery needs of B2Bclients.Revenuesgeneratedfromcoreindustrialzonesincreased in the first ha

171、lf of the year,and customers wereempowered to improve operating performance by our efforts inthe industry.(3)Improving“professional”services oriented towardB2C and B2B scenarios1 1B2C scenarios:focused on building on homedelivery and“delivery and installation”service capabilities.The home delivery s

172、ervice added new items of services such aswooden frame dismantling,start-up inspection,unpacking andplacement,and installation.The“delivery and installation”service added double-person delivery service in the core area.In the first half of the year,the“delivery and installation”orders increased by 1

173、59%year-on-year;B2B scenarios:Improve our professional services such as wooden packaging,warehousing,night collection and night delivery.For collection,we can 100%ensure parcel collection in core industrial zonesat night,and provides high-quality wooden packaging.As fordispatching,we provide dedicat

174、ed services for warehousingdemand,enhancing professional capabilities to build service-based barriers.(4)Advancing the integration between small parcelservice and large-size parcel service to increase efficiencyand reduce costIn terms of distribution,we promote the segregation oflarge and small parc

175、els in an orderly manner,with high-kgexpress parcels gradually allocated to large-size parcel transitdepots for sorting,so as to improve the scale efficiency oflarge-size parcel transit depots,and release the capacity ofsmall parcels.In terms of lines,we take into account both speedand cost reductio

176、n,with trunk lines increasing frequency,transit depots and collection and distribution station schedulesachieving two sets of three dispersals,increasing the rate ofnext-day and two-day delivery,and at the same time integratingwith the franchised network SX Freights lines to improveloading rates.(5)

177、A stable and growing franchise network withincreased market shareSX Freight franchise network continued to expand itsbusiness scale,with a growth rate of over 30%attained in thefirst half of the year.It maintained a relative fast growth amongits franchised peers and improved its market share ranking

178、,with the number of franchised outlets increasing to 15,000+.Through the adoption of policies linking service quality topricing,and terminal service quality to dispatching charges,thenetwork structure was optimized to improve the stability ofoverall service quality and user experience.IV)Cold chain

179、and pharmaceuticalsIn the first half of 2022,the Company registered tax-exclusive revenue of RMB4.07 billion from the cold chainand pharmaceutical business,representing a year-on-yearincrease of 9.3%.In terms of policy making,the national ministries andcommissions have introduced a number of policie

180、s and plansfor agricultural product cold chains,national backbone coldchain logistics bases,urban and rural cold chain development,and pandemic elimination and inspection,to improve the coldS.F.Holding Co.,Ltd.2022 Semi-Annual Report28chain standards and accelerate the development of cold chains;In

181、respect of market development,with the rapid growth ofdiversified fresh food e-commerce,the trend of online andoffline omni-channel expansion has been strengthened.Thismarket trend will mainly benefit cold chain service providersbased on network,with high-quality and strength.With thenational leadin

182、g network-integrated comprehensive cold chainlogistics capabilities,SF Cold Chain is expected to seize moremarket opportunities in the competition.(1)Shipment of fresh foodIn the first half of 2022,the upstream service network ofagricultural products assisted by the Company has coveredmore than 2,80

183、0 county-level cities and more than 4,000 freshproducts across the country.Service optimization:ouraviation,cold chain warehouses,truck-road transportation anddelivery were integrated with external partners resources toserve a broader agricultural product market with improvedcost-effectiveness;Brand

184、 building:In cooperation with thegovernment of place-of-origin,special funds were subsidized tothe customization of regional brand packaging materials to helpbuild13regionalbrandsofagriculturalproducts;Technology empowerment:Convenient technology toolssuch as Xiaoguoguo management system,Fengshou an

185、d dropshipping were researched and invested to help farmers sell,deliver and settle.(2)Food cold chainOptimize product system.The original cold chain LTLproducts were upgraded to“cold chain large-size parcelstandard express”(20 kg-500 kg,multi-batch,small-batch,door-to-door)and“cold chain large-size

186、 parcel to the port ofdestination”(over 500 kg,cross-city,warehouse-to-warehouse)respectively,the operation mode and service area separationwere optimized to meet the differentiated needs of customers.Improve cold chain capabilities.Consolidate thebackbonenetworks:The“3+1”(warehousenetwork/trunk/las

187、t-leg distribution+inter-provincial network)backbone networks for cold chain were improved.Through thedynamic adjustment of warehouse-trunk distribution network,customers can be guaranteed to realize multi-channel stabledelivery under the uncertainties brought by the epidemic.Boost local economic gr

188、owth in places of origin of freshfood products:Through the direct delivery mode of cold chaintrunk network,we transported fresh food from the place-of-origin to sales area in an efficient and economical way tooptimize the cost structure and help cover more fresh products;Expand international transpo

189、rtation of cold chain-involved food:We have established a sea and air cold chainlogistics infrastructure for cross-border popular routes toprovide domestic and foreign customers with fresh cross-bordertransportation solutions.At present,nearly 1,000 tonnes ofhigh-value products such as durian in Tha

190、iland and seafood inDhaka have been shipped.Establish quality standards.A sound food cold chainqualityandfoodsafetymanagementsystemhasbeenestablished.We actively work with relevant governmentdepartmentsandindustryassociationstoformulateandimplement international,national and industry standards forfo

191、od cold chain logistics.(3)Pharmaceutical logisticsWith the rollout of national policies related to thepharmaceutical industry such as centralized procurement,distribution cycle shortening and internet healthcare promotion,the pharmaceutical supply chain has become increasinglycentralized,flat,digit

192、alized and intelligent.Leveraging our“network+technology”strengths,wehavemadebreakthroughs in the following areas:1 1Expand the IVD(in vitro diagnostic product)market:In the first half of the year,we ensured thetransportation of the first batch of Covid-19 antigen detectionkits in China,and the cumu

193、lative transportation exceeded 1million doses;with respect to warehouse,we cooperated withIVD manufacturers to realize the construction and operation ofthe general warehouse for finished products;we integrated withKerry Logistics to break through the IVD Hong Kongpharmaceutical sub-warehouses busine

194、sses(15-25/2-8/-20),so as to realize the strategy of distributing from HongKong sub-warehouses to the world.Ensure vaccinetransportation:Since the first service provided,we havesafely delivered an aggregate of 568 million doses of Covid-19vaccines,including 196 million doses in the first half of 202

195、2;and we optimized trunk-warehouse distribution mode ofvaccines to respond to the market demand for vaccines inSouthwest and Northwest China at a faster pace.Onlinepharmaceutical service:By setting up a unique temperature-controlled transportation mode for pharmaceutical e-commerceS.F.Holding Co.,Lt

196、d.2022 Semi-Annual Report29platform merchants and self-operated store merchants,weprovided a standardized and precise temperature deliverysolution for drugs to their customers.This will help theoperation of the B2B and B2C scenarios of pharmaceutical e-commerce in multiple regions;in addition,we hav

197、e brokenthrough Internet hospital DTP project to achieve multi-locationand multi-hospital online operation,providing a safe andefficientpharmaceutical-to-homeserviceexperienceforchronically ill patients.Build on cold chain capability:Weutilized science and technology to facilitate the efficientcoord

198、ination of various transportation capacity resources,expanded internal and external transportation capacity reservesto improve the efficiency and resilience of transportationcapacity supply under the pandemic;meanwhile,we gatheredrailwaymultimodal transport resources to accelerate thedevelopmentofdo

199、mesticpharmaceuticalcoldchaintransportation network;in cryogenic field,we broke throughthe-80 temperature-controlled reagent transportation in theClinical Inspection Centre of the Ministry of Health,which ishelpful to strengthen the cryogenic service capacity.V)Intra-city on-demand deliveryIn the fi

200、rst half of 2022,the Company registered tax-exclusive revenue of RMB2.87 billion from Intra-city on-demand delivery business,representing a year-on-yearincrease of 28.2%.As a third-party on-demand delivery service provider,SFIntra-City adopts a business model covering all scenarios suchas local cate

201、ring,local retail,local e-commerce and localservices,as well as a differentiated performance networkcapability covering the whole country.Driven by the above,SFIntra-City caters for the varying on-demand delivery serviceneeds of merchants in different industries and retail consumersunder the new con

202、sumption trend.Among them,personalservice,non-catering scenarios and the continuous expansion oflower-tier cities and counties are the main driving forces.(1)Explore“new consumption”service scenarios tomaintain a stable business growthSF Intra-City empowers merchants by virtue of its openand inclusi

203、ve on-demand delivery network and professionaland comprehensive distribution solutions,which can meet theneeds of brand customers,small and medium-sized merchantsand retail consumers in various ways.During the 12 monthsended on 30 June 2022,the annual active merchants of SFIntra-City has reached 299

204、,000,representing a year-on-yearincrease of 31%,and a total of 2,900 brand customers havebeen served.As for merchants,SF Intra-City continues to expand itscoverage and develop in-depth industry solutions.Its businessinvolves such services as supermarket retail hourly delivery,half-day delivery,last-

205、lag delivery of cold chain products,home delivery of groceries,new drug delivery,TraditionalChinese medicine(TCM)decoction and delivery,3C electronicdevice online repair and return,etc.For diversified trafficplatforms,SF Intra-City actively promotes ecological co-construction with major local life s

206、ervice platforms,especiallyfocusing on the cooperation of new business such as live-streaming e-commerce in real-time retail demand scenarios,soas to help the platform enhance user experience.Revenue fromlocal e-commerce scenarios increased by 104%year-on-year.For retail consumers,SF Intra-City grad

207、ually extends itsoperationsfromon-demanddeliveryservicetohighlydiversified,high-quality on-demand order fulfilment services,covering personal life and work scenarios such as lifeassistance,health care,and commercial agents.During thepandemic,SF Intra-City provided consumers with all kinds of“Purchas

208、e for Me,Solve for Me”services in their home life,and also supported their“remote office work”.In addition,SFIntra-City accesses local life service providers such as laundry,moving,hospitality,hospital accompanying and mobile phonerecycling in SF Intra-City Applet,so as to build a butler-likeone-sto

209、p service.Revenue from high value-added local servicescenarios increased by 48%year-on-year.(2)Continue to improve our science and technologysystem to achieve efficient scheduling in multiple scenariosWe continued to improve the three core functions in ourCLS system,including intelligent business pl

210、anning andmarketing management,deliverymen integration schedulingand intelligent order distribution,and intelligent operationoptimization.An efficient real-time order scheduling systemsupports complex distribution networks to achieve optimalmatching of orders and deliverymen.We attached greatimporta

211、nce to optimizing online process experience of usersand built a more convenient and efficient scheduling mode fordeliverymen,making it easier for them to accept orders andS.F.Holding Co.,Ltd.2022 Semi-Annual Report30serve customers,as well as reducing cost and enhancingefficiency at the same time.In

212、 addition,based on the neutral and open marketpositioning,we improved the capability for merchants toconnect order sources from different channels,platforms andprivate domains,and carry out intelligent distribution andintelligent,which would be the first choice of service providersunder the trend of

213、 multi-polarized traffic faced by merchants inthe future.(3)Consolidate the diversified transportation capacitynetwork,ensuring high-quality and stable deliveryWe continued to strengthen the transportation capacityinfrastructure of SF Intra-City,forming a nationwide integratedscheduling network.To f

214、urther consolidated our differentiatednetwork capabilities and product delivery capabilities,SF Intra-City has powered its delivery capacity of“two-wheeled+four-wheeled”vehicles to meet the needs of non-standard deliveryscenarios and all kinds of long-tail service such as longdistance,heavy weight,m

215、ulti-point delivery and errands.During the reporting period,with the percentage of orders formedium and long distance over 3 km increased,the averagedelivery time and the on-time delivery rate remained at a highlevel.Furthermore,fluctuations in peak-season order fulfilmentquality remained below 3%du

216、ring public holidays.Meanwhile,as the number of cities with night(24-hour)delivery servicesincreased,volume of orders at night continued to rise.In the first half of 2022,SF Intra-City constantly expandednew consumption scenarios,adjusted its business structure andincreased the shares of revenue gen

217、eration of high value-addedservice scenarios.Through achieving optimal efficiency of itscapacity network by the integration of science and technologyscheduling,and promoting resource utilization efficiency aswell as input-output ratio by continuous fine management andoperation,SF Intra-City has stea

218、dily improved its holisticefficiency.）Supply chain and internationalIn the first half of 2022,the Company registered tax-exclusive revenue of RMB46.53 billion from the supplychain and international business,representing a year-on-year increase of 442.7%.Since the fourth quarter of 2021,wehave merged

219、 Kerry Logistics into this business segment toscale up the Companys international business operations.(1)International expressAs of the end of the reporting period,business of SFInternational Express was operated in 84 countries and regionsaround the world,while its cross-border e-commerce servicesc

220、overed more than 200 countries and regions.Focusing onprocessstandardizationandsystemconstruction,theinternational express delivery business continued to improvethe competitiveness of its products.We consolidated theoperating foundation and tended to develop the market inSoutheast Asia to achieve st

221、eady operation of business.1 1Step up the construction of international airnetwork:We increased the number of flights of internationalcargo scheduled routes to 5-7 flights/week between China andSingapore,Malaysia,Thailand(新馬泰)and Southeast Asia.Meanwhile,we added new international routes such asShen

222、zhen-Hanoi,Wuhan-Osaka,Xian-OsakaandXian-Ulaanbaatar to improve the air layout of the internationalexpress delivery network.Create benchmark products inSoutheast Asia:We adopted the optimized collection modeduring the receipt period to upgrade the customers intelligentordering experience.For matchin

223、g the optimal timeliness andtransportation capacity,we integrated the transfer link in thetransfer section.Furthermore,we strengthened self-operatedcustoms clearance capabilities in the customs clearance processto improve efficiency.In addition,we strived to coordinate withKerry Logisticss local net

224、work resources in Southeast Asia inthe delivery link to optimize service standards.We aim to bringabout express timeliness equal to the international leadingexpress level in delivery of some Southeast Asian countriesthroughstableandefficientlinkcontrol.Buildoninternational operation capability with

225、technology:With theassistanceofintelligenttechnologiessuchasbigdata,intelligent algorithms and block chain,we further decoupledand optimized the operational elements of each part ofinternational logistics.As such,we achieved accurate planningand real-time management of international end-to-end routi

226、ngandfullyenhancedoperationalefficiencyandcustomerexperience.(2)International freight and freight forwardingThe Companys international business growth in revenueS.F.Holding Co.,Ltd.2022 Semi-Annual Report31and earnings was mainly driven by the international freightforwarding business.The Company has

227、 expanded its businessscale by measures such as tapping into complementary internalresources and through external integration and M&A deals,andsucceeded in achieving relatively fast earnings growth despitethe pandemic and uncertainties in the global environment.Earnings from Greater China accounted

228、for 28%of thebusinesss total earnings and 72%outside of Greater China,with the business focused on export markets inAsia.Leveraging the massive customer base of the domesticnetworkandthehigh-densitynetworkpenetration,theCompany has established an incentive mechanism and rolled itout in some business

229、 divisions to incentivize them to seizeopportunities in the international freight and freight forwardingbusiness,striving to acquire new customers and secure newcontracts.Inaddition,byintegratingthe resourcesandcapabilities of the international air freight business andintroducing clear division of l

230、abor in the organization,werealize the unified sales and promotion of the business.Goingforward,theCompanywillcombinetheneedsoftheinternational express and international freight businesses basedon well-coordinated planning,tapping into the full potential ofKerryLogistics exceptionalfreightbusinessvo

231、lumetoimprove the operational efficiency of international routeoperations.In addition,the Company has stepped up businessintegration of resources and capacities with Kerry Logistics interms of international express,international freight forwarding,etc.System integration:as regards system support by

232、SFTechnology for major customers along international express,freight forwarding operations have been integrated with thesystem,and the latest technologies are applied to helpstandardize and improve international business operations ofKerry Logistics in terms of SAP building abroad;Businessintegratio

233、n:through integration of resources and cross-selling,in addition to the international express business,the pair haskicked off partnerships in business areas such as bulk shipment,food cold-chain transportation,pharmaceutical logistics,andthe construction and implementation of overseas businesslogist

234、ics solution for major clients,jointly developing solutionsandlocalizedimplementationplansforcustomersbyleveraging the Companys resources.(3)Supply chain:In the first half of the year,although the supply chaincycle was blocked due to the pandemic,the Companyresponded actively and made every effort t

235、o ensure the smoothoperation of the supply chain of major customers.Customersupport:On the basis of strictly implementing the pandemicprevention policy,we will meet the needs of customers to themaximum extent,mobilize resources and transfer storagetimely around the pandemic areas to help customers r

236、esumework and production as soon as possible;Service expansion:SF DSC takes warehouse distribution service as the cornerstoneto expand the customer products and content covered by itsdiversified services,such as inbound,after-sales,bondedwarehousing,packaging and e-commerce,and meet the needsof cust

237、omers in all aspects of the supply chain;while New Haviactively explores the opportunities to extend its product lines tothe upstream and downstream of the food supply chain,developsnewcustomers,gainsmoreshareofexistingcustomerswithcost-effectiveintegratedsolutions,andincreasestheproportionofnewbusi

238、ness.Digitalempowerment:Internally,we connect the system database ofeach link,operate through technology empowerment,andimprove the degree of digital integration and overall efficiency;externally,according to the differentiated needs of industriesand customers,we quickly customize and provide smart

239、supplychain solutions for customers taking efficiency and cost intoaccount.In addition,we diversify technology products of theexisting supply chain to become a symbiotic partner on theroad of customersdigital transformation.S.F.Holding Co.,Ltd.2022 Semi-Annual Report324.Operation optimizationIn the

240、first half of the year,the Company stepped upoperation integration and innovation efforts,driving a shift inbusinessperceptionawayfrom“operation”toward“management”.To promote the revolution of the entire networkoperating mode,we focused on the optimization of the end-to-endoperationprocess.Inthepre-

241、planninglink,thetechnology-based intelligent operation model was used to helpestimate earnings and decide the optimal network planning andresource investment scheme.In the operation link,we definedaresource-inputstandardcenteredonproductsbystrengthening the integration of large and small networkreso

242、urces,flexibly integrating multiple networks.And in post-action link,we reviewed the effect of reform and the efficiencyof resource utilization,strengthened the LEAN management,and endeavored to improve the timeliness and quality of relatedservices while ensuring the optimal business performance.I)N

243、etwork coordination(1)Site co-construction:Efforts are made to improveoverall network planning and resource coordination.The transitdepots,collection and dispatch points and warehouses for smalland large-size parcels are arranged and constructed based onthree types,namely“the same site,the same park

244、,the sameregion”.As of the first half of 2022,totally 301 sites in first-tierand second-tier cities were integrated,182 sites in third-tier andfourth-tier cities were integrated,with a net decrease of 47 sites.Theincrementofsitesineachbusinesssegmentwasreasonably controlled to improve the utilizatio

245、n rate of sites.(2)Distribution integration:It is aimed to optimizeresource efficiency by flexibly integrating the transit depots.When the volume of goods decreased due to pandemiclockdown or when the volume of goods was in the trough onholidays,large and small parcels were handled in the same site,

246、the capacity of small sites was intensively utilized,and somesites for large-size parcels were suspended.The temporaryshutdown rate was increased by more than 20%compared withprevious year,and the per capita efficiency of distributionworkers increased by 8%.During the peak period of e-commerce promo

247、tion,the operation of large and small parcelsis separated to release the capacity of small-parcel sites.With adaily peak,78%of large-size parcels was separated andoperated in large sites,and we use Fengwangs capability ofsites division to improve the operation capacity of warehousenetwork and reduce

248、 the input of temporary sites during peakseasons.(3)Route optimization:We precisely invested in thetransportation capacity based on business conditions,reducedthe inefficient lines,and integrated 934 lines of large and smallparcels.We promoted the outsourcing suppliers to join acommunityofinterestsb

249、yoptimizingthebiddingandsettlement mode for outsourcing trunk lines,and take theinitiative to improve the loading rate.We continued to optimizethe planning of the land network,adding 107 direct trunk linesand increasing transportation frequencies for 741 transport linesamong our existing lines.We gr

250、adually broke the restrictionthat adestination transitdepotisonly responsible fordistributing local parcels under the original mode.Based on theoptimal distance,we can distribute parcels across regions,reducing the detour of land transport parcels,and improved theland network timeliness.The accrual

251、model of self-employeddriver was changed for branch lines,which not only improvesdriver efficiency and average return but also saves unit costs forbranch lines.In addition,we took advantage of spare resourcesof branch lines to assist good distribution of Fengwang Expressnetwork.With the implementati

252、on of various measures,thesmall parcel loading rate of trunk lines increased by 9percentage points(that of large parcels by 3 percentage points),and the average load of a single vehicle increased by 9.6%year-on-year.These efforts eased the pressure from the risingtransportation cost due to the risin

253、g oil price and pandemiclockdown.(4)Network co-construction:We built 242 integratednetworks which can handle both small and large-size parcels,optimized the resource construction of terminal networks,andreduced the input cost of sites and personnel.In addition,welaunched an operation mode coordinati

254、ng small and large-sizeparcel couriers in integrated network at several single regions.Leveraging the connection ability of large-parcel couriers andincreasing the time small-parcel couriers spent to receivecustomers,we give full play of the role of sales personnel tohelp increase income and optimiz

255、e costs for connecting branchline.S.F.Holding Co.,Ltd.2022 Semi-Annual Report33II)Terminal optimization(1)Network model reform:The package sorting processhas been moved from warehouses(as is the case withconventional outlets)to transit depots.We enhance our sortingcapability of transit depots,increa

256、se small terminal stationscloser to the clients(including operating stations,servicecenters,and cooperation),and promote direct sorting at thetransit depots and distributing to small terminal stations,so asto simplify the functions of traditional outlets,reduce sites andpersonnel costs,save the roun

257、d-trip time deliverymen need andimprove the capacity of receiving customers.In the first half of2022,4,518 traditional outlets have implemented the abovemodel reformation,adding 1,395 small terminal stations.At thetransit depot stage,35%of the shipments were sorted directlyin small terminal stations

258、,with 56%of the shipments directlyshipped to the small terminal stations from transit depots,which reduced the site area by 100,000 sqm in the first half ofthe year.(2)Deliverymen management:Visualized evaluation:We continue to promote the online evaluation system of servicequality,analyzedtheservic

259、eevaluationindicatorsandgradually launched it online.We provide deliverymen withbetter remuneration and treatment based on the score to guidetheirindependentserviceconsciousness.Protectingdeliverymen rights and interests:Depending on such factorsas nature,difficulty,time consumed,the deliverymen fee

260、 ratefor the collection and distribution is priced based on laborintensity.And we have dynamically adjusted the fee rate manytimes for areas where deliverymen earns low incomes,facehigh difficult tasks,and have medium-high turnover-rate toensure an attractive salary for them.Improving skilltraining:

261、In the first half of the year,more than 89,000 newdeliverymen received online training;449 online courses wereoffered for on-job training,and more than 44.62 milliontraining opportunities were provided,and 600,000 intensivetraining opportunities were offered to employees who face skillweakness.S.F.H

262、olding Co.,Ltd.2022 Semi-Annual Report34II.Core Competitiveness Analysis1.Efficient and reliable global logistics infrastructure networkS.F.Holding Co.,Ltd.2022 Semi-Annual Report35SF partnered up with the government to build Ezhou HuaHu Airport,which is the first cargo hub airport in Asia and the f

263、ourthin the world.The airport completed its test flights in March and was officially put into operation on 17 July.For SFs airport transfercenter project,the construction of steel structure and concrete structure is completed,and the roof and curtain wall installation hasbasically been completed.It

264、is planned to complete the installation of equipment in the third quarter,start joint commissioning in thefourth quarter,and make it available for operation at the end of the year,with relevant functions gradually enabled.Two flight routes,namely Ezhou-Shenzhen and Ezhou-Shanghai,have been launched

265、for cargo transportation at the first stage.Within this year,international air lines,Ezhou-Osaka and Ezhou-Frankfurt will be launched.After the transfer center being put intooperation,the Company will gradually plan and adjust the air network to build a hub-and-spoke air network,which is expected to

266、further increase cities covered with high time-definite services and reduce the unit cost of aviation by adding large aircraft.In addition,as a core air freight hub,the 1.5/2-hour flight from Ezhou HuaHu Airport can cover an area accounting for 90%ofthe national economic population.The airport city

267、is expected to introduce high-end manufacturing,biomedicine,fresh cold chain,cross border e-commerce,electronic spare parts,emergency rescue and other industries,combined with SFs all-cargo routescovering the entire country and radiating the world,to help realize the countrys industrial upgrading an

268、d enhance the strength of theinternational supply chain.Note：The above data is as of June 30,2022,and the number of time periods is accumulated from January 1,2022 to June 30,2022.S.F.Holding Co.,Ltd.2022 Semi-Annual Report36Note：The above data is as of June 30,2022,and the number of time periods is

269、 accumulated from January 1,2022 to June 30,2022.S.F.Holding Co.,Ltd.2022 Semi-Annual Report37Note：The above data is as of June 30,2022,and the number of time periods is accumulated from January 1,2022 to June 30,2022.S.F.Holding Co.,Ltd.2022 Semi-Annual Report38S.F.Holding Co.,Ltd.2022 Semi-Annual

270、Report392.Complete end-to-end one-stop comprehensive logistics service capabilityAdhering to the diversification-oriented strategic planning,and based on a fully established and efficient express network,through“internal cultivation+external mergers and acquisitions,the Company horizontally branched

271、 out into new businesses andacquired high-quality industry partners to gradually grow into Chinas largest express logistics service provider covering time-definite express,economy express,freight,cold chain and pharmaceuticals,intra-city on-demand delivery,international express,international freight

272、 and freight forwarding,and supply chain,focusing on logistics ecosystem development as the top priority.At the same time,we also vertically improved the product matrix,through direct operation,external cooperation and othermodels;in each market segment of every business sector,we have launched high

273、-quality services targeting medium-and high-endconsumers,as well as cost-effective services for markets in lower-tier cities.Through effective product stratification and organiccombination between different products,we cater to the diverse needs of clients,and developed complete end-to-end one-stopi

274、ntegrated logistics solutions.Our services have penetrated into a wide variety of businesses such as industrial manufacturing,commercial circulation,onlinesales of agricultural products,food and pharmaceutical cold chain,international trade,local life,etc.,covering all aspects of socialproduction an

275、d peoples livelihood.Boasting efficient express logistics services,lean supply chain management experience,and apowerful logistics network that penetrates into rural counties,towns and villages in China and covers 99 countries and regionsaround the world,we actively respond to the“go to the countrys

276、ide,go to factories,and go global”campaign launched by thegovernment for the development of modern service industry and express delivery,support rural economy revitalization,intelligentmanufacturing,and industrial upgrading,and build on our capability to protect the international supply chain;furthe

277、rmore,weactively embrace new patterns and trends in the industry to help clients innovate business models,enhance consumer perceptionexperience,and practice the delivery and protection of a better life.S.F.Holding Co.,Ltd.2022 Semi-Annual Report40S.F.Holding Co.,Ltd.2022 Semi-Annual Report413.Cuttin

278、g-edge technology for a digitalized,visual and intelligent supply chainSF is committed to building a smart supply chain ecosystem in the digital age and establishing itself as a leader of smart supplychain operation.SF combines the massive data and industry solution experience gained in diverse busi

279、nesses with the application ofleading intelligent and digital logistics technologies to promote supply chain technology innovation and help clients in variousindustries create a modern supply chain system with efficient response.As of the end of the reporting period,SF had taken out 4,049patents and

280、 2,350 software copyrights,with invention patents accounting for 58.85%of the total number of patents obtained.(1)Internal:digital and intelligent upgrade of the logistics network to build SFs smart brainThe purpose is to improve the digitalization and intelligentization levels of SF Holdings logist

281、ics network,through thedigitalized end-to-end operation including collection and delivery,distribution,and transportation,applying big data prediction,visual monitoring and early warning techniques,to achieve global intelligent planning and scheduling,real-time matching ofresources,and flat and effi

282、cient management;this is further combined with AIoT,automation,and unmanned operation investment,to improve network operation efficiency and help the Company reduce costs and increase efficiency.Forecast&Scheduling:Based on big data+AI algorithms,we created a global intelligent decision-making syste

283、m covering“forecastearlywarningschedulingfeedback”.1 1Early forecastInformation such as parcel quantity and weight throughout the entire network,specific cities,outlet,or the minimum collectionand delivery unit area can be forecasted by year,month,week,day,shift,etc.Resources were invested according

284、 to the forecast data.The forecast accuracy has improved consistently,-the accuracy of estimates of air flow direction,transit shipment quantity and outletdelivery improved 26%,3%,and 8%respectively,and the accuracy of collection and delivery time forecasts during peak seasonsincreased by 5%year-on-

285、year,making it easier for operations teams to plan resources in advance and minimize random investment ofresources.2Real-time scheduling:Resources are allocated in real time via the online operation monitoring and dispatching system,integrating various resources,including 440,000 deliverymen,over 93

286、,000 trunk and feeder vehicles,and more than 2,100 air routesacross the entire networks,ensuring the normal delivery time on daily of over 100,000 parcels which might be delayed.Wedeveloped branch-line scheduling function of carpooling for leftover stock and rolled it out throughout the network to r

287、educe costs;implemented online issuance of instructions to improve management efficiency and resource utilization.Intelligent distribution:Automation equipment was upgraded in 15 transit depots in the first half of 2022,boosting distributioncapacity and efficiency.As of the end of the reporting peri

288、od,automatic sorting had been achieved for more than 85%of smallparcels and 51%of single delivery items(i.e.large-size or irregular parcels that do not require centralized packaging).In addition,vision technology,AI deep learning,etc.have been applied to enable visual monitoring of the entire proces

289、s of site operation,as wellas parcel security inspection,video tracking,operation monitoring,and risk warning;on-site production capacity is monitored on areal time basis,and resources planning and diversion have been rationalized to ensure optimal distribution efficiency.Intelligent transportation:

290、AF continuously improved the full-stack end-to-end IT and platform-based management acrossvarious transportation modes such as air,land and rail transportation.Air transportation:following the principle of“optimaltimeliness cost”,automated scheduling decision-making of all-cargo aircraft was realize

291、d with the assistance of intelligent algorithms;commercial flight resources and various application scenarios have been integrated to support online management of large-size airS.F.Holding Co.,Ltd.2022 Semi-Annual Report42parcel operations on a comprehensive scale,and ensure reliable flight booking

292、operations for“exclusive expedite delivery”products;and a variety of transport capacity systems were utilized to output exceptional flight scheduling and cargo diversion solutions toensure timeliness.Land transportation:in the first half of the year,100%of railway resources were subject to platform-

293、basedtransportation capacity management to achieve dynamic train tracking;centralized procurement of conventional transportation isdirectly managed by the headquarters to enable 100%online management and control of the entire procurement process,optimize theoverall transportation capacity procuremen

294、t model and pricing,and effectively control transportation capacity costs;as regardsbranch route connection,digital management has been strengthened by deepening information communications between the deliverysystem and the branch route connection system,such that the probability of delivery delay i

295、s further reduced as a result of moresmooth shift handover workflow.Intelligent terminal management:Applying the AOI(Area of Interest)technology(a technology for geographic areas ofdynamic digital map operation),we conducted comprehensive digital operation and online management of terminal collectio

296、n anddelivery,involving real-time location allocation for deliverymen,intelligent path planning and automated terminal management.Inparticular,in the first half of 2022,support was provided for operations teams to trial digital management in South China amidoperational capability building efforts th

297、at concern the deliverymen labor value assessment model,regional task allocation criteria,the deliverymen performance appraisal system and the channel distribution model.Through the above methods,the overall customercomplaint rate improved by as much as 32%year-on-year.Furthermore,direct system-base

298、d deliverymen management wasintroduced to ensure reasonable task assignment and fair payment for delivery staffs,incentivizing them to improve service qualityand thus contribute to business growth.Intelligent cost management and control:applying the digital solution of“full-stack business-finance in

299、tegration”,weremoved data barriers between business and financial operations and set up a middle-office platform of business-finance data,realizing automate detection of cost irregularities,and online release and closed-loop management of tasks with cost irregularities,soas to create an efficient,on

300、e-stop digital and intelligent cost management and control platform,realize intensive/systematic intelligentmanagement based on technological strengths,and help the Company attain sound performance while lowering costs at the sametime.(2)External:Application of smart supply chain technologies to boo

301、st the transformation and upgrade of clients supplychainThe purpose is to integrate SFs exceptional technical capabilities and industrial experience,develop standardized scientific andtechnological products and solutions,incorporate digital and intelligent capabilities into clients value chain,solve

302、 the pain points atall levels of client supply chain including planning,management,execution,etc.,and help various industries create a flexible andintelligent supply chain system that responds efficiently to facilitate industrial upgrading,cost reduction and efficiency enhancement.SF has provided en

303、d-to-end technical services that revolve around clients raw material supply,production,warehousing,transportation,sales,operation and other processes:Raw material procurement and entry into factories:We carry outintelligent management of raw material supplies,and through methods like circular pickup

304、 schemes,automate route setting andloading optimization;Production:We adopt personnel management and intelligent park solutions based on computer vision toensure production efficiency and work safety in parks;Warehousing:At design and implementation levels,we providewarehouse network planning,multi-

305、level replenishment,online and offline shared inventory,and other solutions;at the in-warehouseexecution level,we provide multiple services such as storage location optimization and warehousing automation;Sales:Employing big data and algorithm technologies,we help clients gain insights of their cons

306、umers and carry out precision marketing,and provide online omni-channel store operation and management tools for small and medium-sized businesses;Operations:Insupport of digitalized operations,through our implementation of end-to-end supply chain base systems(OMS/TMS/WMS/BMS),weS.F.Holding Co.,Ltd.

307、2022 Semi-Annual Report43connect the entire business processes of ordering,warehousing,transportation,settlement,etc.The Company continuously tracks the latest trends and evolution paths of cutting-edge logistics technologies,actively deploysvision technologies with major impact on the industry and

308、future development,and keeps enhancing technological competitiveness.This includes:Enablement of the logistics business by automation technology towards the creation of unmanned and automatedsites;Big data and artificial intelligence continue to strengthen SFs smart brain,and improve the resource ap

309、plication efficiencyand client experience;Applying blockchain and privacy computing to the building of the infrastructure of data ecosystems,wecontinue to explore secure applications of data assets;We pay close attention to emerging cross-cutting technology such asdigital twin,and actively explored

310、and practiced it in various business scenarios.Through the deployment and application ofinnovative technologies,we continue to promote the expansion of digital boundaries and the improvement of intelligent capabilitiesof enterprises.S.F.Holding Co.,Ltd.2022 Semi-Annual Report444.Build brand value wi

311、th excellent service experienceSF has established itself as a well-recognized and reputable express delivery service provider through over 20 years ofdevelopment.It has built a brand image of“efficiency”,“punctuality”and“safety”,created great brand value through high-qualityservice,and is widely rec

312、ognized by clients,the industry and the community.The Company appeared in the 2022 Fortune Global 500 list released by Fortune on August 3,2022 with a ranking of no.441,making it the first Chinese private express delivery company to rank among the worlds top 500 companies.S.F.Holding Co.,Ltd.2022 Se

313、mi-Annual Report45III.Analysis of Main Business1.OverviewIn the first half of 2022,the express and logistics industry faced a complicated external environment.Some cities were underlockdown due to the outbreak of COVID-19,which affected the growth rate of revenue of express logistics enterprises.A s

314、lowdownin actual capacity growth may also affect the effective dilution of fixed costs and weaken the economies of scale.In addition,higherfuel prices lead to faster increase in transportation costs.A series of negative factors brought great challenges to the operatingefficiency of express logistics

315、 enterprises.As a logistics enterprise to ensure the supply of livelihood materials during the lockdown,the Company actively responded tothe call of the government and made every effort to ensure the transportation and last-mile delivery of essential living materials forresidents during the lockdown

316、 by leveraging the stable and reliable service quality of self-owned direct network and end-to-endmultiple logistics service capability.In addition,the Company continued to focus on its core logistics strategy,gave great prominenceto sustainable and healthy development and adhered to sound operation

317、al priorities.We improved the competitiveness of productsand the quality of revenue through the adjustment and optimization of product structure,and gradually strengthened the reform ofoperating models.Leveraging the intelligent planning of multi-network cooperation and the fine dynamic adjustment o

318、f resources,we effectively coped with external challenges,achieved a significant improvement in the 2022 half-year performance compared withthe same period of the previous year and obtained good operating results.I)In terms of revenue,the Company registered a total business volume1of 5.13 billion sh

319、ipments in the first half of 2022,approximately the same as last year;and a gross operating income of RMB130.06 billion,representing a year-on-year increase of47.2%.Among others,(1)(1)The express&logistics segment grew by 3.4%in revenue in the first half of this year.From March toMay,the growth rate

320、 of business volume was under pressure due to the impact of the pandemic.However,with the gradual lifting oflockdown,the Company fully assisted the resumption of work and production and the 618 shopping festival,bringing a rapidrecovery of business.In June,we recorded a high dual-digit growth rate o

321、f 11.2%in revenue,which was significantly ahead of theindustry average.In addition,the Company took the initiative to optimize product portfolio and reduce the volume of low-marginproducts.Although the growth rate of business volume was affected to a certain extent,the overall average revenue per sh

322、ipment ofexpress&logistics segment increased by 3.3%and the quality of revenue was consistently improved.(2)(2)The supply chain andinternational segment grew by 442.7%in revenue in the first half of this year,accounting for 35.8%of gross operating income.Thefast growth was mainly due to the Companys

323、 merger with Kerry Logistics since the fourth quarter of 2021.In addition,KerryLogistics also completed some mergers and acquisitions in the field of international freight,further expanding the scale ofinternational business.For details on the development of each business segment,please refer to“(3)

324、Summary of businessdevelopment”of“I.Business Development of the Company”of this section.II)In terms of profit,the Company realized a net profit attributable to shareholders of the parent company of RMB2.51 billionin the first half of 2022,representing a year-on-year increase of 230.6%,and a net prof

325、it attributable to shareholders of the parentcompany after deducting non-recurring gains and losses of RMB2.15 billion,representing a year-on-year increase of 550.2%.Thenon-recurring items were mainly government subsidies and one-off gains from the disposal certain subsidiaries.The results in the fi

326、rst half of 2022 increased significantly compared with that of the same period of previous year.In addition tothe improvement of revenue structure,in terms of cost,the Company continued to deepen reforms in the end-to-end operating modelto advance the lean resource planning and cost control.In terms

327、 of multi-network integration,we further strengthened the integrationof outlets,distribution sites,warehousing,and transportation resources of main and branch lines.Meanwhile,we reinforced flexibleresource coordination across business segments during the off-season and peak season,so as to ensure th

328、e quality of products and1It does not include the express delivery volume of Kerry Logistics,nor includes business volume of international freight and freight forwarding and supply chain of the Company.S.F.Holding Co.,Ltd.2022 Semi-Annual Report46services while improving efficiency of resource utili

329、zation and input-output ratio.Furthermore,we stepped up efforts to enhance ourdeep digital operation capability driven by science and technology under the reform of the operation model.Thus,we realized thepre-action decision making based on data model,in-process intelligent control and scheduling,as

330、 well as post-review of benefitanalysis for resource input in each link,improving our refined cost management and control.For the specific introduction of thereform of operation model and technology assistance,please refer to“I.Business Development of the Company”,“(III)Summary ofBusiness Developmen

331、t”,“4.Operation optimization”and“II.Analysis of Core Competitiveness Analysis”,and“3.Cutting-edgetechnology for a digitalized,visual and intelligent supply chain”and related content.Based on the above operating measures,the profitability of the Companys various business segments has reboundedsignifi

332、cantly year-on-year,and new businesses have continued to reduce losses.In addition,compared with the same period ofprevious year,the profits of the Companys supply chain and international business segments increased due to the merge of KerryLogisticss performance during the reporting period.)In term

333、s of capital structure,as of the end of the reporting period,the total assets of the Company were RMB212.47billion;the net assets attributable to shareholders of the parent company were RMB81.72 billion;and the gearing ratio was 55.6%,up2.2 percentage points from 53.4%at the end of previous year.This was mainly attributable to the increase in borrowings by KerryLogistics as a result of the acquisi