1、 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington,D.C.20549 Form 20-F(Mark One)REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIES EXCHANGE ACT OF 1934 OR ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended De

2、cember 31,2021.OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to OR SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring this shell company report For the transiti

3、on period from to Commission file number 001-37922 ZTO Express(Cayman)Inc.(Exact name of Registrant as specified in its charter)N/A(Translation of Registrants name into English)Cayman Islands(Jurisdiction of incorporation or organization)Building One,No.1685 Huazhi Road,Qingpu District,Shanghai,2017

4、08 Peoples Republic of China(Address of principal executive offices)Huiping Yan,Chief Financial Officer Building One,No.1685 Huazhi Road,Qingpu District,Shanghai,201708 Peoples Republic of China Phone:(86 21)5980 4508 Email:(Name,Telephone,Email and/or Facsimile number and Address of Company Contact

5、 Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Title of each class Trading Symbol(s)Name of Each Exchange on Which RegisteredAmerican depositary shares,each representing one Class A ordinary share par value US$0.0001 per share ZTO New York Stock Exchange Class

6、A ordinary shares,par value US$0.0001 per share 2057 The Stock Exchange of Hong Kong Limited Securities registered or to be registered pursuant to Section 12(g)of the Act None(Title of Class)Securities for which there is a reporting obligation pursuant to Section 15(d)of the Act:None(Title of Class)

7、Indicate the number of outstanding shares of each of the Issuers classes of capital or common stock as of the close of the period covered by the annual report.As of December 31,2021,there were 808,448,289 ordinary shares outstanding,par value$0.0001 per share,being the sum of 602,348,289 Class A ord

8、inary shares and 206,100,000 Class B ordinary shares.Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No If this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports

9、pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the regi

10、strant was required to file such reports),and(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of t

11、his chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer or an emerging growth company.See definition of“

12、large accelerated filer,”“accelerated filer,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.(Check one):Large accelerated filer Accelerated filer Non-accelerated filer Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S.G

13、AAP,indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.The term“new or revised financial accounting standard”refers to any update iss

14、ued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5,2012.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financial reporting under Se

15、ction 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:U.S.GAAP International Financia

16、l Reporting Standards as issued by the International Accounting Standards Board Other If“Other”has been checked in response to the previous question,indicate by check mark which financial statement item the registrant has elected to follow.Item 17 Item 18 If this is an annual report,indicate by chec

17、k mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sec

18、tions 12,13 or 15(d)of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.Yes No i TABLE OF CONTENTS INTRODUCTION 1 FORWARD-LOOKING STATEMENTS 4 PART I 5 Explanatory Note 5 ITEM 1.IDENTITY OF DIRECTORS,SENIOR MANAGEMENT AND ADVISERS 11I

19、TEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE11ITEM 3.KEY INFORMATION11ITEM 4.INFORMATION ON THE COMPANY69ITEM 4A.UNRESOLVED STAFF COMMENTS108ITEM 5.OPERATING AND FINANCIAL REVIEW AND PROSPECTS108ITEM 6.DIRECTORS,SENIOR MANAGEMENT AND EMPLOYEES126ITEM 7.MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTI

20、ONS 144ITEM 8.FINANCIAL INFORMATION147ITEM 9.THE OFFER AND LISTING149ITEM 10.ADDITIONAL INFORMATION150ITEM 11.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK166ITEM 12.DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 167 PART II 170 ITEM 13.DEFAULTS,DIVIDEND ARREARAGES AND DELINQUEN

21、CIES 170ITEM 14.MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 170ITEM 15.CONTROLS AND PROCEDURES170ITEM 16A.AUDIT COMMITTEE FINANCIAL EXPERT171ITEM 16B.CODE OF ETHICS 171ITEM 16C.PRINCIPAL ACCOUNTANT FEES AND SERVICES171ITEM 16D.EXEMPTIONS FROM THE LISTING STANDARDS FO

22、R AUDIT COMMITTEES171ITEM 16E.PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 171ITEM 16F.CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT172ITEM 16G.CORPORATE GOVERNANCE172ITEM 16H.MINE SAFETY DISCLOSURE172ITEM 16I.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION

23、S 172 PART III 173 ITEM 17.FINANCIAL STATEMENTS173ITEM 18.FINANCIAL STATEMENTS173ITEM 19.EXHIBITS 173 1 INTRODUCTION ZTO Express(Cayman)Inc.is not a Chinese operating company but rather a Cayman Islands holding company with operations primarily conducted by its subsidiaries in China and through cont

24、ractual arrangements with ZTO Express based in China.PRC laws and regulations restrict and impose conditions on foreign direct investment in companies involved in the provision of domestic mail delivery services.Therefore,we operate such business in China through ZTO Express and its subsidiaries,and

25、 rely on contractual arrangements among Shanghai Zhongtongji Network,ZTO Express and its shareholders to consolidate its financial results with ours under U.S.GAAP.These contractual arrangements enable us to exercise effective control over ZTO Express,receive the economic benefits that could potenti

26、ally be significant to ZTO Express in consideration for the services provided by Shanghai Zhongtongji Network,and hold an exclusive option to purchase all or part of the equity interests in ZTO Express when and to the extent permitted by PRC law.Because of these contractual arrangements,we are the p

27、rimary beneficiary of ZTO Express and hence consolidate its financial results with ours under U.S.GAAP.Revenues contributed by ZTO Express accounted for 97.1%,94.1%and 97.7%of our total revenues for the fiscal years 2019,2020 and 2021,respectively.As used in this annual report,“ZTO”refers to ZTO Exp

28、ress(Cayman)Inc.,and“we,”“us,”“our company”or“our”refers to ZTO Express(Cayman)Inc.,its subsidiaries,and,in the context of describing our operations and consolidated financial information,ZTO Express and its subsidiaries in China.Investors in our ADSs and/or Class A ordinary shares thus are not purc

29、hasing equity interest in ZTO Express but instead are purchasing equity interest in ZTO Express(Cayman)Inc.,a Cayman Islands holding company.Our corporate structure is subject to risks associated with our contractual arrangements with ZTO Express.The contractual arrangement is perceived as replicati

30、ng foreign investment in China-based companies where PRC regulations prohibit direct foreign investment in the operating companies.ZTO and its investors may never have a direct ownership interest in ZTO Express or in the businesses that are conducted by ZTO Express or its subsidiaries.Uncertainties

31、in the PRC legal system could limit our ability to enforce these contractual arrangements,and these contractual arrangements have not been tested in a court of law.If the PRC government finds that the agreements that establish the structure for operating our business do not comply with PRC laws and

32、regulations,or if these regulations or their interpretations change in the future,we could be subject to severe penalties or be forced to relinquish our interests in those operations.This may result in ZTO Express being deconsolidated,which would materially and adversely affect our operations,and ou

33、r ADSs and/or Class A ordinary shares may decline significantly in value or become worthless.ZTO,our PRC subsidiaries,ZTO Express,and investors of ZTO face uncertainty about potential future actions by the PRC government that could affect the enforceability of the contractual arrangements with ZTO E

34、xpress and,consequently,significantly affect the financial performance of ZTO Express and our company as a whole.The PRC regulatory authorities could disallow the contractual arrangement,which would likely result in a material adverse change in our operations,and our Class A ordinary shares or our A

35、DSs may decline significantly in value or become worthless.For a detailed description of the risks associated with our corporate structure,please refer to risks disclosed under“Item 3.Key InformationD.Risk FactorsRisks Related to Our Corporate Structure.”We face various legal and operational risks a

36、nd uncertainties associated with being based in or having the majority of our operations in China and the complex and evolving PRC laws and regulations.For example,we face risks associated with regulatory approvals on offerings conducted overseas by and foreign investment in China-based issuers,the

37、use of VIEs,anti-monopoly regulatory actions,and oversight on cybersecurity and data privacy,as well as the lack of PCAOB inspection on our auditors,which may impact our ability to conduct certain businesses,accept foreign investments,or list on a United States or other foreign exchange.These risks

38、could result in a material adverse change in our operations and the value of our ADSs,significantly limit or completely hinder our ability to continue to offer securities to investors,or cause the value of such securities to significantly decline.For a detailed description of risks related to doing

39、business in China,see“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in China.”2 Our ADSs may be delisted and our ADSs and shares prohibited from trading in the over-the-counter market under the Holding Foreign Companies Accountable Act,or the HFCAA,given the PCAOB is unable to

40、inspect or fully investigate auditors located in China.On December 16,2021,PCAOB issued the HFCAA Determination Report,according to which our auditor is subject to the determinations that the PCAOB is unable to inspect or investigate completely.Under the current law,delisting and prohibition from ov

41、er-the-counter trading in the U.S.could take place in 2024.On June 22,2021,the U.S.Senate passed a bill known as the Accelerating Holding Foreign Companies Accountable Act,which,if enacted,would decrease the number of non-inspection years from three years to two years,and thus,our ADS could be delis

42、ted from the exchange and prohibited from over-the-counter trading in the U.S.in 2023.If this happens,there is no certainty that we will be able to maintain our listing status on another non-U.S.exchange,such as Hong Kong Stock Exchange,and the impact on the market for our shares outside of the U.S.

43、is uncertain.The delisting of our ADSs,or the threat of their being delisted,may materially and adversely affect the value of your investment.For more details,see“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in China.”ZTO Express(Cayman)Inc.,our Cayman Islands holding company,

44、or the Parent,may transfer cash to our wholly-owned Hong Kong subsidiaries(through intermediate holding companies in the British Virgin Islands),by making capital contributions or providing loans,and our Hong Kong subsidiaries may transfer cash to our PRC subsidiaries by making capital contributions

45、 or providing loans to them.Because the Parent and its subsidiaries control ZTO Express through contractual arrangements,they are not able to make direct capital contribution to ZTO Express.However,they may transfer cash to ZTO Express by loans or by making payment to ZTO Express for inter-group tra

46、nsactions.As of December 31,2021,the Parent had made cumulative capital contribution of RMB15,080.5 million.In 2019,2020 and 2021,no shareholder loan was provided by the Parent to our PRC subsidiaries.For the years ended December 31,2019,2020 and 2021,no dividends or distributions were made to the P

47、arent by our subsidiaries.For the years ended December 31,2019,2020 and 2021,dividends of US$189.1 million,US$233.5 million and US$208.4 million were paid to shareholders of the Parent of record as of designated record dates.Historically,ZTO Express(Cayman)Inc.paid dividends to its shareholders prim

48、arily using proceeds from offshore financing activities.As ZTO Express(Cayman)Inc.is a Cayman Islands holding company with no material operations of its own,its ability to pay dividends may depend upon dividends paid by our PRC subsidiaries in the future.For more detailed discussion of how cash is t

49、ransferred between ZTO,our subsidiaries and ZTO Express,see“Cash Transfers and Dividend Distribution”at the outset of Part I.Unless otherwise indicated and except where the context otherwise requires,references in this annual report on Form 20-F to:“ADSs”are to our American depositary shares,each of

50、 which represents one Class A ordinary share;“ADRs”are to the American depositary receipts that evidence our ADSs;“China”or the“PRC”are to the Peoples Republic of China,excluding,for the purposes of this annual report only,Hong Kong,Macau and Taiwan;“delivery service fees”are to service fees directl

51、y charged by network partners from parcel senders in connection with express delivery services rendered.The full delivery service fees collected by pickup outlets upfront from the senders typically comprise of(i)the pickup service fees;(ii)the network transit fees payable to the Company;and(iii)the

52、last-mile delivery fees payable to the delivery outlets operated by other network partners;“Hong Kong”or“HK”or“Hong Kong S.A.R.”are to the Hong Kong Special Administrative Region of the PRC;“Hong Kong Listing Rules”are to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Ko

53、ng Limited,as amended or supplemented from time to time;“Hong Kong Stock Exchange”are to The Stock Exchange of Hong Kong Limited;3 our“network partners”are to business partners that own and operate pickup and delivery outlets in our network and operate express delivery services under our“Zhongtong”o

54、r“ZTO”brand;“network transit fees”are to fees payable by our network partners to us in connection with the services we provide to them,which mainly include parcel sorting and parcel line-haul transportation;“New Retail”are to the continued integration of online and offline retail channels by large e

55、-commerce platforms and various retail merchants to reduce customer acquisition costs and enhance customers shopping experience;“ordinary shares”are to our Class A and Class B ordinary shares,par value US$0.0001 per share;our“parcel volume”in any given period are to the number of parcels collected b

56、y our network partners using our waybills in that period;“RMB”or“Renminbi”are to the legal currency of China;“SFO”are to the Securities and Futures Ordinance(Chapter 571 of the Laws of Hong Kong),as amended or supplemented from time to time;“unit cost per parcel”are to the sum of cost of revenues an

57、d total operating expenses of the applicable period divided by our total parcel volume during the same period;“US$,”“U.S.dollars,”“$,”or“dollars”are to the legal currency of the United States;“ZTO”are to ZTO Express(Cayman)Inc.;“ZTO Express”are to ZTO Express Co.Ltd.or,depending on the context,ZTO E

58、xpress Co.Ltd.and its subsidiaries;and “we,”“us,”“our company”or“our”are to ZTO Express(Cayman)Inc.and its subsidiaries,and,in the context of describing our operations and the consolidated financial information,its consolidated variable interest entity and the subsidiaries of the consolidated variab

59、le interest entity in China,including,but not limited to,ZTO Express.Depending on the context,references to“we”and“our”may also include the network partners within our network.4 FORWARD-LOOKING STATEMENTS This annual report on Form 20-F contains forward-looking statements that relate to our current

60、expectations and views of future events.These statements involve known and unknown risks,uncertainties and other factors that may cause our actual results,performance or achievements to be materially different from those expressed or implied by the forward-looking statements.These statements are mad

61、e under the“safe harbor”provisions of the U.S.Private Securities Litigations Reform Act of 1995.You can identify some of these forward-looking statements by words or phrases such as“may,”“will,”“expect,”“anticipate,”“aim,”“estimate,”“intend,”“plan,”“believe,”“is/are likely to,”“potential,”“continue”

62、or other similar expressions.We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition,results of operations,business strategy and financial needs.These forward-looking statements include

63、statements relating to:our goals and strategies;our future business development,financial conditions and results of operations;the expected growth of the express delivery industry in China;our expectations regarding demand for and market acceptance of our services;our expectations regarding our rela

64、tionships with network partners,direct and end customers,suppliers and our other stakeholders;competition in our industry;and relevant government policies and regulations relating to our industry.You should read this annual report and the documents that we refer to in this annual report and have fil

65、ed as exhibits to this annual report completely and with the understanding that our actual future results may be materially different from what we expect.Other Sections of this annual report discuss factors which could adversely impact our business and financial performance.Moreover,we operate in an

66、 evolving environment.New risk factors emerge from time to time and it is not possible for our management to predict all risk factors,nor can we assess the impact of all factors on our business or the extent to which any factor,or combination of factors,may cause actual results to differ materially

67、from those contained in any forward-looking statements.We qualify all of our forward-looking statements by these cautionary statements.You should not rely upon forward-looking statements as predictions of future events.The forward-looking statements made in this annual report relate only to events o

68、r information as of the date on which the statements are made in this annual report.Except as required by law,we undertake no obligation to update or revise publicly any forward-looking statements,whether as a result of new information,future events or otherwise,after the date on which the statement

69、s are made or to reflect the occurrence of unanticipated events.Our reporting currency is the Renminbi,or RMB.This annual report contains translations of RMB and Hong Kong dollar amounts into U.S.dollars at specific rates solely for the convenience of the reader.Unless otherwise stated,all translati

70、ons of RMB and Hong Kong dollars into U.S.dollars and from U.S.dollars into RMB in this annual report were made at a rate of RMB6.3726 to US$1.00 and HK$7.7996 to US$1.00,the respective exchange rates on December 30,2021 set forth in the H.10 statistical release of the Federal Reserve Board.We make

71、no representation that any RMB,Hong Kong dollar or U.S.dollar amounts referred to in this annual report could have been,or could be,converted into U.S.dollars,RMB or Hong Kong dollars,as the case may be,at any particular rate or at all.5 PART I EXPLANATORY NOTE ZTO is a Cayman Islands holding compan

72、y with no equity ownership in ZTO Express,its consolidated affiliated entity.We conduct our operations in China through(i)our PRC subsidiaries and(ii)ZTO Express,with which we have maintained contractual arrangements.Investors in our ADSs thus are not purchasing equity interest in ZTO Express in Chi

73、na but instead are purchasing equity interest in a Cayman Islands holding company.If the PRC government finds that the agreements that establish the structure for operating certain of our businesses do not comply with PRC laws and regulations,or if these regulations or their interpretations change i

74、n the future,we could be subject to severe penalties or be forced to relinquish our interests in those operations.ZTO,our PRC subsidiaries,ZTO Express,and investors of ZTO face uncertainty about potential future actions by the PRC government that could affect the enforceability of the contractual ar

75、rangements with ZTO Express and,consequently,significantly affect the financial performance of ZTO Express and our company as a whole.The PRC regulatory authorities could disallow the VIE structure,which would likely result in a material adverse change in our operations,and our Class A ordinary shar

76、es or our ADSs may decline significantly in value.PRC governments authority in regulating our operations and its oversight and control over offerings conducted overseas by,and foreign investment in,China-based issuers could significantly limit or completely hinder our ability to offer or continue to

77、 offer securities to investors.Implementation of industry-wide regulations in this nature may cause the value of such securities to significantly decline.For more details,see“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in ChinaThe PRC governments significant oversight and dis

78、cretion over our business operation could result in a material adverse change in our operations and the value of our ADSs and ordinary shares.”Risks and uncertainties arising from the legal system in China,including risks and uncertainties regarding the enforcement of laws and quickly evolving rules

79、 and regulations in China,could result in a material adverse change in our operations and the value of our Class A ordinary shares or ADSs.For more details,see“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in ChinaUncertainties with respect to the PRC legal system could adverse

80、ly affect us.”Our Holding Company Structure and Contractual Arrangements ZTO Express(Cayman)Inc.is a holding company with no material operations of its own.We conduct our operations primarily through our PRC subsidiaries and ZTO Express,our consolidated affiliated entity,and its subsidiaries.Our dom

81、estic mail delivery services in China have been conducted through ZTO Express in order to comply with the PRC laws and regulations,which prohibit or restrict control of companies involved in the provision of domestic mail delivery services.Revenues contributed by ZTO Express accounted for 97.1%,94.1

82、%and 97.7%of our total revenues for the fiscal years 2019,2020 and 2021,respectively.Investors in our ADSs and/or Class A ordinary shares are not purchasing equity interest in ZTO Express in China but instead are purchasing equity interest in a holding company incorporated in the Cayman Islands.6 Th

83、e following chart illustrates our companys organizational structure,including our principal subsidiaries and consolidated affiliated entities as of March 31,2022:(1)To the knowledge of our company,Meisong Lai,Jianfa Lai,Jilei Wang.Xiangliang Hu,Shunchang Zhang,Jianying Teng,Xuebing Shang,Baixi Lan a

84、nd Jianchang Lai are beneficial owners of the shares of our company and hold 34.35%,12.00%,10.00%,7.05%,6.00%,5.02%,4.40%,1.40%and 1.06%equity interests in ZTO Express Co.,Ltd.,respectively.Among them,Meisong Lai,Jianfa Lai,Jilei Wang are also directors of our company.The remaining 18.72%equity inte

85、rest in ZTO Express Co.,Ltd.are held by 34 other shareholders.None of these 34 shareholders hold more than 4.00%of the equity interest in ZTO Express Co.,Ltd.7 A series of contractual agreements,including voting rights proxy agreement,equity pledge agreement,exclusive call option agreement,powers of

86、 attorney,spouse consent letters and exclusive consulting and services agreement and its supplemental agreement,have been entered into by and among Shanghai Zhongtongji Network,our wholly owned subsidiary,ZTO Express,our consolidated affiliated entity,and the shareholders of ZTO Express.The followin

87、g is a summary of the currently effective contractual arrangements:(i)voting rights proxy agreement,pursuant to which each of the shareholders of ZTO Express irrevocably appointed Meisong Lai,Shanghai Zhongtongji Networks designated person,as their attorney-in-fact to exercise all applicable shareho

88、lder rights,including,but not limited to:(i)calling for and attending shareholders meetings as the proxy of the shareholders;(ii)exercising voting rights and all other shareholders rights provided under PRC laws and the articles of association of ZTO Express,including but not limited to,selling,tran

89、sferring,pledging or disposing all or a portion of the shares held by such shareholder or the assets of ZTO Express;(iii)voting on all matters submitted to shareholders meetings,including but not limited to,the election of directors and senior management officers who shall be appointed by shareholde

90、rs;and(iv)exercising other voting rights granted to the shareholders by the articles of association of ZTO Express,as may be amended from time to time;(ii)equity pledge agreement,pursuant to which each of the shareholders of ZTO Express pledged all of their equity interests in ZTO Express to guarant

91、ee their and ZTO Expresss performance of their obligations under the contractual arrangements,including the exclusive consulting and services agreement,its related agreements and the equity pledge agreement;(iii)exclusive call option agreement,pursuant to which each of the shareholders of ZTO Expres

92、s irrevocably granted Shanghai Zhongtongji Network an exclusive option to purchase,or have its designated entity or person to purchase,at its discretion,to the extent permitted under PRC law,all or part of the shareholders equity interests in ZTO Express;”(iv)powers of attorney,pursuant to which the

93、 shareholders of ZTO Express each irrevocably appointed Shanghai Zhongtongji Networks designated person,Meisong Lai,as the attorney-in-fact to exercise all of applicable shareholders voting and related rights with respect to such shareholders equity interests in ZTO Express;(v)consent letter,pursuan

94、t to which each of the spouses of six key shareholders of ZTO Express unconditionally and irrevocably agreed that the spouse is aware of the abovementioned exclusive call option agreement,voting right proxy agreement,irrevocable powers of attorney,equity pledge agreement and the exclusive consulting

95、 and services agreement,and has read and understood the contractual arrangements;and(vi)exclusive consulting and services agreement and its supplemental agreement,pursuant to which Shanghai Zhongtongji Network has the exclusive right to provide ZTO Express with the technical support and consulting s

96、ervices required by ZTO Expresss business.Shanghai Zhongtongji Network owns the exclusive intellectual property rights created as a result of the performance of this agreement.ZTO Express agrees to pay Shanghai Zhongtongji Network an annual service fee,at an amount equal to 100%of the net income of

97、ZTO Express and its affiliates.For more details of these contractual arrangements,see“Item 4.Information on the CompanyC.Organizational StructureAgreements that provide us effective control over ZTO Express”and“Agreement that allows us to receive economic benefits from ZTO Express.”8 However,the con

98、tractual arrangements may not be as effective as direct ownership in providing us with control over ZTO Express,and we may incur substantial costs to enforce the terms of the arrangements.See“Item 3.Key InformationD.Risk FactorsRisks Related to Our Corporate StructureWe rely on contractual arrangeme

99、nts with our variable interest entity and its shareholders for a substantial portion of our business operations,which may not be as effective as direct ownership in providing operational control”and“Item 3.Key InformationD.Risk FactorsRisks Related to Our Corporate StructureThe shareholders of our v

100、ariable interest entity may have potential conflicts of interest with us,which may materially and adversely affect our business and financial condition.”There are also substantial uncertainties regarding the interpretation and application of current and future PRC laws,regulations and rules regardin

101、g the status of the rights of ZTO with respect to its contractual arrangements with ZTO Express and its shareholders.The Circular on Seeking Public Comments on the Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Enterprises(Draft for Comment),or the Dra

102、ft Overseas Securities Offering and Listing Measures,and the Circular on Seeking Public Comments on the Administrative Regulations of the State Council on the Overseas Issuance and Listing of Securities by Domestic Enterprises(Draft for Comment),or the Draft Overseas Securities Offering and Listing

103、Regulations,were issued for public comments on December 24,2021.However,it is uncertain whether the Draft Overseas Securities Offering and Listing Measures,the Draft Overseas Securities Offering and Listing Regulations or any new PRC laws or regulations relating to variable interest entity structure

104、s will be adopted or if adopted,what they would provide.If we or ZTO Express are/is found to be in violation of any existing or future PRC laws or regulations,or fail to obtain or maintain any of the required permits or approvals,the relevant PRC regulatory authorities would have broad discretion to

105、 take action in dealing with such violations or failures.See“Item 3.Key InformationD.Risk FactorsRisks Related to Our Corporate StructureIf the PRC government finds that the agreements that establish the structure for operating certain of our operations in China do not comply with PRC regulations re

106、lating to the relevant industries,or if these regulations or the interpretation of existing regulations change in the future,we could be subject to severe penalties or be forced to relinquish our interests in those operations,”“Item 3.Key InformationD.Risk Factors Risks Related to Our Corporate Stru

107、cture Our current corporate structure and business operations may be affected by the PRC Foreign Investment Law,”“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in ChinaUncertainties with respect to the PRC legal system could adversely affect us;”and“Item 3.Key InformationD.Risk

108、 FactorsRisks Related to Doing Business in ChinaThe PRC governments significant oversight and discretion over our business operation could result in a material adverse change in our operations and the value of our ADSs and ordinary shares.”Permissions Required from the PRC Authorities for Our Operat

109、ions We conduct our business primarily through our PRC subsidiaries,ZTO Express and its subsidiaries in China.Our operations in China are governed by PRC laws and regulations.As of the date of this annual report,our PRC subsidiaries,ZTO Express and its subsidiaries have obtained the requisite licens

110、es and permits from the PRC government authorities that are material for the business operations of our holding company,ZTO Express and its subsidiaries in the PRC,including,among others,the Courier Service Operation Permit and Road Transportation Operation Permit.Given the uncertainties of interpre

111、tation and implementation of relevant laws and regulations and the enforcement practice by relevant government authorities,we may be required to obtain additional licenses,permits,filings or approvals for the functions and services of our platform in the future.For more detailed information,see“Item

112、 3.Key InformationD.Risk FactorsRisks Related to Our BusinessAny lack of requisite approvals,licenses or permits applicable to the business operation of us or our network partners may have a material and adverse impact on our business,financial condition and results of operations.”9 Furthermore,in c

113、onnection with issuance of securities to foreign investors,the PRC government has recently indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers.On July 6,2021,the relevant PRC government authorities made p

114、ublic the Opinions on Strictly Scrutinizing Illegal Securities Activities in Accordance with the Law.These opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on overseas listings by China-based companies and proposed to take effective

115、 measures,such as promoting the construction of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies.On December 24,2021,the China Securities Regulatory Commission,or the CSRC published the Draft Overseas Securities Offering and Listing Meas

116、ures and the Draft Overseas Securities Offering and Listing Regulations for public comments.Pursuant to the Draft Overseas Securities Offering and Listing Measures and the Draft Overseas Securities Offering and Listing Regulations,PRC domestic companies that directly or indirectly seek to offer or l

117、ist their securities in an overseas stock exchange,including a PRC company limited by shares and an offshore company whose main business operations are in China and intends to offer securities or be listed in an overseas stock exchange based on its onshore equities,assets,earnings or other similar i

118、nterests,are required to file with the CSRC within three business days after submitting their application documents to the regulator in the place of intended listing or offering.Failure to complete the filing under the Draft Overseas Securities Offering and Listing Measures and the Draft Overseas Se

119、curities Offering and Listing Regulations may subject the domestic company to a warning or a fine of one to ten million RMB.Under serious circumstances,the domestic company may be ordered to suspend its business or suspend its business pending rectification,or its permits or businesses licenses may

120、be revoked.As of the date of this annual report,there is no schedule for the adoptions of such drafts,and it remains unclear whether the versions adopted will have any further material changes.There remain substantial uncertainties about how these drafts will be enacted,interpreted or implemented an

121、d how they will affect our operations and future overseas offerings.As of the date of this annual report,we,our PRC subsidiaries and ZTO Express are not required to obtain any necessary approval or permission from the CSRC,the Cyberspace Administration of China,or the CAC or any other entity that is

122、 required to approve ZTO Express operations or required for us to offer securities to foreign investors under any currently effective PRC laws,regulations,and regulatory rules.However,if we had inadvertently concluded that such approvals were not required,or if applicable laws,regulations or interpr

123、etations change in a way that requires us to obtain such approval in the future,we may be unable to obtain such approvals in a timely manner,or at all,and such approvals may be rescinded even if obtained.Any such circumstance could subject us to penalties,including fines,suspension of business and r

124、evocation of required licenses,significantly limit or completely hinder our ability to continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless.See“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in China The PRC go

125、vernments significant oversight and discretion over our business operation could result in a material adverse change in our operations and the value of our ADSs and ordinary shares.”The Holding Foreign Companies Accountable Act The Holding Foreign Companies Accountable Act,or the HFCAA,was enacted o

126、n December 18,2020.The HFCAA states if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the Public Company Accounting Oversight Board(United States),or the PCAOB,for three consecutive years beginning in 2021,

127、the SEC shall prohibit our shares or ADSs from being traded on a national securities exchange.Since our auditor is located in China,a jurisdiction where the PCAOB has been unable to conduct inspections without the approval of the Chinese authorities,our auditor is not currently inspected by the PCAO

128、B,which may impact our ability to remain listed on a United States or other foreign exchange.The related risks and uncertainties could cause the value of our ADSs to significantly decline.For more details,see“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in China The PCAOB is c

129、urrently unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections over our auditor deprives our investors with the benefits of such inspections”and“Item 3.Key InformationD.Risk FactorsRisks Related to D

130、oing Business in ChinaOur ADSs will be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act,or the HFCAA,in 2024 if the PCAOB is unable to inspect or fully investigate auditors located in China,or in 2023 if proposed changes to the law are enacted.The deli

131、sting of our ADSs,or the threat of their being delisted,may materially and adversely affect the value of your investment.”10 Cash Transfers and Dividend Distribution ZTO Express(Cayman)Inc.,our Cayman Islands holding company,or the Parent,may transfer cash to our wholly-owned Hong Kong subsidiaries(

132、through intermediate holding companies in the British Virgin Islands),by making capital contributions or providing loans,and our Hong Kong subsidiaries may transfer cash to our PRC subsidiaries by making capital contributions or providing loans to them.Because the Parent and its subsidiaries control

133、 ZTO Express through contractual arrangements,they are not able to make direct capital contribution to ZTO Express.However,they may transfer cash to ZTO Express by loans or by making payment to ZTO Express for inter-group transactions.The following table sets forth the amount of the transfers for th

134、e periods presented.Year Ended December 31,2019 2020 2021 (RMB in millions)Capital contributions and loans from parent to Cayman,BVI,and Hong Kong subsidiaries 1,901 10,0111,250Capital contributions from Hong Kong subsidiaries to PRC subsidiaries 1,819 6,0413,671Amounts received by subsidiaries from

135、 ZTO Express*9,249 11,64615,974Note:(1)*The cash flows between the subsidiaries and ZTO Express included the following:transportation fees,service fees and rental expenses.As of December 31,2021,the Parent had made cumulative capital contribution of RMB15,080.5 million.In 2019,2020 and 2021,no share

136、holder loan was provided by the Parent to our PRC subsidiaries.For the years ended December 31,2019,2020 and 2021,no dividends or distributions were made to the Parent by our subsidiaries.For the years ended December 31,2019,2020 and 2021,dividends of US$189.1 million,US$233.5 million and US$208.4 m

137、illion were paid to shareholders of the Parent of record as of designated record dates.11 Historically,ZTO Express(Cayman)Inc.paid dividends to its shareholders primarily using proceeds from offshore financing activities.As ZTO Express(Cayman)Inc.is a Cayman Islands holding company with no material

138、operations of its own,its ability to pay dividends may depend upon dividends paid by our PRC subsidiaries in the future.Our PRC subsidiaries in turn generate income from their own operations,and in addition enjoy all economic benefit and receive service fees from ZTO Express pursuant to the exclusiv

139、e business cooperation agreement with ZTO Express.Under PRC law,each of our subsidiaries and ZTO Express in China is required to set aside at least 10%of its after-tax profits each year,if any,to fund certain statutory reserve funds until such reserve funds reach 50%of its registered capital.In addi

140、tion,each of our subsidiaries and ZTO Express in China may allocate a portion of its after-tax profits based on PRC accounting standards to a surplus fund at its discretion.The statutory reserve funds and the discretionary funds are not distributable as cash dividends.Remittance of dividends by a wh

141、olly foreign-owned company out of China is subject to examination by the banks designated by SAFE and declaration and payment of withholding tax.Additionally,if our PRC subsidiaries and ZTO Express incur debt on their own behalf in the future,the instruments governing their debt may restrict their a

142、bility to pay dividends or make other distributions to us.Our PRC subsidiaries have not paid dividends and will not be able to pay dividends until it generates accumulated profits and meets the requirements for statutory reserve funds.For more details,see“Item 3.Key InformationD.Risk FactorsRisks Re

143、lated to Doing Business in ChinaPRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from loaning to or making additional capital contributions to our PRC subsidiaries,which could materi

144、ally and adversely affect our liquidity and our ability to fund and expand our business”and“Item 3.Key InformationD.Risk FactorsRisks Related to Doing Business in ChinaGovernmental control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your i

145、nvestment.”Except these regulatory requirements,there are not any other statutory restrictions and limitations on our ability to distribute earnings from our PRC subsidiaries to the parent company and U.S.investors or the ability of ZTO Express to settle amounts owned under the VIE agreements.ITEM 1

146、.IDENTITY OF DIRECTORS,SENIOR MANAGEMENT AND ADVISERS Not applicable.ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable.ITEM 3.KEY INFORMATION A.Our Selected Consolidated Financial Data The following summary consolidated statements of comprehensive income data for the years ended December

147、 31,2019,2020 and 2021,summary consolidated balance sheet data as of December 31,2020 and 2021 and summary consolidated cash flow data for the years ended December 31,2019,2020 and 2021 have been derived from our audited consolidated financial statements included elsewhere in this annual report.The

148、summary consolidated statements of comprehensive income data for the years ended December 31,2017 and 2018,the summary consolidated balance sheet data as of December 31,2017,2018 and 2019 and the summary consolidated cash flow data for the years ended December 31,2017 and 2018 have been derived from

149、 our audited consolidated financial statements that are not included in this annual report.Our consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States of America,or U.S.GAAP.12 You should read the summary consolida

150、ted financial information in conjunction with our consolidated financial statements and related notes and“Item 5.Operating and Financial Review and Prospects”included elsewhere in this annual report.Our historical results are not necessarily indicative of our results expected for future periods.Year

151、s Ended December 31,2017 2018 2019 2020 2021 RMB RMB RMB RMB RMB US$(in thousands,except for share and per share data)Selected Consolidated Comprehensive Income Data:Revenues 13,060,07317,604,45122,109,94625,214,290 30,405,8394,771,340Cost of revenues (8,714,489)(12,239,568)(15,488,778)(19,377,184)(

152、23,816,462)(3,737,323)Gross profit 4,345,5845,364,8836,621,1685,837,106 6,589,3771,034,017Operating income(expenses):Selling,general and Administrative (780,517)(1,210,717)(1,546,227)(1,663,712)(1,875,869)(294,365)Other operating income,net 183,368178,057387,890580,973 789,503123,890Total operating

153、expenses (597,149)(1,032,660)(1,158,337)(1,082,739)(1,086,366)(170,475)Income from operations 3,748,4354,332,2235,462,8314,754,367 5,503,011863,542Other income(expenses):Interest income 166,325401,162585,404442,697 363,89057,102Interest expense (15,668)(780)(35,307)(126,503)(19,851)Loss from fair va

154、lue changes of financial instruments (877)52,9098,303Gain on deemed disposal of equity method investments Gain/(loss)on disposal of equity investees and subsidiary 562,637(2,860)1,086 2,357370Impairment of investment in equity investee (30,000)(56,026)Unrealized gain from investment in equity invest

155、ee 754,468 Foreign currency exchange gain(loss)(48,149)41,18913,301(127,180)(56,467)(8,861)Income before income tax and share of loss in equity method investments 3,820,9435,336,4316,757,1185,034,786 5,739,197900,605Income tax expense (646,361)(929,133)(1,078,295)(689,833)(1,005,451)(157,777)Share o

156、f loss in equity method investments (15,682)(19,386)(7,556)(18,507)(32,419)(5,087)Net Income 3,158,9004,387,9125,671,2674,326,446 4,701,327737,741Net loss/(income)attributable to noncontrolling interests 763(4,887)2,878(14,233)53,5008,395Net income attributable to ZTO Express(Cayman)Inc.3,159,6634,3

157、83,0255,674,1454,312,213 4,754,827746,136Net income attributable to ordinary shareholders 3,159,6634,383,0255,674,1454,312,213 4,754,827746,136 Net earnings per share/ADS attributable to ordinary shareholders Basic 4.415.837.245.42 5.800.91Diluted 4.405.827.235.42 5.800.91Weighted average shares use

158、d in calculating net earnings per ordinary share/ADS Basic 717,138,526751,814,077784,007,583796,097,532 819,961,265819,961,265Diluted 717,599,562752,672,956784,331,120796,147,504 819,961,265819,961,265Other comprehensive income(loss),net of tax of nil:Foreign currency translation adjustment (590,545

159、)867,612104,004(771,291)(146,533)(22,994)Comprehensive income attributable to ZTO Express(Cayman)Inc.2,569,1185,250,6375,778,1493,540,922 4,608,294723,142 13 As of December 31,2017 2018 2019 2020 2021 RMB RMB RMB RMB RMB US$(in thousands)Selected Consolidated Balance Sheet Data:Current assets:Cash a

160、nd cash equivalents 5,425,0244,622,5545,270,20414,212,778 9,721,2251,525,472Short-term investment 5,224,55913,599,85211,113,2173,690,402 2,845,319446,493Advances to suppliers 263,574337,874438,272589,042 667,855104,801Prepayments and other current assets 719,9831,507,9961,964,5062,334,688 3,142,3684

161、93,106Non-current assets:Property and equipment,net 6,473,0109,035,70412,470,63218,565,161 24,929,8973,912,045Goodwill 4,241,5414,241,5414,241,5414,241,541 4,241,541665,590Total assets 25,827,63839,682,85745,890,50259,204,750 62,772,3439,850,350Liabilities and equity Current liabilities:Short-term b

162、ank borrowings 250,0001,432,929 3,458,717542,748Other current liabilities 2,281,0672,833,7693,552,2884,487,084 5,794,380909,263Total liabilities 4,386,3215,413,3087,487,10510,105,052 13,844,7622,172,544Total liabilities and equity 25,827,63839,682,85745,890,50259,204,750 62,772,3439,850,350 Years En

163、ded December 31,2017 2018 2019 2020 2021 RMB RMB RMB RMB RMB US$(in thousands)Selected Consolidated Cash Flow Data:Net cash provided by operating activities 3,630,6844,404,0516,304,1864,950,749 7,220,2171,133,010Net cash used in investing activities(8,294,547)(12,872,633)(3,664,213)(3,549,341)(8,756

164、,533)(1,374,091)Net cash provided by/(used in)financing activities(1,061,558)7,042,122(1,982,306)8,337,407 (2,903,985)(455,699)Effect of exchange rate changes on cash,cash equivalents and restricted cash(424,000)275,680(3,207)(656,137)(150,430)(23,606)Net increase/(decrease)in cash,cash equivalents

165、and restricted cash(6,149,421)(1,150,780)654,4609,082,678 (4,590,731)(720,386)Cash,cash equivalents and restricted cash at beginning of year 11,923,1555,773,7344,622,9545,277,414 14,360,0922,253,412Cash,cash equivalents and restricted cash at end of year 5,773,7344,622,9545,277,41414,360,092 9,769,3

166、611,533,026 14 Financial Information Related to ZTO Express The following table presents the condensed consolidating balance sheet data for ZTO Express and other entities as of the dates presented.As of December 31,2021 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thou

167、sands)Assets Current assets:Cash and cash equivalents 621,0348,169,249930,942 9,721,225Restricted cash 27,736 27,736Accounts receivable,net 262,167671,277 933,444Financing receivables,net 133,541977,920 1,111,461Short-term investment 196,4622,328,857320,000 2,845,319Inventories 52,74730,214 82,961Ad

168、vances to suppliers 612,84255,013 667,855Prepayments and other current assets 1,218,1721,924,196 3,142,368Amounts due from related parties2,692,89896,288440,190 (3,095,386)133,990Total current assets 3,510,394 12,901,599 5,349,752 (3,095,386)18,666,359Investments in equity investees 45,807,1792,402,

169、827300,380 (44,779,938)3,730,448Property and equipment,net 19,063,3635,866,534 24,929,897Land use rights,net 4,141,2411,194,308 5,335,549Intangible assets,net 35,634 35,634Operating lease right-of-use assets 26,407870,831 897,238Goodwill 84,4304,157,111 4,241,541Deferred tax assets 284,139650,709 93

170、4,848Long-term investment 1,214,500 1,214,500Long-term financing receivables,net 295,9531,117,003 1,412,956Other non-current assets 377,643384,630 762,273Amounts due from related parties-non current 611,100 611,100TOTAL ASSETS 49,317,573 41,438,836 19,891,258 (47,875,324)62,772,343 Liabilities Curre

171、nt liabilities Short-term bank borrowings 637,2602,821,457 3,458,717Accounts payable 400,8801,556,649 1,957,529Notes payable 45,000129,920 174,920Advances from customers 12,7521,213,797 1,226,549Income tax payable 86,789 86,789Amounts due to related parties 3,103,73814,434 (3,095,386)22,786Operating

172、 lease liabilities,current 12,022238,973 250,995Acquisition consideration payables 22,942 22,942Dividends payable 708 708Other current liabilities 42,3583,196,7422,555,280 5,794,380Total current liabilities 680,3266,880,8658,530,510 (3,095,386)12,996,315Non-current operating lease liabilities 22,351

173、533,740 556,091Deferred tax liabilities 179,813112,543 292,356TOTAL LIABILITIES 680,326 7,083,029 9,176,793 (3,095,386)13,844,762 15 As of December 31,2020 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Assets Current assets:Cash and cash equivalents 3,443,6249

174、,992,429776,725 14,212,778Restricted cash 133,196 133,196Accounts receivable,net 231,347514,666 746,013Financing receivables,net 150,673341,486 492,159Short-term investment 2,509,1371,181,265 3,690,402Inventories 10,29542,775 53,070Advances to suppliers 543,42145,621 589,042Prepayments and other cur

175、rent assets 13,0131,168,5981,153,077 2,334,688Amounts due from related parties4,993,853643,07934,034 (5,597,688)73,278Total current assets 10,959,627 14,054,303 2,908,384 (5,597,688)22,324,626Investments in equity investees 37,391,4462,062,086110,570 (36,339,639)3,224,463Property and equipment,net 1

176、2,540,0086,025,153 18,565,161Land use rights,net 3,221,8241,138,849 4,360,673Intangible assets,net 41,832 41,832Operating lease right-of-use assets 41,275834,984 876,259Goodwill 84,4304,157,111 4,241,541Deferred tax assets 206,029514,532 720,561Long-term investment 652,5001,189,500 1,842,000Long-ter

177、m financing receivables,net 185,3501,784,990 1,970,340Other non-current assets 437,83899,456 537,294Amounts due from related parties-non current 500,000 500,000TOTAL ASSETS 49,003,57334,564,47517,574,029 (41,937,327)59,204,750 Liabilities Current liabilities Short-term bank borrowings 1,432,929 1,43

178、2,929Accounts payable 480,8191,155,069 1,635,888Notes payable 168,062158,138 326,200Advances from customers 50,7391,068,927 1,119,666Income tax payable(202,098)250,726 48,628Amounts due to related parties 4,993,853620,490 (5,597,688)16,655Operating lease liabilities,current 12,323234,071 246,394Acqu

179、isition consideration payables 22,942 22,942Dividends payable 11,198 11,198Other current liabilities 13,5621,878,7212,594,801 4,487,084Total current liabilities 24,7607,405,3617,515,151 (5,597,688)9,347,584Non-current operating lease liabilities 34,354468,127 502,481Deferred tax liabilities 127,1711

180、27,816 254,987TOTAL LIABILITIES 24,760 7,566,886 8,111,094 (5,597,688)10,105,052 The following table presents the condensed consolidating statements of operations for ZTO Express and other entities for the periods presented.For the Year Ended December 31,2021 Consolidated The Company Subsidiaries ZT

181、O Express Elimination Total RMB (in thousands)Revenue 15,651,99729,721,135 (14,967,293)30,405,839Net income 4,754,8273,653,5651,237,524 (4,944,589)4,701,327 16 For the Year Ended December 31,2020 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Revenue 12,999,401

182、23,734,103 (11,519,214)25,214,290Net income 4,312,2133,852,147478,168 (4,316,082)4,326,446 For the Year Ended December 31,2019 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Revenue 10,064,44321,465,515 (9,420,012)22,109,946Net income 5,674,1453,406,555841,707

183、(5,595,961)4,326,446 The following table presents condensed consolidating cash flow data for ZTO Express and other entities for the years ended presented.For the Year Ended December 31,2021 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Net cash provided by ope

184、rating activities 88,8766,155,051976,290 7,220,217Net cash provided by/(used in)investing activities 1,679,330(10,808,233)(877,285)1,249,655 (8,756,533)Net cash(used in)/provided by financing activities(4,518,056)2,808,51455,212 (1,249,655)(2,903,985)For the Year Ended December 31,2020 Consolidated

185、The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Net cash provided by/(used in)operating activities 303,1645,185,341(537,756)4,950,749Net cash(used in)/provided by investing activities(3,808,613)(9,104,151)(647,170)10,010,593 (3,549,341)Net cash provided by/(used in)financing

186、 activities 6,894,13310,020,9381,432,929 (10,010,593)8,337,407 For the Year Ended December 31,2019 Consolidated The Company Subsidiaries ZTO Express Elimination Total RMB (in thousands)Net cash provided by operating activities 433,1724,087,2961,783,718 6,304,186Net cash provided by/(used in)investin

187、g activities1,223,284(4,957,929)(1,831,001)1,901,433 (3,664,213)Net cash(used in)/provided by financing activities(2,033,666)1,952,793 (1,901,433)(1,982,306)B.Capitalization and Indebtedness Not applicable.C.Reasons for the Offer and Use of Proceeds Not applicable.17 D.Risk Factors SUMMARY OF RISK F

188、ACTORS Investing in our Class A ordinary shares and/or ADSs involves significant risks.You should carefully consider all of the information in this annual report before making an investment in our Class A ordinary shares and/or ADSs.The following list summarizes some,but not all,of these risks.Risks

189、 Related to Our Business and Industry Our business and growth are highly dependent on the development of the e-commerce industry and the emergence of New Retail in China.Our business operations have relied on,and are likely to continue to be significantly influenced by,certain third-party e-commerce

190、 platforms.We face risks associated with our network partners and their employees and personnel.We face intense competition,which could adversely affect our results of operations and market share.Any service disruptions experienced by our sorting hubs or the outlets operated by our network partners

191、may adversely affect our business operations.Our technology systems are critical to our business operations and growth prospects,and failure to continue to improve,and effectively utilize,our technology systems or develop new technologies could harm our business operations,reputation and growth pros

192、pects.We operate in a labor-intensive industry and an overall contraction in the availability of workers in the labor market or any labor unrest may negatively affect our business.We engage outsourcing firms to provide personnel for our operations.We have limited control over these personnel and may

193、 be liable for violations of applicable PRC labor laws and regulations accordingly.We face risks associated with parcels handled and transported through our network and risks associated with transportation.Our past growth rates may not be indicative of our future growth,and if we are unable to manag

194、e our growth or execute our strategies effectively,our business and prospects may be materially and adversely affected.18 Risks Related to Our Corporate Structure ZTO is a Cayman Islands holding company with no equity ownership in our variable interest entities and we conduct our operations in China

195、 primarily through(i)our PRC subsidiaries and(ii)our variable interest entities,with which we have maintained contractual arrangements.Investors in our ADSs and/or Class A ordinary shares thus are not purchasing equity interest in our operating entities in China but instead are purchasing equity int

196、erest in a Cayman Islands holding company.If the PRC government finds that the agreements that establish the structure for operating our business do not comply with the PRC laws and regulations,or if these regulations or their interpretations change in the future,we could be subject to severe penalt

197、ies or be forced to relinquish our interests in those operations.Our holding company,our PRC subsidiaries,our variable interest entities,and investors of ZTO face uncertainty about potential future actions by the PRC government that could affect the enforceability of the contractual arrangements wit

198、h our variable interest entities and,consequently,significantly affect the financial performance of our variable interest entities and our company as a whole.Risks Related to Doing Business in China Changes in Chinas economic,political or social conditions or government policies could have a materia

199、l adverse effect on our business and operations.PRC governments significant authority in regulating our operations and its oversight and control over securities offerings conducted overseas by,and foreign investment in,China-based issuers could significantly limit or completely hinder our ability to

200、 offer or continue to offer securities to investors.Implementation of industry-wide regulations in this nature may cause the value of such securities to significantly decline.Risks and uncertainties arising from the legal system in China,including risks and uncertainties regarding the enforcement of

201、 laws and quickly evolving rules and regulations in China,could result in a material adverse change in our operations and the value of our ADSs.We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have,and any limi

202、tation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business.The PCAOB is currently unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PC

203、AOB to conduct inspections over our auditor deprives our investors with the benefits of such inspections.Our ADSs will be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act,or the HFCAA,in 2024 if the PCAOB is unable to inspect or fully investigate audit

204、ors located in China,or in 2023 if proposed changes to the law are enacted.The delisting of our ADSs,or the threat of their being delisted,may materially and adversely affect the value of your investment.19 Risks Related to Our Shares and ADSs We adopt different practices as to certain matters as co

205、mpared with many other companies listed on the Hong Kong Stock Exchange.The trading prices of our ADSs and Class A ordinary shares have been and are likely to continue to be volatile,which could result in substantial losses to holders of our Class A ordinary shares and/or ADSs.Our dual-class share s

206、tructure with different voting rights will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A ordinary shares and ADSs may view as beneficial.RISKS RELATED TO OUR BUSINESS AND INDUSTRY Our busines

207、s and growth are highly dependent on the development of the e-commerce industry and the emergence of New Retail in China.We generate a significant portion of our parcel volume by serving end customers that conduct business on various e-commerce platforms in China,and our end customers rely on our se

208、rvices to fulfill orders placed by consumers on such platforms.In December 2021,more than 90%of our total parcel volume was attributable to e-commerce platforms.Our business and growth are therefore highly dependent on the viability and prospects of the e-commerce industry in China.Any uncertainties

209、 relating to the growth,profitability and regulatory regime of the e-commerce industry in China could have a significant impact on us.The development of the e-commerce industry in China is affected by a number of factors,most of which are beyond our control.These factors include:the growth of broadb

210、and and mobile internet penetration and usage in China;the consumption power and disposable income of e-commerce consumers in China,as well as changes in demographics and consumer tastes and preferences;the availability,reliability and security of e-commerce platforms;the selection,price and popular

211、ity of products offered on e-commerce platforms;the potential impact of the COVID-19 to our business operations and the economy in China and elsewhere generally;the emergence of alternative channels or business models that better suit the needs of consumers in China;the development of fulfillment,pa

212、yment and other ancillary services associated with e-commerce;the continued integration of online and offline retail channels by large e-commerce platforms and various retail merchants to reduce customer acquisition costs and enhance customers shopping experience(“New Retail”);and changes in laws an

213、d regulations,as well as government policies,that govern the e-commerce industry in China.20 The e-commerce industry is highly sensitive to changes in macroeconomic conditions,and e-commerce spending tends to decline during recessionary periods.Many factors beyond our control,including inflation and

214、 deflation,fluctuations in currency exchange rates,volatility of stock and property markets,interest rates,tax rates and other government policies and changes in unemployment rates can adversely affect consumer confidence and spending behavior on e-commerce platforms,which could in turn materially a

215、nd adversely affect our growth and profitability.In addition,unfavorable changes in domestic and international politics,including military conflicts,political turmoil and social instability,may also adversely affect consumer confidence and spending,which could in turn negatively impact our growth an

216、d profitability.Our business operations have relied on,and are likely to continue to be significantly influenced by,certain third-party e-commerce platforms.Our business operations have relied on certain third-party e-commerce platforms,such as the Alibaba ecosystem,and we still expect to be signifi

217、cantly influenced by those third-party e-commerce platforms in the foreseeable future.Although such third-party e-commerce platforms are not our direct customers,they have significant influence over how transactions take place on their e-commerce platforms,including how purchase orders are fulfilled

218、 by indicating to consumers the preferred express delivery companies for orders placed.For example,in order to maintain and foster our cooperation with Alibaba,we may have to accommodate the demands and requirements from various players in the Alibaba ecosystem,such as the adoption of digital waybil

219、ls initiated by Cainiao Network,a central logistics information system and solutions provider affiliated with Alibaba.Such demands and requirements may increase the cost of our business or weaken our connection with our end customers.Furthermore,in May 2018,Alibaba and Cainiao Network entered into a

220、 strategic transaction with us.Pursuant to the transaction terms,certain investors led by Alibaba and Cainiao Network invested US$1.38 billion in our company in exchange for approximately 10%of our equity interest at that time and obtained certain shareholder rights in our company.The transaction wa

221、s completed in June 2018.Alibaba has also invested,and may invest in the future,in our competitors.Alibaba may encourage merchants on its platforms to choose certain other investees services over ours for business reasons.Alibaba may also build an in-house delivery network to serve its e-commerce pl

222、atforms in the future.If either or both of these situations were to materialize,our business may be negatively impacted,and our results of operations may be materially and adversely affected.We face risks associated with our network partners and their employees and personnel.As of December 31,2021,w

223、e had over 30,400 pickup/delivery outlets and over 5,700 direct network partners under our ZTO brand.We rely on these network partners to directly interact with and serve end customers.However,the interests of a network partner may not be entirely aligned with ours or with those of our other network

224、 partners at all times.We manage our business relationships with direct network partners through contractual agreements,which provide for performance incentives along with periodic evaluations.Our direct network partners may sub-contract part of their business to their cooperation partners,which we

225、refer to as our indirect network partners.The sub-contracting to indirect network partners is subject to our consent.However,we may not be able to manage the network partners as effectively as if we had full ownership of them or operated their business directly.In particular,we do not enter into agr

226、eements with our indirect network partners and are therefore unable to exert a significant degree of influence over them.21 Our network partners and their employees have a significant number of direct interactions with our end customers,and their performance is directly associated with our brand.We

227、do not directly supervise the employees of our network partners in providing services to end customers.Our existing network-wide service standards and periodic training to the personnel of our network partners may not be sufficient for us to effectively monitor,maintain and improve their service qua

228、lity or their general conduct towards end-customers.In the event of any unsatisfactory performance or unlawful behavior by our network partners and/or their employees towards end-customers,we may experience service disruptions and our reputation may be materially and adversely affected.We may volunt

229、arily,or upon the request of applicable authorities,conduct investigations on such event and adopt remediation/preventive measures.Such efforts may not be limited to the relevant parties,but applicable throughout our network,which could cause temporary diversion from the ordinary course of our and o

230、ur network partners business.Furthermore,our network partners may fail to implement sufficient control over the pickup and delivery personnel who work at the outlets in connection with their conduct,such as proper collection and handling of parcels and delivery service fees,adherence to customer pri

231、vacy standards and timely delivery of parcels.As a result,we or our network partners may suffer financial losses,incur liabilities and suffer reputational damage in the event of theft or late delivery of parcels,embezzlement of delivery service fees,mishandling of customer privacy,misconduct or unla

232、wful behavior towards end-customers,or any other behavior that reflects adversely on our business and reputation.Suspension or termination of a network partners services in a particular geographic area may result in a significant interruption or failure to provide services in the corresponding geogr

233、aphic area.A network partner may suspend or terminate its services voluntarily or involuntarily due to various reasons,including a disagreement or dispute with us,failure to make a profit,failure to obtain requisite approvals,failure to maintain licenses or permits or to comply with other government

234、al regulations,and events beyond our or its control,such as inclement weather,natural disasters,transportation interruptions or labor unrest or shortage.Due to the intense competition in Chinas express delivery industry,our existing network partners may also choose to discontinue their cooperation w

235、ith us and work with our competitors instead.We may not be able to promptly replace these network partners or find alternative ways to provide services in a timely,reliable and cost-effective manner,or at all.As a result of any service disruptions associated with our network partners,our customer sa

236、tisfaction,reputation,operations and financial performance may be materially and adversely affected.We face intense competition,which could adversely affect our results of operations and market share.We operate in a highly competitive and consolidating industry.We compete primarily with leading dome

237、stic express delivery companies,including YTO Express,STO Express,Yunda Express,J&T Express,SF Express and the express delivery services provided by China Post such as EMS.We compete with them based on a number of factors,including network stability,business model,operational capabilities,infrastruc

238、ture capacity,cost control and service quality.We have historically experienced a decline in the delivery service market prices and we may continue to face downward pricing pressure.If we and our network partners cannot effectively control our costs to remain competitive,our market share and revenue

239、 may decline.Additionally,if we have to subsidize our network partners to increase our network partners competitiveness,our gross margin may decline.Our competitors may attempt to gain market share by lowering their rates,especially during economic slowdowns or in key regional markets.Such rate redu

240、ctions may limit our ability to maintain or increase our rates and operating margins and inhibit our ability to grow our business.In addition,major e-commerce platforms,such as Alibaba,Pinduoduo and JD.com,may choose to build or further develop their respective in-house delivery capabilities to serv

241、e their logistics needs and compete with us,which may significantly affect our market share and total parcel volume.Furthermore,as we diversify our service offering and further expand our customer base,we may face competition from existing or new players in new sectors we choose to enter.In particul

242、ar,we or our network partners may face competition from existing or new last-mile delivery service providers which may expand their service offerings to include express delivery or adopt a business model disruptive to our business and compete with our network partners for delivery personnel.Similarl

243、y,existing players in an adjacent or sub-market may choose to leverage their existing infrastructure and expand their services to serve our customers.If these players succeed in doing so,our market share may suffer and our business and financial performance may be significantly and adversely affecte

244、d.22 Certain of our current and potential competitors,as well as international logistics operators with a presence in China,may have significantly greater resources,longer operating histories,larger customer bases and greater brand recognition than us.Other current and potential competitors may be a

245、cquired by,receive investment from,or enter into strategic relationships with,established and well-financed companies or investors which would help enhance their competitiveness.Moreover,competitors may adopt more aggressive pricing policies or devote greater resources to marketing and promotional c

246、ampaigns than us.We may not be able to compete successfully against current or future competitors,and competitive pressures may have a material and adverse effect on our business,financial condition and results of operations.Any service disruptions experienced by our sorting hubs or the outlets oper

247、ated by our network partners may adversely affect our business operations.Our daily operations rely heavily on the orderly performance of our sorting hubs and the pickup and delivery outlets operated by our network partners.Any service disruption at our sorting hubs or the pickup and delivery outlet

248、s as a result of a failure or disruption of the automated facilities,under-capacity during peak parcel volume periods,force majeure,third-party sabotage,disputes,employee delinquency or strike,government inspections or regulatory orders mandating service halt or temporary or permanent shutdown would

249、 adversely impact our business operations.For example,any ad hoc regulatory inspection by local authorities,such as environmental safety and security checks,on any of our facilities or our network partners service outlets may cause business disruptions and delay the processing and delivery of parcel

250、s.The outbreak of an epidemic,such as the recent outbreak of COVID-19,may also cause a significant disruption to our business.For instance,certain emergency measures implemented by the Chinese government in early 2020,mandated the temporary closure of our facilities,sorting hubs and service outlets.

251、The severe flood in Henan province in July 2021 also caused temporary closure of our facilities,sorting hubs and service outlets in Henan province.If we are required by governmental authorities to implement changes to our facilities or relocate any of our facilities or our network partners service o

252、utlets,our and our network partners operating costs may increase as a result.In the event of service disruptions at our sorting hubs or outlets,parcel sorting or parcel pickup and delivery may be delayed,suspended or stopped.Such parcels would need to be redirected to other nearby sorting hubs or ou

253、tlets,and such rerouting of parcels will likely increase risks of delay and delivery errors.At the same time,increased parcel sorting or pickup and delivery pressure on nearby sorting hubs or outlets may negatively impact their performance and result in adverse effects to our entire network.Any of t

254、he foregoing events may result in significant operational interruptions and slowdowns,customer complaints and reputational damage.Our technology systems are critical to our business operations and growth prospects,and failure to continue to improve,and effectively utilize,our technology systems or d

255、evelop new technologies could harm our business operations,reputation and growth prospects.The satisfactory performance,reliability and availability of our technology systems is critical to our ability to deliver high-quality customer services.We rely on the Zhongtian system,our self-developed and c

256、entralized technology systems,which consists of our operational management system,our network management system,our settlement system,our finance system and other systems and mobile apps connecting our network partners to efficiently operate our network.These integrated systems support the smooth pe

257、rformance of certain key functions of our business,such as order tracking,fleet dispatch and management,route planning,and fee settlement.In addition,the maintenance and processing of various operating and financial data is essential to the day-to-day operation of our business and formulation of our

258、 strategies.Therefore,our business operations and growth prospects depend,in part,on our ability to maintain and make timely and cost-effective enhancements and upgrade to our technology systems and to introduce innovative additions to meet changing operational needs.Continued investment in informat

259、ion technology and equipment to enhance operational efficiency and reliability is part of our growth strategy.While we have significantly increased our spending on technology,such investment may not be sufficient to fully support our expanding business needs.Failure to maintain sufficient spending o

260、n technology systems could cause economic losses and put us at a disadvantage to our competitors.We can provide no assurance that we will be able to keep up with technological improvements or that technologies developed by others(including our competitors)will not render our services less competitiv

261、e or attractive.Any issues impairing the functionality and effectiveness of our systems could result in unanticipated system disruptions,slower response time and impaired user experiences,as well as delays or inaccuracies in reporting operating and financial information.23 Any interruptions caused b

262、y telecommunications failures,computer viruses,hacking,or other attempts to harm our technology infrastructure could result in the unavailability or slowdown of our centralized system and significantly impact workflows throughout our entire network.We can provide no assurance that our current securi

263、ty mechanisms will be sufficient to protect our technology systems from any third-party intrusions,viruses or hacker attacks,information or data theft or other similar activities.Any such occurrences could disrupt our services,damage our reputation and harm our results of operations.We operate in a

264、labor-intensive industry and an overall contraction in the availability of workers in the labor market or any labor unrest may negatively affect our business.Our business is labor-intensive.As of December 31,2021,we had a total of 23,865 employees and over 57,000 outsourced personnel.A failure by us

265、 or our network partners to maintain a stable and dedicated workforce may result in disruption or delays in the services provided to end customers.We and our network partners often need to hire additional or temporary workers to handle the significant increase in parcel volume following special prom

266、otional events such as promotional campaigns on June 18,November 11 and December 12 of each year or during other peak seasons throughout the year.During these periods we have observed an increasingly competitive and tight labor market.In general,this has resulted in,and we expect will continue to re

267、sult in,increased labor costs driven by higher salaries,social benefits and employee headcounts.Further,we and our network partners compete with other companies in our industry as well as other labor-intensive industries for labor,and such competition may affect the overall stability of our workforc

268、e and the performance of our network.For example,emerging disruptive business models like intra-city delivery,which enables senders and recipients within the same city to achieve rapid point-to-point delivery;or omni-channel delivery,which fulfills the logistics demands for omni-channel retailers an

269、d consumers,are likely to compete for pickup and delivery personnel with our network partners and service outlets.Some of our network partners or outlets may be pressured to increase compensation and social welfare benefits for their employees,which may result in lower profitability and insufficient

270、 cashflow for our network partners or service outlets.If our network partners or service outlets are unable to offer competitive salaries and benefits,or pay their employees on time or in full,they may lose their personnel,resulting in insufficient delivery resources,disgruntled employees,and lower

271、delivery service quality in certain parts of our network.We and our network partners have been involved in labor disputes in the past,none of which either individually or in the aggregate,had a material adverse impact on us.We and our network partners expect to continue to be involved in labor dispu

272、tes from time to time,including involvement in various legal or administrative proceedings related to such disputes.Any labor unrest directed against us or our network partners could directly or indirectly prevent or hinder our normal business operations,and,if not resolved in a timely manner,lead t

273、o delays in fulfilling our customer orders and decreases in our revenue.Historically,we have experienced an incident where an employee strike of one of our network partners caused a prolonged service suspension in a southern city of China,and we cannot assure you that similar incidents would not hap

274、pen in the future.We and our network partners cannot predict or control any labor unrest,especially those involving labor not directly employed by us.Further,labor unrest may have a negative effect on general labor market conditions or result in changes to labor laws,which in turn could materially a

275、nd adversely affect our business,financial condition and results of operations.We engage outsourcing firms to provide personnel for our operations.We have limited control over these personnel and may be liable for violations of applicable PRC labor laws and regulations accordingly.We engage outsourc

276、ing firms to provide a large number of personnel to work at our network facilities.As of December 31,2021,over 57,000 outsourced personnel were active in our operations.We enter into agreements with outsourcing firms and do not have any direct contractual relationship with outsourced personnel,resul

277、ting in limited control over them.If any outsourced personnel fail to operate in accordance with instructions,policies and business guidelines set forth by outsourcing firms based on our requirements,our market reputation,brand image and results of operations could be materially and adversely affect

278、ed.24 Our agreements with the outsourcing firms may provide that we are not liable to the outsourced personnel.However,if the outsourcing firms violate any relevant PRC labor laws,regulations or their employment agreements with the personnel,such personnel may file a claim against us as they provide

279、 their services at our network facilities.As a result,we may incur legal liability,and our market reputation,brand image as well as our business,financial condition and results of operations could be materially and adversely affected.We face risks associated with parcels handled and transported thro

280、ugh our network and risks associated with transportation.We handle a large volume of parcels across our network,and face challenges with respect to the protection and inspection of these parcels.Parcels in our network may be stolen,damaged or lost for various reasons,and we and/or our network partne

281、rs may face actual or alleged liability for such incidents.In addition,we may fail to detect unsafe or prohibited/restricted items.There have been incidents in the past where our network partners failed to strictly implement parcel screening procedures and allowed controlled items to be mailed throu

282、gh our network.Further,unsafe items processed and transported by us,such as flammables and explosives,toxic or corrosive items and radioactive materials,may damage other parcels in our network,injure their recipients,harm our personnel and result in property damage.Failure to prevent prohibited or r

283、estricted items from entering our network may result in administrative or criminal penalties as well as civil liability for personal injury and property damage.The transportation of parcels involves inherent risks.We have a large number of vehicles and personnel involved in our transportation operat

284、ions at all times,who are subject to risks associated with transportation safety,including transportation related injuries and losses.For example,our vehicles and personnel may be involved in traffic accidents from time to time,resulting in personal injury and loss or damage to parcels carried by th

285、em.In addition,frictions or disputes may occasionally arise from the direct interaction of our personnel with parcel senders and recipients,which may result in personal injury or property damage if such incidents escalate.The insurance policies carried by us may not fully cover the damages caused by

286、 transportation related injuries or losses.Any of the foregoing could disrupt our services,cause us to incur substantial expenses and divert the time and attention of our management.We and our network partners may face claims and incur significant liabilities if found liable or partially liable for

287、any injuries,damages or losses.Claims against us may exceed the amount of our insurance coverage or may not be covered by insurance at all.Government authorities may also impose significant fines on us or require us to adopt costly preventive measures.Furthermore,if our services are perceived to be

288、unsafe by our end customers,e-commerce platforms and consumers,our business volume may be significantly reduced,and our business,financial condition and results of operations may be materially and adversely affected.Our past growth rates may not be indicative of our future growth,and if we are unabl

289、e to manage our growth or execute our strategies effectively,our business and prospects may be materially and adversely affected.Our business has grown substantially in recent years,but our past growth rates may not be indicative of our future growth.Our revenue growth in recent years was partly att

290、ributable to business acquisition,such as the acquisition of China Oriental Express Co.,Ltd.The acquired business of China Oriental Express Co.,Ltd.provides freight forwarding services,and our revenue generated from such services amounted to RMB1,236.0 million,RMB1,862.7 million and RMB1,529.6 milli

291、on(US$240.0 million)in 2019,2020 and 2021,respectively,accounting for 5.6%,7.4%and 5.0%of our total revenues during the same periods,respectively.We plan to further expand our network in response to increasing customer and consumer needs,but we may not succeed in doing so.Even if we are able to expa

292、nd our network as planned,we may not be able to continue to integrate and optimize a larger network.In addition,as customer and consumer needs at both the national and regional levels are continuously changing,we may not be able to successfully anticipate or respond to such changes.For example,we ma

293、y experience shortages in our delivery capacity if our expansion fails to accurately and timely match increased customer and consumer demand.Furthermore,our anticipated future growth will likely place significant demands on our management and operations.Our success in managing our growth will depend

294、,to a significant degree,on the ability of our executive officers and other members of our senior management to carry out our strategies effectively,our ability to balance the interests between us and our network partners as well as among our network partners,and our ability to adapt,improve and dev

295、elop our financial and management information systems,controls and procedures.In addition,we will likely have to successfully recruit,train and manage more employees and improve and expand our sales and marketing capabilities.If we are not able to manage our growth or execute our strategies effectiv

296、ely due to any of the foregoing reasons,our expansion may not be successful,and our business and prospects may be materially and adversely affected.25 Our long-term growth and competitiveness are highly dependent on our ability to control costs and maintain or raise prices.To maintain competitive pr

297、icing and enhance our profit margins,we must continually control our costs.Effective cost-control measures have a direct impact on our financial condition and results of operations.We have adopted various cost control measures and will continue to add new ones as necessary and appropriate.For exampl

298、e,transportation costs can be reduced through the choice of appropriate vehicles and optimization of transportation routes,and labor costs can be reduced through automation.However,the measures we have adopted or will adopt in the future may not be as effective as expected in improving our financial

299、 condition and results of operations.We do not intend to compete with our competitors by introducing aggressive pricing policies,which we consider detrimental to our long-term growth.Delivery services fees charged by our network partners to parcel senders have declined over time,partially as a resul

300、t of market competition.Our gross profit per parcel is also affected by a variety of other factors,such as a decline in the average weight of parcels handled by us,an increase in the adoption of digital waybills,which have a lower charge rate than traditional paper waybills,an increase in delivery s

301、ervices directly provided to certain enterprise customers,and changes in our operating model.For example,the direct shipping model,whereby some parcels are directly shipped by certain volume-qualified network partners to our destination sorting hubs without going through our origination sorting hubs

302、,reduces overall delivery time and operating costs and also lowers our revenues.If we are not able to effectively control our cost and adjust the level of network transit fees based on operating costs and market conditions,our profitability and cash flow may be adversely affected.We face challenges

303、in diversifying our service offerings and expanding our customer base.We intend to further diversify our service offerings and expand our customer base to increase the number of revenue sources in the future.New services or new types of customers may involve risks and challenges that we do not curre

304、ntly face.Such new initiatives may require us to devote significant financial and managerial resources and may not perform as well as expected.We may not be able to successfully address customer demand and preferences and our existing network and facilities may not be adaptable enough to accommodate

305、 new services or customers.For example,different service offerings will likely require different equipment specifications and service standards,which may require significant time and costs to implement.We may also be inexperienced with operating models and cost structures associated with new types o

306、f customers we may choose to pursue.In addition,we may not be able to provide services of sufficient quality,which may result in complaints or liability claims against us,all of which would harm our overall reputation and financial performance.We may also selectively invest in emerging business oppo

307、rtunities in adjacent logistics markets,such as less-than-truckload shipping,or leverage our existing network and infrastructure to directly engage in related businesses.We cannot assure you that such endeavors will be profitable or that we will be able to recoup our investments with respect to any

308、new services or new types of customers in time or at all.Damage to our brand image and corporate reputation could materially and adversely impact our business.We believe our brand image and corporate reputation will play an increasingly important role in enhancing our competitiveness and maintaining

309、 our growth.Many factors,some of which are beyond our control,may negatively impact our brand image and corporate reputation if not properly managed.These factors include our ability to provide superior services to our end customers,successfully conduct marketing and promotional activities,manage re

310、lationships with and among network partners,manage complaints and negative publicity,and maintain a positive perception of our company,our peers and the express delivery industry in general.For instance,one of our business outlets in Chengdu,Sichuan province,was found to have transported puppies and

311、 kittens in inhumane way as part of pet blind box sales on e-commerce sites in May 2021,which caused damage to our brand image.Any actual or perceived deterioration of our service quality,which is based on an array of factors including customer satisfaction,number of complaints as well as number of

312、accidents,may subject us to damages,including the loss of important customers.Any negative publicity against us or our peers may harm our corporate reputation and may result in changes to government policies and the regulatory environment.If we are unable to promote our brand image and protect our c

313、orporate reputation,we may not be able to maintain and grow our customer base and our business and our growth prospects may be adversely affected.26 Our business and the business of our network partners are subject to a broad range of PRC laws and regulations.If we or our network partners are deemed

314、 to be not in compliance with any of these laws and regulations,our business,reputation,financial condition and results of operations may be materially and adversely impacted.Our business is subject to governmental supervision and regulation by the relevant PRC governmental authorities,including but

315、 not limited to the State Post Bureau and the Ministry of Transportation.Together,these governmental authorities promulgate and enforce regulations that cover many aspects of our day-to-day operations.See also“Item 4.Information on the CompanyB.Business OverviewRegulation.”For example,the PRC Postal

316、 Law indicates that express delivery companies cannot engage in“posting and mail delivery business exclusively operated by postal enterprises.”However,PRC law does not provide a definition for“posting and mail delivery business exclusively operated by postal enterprises.”If the authorities define su

317、ch term in the future and if the parcels that we deliver fall into the defined category,we may be considered in violation of such regulation.Further,certain of our network partners may commence express delivery services while still in the process of obtaining Courier Service Operation Permits,and si

318、nce they use our brand in their businesses,we may be subject to fines or receive order of rectification as a result.Incidents like the foregoing ones may materially and adversely impact our business,reputation,financial condition and results of operations.According to the Interim Regulations on Expr

319、ess Delivery,which were promulgated by the State Council on March 2,2018,took effect on May 1,2018 and were amended on March 2,2019,we are subject to a revised set of requirements in operating our express delivery business,including but not limit to:(i)we are required to timely file records with the

320、 local postal administrations for opening express delivery terminal outlets;(ii)in case we intend to suspend operating express delivery services,we shall make public announcement in advance,submit a written notice to the postal administrative departments,return the Courier Service Operation Permit a

321、nd make proper arrangement on undelivered express parcels;(iii)we shall not sell,reveal or illegally provide any client information and we shall take remedial measures and report to the local postal administrations in case any client information is revealed or may be revealed;(iv)we shall verify the

322、 identity of senders and register their identity information when receiving express parcels and shall not receive their express parcels where senders refuse to furnish identity information or furnish false identity information;(v)we shall refuse to accept the prohibited parcels and shall cease to so

323、rting,transporting and delivering parcels which are suspected of containing prohibited items and shall promptly submit a report to governmental authorities and assist in investigations;(vi)we shall formulate our emergency plans,carry out emergency drills and exercises regularly and report emergencie

324、s to the local postal administrations;(vii)clients may claim compensation from us for any delay,missing,damage or shortage of express parcels handled by our network partners,since they use our trademark,corporate name and express waybill.See“Item 4.Information on the CompanyB.Business OverviewRegula

325、tionRegulations Relating to Express Delivery Services.”The operation of our express delivery service is subject to this regulation.Failure to comply with these regulations result in requirement to rectify,fines,suspension of business for remediation or revocation of Courier Service Operation Permit.

326、27 Pursuant to the Administrative Provisions concerning the Running of Cargo Vehicles with Out-of-Gauge Goods,which were promulgated by the PRC Ministry of Transport on August 19,2016,took effect on September 21,2016 and amended on August 11,2021,cargo vehicles running on public roads shall not carr

327、y cargo weighing more than the limits prescribed by this regulation and their dimensions shall not exceed those as set forth by the same regulation.The operation of our truck fleet is subject to this regulation.We have not been required to modify or replace any of our trucks.While we expect to gradu

328、ally reduce the number of non-complying trucks,the non-complying trucks may be banned and we may be required to modify noncomplying trucks or purchase new ones to replace them.Otherwise,we may be subject to additional penalties under this regulation if we continue to operate trucks that exceed the l

329、imits set forth in the regulation.Pursuant to the PRC E-commerce Law,or the E-commerce Law,which was promulgated by Standing Committee of the National Peoples Congress on August 31,2018,took effect on January 1,2019,we are subject to certain requirements in e-commerce business,including but not limi

330、t to,(i)in providing express logistics services for e-commerce activities,the providers thereof shall abide by laws and administrative regulations,and comply with the service standards and time limits they have promised;(ii)while handing over commodities to consignees,express logistics service provi

331、ders shall remind consignees to examine the commodities immediately on the spot;in the event that the commodities are received by others for consignees,such express logistics service providers shall obtain the consent of consignees;and while senders handing over commodities to express logistics serv

332、ice providers,such express logistics service provider shall,in accordance with relevant laws and regulations,examine whether the postal articles are prohibited or restricted from express delivery in the presence of senders;and(iii)express logistics service providers are required to use environmental

333、-friendly packaging materials in accordance with the relevant provisions in an effort to reduce the consumption of packaging materials and implement the recycling measures.While offering express logistics services,the providers thereof may agree to be entrusted by e-commerce operators to collect payments for goods on a commission basis.See“Item 4.Information on the CompanyB.Business OverviewRegula