Today, let's review SF's annual report. Because from all angles, SF Express is really different.
On the evening of March 26, SF Holdings released its 2023 annual report. The financial report data shows:
In 2023, the company achieved operating income of 258.4 billion yuan, net profit attributable to shareholders of listed companies of 8.23 billion yuan, a year-on-year increase of 33.4%, net profit after deducting non-recurring gains and losses of 7.13 billion yuan, a year-on-year increase of 33.7%, and basic earnings per share of 1.70 yuan, a year-on-year increase of 33.9%.
Judging from the above-mentioned key performance indicators, SF's progress in 2023 is still obvious, especially its net profit attributable to the parent company of 8.23 billion yuan, a year-on-year increase of 33.4%.
On the whole, there are both opportunities and challenges behind the financial report. The question is: what kind of changes have taken place in SF's strength map, and what are the new trends?
PART.01
Inner cultivation
SF Express has a big family and a big business, and the "report card" for 2023 is also very long.
In order to more intuitively review SF's "report card" in 2023, the old ghost uses "addition, subtraction, multiplication and division" to roughly summarize it into four directions to observe SF.
1. Do "addition" to strengthen the aging chassis
As the absolute main force of "time-sensitive express" in China, SF Express occupies an absolute dominance in terms of market share, service experience and user reputation.
From the perspective of the proportion of business revenue, the timeliness business is still the absolute responsibility of SF's overall revenue. In 2023, SF Express will also continue to make efforts to stabilize its business fundamentals, with the revenue of its aging business reaching RMB115.46 billion, accounting for 44.7% of total revenue.
2. Do "subtraction" and focus on the dominant track
In June 2023, SF Express made a painful decision to take action against "Fengwang" and cut off this loss-making business.
As the so-called "there is a give-and-take", the optimization, adjustment, change and progress between the take-off and give-off are immediate and clear at a glance. In 2023, when the product structure is optimized, SF's economic express will focus more on the mid-to-high-end e-commerce market, and the overall revenue will remain at about 25.05 billion yuan, excluding the Fengwang business, and the revenue of the economic express business will increase by 8.6% year-on-year.
3. Do "multiplication" and activate the ecosystem
In addition to ensuring that the "basic disk" cannot be lost, in order to maintain the existing advantages and status, for SF, it means that it must further expand and improve the ecological system, and fight the ecological war and coordinated battle.
At present, as an independent third-party integrated logistics service provider, standing on the "shoulders of giants" of large-scale express, cold logistics, and third-party real-time distribution in the same city, have made achievements, and have a certain competitiveness, and are in the leading position in the Chinese market in most logistics segments.
In this financial report, it can be clearly seen that the business ecosystem that SF has been painstakingly operating for many years has begun to usher in a substantial harvest period. Among them—
The revenue of express transportation business exceeded 30 billion yuan, reaching 33.08 billion yuan, an increase of 18.5% year-on-year, the revenue of cold transportation business exceeded 10 billion yuan in 2023, an increase of 19.7% year-on-year, and the revenue of intra-city instant delivery business reached 7.25 billion yuan, an increase of 12.6% year-on-year.
What is more noteworthy is that, as a typical representative of SF Rio Tinto's new business, SF's intra-city instant delivery business will successfully turn around its losses in 2023 and break through the "profit red line", not only achieving its first annual profit, but also finding a clear way to break the situation, which is of great significance.
4. Do "division" to reduce the cost of resource financing
To do division, the first thing to pay attention to is to reduce costs, reduce costs, and reduce costs again.
Based on the data of the annual report, while the performance has increased, SF has strengthened its management and control to see initial results, and in 2023, the multi-network integration will achieve business cost reduction and revenue generation benefits further improved compared with previous years.
For example, in 2023, SF Express will continue to promote the integration and shipment of large and small trunk line resources, increase the frequency of large and large trunk shipments, straighten routes and reduce transfers, and promote the loading rate of large trunk vehicles to increase by 6.2 percentage points compared with the end of last year.
PART.02
Gaitaku
When it comes to "outreach", it is easy to see it as radical, but it also depends on what "outreach" is. Specific to SF, what do you want to "expand"?
First, we must continue to amplify the advantages of aviation.
After nearly 20 years of development, SF Airlines is a well-deserved vanguard in the air-space battle of China's express delivery, and this is an important basic plate for SF Express in the international business game in the future.
Looking at the "big", the size of SF Airlines' fleet has been further expanded, and the leading position of "the largest in the country" continues to be maintained. As of the end of 2023, SF Express will cover 100% of cities in China and 202 countries and regions around the world, and SF is also the largest air cargo carrier in China and has the largest cargo fleet in China, with a total of 103 full-freighter aircraft owned and leased by the end of 2023, operating a total of 152 domestic and international routes and connecting 65 international airports.
To "small", Ezhou Huahu Airport is gradually getting better, whether it is the route or cargo volume, or the navigation range, it is getting bigger and bigger. By the end of 2023, SF Express has opened 45 domestic cargo routes and 10 international cargo routes in the Ezhou hub, covering 40 cities across the country and connecting 13 international airports. There are about 90 inbound and outbound cargo flights per day in the Ezhou hub, and the volume of cargo flights has ranked among the top three in the country.
Second, the international business is scattered.
While firmly grasping the "air supremacy", SF Express is also grabbing the "ticket" of the international express market.
In addition to aviation, SF Express has also significantly strengthened its control over international business, operating a number of land, rail and sea transportation resources and routes, providing customers with domestic and cross-border LTL and bulk cargo multimodal transportation services, and operating and managing 1,900 warehousing resources, 396 transshipment centers and more than 44,000 self-operated and agency service points around the world.
In the era of "great navigation" of express delivery, SF Express has made a comeback by aggregating resources, making a series of big moves, and its style of play has become more and more "international" and more "international".
To cite a representative event -
In July 2023, SF Express acquired Kerry Logistics Asia Pacific and Europe Express Company for HK$250 million. If SF Express's "acquisition" of Kerry Logistics in August 2021 is to implement its global expansion plan with a more aggressive attitude, and with this continuous acquisition investment, it is a good reflection of SF's current business extension and territory expansion ideas. Through mergers and acquisitions, we continue to expand and break business boundaries and then penetrate into related fields, especially in Southeast Asia, after the integration of SF Express and Kerry Logistics has passed through the "deep water area", synergies have begun to emerge, and as a fulcrum, we have strengthened our international freight capacity in the local market in Southeast Asia and connecting Asia and the world.
Recently, SF Express has ushered in another big positive - joining the Universal Postal Union. With this "new identity", SF not only has face (recognition of international status and influence), but also has a liner (participation in international rules, substantive discourse, and good business development).
PART.03
Strong chains
The beautiful figures on the above-mentioned financial reports are just a facet of SF Express. The old ghost is more concerned about the core tone of SF's financial report: deepening integration, accumulating reform, and intensively cultivating Asia to create the only one.
SF Express released such bold words, strongly releasing new signals and new directions.
After the release of this financial report, SF Express has a clear path for its future path——
Committed to becoming a leading global logistics company connecting Asia and the world, SF will adhere to the long-term sustainable and healthy development and forward-looking strategic deployment, focus on the three major tracks of "network standard products, digital industry supply chain services, and global end-to-end supply chain services", and expand the incremental market with more flexible product and service models and more refined pricing strategies. Southeast Asia flows to the local market to grasp the development opportunities of emerging regions, to achieve the strategic goal of "Asia's only".
Putting aside these various established goals and plans, and reviewing SF's own improvement path, it is not difficult to find that there is a clear main line running through its model iteration, business upgrading and business evolution.
The old ghost is summed up in one word - "strong chain".
We can see very clearly that in the future of the express delivery industry, as the whole network of express delivery companies gradually extend to the "large and complete" platform cross-border, the head of the large companies is no longer the "market share" and "price" competition, but the industrial chain, the whole scene of products and even the competition of integrated logistics, which is an inevitable trend.
SF's strongest barrier and moat is service and word of mouth, which is the golden sign accumulated over the years, which is embodied in product strength, service strength and comprehensive strength, that is, focusing on the strategy of "deepening the industry, expanding the scene, and making the product complete", enhance the competitiveness of differentiated services and business efficiency, and form an effective core competition chain.
In terms of product strength, since the "return and exchange" business became a hit in 2022, SF Express will continue to launch a strong offensive in 2023, continuously enriching and upgrading return channels, simplifying the return process, and extending the door-to-door pickup time. At present, SF Express has successfully won the return and exchange business of Taobao, Pinduoduo, Douyin and other e-commerce platforms. According to the data, SF Express's return business cooperation with multiple e-commerce platforms has achieved a breakthrough in market share, with a rapid year-on-year increase in business volume, and its market share has also been consolidated and improved.
In terms of service capabilities, a typical example is that in the matter of "home delivery", SF's service is obvious to all, and insisting on "home delivery" has also become an important label that distinguishes SF from "other express delivery". In the context of the implementation of the "new express regulations" and the "new national standard", the old way of "investing without telling the news" of the major express headquarters in the past must be changed, and more energy should be focused on service quality.
In terms of comprehensive strength, compared with the early stage of "concentrating on big things", in recent years, SF Express has begun to strengthen the resource synergy effect of various sectors, either by slotting scarce resources, or by making up for business shortcomings, extending the industrial chain, and forming an effective core competition chain.
Based on the urban service scenario under the trend of local life, SF has launched a more competitive Datong City half-day delivery product through the integration of internal high-quality resources, and has covered more than 200 cities by the end of 2023, and launched a series of pre-warehouse + distribution products of "upper warehouse and lower transit", and the service has covered more than 100 cities by the end of 2023.
A glimpse of the whole leopard. Under the strategy of internal cultivation, external expansion, and chain strengthening, SF's tactics of grabbing time, occupying resources, seeking ecology, and expanding its territory are very clear.
epilogue
The industry always has high expectations for SF, and SF Express is becoming more and more stable and mature. With this good performance, SF Express has shown a confident attitude towards the future to the outside world.
On the one hand, it plans to distribute a cash dividend of 6 yuan (tax included) to all shareholders for every 10 shares, an increase of 140% year-on-year compared with 2022, and the dividend ratio will reach 35%, an increase of 15% year-on-year
On the other hand, SF intends to change the purpose of the repurchased shares in the equity repurchase plan in March, September 2022 and January 2024 to cancellation, which will be more conducive to increasing earnings per share.
What surprises will SF Express bring next? It is worth looking forward to.