Solidifies its leading position in Southeast Asia with rising market share, while its parcel volume growth in China outpaces the industry
J&T Global Express Limited ("J&T Express" or "J&T" or "the Company", stock code: 01519), a global logistics service provider, announced its 2024 interim results for the first half of 2024 ("H1 2024" or "the Period"). In the first half of the year, J&T's revenue reached US$4.86 billion, representing a year-over-year ("YoY") increase of 20.6%. Revenue of its core business, express delivery services, reached US$4.74 billion, marking a YoY increase of 33.7%. Gross profit showed a YoY increase of 176.8% to US$540 million.
In H1 2024, all of J&T's profit metrics swung to positive. The Company reported a net profit of US$31.026 million, a significant turnaround compared to the loss of US$670 million over the same period last year. Adjusted net profit was US$63.248 million, compared to a loss of US$260 million over the same period last year. Adjusted EBITDA soared by 795.6% to reach US$350 million. Adjusted EBIT also turned positive and reached US$120 million, underlining a healthy and sustainable level of profitability.
During the Period, J&T's total parcel volume increased by 38.3% YoY to 11.01 billion. The business scale of all operating regions continued to expand, with parcel volume consistently achieving double-digit growth. In Southeast Asia ("SEA"), parcel volume increased by 42% YoY to 2.04 billion, raising its market share to 27.4%. In China, parcel volume grew by 37% to 8.84 billion. In newer markets such as Saudi Arabia and Mexico ("New Markets"), parcel volume surged approximately 64% to 140 million.
Dylan Tey, Chief Financial Officer of J&T Express, commented: "In the first half of 2024, J&T's total revenue increased by over 20% YoY, primarily driven by the growth in express delivery services across 13 countries. With the business in China achieving profitability for the first time, the Company's adjusted EBIT turned positive for the first time. We maintained a healthy and sustainable profitability in Southeast Asia. In New Markets, we achieved a significant increase in revenue and reduction of EBIT loss, driven primarily by strong parcel volume growth, as well as continuous management refinement and operational optimization."
China's parcel volume growth leads the industry; cost per parcel reduction drives adjusted EBIT to profitability for the first time
During the Period, J&T's market share continued to rise, with a 37% YoY growth in parcel volume outpacing its peers. J&T's market share, in terms of parcel volume in China, reached 11%, up 1.1 percentage points YoY. This was primarily driven by J&T seizing the growth opportunities brought by the rapid growth of social e-commerce and enhancing customer acquisition with cost-effective services. At the same time, J&T continued to explore its business development in China's lower-tier markets, cooperating with a number of e-commerce platforms to undertake consolidation delivery business targeting at remote areas, thereby helping e-commerce vendors and e-commerce platforms to expand to areas that were originally difficult to reach."
In the first half of the year, J&T revenue in the Chinese market was approximately US$3 billion, a year-on-year increase of about 36%. The adjusted EBITDA reached US$200 million, and the adjusted EBIT turned positive for the first time, reaching US$59.595 million. This is mainly due to the Company's relatively stable revenue per parcel in the first half of the year, with the unit cost per parcel of express delivery continuing to decline. Specifically, the unit cost per parcel dropped by about 6% to US$0.32. Benefited from to the continuous implementation of refined management and operational optimization in each process in China, which has continually enhanced the strength and efficiency of our entire network.
Maintaining its lead in SEA for four consecutive years with growing market share; continually optimizing service quality
J&T's full coverage and well-established logistics network in SEA, as well as its cost-effective services and strong customer relationships, have continued to serve as competitive advantages. As a result, the Company's parcel volume in the region increased by 42% YoY. J&T's market share reached 27.4%, up 2 percentage points compared to 2023.
In SEA, J&T continues to seize opportunities in the e-commerce market and actively develop non-e-commerce platform customers. The Company also benefits from both the overall rise in e-commerce volume and the emergence of social commerce, while maintaining a strong commitment to service quality. In H1 2024, the Company's average parcel delivery time in SEA was shortened by 13.8% YoY.
In the first half of 2024, revenue of the Company's SEA operations increased by 22% to US$1.52 billion, adjusted EBITDA grew by 13% to US$210 million, and adjusted EBIT grew by 46% YoY to reach US$130 million.
New Markets business maintained rapid growth and actively expands local e-commerce customer base
J&T continues to penetrate new markets, rapidly expanding its business scale. The volume of packages in J&T new markets is growing at a high speed. While maintaining close cooperation with Chinese cross-border e-commerce platforms, we are actively developing and maintaining good relationships with major local e-commerce platforms such as Noon in the Middle East and Salla in Saudi Arabia. At the same time, the demand for parcel services from individual customers and commercial organizations in new markets is increasing. To better serve this need, we have launched the J&T SPEED product in the Middle East.
In 1H 2024, revenue from new markets reached US$290 million, representing a near 1.2x YoY increase. This growth was fuelled primarily by a 64% YoY surge in regional parcel volume. During the Period, gross profit turned positive, reaching US$35.022 million, while the adjusted EBITDA loss narrowed significantly to US$7.84 million compared to the same period last year.
Continue to Enhance Service Experience: Solidifying the Path to Global Development
J&T is committed to providing customers with an enhanced logistics service experience by continuously building its own sorting centers, enhancing the efficiency of self-operated transportation fleets, and investing in automated equipment across various markets. As of 30 June 2024, the Company had approximately 8,000 network partners and around 19,900 outlets. The Company operated 237 sorting centers equipped with 254 automated sorting lines. Its transportation network comprised over 4,100 line-haul routes, utilizing more than 9,900 vehicles, including over 5,700 that were company-owned.
Fan Suzhou, Executive President of J&T Express, stated: "We achieved profitability for the first time during this financial period, laying a more solid foundation for the Company's healthy and long-term development. Our strategic goal is to build an express delivery network that serves countries around the world, catering not only to international e-commerce platforms but also to local e-commerce and non-platform customers. This will enable us to establish long-term competitive advantages through a comprehensive network, cost-effective solutions, and excellent services. Looking ahead, we will closely monitor global market dynamics and carefully select the timing and methods for entering related markets. We firmly believe that through hard work and continuous innovation, we will better serve global customers and achieve J&T's long-term growth objectives."