ZTO Express (Cayman) Inc (NYSE:ZTO) stock rose 4.02% (As on May 18, 11:15:43 AM UTC-4, Source: Google Finance) after the company posted mixed results for the first quarter of FY 23. Parcel volume was 6,297 million, an increase of 20.5% from 5,226 million in the same period of 2022. Number of pickup/delivery outlets was over 31,000 as of March 31, 2023. Number of direct network partners was over 5,900 as of March 31, 2023. Out of the approximately 11,000 self-owned trucks, approximately 9,500 were high capacity 15 to 17-meter-long models as of March 31, 2023, compared to approximately 9,200 as of March 31, 2022. Number of line-haul routes between sorting hubs was approximately 3,800 as of March 31, 2023, compared to approximately 3,650 as of March 31, 2022.

ZTO in the first quarter of FY 23 has reported the adjusted earnings per share of 34 cents, beating the analysts’ estimates for the adjusted earnings per share of 24 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 13.7 percent to $1.31 billion in the first quarter of FY 23, missing the analysts’ estimates for revenue by 5.17%. Revenue from the core express delivery business increased by 16.1% compared to the same period of 2022, as a combined result of a 20.5% increase in parcel volume and a 3.7% decrease in parcel unit price. Revenue from freight forwarding services decreased by 41.8% compared to the same period of 2022 primarily due to declined cross border e-commerce demand and pricing caused by weak global economy. Revenue from sales of accessories, largely consisted of sales of thermal paper used for digital waybills’ printing, increased by 30.8% in line with parcel volume growth. Gross Profit was RMB2,523.4 million (US$367.4 million), increased 55.8% from RMB1,619.5 million in the same period of last year as a combined result of increased revenues and cost productivity gain. Gross margin rate improved to 28.1% from 20.5% for the same period last year. Income from operations was RMB1,950.4 million (US$284.0 million), an increase of 74.7% from RMB1,116.3 million for the same period last year. Operating margin rate increased to 21.7% from 14.1% in the same period of last year.

The Company raises its annual parcel volume projection to be in the range of 29.27 billion to 30.24 billion, representing a 20% to 24% increase year over year.