Sinotrans Limited(601598) investor relations activity record
Date and time: March 30-31, 2022
Song Rong, executive director and general manager
Li Qian, independent non-executive director
Receptionist of the company: Wang Jiuyun, chief financial officer
Li Shiji, deputy general manager and Secretary of the board of directors
Gao Xiang, deputy general manager and chief digital Officer
□ company on-site reception \uf0fe telephone reception
Investor relations activities □ reception at other places □ public briefing
Category \uf0fe regular report explanation meeting □ important announcement explanation meeting
□ others
1. The profit margin of the company's air transportation agency business has improved, but the profit margin of the sea transportation agency business has not seen such a change. Is there any difference in the business model? If so, is it planned to adopt the same model in the future shipping?
In terms of air transportation business, the company's business model has gradually changed from the traditional freight forwarding model to the composite model of "freight forwarding + carrier", and with the rapid development of cross-border e-commerce and high-end manufacturing industry, it has formed a stable demand for trunk transport capacity, so as to effectively improve the controllable transport capacity. Since 2020, there has been a shortage of air transport capacity supply and a significant increase in freight rates, which has led to a significant increase in the company's air transport related business revenue and profits.
In terms of shipping agency, when the company provides space booking services for customers, the freight is usually settled with customers according to the actual freight. Therefore, the rise of freight rate has a positive impact on the company's revenue, but has a limited impact on the sector's profits. The profit of shipping agency mainly comes from the services provided to customers, such as customs declaration, transportation, warehousing and so on. At present, there are still great differences between the modes of sea transportation business and air transportation business. Whether the company wants to change its business mode in the future depends on market conditions, demand and other factors.
Main research contents 2. What are the changes in the single container profit of the company's shipping agency section?
In 2021, the company's shipping agent's single container profit increased by 13% year-on-year compared with that in 2020. It is hoped that the service chain of the company will be extended and the service quality will be further improved in the future.
3. What is the company's plan for the fixed capacity of charter flights in 2022?
The charter agreement between the company and the airline is usually one year, and some are within one year or two years. In the future, the company will make a comprehensive judgment in combination with the market and demand.
4. What are the reasons for the relatively low profit margin of cross-border e-commerce logistics of the company?
As the company's cross-border e-commerce related major customers have a relatively stable and predictable volume of goods, the company can purchase fixed transportation capacity on a large scale. When the company signs charter agreements with airlines, some major customers lock in some of their shipping spaces and costs. Therefore, the profit margin of cross-border e-commerce logistics business is lower than that of the company's air transportation agency business. The epidemic makes customers put forward higher requirements for the security and stability of the supply chain. The company locks in the transportation capacity by charter flights, hoping to provide customers with stable supply chain guarantee rather than simply win the profits brought by high freight rates. common
Through cooperation with cross-border e-commerce strategic customers, the company has locked in the demand for transport capacity. The controllable transport capacity outside the spaces locked by strategic customers has increased significantly, resulting in a rapid increase in the profit margin of the company's air transportation agency. In 2021, the revenue of air transportation agency increased by 11.06% and the profit of segment increased by 94.78%. Overall, the segment profit margin of the company's air transport channel business in 2021 has also improved. 5. What is the customer concentration of the company's sea and air transportation business?
The company is the largest shipping agency enterprise in China. The nature of the service determines that the customers of the shipping agency business are very scattered; Compared with shipping agents, the air transportation business has some large customers, but the overall customer concentration is not high. 6. What impact does the situation between Russia and Ukraine have on the company's maritime, air and railway business? Have you seen the transfer of business from train to sea?
The company has little business in Ukraine.
The impact of the situation in Russia and Ukraine is mainly in the following business segments:
Cost side: the rise of energy prices and oil prices will make relevant costs fluctuate, but the fluctuation of fuel prices has no significant impact on the overall performance of the company.
Revenue side:
In terms of railway business, the situation between Russia and Ukraine has a certain impact on the shipment of China EU train business. But overall, although the company's China Europe train business has developed rapidly in the past two years, the business volume is relatively small compared with that of sea transportation.
In terms of air transport business, charter flights operated by Russian Airlines have been cancelled, but this part of the business does not account for a large proportion. At the same time, the rise in air freight rates in March also partially hedged the impact of the cancellation of charter flights on business volume and oil prices. In the cancelled routes, some customers have locked their own seats at the same time when the company charter flights. Therefore, the cancellation of this part of charter flights will have a certain impact on the revenue and profit of the company's air transportation business, but there is no significant impact. If the situation improves in the future, the company will remain cautiously optimistic about the air transportation business.
In terms of KLG, its business coverage is mainly in Western Europe and a small part of its business is in Romania in Eastern Europe. At present, the situation in Russia and Ukraine has little impact on its operation. 7. What is the impact of freight rate fluctuation on the overall profit and single container profit of the company's shipping agency business? If the freight rate falls by 50%, what is the impact on the company's shipping revenue and profit?
The company's marine business services include space booking, customs declaration, warehousing, transportation, etc. the company's customers provide simple link, multi link or whole process logistics services.
The rise of shipping price is a factor in the growth of single container revenue and profit, but the profit growth is far lower than that of freight rate. From past experience, if the freight rate drops sharply, the profit of a single box will also drop, but it will not drop as fast as the freight rate. 8. What is the company's expectation of the shipping and air transport market and the company's performance in 2022?
At present, the demand for logistics business is still at a high level. China's export container freight rate index is still at a high level from January to February, and the air freight rate decreased from January to February, mainly because January and February are the off-season of air freight. Before the epidemic is effectively controlled, it is expected that the international shipping and air freight rates will remain high in the first half of this year. When they can return to normal depends on the epidemic and the changes of the overall macro situation. Since March, there have been some changes in the overall macro situation, which has brought some uncertainty to the company's expectations this year, but the company's management will continue to make efforts to do a good job in the company's business work. 9. How to treat the extension of freight forwarding services by shipping companies? What impact does the establishment of China logistics have on the company?
1) In the past two years, affected by the epidemic, international shipping prices have been rising, the profits of shipping companies have increased significantly, and some shipping companies have begun to enter the freight forwarding industry through acquisitions Sinotrans Limited(601598) has been deeply engaged in the market for more than 70 years, and has accumulated extensive customer and supplier resources, excellent industry awareness, highly professional service team and rich infrastructure; At the same time, as an independent third-party company, it has obvious advantages compared with other participants. Shipping company
Both suppliers and our customers. If the epidemic situation is effectively controlled in the future, the shipping market will gradually return to normal. The logistics market is still expanding gradually, and the company will find its own positioning and jointly promote the vigorous development of the logistics industry.
2) Sinotrans Limited(601598) focuses on export logistics business, and the air transportation business of Cts International Logistics Corporation Limited(603128) under China logistics overlaps with the company. In terms of international logistics business, Sinotrans Limited(601598) also has a wide coverage area. As a subsidiary of China Merchants Group, the company has more than 70 years of experience and has certain advantages in personnel reserve, logistics technology research and development and multi scenario application. The company is glad to see the establishment of China Logistics Group, which is also a friend of the company, which is good for the safety and stability of China's overall industrial chain and future development. 10. What is the reason why the profit margin of contract logistics in the second half of 2021 is lower than that in the first half of 2021?
There is no change in the operation of the contract logistics sector. The decline in the segment profit margin is mainly due to the distribution of the accrued credit impairment losses in each sector, and the contract logistics is also involved; In addition, with the completion of the annual business objectives, some subsidiaries accrued some performance related bonuses in the fourth quarter.
11. The company's net profit in 2021 was 3.713 billion yuan, of which Sinotrans DHL contributed 1.987 billion yuan, accounting for 53% of the company's net profit attributable to the parent company. Does it mean that the growth of the company's proprietary business is slow?
In 2021, under the complex and changeable market environment, the company met the difficulties and still achieved good growth in air transportation agency and cross-border e-commerce logistics business. Contract logistics continued to recover, and the train business continued to improve. The profit of the combined segments of the company's three business segments increased by 17% year-on-year. However, as the company deducted some costs and expenses at the consolidation level, non operating expenses arising from litigation, and accrued asset impairment losses, the increase of net profit at the consolidation level was not very large. 12. In the fourth quarter of 2021, the company accrued credit impairment loss, asset impairment loss and goodwill impairment. Please introduce the specific situation
The company has fully consolidated its assets. For warehouse resources with signs of impairment such as failure to meet expectations, the company has conducted an impairment test in accordance with the principle of prudence, and accrued impairment losses on some assets according to the impairment test results.
According to the requirements of the standards, the company reviews the accounts receivable every year according to the expected credit loss model. In 2021, the freight rates of sea and air transportation have been at a relatively high level, and the economic development is facing the triple pressure of "shrinking demand, supply impact and weakening expectation". In order to prevent relevant risks, the company has adjusted the expected credit loss rate based on the principle of prudence. After the receivables with corresponding impairment provision are recovered, the corresponding impairment provision will be reversed.
According to the requirements of the standards, the company will conduct impairment test on goodwill every year. The impairment of goodwill in this year is mainly the impairment withdrawn by the subordinate cold chain logistics company according to the impairment test results. The goodwill generated by the company's acquisition of KLG is not impaired. 13. The company's stock option incentive plan has been approved by the general meeting of shareholders and the grant registration has been completed. When does the company plan to repurchase? In addition, can you introduce the main performance indicators of the equity incentive plan?
The company will comprehensively consider repurchasing A shares according to the equity incentive plan, exercise arrangement and capital situation, and disclose them in accordance with the requirements of the listing rules.
Performance indicators include the compound growth rate of net profit attributable to the parent company, return on net assets and economic value added. In addition, it also depends on the quantile of comparable companies in the same industry. For example, the compound growth rate of net profit attributable to the parent company, the first batch of exercise in 2024 requires the benchmark in 2022 and the compound growth rate in 2020 to reach 11%.
14. The dividend payout of the company in 2021 increased by 50% year-on-year compared with that in 2020. Will this dividend payout rate be maintained and will it continue to increase in the future?
Since its listing in Hong Kong in 2003, the company has maintained a stable dividend payout rate, especially since its opening in 2014
Since the beginning, the dividend payout rate has been stable at more than 30%. The company has always attached importance to the rights and interests of all shareholders and hopes to share the results of the company's operation and growth with the majority of shareholders. The board of directors of the company will comprehensively consider the operating results, cash flow level, capital expenditure needs and other factors of the year and put forward a specific annual dividend distribution plan. 15. How is the progress of the company's land asset securitization?
Based on the separation of light and heavy assets, the company is exploring various ways to tap the value of assets, and will announce them as required at an appropriate time. 16. The company's capital expenditure plan for 2022 and 2023
In 2021, the company's capital expenditure was 1.6 billion, including infrastructure construction and equity investment. Over the past few years, the company has invested relatively stable funds in infrastructure construction (such as logistics park construction, warehouse renewal and transformation, equipment investment, etc.), and the equity investment depends on the progress of mergers and acquisitions. There is no significant change in the direction of the company's overall capital expenditure in 2022 and 2023, but the specific amount depends on the promotion of infrastructure construction and M & A projects every year. 17. Operation of KLG company acquired by the company
In 2021, the performance of KLG group still achieved good growth in the case of repeated outbreaks in Europe. Its operating income was about 2 billion yuan, a year-on-year increase
