J&T Global Express Limited ($1519)

Hello and good day. Welcome to J&T Express Q1 2026 Business Performance Announcement. [Operator Instructions]. Now I'll give the floor to Frank.

Hello, everyone, and welcome to J&T Express Q1 2026 Business Performance Briefing. And this is Frank, and materials for today's meeting have been sent to you via e-mail and uploaded to the company's website. Joining us today, we have Dylan, CFO at J&T Express; and Haibin, Director of Investment and Financing. We are going to have 2 parts. First of all, Haibin will present the company's business performance in Q1 2026 and then Q&A, where management will answer your questions.

Hello, everyone. Welcome to attend this 2026 Q1 business performance announcement. This is Haibin. Our group total parcel volume reached 8.33 billion pieces in Q1 2026, up 26.2% year-on-year. The group's growth majorly driven by the Southeast Asia, China and other markets. First of all, Southeast Asia. Parcel volume in Southeast Asia reached 2.77 billion pieces in Q1, up 79.9% year-on-year. The key growth drivers in Southeast Asia remained strong in Q1 2026. First, the e-commerce shopping festival around the Lunar New Year and Ramadan in the Southeast Asia boosted local consumption, driving high growth together with the e-commerce customers in Q1. Second, our e-commerce platform customers increased investment and promotion activities and expanded product categories drove the rapid growth. Third, our non-platform parcels also grew and made a solid contribution to the volume, but the overall growing trajectory is slower than the e-commerce parcels accounting for less than 10%. Meanwhile, the platforms has raised the comprehensive requirements for logistics. We have seen that small and medium-sized express operators struggle to meet their requirements, but cost and pricing advantages and solid network capabilities of ours have widened the gap with our competitors and further strengthened our industrial positioning. Second of all, for China, the parcel volume in China reached 5.4 billion pieces in Q1, up 8.4% year-on-year, and our business volumes in China rebounded in Q1, supported by the Spring Shopping Festival. The industrial total volume increased by 7% year-on-year in January to February of 2026 and overall growth rate of the express delivery industry rebounded compared with the Q4 of last year. We also adapted the changes of the policy regulation and industrial competition and actively adjust our strategies, continuously strengthened our network foundation and improved timeless, service quality and cost control capabilities so that we are able to have the high-value customers more serviced and enhance our technology empowerment and sustainable growth. Lastly, the other market, we believe that we have noticed that we have updated volume disclosure term for former new markets and other markets. Other markets refer to J&T operating regions outside of China and Southeast Asia, including the original 5 new countries and further new markets we entered. In Q1, our parcel and other volumes reached 150 million pieces, up 100.5% year-on-year. The accelerated growth in other markets in Q1 was mainly due to, first of all, the e-commerce penetration in other markets is still low. Per capita parcel volume is much lower than that of China and Southeast Asia, while local per capita GDP is relatively high, leaving large room and potential for e-commerce consumption growth. Second, our key e-commerce customers continue to increase investment in Latin America and achieve stronger growth and the company grow together with our customers. Furthermore, the company continuously exported the express delivery operation experience from China and Southeast Asia to other markets, invested in automated sorting equipments, optimized routing plannings and improved the end pickup and delivery efficiency. Finally, it matched the rapid growth of local demand. Specifically, Brazil and Mexico maintained solid growth. The content e-commerce ecosystem in the Brazilian market is most mature. We then tie up new customers and achieved good growth. This is the business performance of each market in Q1 of 2026, and this briefing is limited to operational data without coverage of the financial figures. Thank you. Right. Now let's have the Q&A.

[Operator Instructions] Now let's have the first question. This is from [indiscernible] Securities.

My question is that still we have a very good growth. I think that everyone could hear me. So the question is that we still have a very good growth and the figures, and everybody pays a lot of attention to the development of the e-commerce business. So for e-commerce as well as the growing global business of e-commerce, we emphasized a lot on the investment increase. So how are we looking ahead in terms of the subsidies from our customers? And at the same time, for Southeast Asia and Latin America market, how do you think about the absolute number of the overall growth?

So you're asking the question related to the market of Southeast Asia?

That's right.

Overall speaking, as we have already disclosed in the annual report, the e-commerce parcel in Southeast Asia is developing very fast. According to our estimation that in 2026, the overall e-commerce business in the Southeast Asia market is going to be growing at 30% and double-digit growth in the next 5 years. As the biggest courier service or express delivery operator in Southeast Asia, because of our investment and overall strategy, I believe that we are going to outperform the industry average. In Southeast Asia, we have seen the TikTok, Temu, Shein and the other markets and other customers, they have emphasized more their investments in Southeast Asian market as well. So by having different operation and different marketing and campaign and increased the product categories, the overall business has grown. So overall speaking, as we have already mentioned that the volume share has been increasing in Southeast Asia. And some of our competitors are now exiting from the competition. So be it the pricing or the overall network capability in Southeast Asia market, we are going to have a further upgrade. But of course, we have the market share data updated every half year. So next quarter, we are going to give you the report about the change of market share in South Asia. Talking to you about the background. So from our standpoint, except for the e-commerce platform parcels, we are also going to increase the percentage of non-e-commerce parcels. And percentage-wise, now this is less than 10% for the other businesses, because we have a very good growth of our e-commerce parcels. So be it from our operational strategy standpoint and the other points, we are going to have a lot of development here in the Southeast Asian market.

Next question is from [indiscernible] from CICC.

[indiscernible] from CICC. So I have 2 questions. The first one is about the Southeast Asian market. We already know that there are news of saying that in Thailand because the oil price is growing, the particular price of express delivery is also increasing. That was the news. We would like to understand the change of ASP in Southeast Asia market, because the overall cost of the petroleum is getting up, what is the overall impact on you? And second question is about the other markets. And we know and congratulate you on a wonderful growth in other markets. In Q1, in Middle East, probably you had uncertainty about the parcel volume there in Middle East. Would you like to give us further sharing about the overall market growth in Latin America and Middle East as well in other markets?

Right. Thank you, [ Stefan ], for this particular question. Let's have the first answer. With regards to the overall petroleum cost, we have already seen that because of geopolitical tensions, we do have regional conflicts and causing the rising cost of petroleum. At the current stage, with regards to these countermeasures, we do have several of them. First of all, we had a previous storage of petroleum for a short period of time in order to offset the overall impact. And second is that in a lot of countries in Southeast Asia, we do have different situations. Sometimes the government will have subsidy, but we need to be in the line to actually acquire that quota. So we are going to emphasize more on the communications with our customers. So at the current stage with a very high cost of the fuel oil, we are now going to try our best to try to replace the traditional fuel oil with the new energy and lower down the overall cost and dependency. And second is that while we increase the overall cost of freight and the other cost, we are going to also pass through up to our suppliers so that at the same time, we are going to tackle against this particular challenge together with our customers and upstream as well. All right. So this is the overall planning. Second question with regards to impact from Middle East because of the regional conflicts happening there. As for J&T Express, we are an international company. So we are now operating in different countries in the world with offsetting risks from different regions and countries. So we are going to remain operational in the Middle East and pay attention to the changes of the national conflicts and trying to have a very flexible strategy in place. Hopefully, that the overall business in Middle East is going to be very sustainable.

Now we have Steve Qiu from GS asking the question.

Congratulations on this very strong performance in Q1 of 2026. I have 2 questions. First of all, in the very beginning, Haibin already mentioned that in Southeast Asia market, we have seen some of the 3PL kind of exiting from a competition and being cleared out. You are now gaining more orders. So we would like to know that when you are getting some of the orders from the 3PL or the major 3PLs and how do you think about this collaboration? In Thailand, Indonesia and other relevant countries, what is the overall trend? And my second question would be on the China market, not only about the third-party carriers fleet, but also your own proprietary fleet, there is a slight decrease of that number. So what is the reasons behind?

Let's actually answer the first question, and my colleague is answering the second one. So talking about some of the small 3PL players exiting from the market in Southeast Asia, this is something that we are expecting. We always emphasize that they are actually servicing all the platforms because we are a third-party express delivery service provider. I think that this is not a competition between third-party versus [indiscernible], but this is a competition about the overall e-commerce. And at the end of the day, the e-commerce companies are actually selecting the most effective and cost-efficient partners to work with like China, right? I don't need to talk to you about the significance of that further. And from our standpoint, at this moment, the most important thing that we have to do is that in terms of cost and efficiency as well as the quality, we are going to actually make further advancements. So in the past 10 years, we actually had a very good operation in Southeast Asia. And now we are now expanding our overall business. So to be honest, we have already enhanced our capabilities in the Southeast Asian market. And now also we have a very good market coverage in China. So at the same time, we are now going to provide a better cost effectiveness to our customers in Southeast Asia and also providing better quality services. So for Thailand and Indonesia, to be honest, not only we are valuing Thailand and Indonesia, but also for the rest of the Southeast Asian market as well. Of course, there is actually a big billion -- like several billion parcels a year in Southeast Asia, but in China, it's tens of billions. So still that there is a large room for further improvement of parcel volume in Southeast Asia. And now we are improving per capita parcel volume as well in Southeast Asia. So we will increase continuously our investment in Southeast Asia market and further enhance our efficiency of the utilization of the capital. So as a third-party logistics provider, we are building our own kind of a business, but also at the same time, we hope that e-commerce platforms are continuously using our business. All right. So let's answer the second question. In Q1, the number of fleet proprietary owned has been decreased. And there are actually 2 reasons behind. First is that the company is actually increased the overall kind of use of the third-party fleet. And at the same time, we're optimizing the categories like the trucks with the total wheel base of 16.5 meters. And the second part is that in the future, I believe that we do need to have a certain further supply of the additional fleet, and this is not a kind of a quite massive change.

Let's have the next question. [ Sijia Lu ] from [indiscernible].

This is [ Lu, Sijia ] from Changjiang. So I have a question with regards to the Southeast Asia market competition, be it the partners and the number of the service of -- point of service, we are having a very good dynamism here in Southeast Asian markets. We would like to understand if it's the conversion from direct operation to franchisee model, what is the percentage? And in the future, whether you are going to adjust that figure further? Second point is that the point of service number is not changing in Southeast Asian market, but for proprietary trucks and the overall kind of sorting point number, this is increasing. So does it mean that we have reached a plateau in terms of the expanding of the network points? And what is the strategy for the overall future? How do we actually think about the overall development trend of non-platform business?

Right. Thank you very much. Let's have the answers. First of all, it is actually correct that in current 2026 Q1 in terms of the automation machines and the proprietary fleet, we are now increasing our investment here in Southeast Asian market. This is actually the same as the guidance that we have provided in the beginning of the year. So overall speaking, our business had a very strong and robust growth, and we have to actually increase our GP margin. So we have adjusted the particular kind of network efficiency. And automation machineries that we have invested also help us to improve efficiency and operational capability of the whole network and point of service. And second part is about the number of franchisees. In 2026, Q1, the number of franchisees flattened. And we are now doing integration of franchisees and enhancing the capability of franchisees and overall speaking, enhancing our own capability. At current stage, the conversion from direct operation to franchisee model is now being promoted. So this could help us to actually lower down the overall cost. And second, the franchisees have their own businesses as well as their own resources in local market. This is going to be helping us to improve our overall efficiency at the same time. So now we are doing more conversion and over -- kind of a little bit over 1/3 of the direct operational point of services are now becoming franchisees. So in the future, we are going to have a continuous increase of that particular number of the business. But this is not happening that quickly because still we need to find one franchisee after another. And that's part of the question is that at current stage, we are doing further expanding the other non-e-commerce platform businesses like the key accounts. So I think that the overall kind of a definition is quite similar to what we have communicated in the last round. And current stage, it is not that taking a very large proportion. Non-platform business now is only accounted for 10%. But in the future, for non-platform business, this is going to be actually contributing a lot more into our overall top line and bottom line. In 2026 in Q1 in the Philippines, we have already increased more collaborations with the local government and I mean the local customers, and this is the overall trend.

All right. Let's have [indiscernible] from asking the next question.

This is [indiscernible]. First of all, congratulations on such a wonderful performance from the company. And I have 2 questions. The first one is with regards to other markets, we would like to understand that for other markets, as for the contribution from Latin America, what is the overall percentage against the total? And last one is that TikTok and Mercado Libre started to contribute the business since the second half of last year. So now when we have further contribution from these customers, have you actually seen any trend and momentum of the year-on-year growth in the second half of the year? And the second question is about the other new markets. Would you like to share with us that for those countries that you are now entering like Europe and America and Latin America, for instance, any prioritization that you have for the market? And at the same time, what kind of market competition are you expecting?

All right. Thank you very much, [ Emma ], for this particular question. As we have already said that for the new 5 countries, this includes the Middle East and Latin America. And now we have other markets as well. So at current stage, the overall kind of share of Latin America is quite high and Brazil and Mexico in specific. We have emphasized more investments there in 2 countries in Latin America, increasing the parcel volume there. And we know that we had a figure of the orders from the Mercado Libre from the Mexico in 2025 second half. And also at the same time, we do see a very good business growth of ourselves and the decrease of our competitors. So we are very much confident in developing this business from Southeast Asia, I mean, Latin America. And at the current stage, we are going to see a much better potential in the Latin America business. At the same time, we are very much confident in that market. So talking about Mercado Libre, we just increased our partnership since last year. And they are now expanding their business in Latin America as a whole, and we are going to have further partnership with them. So we all know that the per capita parcel volume in Latin America is lower than of Southeast Asia. Last year, overall speaking, for the per capita kind of parcel volume in Latin America and Middle East is 11%. And in Southeast Asia and also China market, we can see that this is actually very high. So we do believe that we do have a very large potential there. So the final objective is still the same. We are actually believing that Latin America is really important. And second question is that the Europe and America and other markets, we are having the paralyzation of this particular answer to every one of you. We are now, at the same time, quite active in preparing our entry into the U.S. and Europe market, and we are defining the final timetable of that. And when that's mature and the answer is ready, we're going to provide that to everyone.

And now we have [indiscernible] asking the next question.

This is my question. For the business volume, I think that this is pretty good and higher than our expectation. The overall momentum is pretty active. So my question is that now until Q2, you are having a collaboration with SF Express. So would you like to tell us more about this collaboration with SF Express? And how do you implement your strategies there?

Right. Thank you very much for your question. Let's actually talk about the update of the like collaborations with SF Express. So as we have already said that we had a kind of a commercial shareholding and strategic collaboration. Now we are establishing a common task force with SF Express. And altogether, we are going to actually see the overall potential of the market. For instance, in China, in the very beginning, we had the parcel delivery at the bottom market and penetrated market. So -- and also parcel collection as well. So in order to open more markets and trying to get more market share, we are now collaborating with SF Express. Also the overall kind of SF Express is having a very good business of the line haul lines in the overall global market. So now we are pretty much targeting that particular advantage of SF Express and work with them in the international arena as well. So we do have a very good and deep penetration into the strategic collaborations with SF Express. And when everything is getting more clear, we are going to have a timely update to everyone.

So now we have [indiscernible] Securities asking the next question.

This is [indiscernible]. So first of all, congratulations on the wonderful business. I have 2 questions regarding the Southeast Asian market. We actually know that this is actually quite glad for us to see a performance in Southeast Asian market and for [indiscernible] overall growth versus first quarter 2025, we had actually a slowdown, but your growth is actually quite high. So I would like to understand whether or not you have any other new customers gained in China. And next question is that do you actually foresee any kind of changes of your competitors in this market because we know that from the parcel volume of 3PL, now it is quite limited in terms of the scope of selection. Second question to you is about the machineries and equipment. We have seen that in kind of Southeast Asia, you have actually increased a lot the automated equipment in Southeast Asian market, this is actually creating historical high. So we would like to understand still the number of machineries and equipment is still lacking that of the China market. So how do you actually see this plateau effect of the number of machineries that you have invested in Southeast Asian market? And how do we actually expect the change in terms of the overall cost in the future because the number of equipment already reached a plateau?

So let me answer the questions. The first question is that whether or not we have any new customers in Southeast Asian market and the overall changes of the market. So to be honest with you, for Southeast Asian market, actually, we do not have a lot of new increased key accounts because we have covered almost all the major platforms. But of course, in terms of the overall kind of market share, we do see a certain increase of market share from our certain kind of customers because they have provided this particular customers or this overall business to ours converted from the competitors and because we have a very good cost effectiveness for these new customers. So for this, we do see a very good increase of our share in that and also for some of the post offices in certain countries or regions. So as for the industrial figures, we are now going to have the update every half a year. So in August, we are going to provide with everyone the overall updated figures in the first half of 2026 and then give you an update of the figures in Southeast Asia market. But according to us, we do not see any kind of a big change happening there in Southeast Asian market because the post offices and post businesses of the Southeast Asian market is not the fast delivery or express delivery, but we are now focusing on express delivery. So there is a difference. So next is that you asked a question about the overall plateau of your equipment and automated sorting machines in the South Asian market. But still there is a gap versus China, right, because of the volume overall, overall speaking. If you're not reaching to a certain scale, it is not worthwhile for us to invest in those equipments. So at the current stage, we're now increasing our investment in equipment purchasing. In Q1 of 2026, we had increased a lot number of equipment in Southeast Asian market, and this is going to be the overall trend for the next quarters in 2026, because we have our expectations of the CapEx raising. Another part is about the overall kind of equipment investment for the point of services and network. Still there's a lot of room for the overall improvement of that figure. The current stage is still manual operated or most of the centers or networks have semi-automated equipment available. So now we are going to increase to actually change that situation, increase our investment.

The next question is from [ Rachel ] [indiscernible].

I have a very quick question regarding the reverse parcel. So we'd like to understand that for the reverse parcels in Southeast Asia market and in China, what is the overall percentage of that? And what is about the overall growth? At the current stage, from ASP or from a profitability standpoint, do you think that this is more contributive to the overall business than the normal parcels? We'd like to share with us about the reverse parcels.

All right. Thank you very much, Rachel, for this question. Let me have the answer. Normally speaking, at the current stage, this is less than 10% for the non-platform parcels, but this is actually quite good in terms of the overall growth, but not as good as that of e-commerce. For China, let's actually talk and expand about this point. in 2026 in Q1, the total number of reverse parcels contributed less than 10% of the top line and the overall growth is actually much faster. So overall speaking, in Southeast Asia market and China, I believe that for non-platform parcels and reverse parcels, the particular kind of profitability is actually better than those platform businesses, and this is going to be helping our overall bottom line. So pretty much we are now encouraging this type of business, which remain the same versus the past.

And now we have [indiscernible].

I have 2 quick questions. The first one is about the newly operational market and countries. For instance, when you enter the U.S. and European and other developed market, what kind of collaborations or what kind of business model that you're going to have? Are you going to do business everything by yourself? Or are you going to do M&A there? And second question is about the shareholder return. So this year, except for having the share buyback, any other incentives that you are considering this year?

Thank you very much for this question. Let me actually answer the question about the newly operation market and countries. You know that we are now announcing the 3 countries in EMEA and 2 in Latin America as new 5 countries. At current stage, we're now realizing the profitability in almost all countries. And also new business models have been used in those new countries and quickly helping us to actually ramp up. And now we do have a very good research and survey conducted in those local countries. So at current stage, I think that it's a very good timing. So be it in the Middle East and the other potential overall countries in the next 1 or 2 years of time, we plan to enter in those markets and expand our overall business. In terms of the business model, this is quite flexible. Of course, first of all, we are going to do 100% proprietary operation and also having some capital and business collaborations with some of our partners and business partners in order to be very flexible. And at the same time, while we are actually preparing for this operational market, we actually were still quite small. So now with the particular increase of our customers' requirements and demands and definitely speaking, we're going to increase our overall investment there. So when the final demand is getting up, we're going to have a much better situation. Second question is about the shareholder return. So we had actually an incentivized plan announced last year according to the dynamic changes of the overall market, the shareholder return will actually become a very important strategies of our company. So at the current stage, we are at a rising momentum of the rapid expansion. So definitely speaking, we are going to have a very good shareholder return plan in place.

Next, we have [indiscernible] from Changjiang Securities.

This is Hu from Changjiang Securities. I have 2 quick questions with regard to the Southeast Asia market. So first of all, in terms of the parcel volume in Indonesia and Malaysia, from March, it seems that they have a certain decrease and receive some of the negative impact. I understand that -- what were the major reasons behind the overall growth decrease? And from Q1 2026 standpoint, what is the overall trend of the overall growth? And my second question is that we know that now because of the fuel oil cost increase and some of the civil servants started to actually work from home. So we would like to understand that do you think that is going to further stimulate the shopping online as an overall trend?

So let's actually answer the very first question. Normally, we don't pretty much comment too much on the monthly data shown by third-party platform. So we are aware of that. But please pay attention to official data. But if this is the overall trend, actually, the March kind of growth is weaker than the previous 2 months. This is because of mismatch because Ramadan actually start earlier this year. And last year, March was actually better than the previous 2 months of the Q1. So that is to say that we didn't have that much of the impact overall speaking in Southeast Asian market. All right. So let me answer the second question. Just now you actually talk about the fuel oil cost increase and start to work from home, whether that actually increase the business of e-commerce or not? At the current stage, it is very difficult to actually answer that, but we have seen a mega trend. The per capita parcel volume in Southeast Asia is way lower than our China. So there's still a very high sailing there in Southeast Asian market. So be it the overall fuel cost is increasing or decreasing. So there is big potential for business growth in South Asian market.

Thank you very much. I think that's all for Q&A section. Let's pass the floor back to Frank.

All right. Thank you very much, dear investors and analysts for attending this meeting, and this is already a very good and thorough communication. If you do have any further questions, please contact IR team and stay tuned. Thank you very much, and good bye. [Statements in English on this transcript were spoken by an interpreter present on the live call.]