J&T Global Express Limited (J92.F) Q3 FY2025 Earnings Call Transcript & Summary

Hello, everyone, and good day. Welcome to join J&T Express Q3 2025 Business Performance Meeting Announcement. [Operator Instructions] Now I would like to hand the call over to the moderator, Sylvia Yang.

Hello, everyone. Welcome to J&T Express Q3 2025 Business Announcement Meeting. I'm Sylvia. The meeting materials have been updated and e-mailed to everyone and updated to our IR website. Today, the management attending today's meeting is CFO of J&T Express, Dylan; and Head of Strategic Investment and Capital Markets, [ Hai Bing ]. The meeting will be divided into 2 parts. First, Hai Bing will provide an overview of company's Q3 2025 business performance, and then we are going to start the Q&A section where management will answer your questions. First, give the floor to Hai Bing.

Hello. This is Hai Bing. I'm very honored to introduce to you the third quarter performance of 2025. Overall speaking, the parcel reached 468 million pieces, 31.8% of the increase. And in total, a year-on-year increase of 25.6% of the parcel volume in 9 months of data reached. The gross market was mainly Southeast Asia and China and New Markets. First Southeast Asian market, we've been seeing a year-on-year increase of 78.7%. For 9 months to date, the parcel volume in South Asia reached 586 million pieces, increasing by 63%. The major reason for the growth is that, first, the e-commerce platform customers increased their investment and promoted rapid growth of business volume through promotional activities and continued arrangement of categories. And the e-commerce customers, TikTok, Temu and Shein continue to increase their investment and also having more promotional activities and this drive to grow. The third point is that the non-platform shipments are also growing and have an absolute contribution to order volume, but not as far as the e-commerce shipments accounted for less than 10%. At the same time, we've seen the gap between us and competitors is widening. Our competitors already withdrawn from express delivery markets in a single country. So we see that the market is also slowing consolidating. China, we already seen a 5.5 billion pieces of the third quarter, year-on-year increase of [ 47% ]. At the end of the 9 months, we had a year-on-year increase of 16.5% of the business growth. for the top 9 months. The major reasons are that, first of all, in July and August of 2025, we had another growth of industrial growth, expected that the growth rate in September will further slow down compared with August. The company's Q3 performance is the same as in-store growth rate. The service quality has been steadily improving. Our logistics index of the mainstream e-com platforms ranking among high franchisees. The brand image is significantly improved in minds of high-quality customers and brain the high-quality orders. And then New Markets, the volume reached to a level of 47.9% of the increase from 9 months to date. We have already having 270 million pieces of parcels from New Markets, an increase of [ 16% ]. And Mexico tariff again in August slow cross-border parcel volume growth. However, Brazil saw a strong growth due to the entry of new customers, resulting to fast quarter-by-quarter increase in parcel volume in our New Markets. This is performance of the third quarter of 2025. You are interested to know the Q3 financial results. Regarding the financial figures, we only currently disclose the semi-annual and annual figures. Therefore, the company generally does not update the performance guidance on a quarterly basis and currently maintains the guidance provided in August. The discussion will be limited to operating data level and will not discuss financial figures. Thank you. Operator, please open the online questioning channel.

[Operator Instructions] The first question comes from Brian Gong from Citi.

2 quick questions. The first is that in New Markets and South Asian markets in Q3, the growth rate is better than the guidance and still accelerating. So I would like to ask you that how do you think about the trend in Q4? Do you think that we can keep the momentum or even getting quicker? Second question is that for China market. Recently, we've been seeing a lot of price increase for the whole industry. So how do you think about the profitability in the second half of the year? And as for the second half of the year, what is your expectation to the profitability?

Right. Thank you very much, Brian, for this question. with regards to the Southeast Asian market, which is a core market of us, at the current stage, we have a higher performance than the guidance, but still there are differences. The first one is that in Southeast Asian markets, even if in Q4 of 2025, I think that even if we are keeping the same growth of the first half of the year, the overall growth rate is going to be higher than the guidance. So our conclusion is that the overall half year, especially second half of the year growth rate will be higher than the guidance, and we are going to make efforts to meet your expectation. But this particular high growth does not necessarily mean that we were conservative while providing the guidance in the beginning of the year because we were neutral by then. So more, we are saying that the e-commerce market in the Southeast Asian market is pretty much competitive and dynamic. So be it for our customers of all platforms or for a company, it is very difficult for us to have a very precise expectation and prediction of the order growth. For instance, at the current stage, we have 70% of the growth rate. And the guidance for the second half of the year growth rate is about 55%, and there is around 20% gap. So if you calculate that to the unit, it is about 3 million orders. If you actually further distribute it to other 5 economies in Southeast Asia, as for each and every country, I think that this is only about hundreds of thousands of orders more than the budget. So for a single country, this is not that large gap. It's just that for each country, we had outperforming the expectation. So overall speaking, there's outperforming the expectation in Southeast Asian market. This explains the very good data in Q3. In the Southeast Asia market, we have alpha and beta customers. So this explains. In New Markets, there are differences. In New Markets, the major growth are from the new customers. For instance, as we always talked to you about that for TikTok in the second half of the year, the Brazil and Mexico, and we work with Mercado Libre. So in the New Markets, we do have challenges from Mexico. Now they do have more tariff. And also in August, they have raised the tariff to about 30%. So in Q4 and also the next year, we are going to see impact to cross-border business. So even if we had high growth in Q3, but in Q4, I believe that there might be a little bit challenge to Mexico market. In New Markets, we will maintain the guidance to 40% growth as it was. So in New Market, the Brazil is performing quite well. And in the first half of the year, we had TikTok enter the Brazil, several thousand orders in the beginning and now hundreds of thousands of orders already. So for Brazilian markets, the high growth will be a little bit supplementing the challenge that we had in Mexican markets. So overall speaking, for the New Markets, the second half of the year guidance, which is 40% of the growth rate is quite neutral and appropriate. So your second question was on the China market. What do we expect for the second half of the year, whether it is becoming more optimistic? I want to explain this from 2 sides. First is about the growth. The second is profitability. In August and July, you can see that the overall industrial growth has been slowing down 12% in August. And in September, this has further slowed down. And in Q4 versus Q3, we are going to see a further slowdown of the business growth. So you can see that the industry is increasing the price and causing the slowdown of the industrial development. This is going to be quite stressful to our overall cost. So I think that for the single ticket revenue and profit, if you can see that Q3 and Q4 might be increasing in terms of that figure versus the first half of the year, but still there is a stress for cost. So we are holding neutral or a little bit neutral towards positivity attitude than the overall budget. So no change versus the guidance.

We're going to have the next question. Liu Gangxian from CICC.

This is Liu Gangxian from CICC. I have 2 minor questions. The first question is about the Southeast Asia market in terms of the growth rate. Just now you have mentioned that it is growing quite fast. And my question is for the overall e-commerce, do you think that this is actually the overall kind of organic growth from the Southeast Asian market itself or you had a different strategics and different investment strategy, whether you are going to update anything on this point? The second question is about Southeast Asia market as well. We could see that recently, there is a news say they've been having the approval of the [ pork ] operation in Indonesia, and it has been resumed, which is a good news. I would like to know that for these merchants and in terms of their operations, whether there is any impact.

Thank you for this wonderful question. First one is about the Southern Asian market in terms of the growth rate. We are very glad to see that in Q3, our growth was higher than expectation and the guidance, the major reasons are that, first of all, the Southern Asian market, the e-commerce penetration is increasing. And more importantly is that one of the key accounts have been investing more in Southern Asian market. So I believe that they are bringing more parcels to us. So this is the very reason why we are going to have the growth better than expectation. Then the second question, the answer is that as you are seeing an [indiscernible] fluctuation in Indonesia, as you said that the current stage, this has been resolved quite fairly. Of course, this happened quite shortly. So this impact was quite limited. And another thing is that for some of the e-commerce platforms, they do have hiccups while operating in South Asia market. But overall speaking, there was merely any impact. So this is going to be a new normal, but we have been actually resolved this quite wonderfully. And one thing to add, as for the first question, I think that for the Southeast Asia market, the out of expectation growth are due to the market performance there dynamically or this part of the reason would be to the express delivery industry. First of all, the overall beta has been developing quite well for the whole market and like the shipment and the penetration of the e-commerce. And second is that the free delivery fee for TikTok in Southeast Asian market, and we have followers of the other competitors. So at the current stage, there are more fierce competition of e-commerce companies. So overall, e-commerce industry is growing very fast. And second point I would like to say is that as for the Korea and also as for the commitment and cost, this is getting higher and higher. And at the same time, as for the price or as for the quality, there is a higher requirements and higher bars. So in certain countries, some of the small vendors, they are not going to be compliant with the requirements of the e-commerce platform and they're exiting from the market. So J&T Express because of a very good quality of our service, we've been increasing our penetration among certain accounts. This is another reason explains the out of expected growth in Southeast Asia market.

Understood. Indeed, as you have already stated that the e-commerce business is growing quite well in the Southeast market and the market is consolidating very quickly. I hope that J&T Express will get a further improvement in Southeast Asian market.

The next question is from [indiscernible] from Haitong Securities.

I am [indiscernible] from Haitong Securities. First of all, I want to congratulate for another wonderful performance of the company. The question from my side is about the development capability. We could see that we are accelerating our growth in overseas. So could you help us to understand the drivers behind? And what is about the major trend of the platform and the whole market? And second is that how do you think about the future potential of the market growth in the overseas? Second point is that we have observed that some of your peers are developing in overseas as well in Cambodia and Middle East. So actually, there are a lot of same phenomenon happened in the history, but still you are the best one in overseas market, and you were not impacted even if the others are going out. So I think that I want to ask you that what is the core competitiveness, for instance, in local operation? How do you think about your competitive edges versus your competitors?

Right. I think that this is a very good question. The first question is you want to gain more color about the potential growth in overseas. There are actually 2 regions, the Southeast Asia market, the major trend is the buy-one-getting-free-delivery. So you could see that in the second half of the year, we are seeing more things happening in Thailand and Vietnam, the biggest e-commerce platform is actually having promotional activity as well. And also the other e-commerce platforms are doing the same thing as for the exemption from postage. I think that at the same time, in China, we've been actually seeing this particular trend and phenomenon happened before. At the current stage, this helped to drive more orders from different price ranges. And at the same time, we are seeing a more competitiveness among the sellers or the merchants and also competition in between different platforms. The differences of the e-commerce customer is that we are a third-party logistics. The major strategy -- strategic positioning is that we want to actually have as many parcels taken from as many e-commerce platforms as possible and also to have a very good operational capability and to lower down our overall cost. But of course, under this particular background of the exemption from the express delivery fee, this drives the growth of the parcel number, and this requires a higher quality of shipment capabilities. So that is actually also driving the exiting of a lot of other small-sized competitors. We could see that we've been seeing some of the competitors that are withdrawing from express delivery market in a single country. So as for the development capability of J&T Express, we are going to be upholding our overall capability and our value proposition. Hopefully, that we are going to increase our penetration among the e-commerce platforms. But I'm talking about every e-commerce platform that you can think of. And I hope that one day, we are able to help them to grow at the same time. So I believe that we are actually a third-party logistics company. So from a development potential standpoint, this is very good. And also, in Latin America and Middle East, we are not seeing this particular trend of the express fee covered by the purchase. And we are seeing actually 2 major trends in new merchant markets. First is that for some of the e-commerce customers, they are investing more, especially in Middle East and Latin America. And another trend is that we are doing a lot of the local-to-local business. You know that for cross-border e-commerce, there are a lot of pressures from the dynamic tariff. So a lot of -- I mean, e-commerce platforms are now doing local-to-local business. So this is actually truly important for us to consider, happening in mature markets and also happening in the emerging markets as well. So this is a very important trend, which is more local-to-local business. So I believe that we have to pay attention to this. And this is actually the major reason for us to have a higher growth rate than the industry for the emerging markets. And another question from you is about the competitive edges. I believe that as for us, we really welcome more competitors joining us in getting to overseas altogether. And everybody knows that in China, we are a new company, and we're still learning from the other competitors and peers. Hopefully, that we are able to gain a much better capability and knowledge know-how in China, be it it's the operation or business model or talent recruitment, et cetera. We want to do better than ourselves. So you could actually change your angle and perspective while viewing this particular question. Everyone joins the local country so that we could expand the pie larger altogether. This is quite significant, and we see it from a positive standpoint.

The next question is from [indiscernible] from Changjiang Securities.

I want to congratulate on the company in achieving very good performance. I have 2 questions. The first one is about the overseas markets and New Markets. You could see that TikTok and Temu are accelerating their expansion plan in the new markets, Temu and TikTok in Brazil had a very good quarter-by-quarter growth of the number of visits. So I would like to know that for China, how do you think about the overall impact? And the second point I would like to ask you is about the China market. Now we could see that under the backdrop of anti-involution campaign, whether or not you are going to adjust your strategy here in China further?

Right. Thank you very much for your question. Let me answer the first question. As for overseas, especially those major e-commerce platforms going global. Probably you have seen this data from someone else from J&T Express standpoint, we have also our strategy. You could see that in Latin America, they [ arised ] there is a very good growth. And this is going to be a very encouraging figure to us. And I believe that they are one of the key accounts of us in Brazil and Latin America as a whole. But of course, we don't only doing business with them. We also have other potential customers and e-commerce partners as well or even local e-commerce platforms. Altogether, they are building the whole pie of our business in Latin America. Of course, for those mainstream e-commerce platforms going global, I definitely believe that this is going to make the whole industrial grow much better in Latin America and also in the Middle East as well. And second question you asked me is about the strategy for China. Actually, for Chinese market, we've been actually seeing some kind of incidents happening. The first one is about the price competition in the first half of the year and also anti-involution in the second half of the year. This was a little bit impacted the overall market performance. And in China market, we are still a follower and a learner. So we are still having a little bit gap versus the top companies. So based on that, we are going to work on our own organic capability to grow. We are going to regard the China operation as a very important training camp for J&T Express. We are going to further recruit the talents and further increase the overall operational efficiency in the emerging markets and to optimize as well as innovate on our business models and try to copy our strategy from the rest of the market to China and also the other countries as well.

Next question is from [indiscernible] from [indiscernible] Securities.

I have a question that in the Southeast Asia, be it in the number of point of services and also the number of fleets, you were investing continuously. I would like to know that which countries are you talking about in Southeast Asia for those investments? And with this further investment upon those hardware, how do you think that your delivery time and the efficiency could be improved? The second question is that which Southeast Asia countries are going to receive more investments from you in the future?

Right. Thank you very much. I am from the IR team. Let me answer the question. In Southeast Asia market, the fleet and also equipment investment is very good. You can see that the number of parcels in the Southeast Asia market is growing very steadily and in a high pace. At current stage, we have 60% of the growth for the top 9 months. So we have to actually invest more to increase our capacity. We are going to update that gradually. So on the fleet, be it the self-owned or outsourced fleet, there are a lot of improvements. Second point is that we are actually updating and also we are rebuilding our facilities. And now we have around 120 centers in Southeast Asia for the shipping center, but only 60 have automation capabilities. In major economies, we are achieving a very high growth rate. And this is due to the very good positioning of automated device and equipment use. And another part of the story is that in the future, we are going to see a gradual implementation of those new equipments and the more number of fleets. So while you are going to see an increased parcel number, we are going to see further investment to buy new vehicles in the fleet or to upgrade our facilities. And this incremental part can be reflected in emerging markets. And for instance, that in one country, we have been investing in 11 automated lines so that while we are taking orders from new customers, we can have a very good bargaining power, and we can provide a very excellent service to our customers. Any further questions?

No further question from myself.

Next question is Fan Qianlei from Morgan Stanley.

This is Tenny from Morgan Stanley. I have 2 questions relating to China market. The first one is about the ASP in China. In the second half of the year because of anti-involution, this ASP could be improving month-by-month or quarter-by-quarter. But still according to some of the other figures, I think there are differences in terms of the year-on-year growth of the ASP. I'd like to understand what is the level of J&T Express and in between franchisees and headquarters, how do you distribute the price increase, whether you can have more details sharing with us? The second quick question is about the impact to the number of parcels. We can see that when the ASP is increasing, actually, this is dragging the development of the parcel number increase. So I'd like to know that whether or not the impact of the parcels among different customers, they might be different. For instance, for some high-end customers, this impact is going to be merely little or in which e-commerce platforms, you are going to see a kind of a different impact because of this increased ASP.

Right. Thank you very much, Tenny, for this wonderful question. As for your first question with regards to the Q3 ASP of China market, the overall trend we've been seeing, especially in September, there was actually a very big increase of the total price and the overall trend is still quite similar to that of the whole industry or the other peers in the industry. But we are not disclosing any financial data for this round. So at the current stage, we're not going to give you the figures about the year-on-year or quarter-by-quarter growth, but the overall trend is the same. As for the profit -- profitability because of ASP increase and distribution between the headquarters and the franchisees at the current stage, we're talking about different regions and for different franchisees, we have actually a different policy. So I cannot give you one size-fits-all answer, say it's half or 1/3 to each. But the overall strategy is that we are hoping that our franchisees are going to become more capable. So in certain regions, we are going to tend to work with the franchisees because as for our competitors, right, in J&T Express, we actually operate the shortest here in China. And also in terms of the overall kind of quality of the franchisees, this is not as good as the other express delivery companies. So I hope that definitely speaking, we're going to see better profitability of the franchisees, which is going to be sustainable and scientific. The second question to your second -- second answer to your second question is that actually, whether there is any kind of impact from a slowing down of part number increase due to ASP increase? How do you think about the difference among competitors? The answer would be that, yes, we've been seeing a lot of difference. For instance, for the first round of ASP increase in Guangdong province, there was a lot of decrease of the business. For instance, there were a lot of low profit margin customers like selling the smartphone case, and they cannot tolerate this particular price increase and they exited from the market. So the first round impact was to those low valuable kind of customers. So for branded customers, as for the big customers, as for the express delivery price, they were not that sensitive towards the price change. So merely any impact. As for J&T and also as for the rest of the other industry, we are sharing the same momentum and also the overall trend.

Right. I would like to have a follow-up question, whether or not there is any difference across different platforms for the impact to the number of parcels?

Right. Answer would be that I think that we are seeing the same trend as you did like for the kind of customers with the low DOV, not only they are going to be selling on one e-commerce platform, but all the customers' platforms. So for those customers of low DOV, they were the major driver of the impact. This impact is not attributable to only a single platform.

Now let's have the next question from [ Guangdong Development Securities ], [indiscernible].

You've been achieving a much better growth for your business, which is our expectations. So I would like to ask you that for the next several years, in Southeast Asian market and the emerging markets, how potential you are for the future? So according to the growth rate that we have, would you like to have more visibility about your predictive value from 2025 to 2028? At the current stage, I went to Indonesia in the October national holiday, I found out that their overall parcel number per capita was quite low, and they had the low income level. So for Indonesia, I think that you're having a big investment there. And I would like to ask you how potential the Southeast Asian market is in the future? The second question is about your customers. So at the current stage, we are seeing a lot of growth. So we want to ask you that you're having a better overall growth rate than that of Q2, which is 20% gap. So definitely, you are gaining support and help from emerging customers. In terms of the development and exploitation on the new platforms, whether you have any updated information and details to be shared with us?

Right. Thank you very much for this question. Are you able to see the presentation PowerPoint that I presented?

Yes.

Actually, as for the growth rate in Southeast Asia market, definitely, we had our expectation growth in Q3. As for us, this is a new normal. Sometimes we are having only the kind of a price. And in Southeast Asia market, in the future, this is going to be a big driver for the growth of e-commerce and e-commerce express delivery as well. So sometimes you can see that if we're taking a look at the transaction volume and the parcel volume, as for the whole Southeast Asian market, it is already gaining additional 20% of the growth rate. In the near future, we're going to maintain that particular momentum in Southeast Asia market in specific. So in the future, we are having our confidence that we will perform much better. So for Southeast Asian market, we are maintaining the guidance as it was. The second point, as you mentioned, was about the major accounts in Southeast Asian markets. Definitely speaking, a major reason for us to grow in Southeast Asian market is that they have their customers and further penetration of e-commerce platforms. And also at the same time, we are further optimizing our overall cost and operational cost specifics. So for other peers, they are exiting their business from some single country. This helped to increase our penetration in that market. In Southeast Asian market, we're going to keep investment and maintaining our competitive positioning in that market. And I would like to give you an example. Most of our customers are from the mainstream e-commerce platforms from China. So of course, I hope that those new and some of the smaller local Southeast Asian platforms could be doing business with us further. And next is that we are doing the -- a lot of non-platform parcels, reverse parcels, commercial parcels and some of the others. So at the current stage, we are making a very good improvement.

Next question is Guo [ Yixue].

I have 2 questions. I am from Nomura. As you have mentioned that because of a raising tariff in Mexico, you've been seeing the less number of parcel cross-border. So could we understand that for those going global e-commerce platforms, some of them are having cross-border parcels partially and also local parcels. So tariff increase reduced the parcel delivery. So this is weaker, of course, in terms of the overall impact than our expectation. Is that the case? My second question I want to ask you is about the China market. Would you be upholding the guidance that you provided for China market? As for the parcel volume, the growth rate should be exactly the same as the industrial level. And also as for the single parcel parameters, we've been seeing a very good quarter-by-quarter growth. So in the second half of the year, you could see that parcel number growth is the same as the industrial number. And also the parcel kind of order number will also be improving versus the industrial average, right?

Right. Thank you very much, Rachel, for the 2 questions. The first question is that you have a correct understanding. For instance, for Latin American customers, their overall business model is that they are doing partially the business of local-to-local and cross-border business. If this is a cross-border business, they're going to be impacted by the tariff and fluctuated a lot. A very good trend is that for our customers, especially in the past 1 or 2 years where we had fluctuated and volatile kind of tariff, they've been actually already notifying this particular problem. So they are now spending more investments in building the local supply chain in those different local countries. So surely, if they had the tariff increase, they were going to divert more traffic to the local customers and local buyers as well. So this is going to be their method in coping with the impact from the tariff. So from a longer standpoint, I think that this particular impact of the tariff will be forcing our e-commerce platform customers in actually giving more resources to the local supply chain. This is benefiting the local business. The second part of your question about clarification is about China. Actually, as of the end of Q3 for J&T Express, our overall growth rate is a little bit lower than the industry average. And in Q4, our strategy is that we want to keep flat versus the industrial growth or getting a little bit low because the overall strategy for us is not try to hit a very high level of the growth rate. But in recent 2 years, we want to do restructuring actively, and we are going to give the more resources in getting those medium-sized to large size of accounts, right, that we always wanted to have. So we want to have more high-quality customers that could help us to improve our profitability in China. This is the strategy that we have here in China. That explains the reason why we're having the same or a little bit lower than the industry average growth rate for J&T Express. But still, the overall trend, I have already explained that in the short period. But for the short medium of the time, in the next 3 to 5 years of time, what is our strategy here in China? In terms of the penetration and market share, we want to get bigger. But still in China market, there are a lot of competitions. So periodically, we are going to do the restructuring or the shifting of strategies. The second point is about the ASP. At the current stage, the ASP is increasing quarter-by-quarter. This is the same as the industry average. And at the same time, the kind of profitability per parcel also increased at the same time.

Now let's have the next question. [indiscernible] from DSB.

I have 2 questions about the operational capability. First is that you were talking about the cost reduction measures. So having franchisee-ship in Southeast Asia. Would you explain on that? Second point is that we'll be seeing 2 interesting things. First is that for China region, you have actually a reduction of the point of sales. And in emerging markets, you have been adding 9 more. So what is your strategy thinking behind?

Right. Thank you very much, Mr. [indiscernible]. The first question is that as for the progress in Southeast Asia market, so actually, the whole progress is pretty similar to our expectations from direct operating to franchisee model. This is the strategy that we have to uphold for a long term in Southeast Asia market. So if you're talking about a single quarter, we're not going to see a very big and obvious increase, but this is an unchanging kind of increase. And also second is the sorting center number. In New Markets in terms of sorting center, we adjust that in Mexico and Brazil. Now we can see that because the parcel is increasing quite fastly, we are dynamically adjusting the number of our sorting centers. So be it for the sorting center or the number of point of service, we are actively shifting our strategies there.

Right. For the 9 new sorting centers, they are in Brazil, right?

Right. And the automation equipment investments are also one of our focuses in Southeast Asia -- I mean, in the South American markets. For the new 9 sorting centers, we have conducted the preliminary analysis. If the capacity is increasing, we're going to position that further. At the current stage, the whole resources, especially the sorting center number is still less than abundant. [Audio Gap]

So against that backdrop, what is the ratio of reverse parcels versus the normal parcels in your individual parcel business?

Right. Thank you very much, Mr. Ling, for this wonderful questions. First is about the CapEx increase in South Asian market. Actually, you could see that our growth rate is actually quite good in Southeast Asian market. At current stage, there is no problem for that. But still, we're actively optimizing on our operational efficiency, around USD 1 billion of CapEx each year for that market -- Sorry, it is USD 600 million in Southeast Asia market. Next, Sylvia will answer your second question.

Right. Thank you very much. As for Q3, overall speaking, the reverse parcel, 2.2 million and the non-reverse individual parcels, 2.4 million. In total, we had 4.6 million parcels. This is accounting for about 7.7% of the total parcel and business. If you compare that with 2024, this has been improved a lot. Last year, the whole percentage was about 6%. That is to say that you could see that the individual parcel business is growing quite rapidly.

Thank you very much. There is no further questions from the line. I would like to hand the call over back to the management to give a conclusion remark.

First of all, I want to thank everyone for this participation in the Q3 2025 business announcement meeting. If you have any questions, please contact the e-mail of the IR team. Thank you very much, everyone. You are now able to be disconnected. Thank you. See you next time. [Statements in English on this transcript were spoken by an interpreter present on the live call.]