Hangzhou-based logistics firm Best reported RMB 569.7 million (USD 80.6 million) in gross profit in the second quarter of this year, up 9.6% year-on-year (YoY), primarily due to improved operating efficiency resulting from cost reductions.
The company, which counts Alibaba among its investors, delivered 2.3 billion express parcels in the second quarter in China, up 19.3% YoY, representing market share of 10.7% during the quarter, while expanding gross margin by 0.9%. Best shipped 1.9 billion tons of freight in the second quarter on the home market, up 28.9% YoY, while expanding gross margin by 2.5 percentage points.
Outside of China, the company shipped 16.1 million parcels in Southeast Asia in the second quarter, up from 783,000 in the same quarter one year ago. In a breakdown, Best shipped 10 million parcels in Thailand, up 95.3% compared with the first quarter of this year, while delivering 5.75 million in Vietnam, up 54.3% quarter on quarter.
“With the height of the COVID-19 pandemic in China behind us, we made a faster-than-expected recovery as we benefited from the deeper and wider trends of digitalization for merchants and online shopping for consumers,” said Johnny Chou, founder and chairman of Best, in the earnings release.
However, the company still generated RMB 30.9 million (USD 4.4 million) in net loss in that quarter, widening from RMB 22.4 million (USD 3.3 million) in net loss in the same quarter of 2019.
This article is part of KrASIA’s “China Brief” section, where KrASIA’s reporters will provide quick daily updates about the tech ecosystem in China.