Zhitong Finance App learned that on March 26, Aneng Logistics (09956), a leading express shipping company, issued the 2023 results announcement. This is the first full annual results announcement since it pioneered the “quality and profit” strategic transformation in the industry. According to the data, Eneng achieved annual revenue of 99.17 billion yuan, a year-on-year increase of 6.2%, gross profit of 1,268 billion yuan, a sharp increase of 73.6%, and adjusted pre-tax profit of 654 million yuan, which significantly turned a loss into a profit; adjusted EBITDA of 1,730 billion yuan, an increase of 57.8% year on year, operating cash flow increased to 1,706 billion yuan, and total LTL freight volume reached 1.04 million tons, which was basically the same as last year. The number of service terminal customers was about 5.5 million, an increase of about 17% year on year.

Overall, guided by the “five most” goals of “the best cost, the best quality, the most stable service response, and the most dense network coverage,” Eneng's logistics transformation and transformation results are outstanding. Profitability increased dramatically in 2023, and gross profit surged by more than 70% year-on-year, reaching the best level since launch, and achieved industry leadership in terms of volume scale, profit level, network coverage, and cost control capabilities. “High quality growth” became its key word of the year.

The announcement shows that in terms of cost capability, Eneng Logistics continues to “practice internal skills”, improve operational efficiency, and create the ultimate cost control capability. On the one hand, the company starts at the distribution end, upgrades the distribution structure, improves efficiency around people, plants, and equipment, and strictly controls costs and expenses through lean operation. On the other hand, strengthen the transportation side, improve transportation efficiency through route planning, capacity structure improvement, etc., and at the same time build a steady fleet management system to continuously reduce vehicle costs. In the second half of 2023, the unit distribution center cost was 156 yuan/ton, down 17.1% from the previous month, and the unit trunk line transportation cost was 310 yuan/ton, down 5.1% from the previous month, and lean management capabilities continued to improve.

In terms of volume structure, Eneng's accurate pricing mechanism replaced the low-profit and negative gross margin business with a high-quality, high-margin business. The average annual ticket weight dropped from 106 kg in 2022 to 93 kg in 2023. Among them, the volume of mini tickets with higher profit margins and LTL tickets increased by 9.1% and 2.4%, respectively.

In terms of service capabilities, the company released a new brand concept of “use safety and energy to deliver good goods”. It continues to improve various service indicators in terms of waybill time, full timeliness delivery rate, settlement rate, and complaint rate, and customer satisfaction has further improved. In 2023, Eneng's average waybill time decreased by 10.1% year on year, the timeliness rate increased by 12 percentage points year on year, the loss rate of 100,000 items decreased by 83.2%, the damage rate of 100,000 items decreased by 33.6%, and the number of complaints about 100,000 tickets decreased by 64.4%.

In terms of organizational transformation, Eneng is focusing on building a flat organization, formulating a series of performance-oriented operating measures, transforming central and back-office functions into a specialized shared service center, and continuously stimulating organizational vitality by constructing a solid budget and financial system and superimposing the application of digital tools. At the level of network construction, relying on precise pricing policies, agile services integrated into the “Iron Triangle” and all-round enabling support, Eneng is committed to transforming the platform ecosystem into a good atmosphere of fairness, impartiality, deep coverage, sustainable profit, and common prosperity. By the end of 2023, Eneng Logistics had more than 28,000 freight partners and freight forwarders, with a township coverage rate of 98.2%, and the retention rate of leading freight partners reached 98.2%, an increase of 2.5 percentage points over the previous year. The platform's strength and stickiness were significantly strengthened.

Eneng Logistics said that as a year of in-depth reform, 2023 has laid a good foundation for the company's long-term development, and the company is confident of starting a new era of quality growth. In the next step, the company will continue to implement a strategy that places equal emphasis on quality and profitability, continue to cultivate deep cultivation in quality and timeliness, operational efficiency, ecological networks, digital investment, product matrices and sustainable development, strengthen its competitive advantage, and promote the integration of China's LTL industry.

McKinsey said in its “2023 LTL Logistics Industry Insight Report” that the domestic LTL market is facing structural transformation and upgrading and is entering a “consolidation period” of the stock market. Among them, Network-wide Express, which has the highest maturity, is the only track likely to run out of the 50 billion tier leader. Industry insiders said that Eneng Logistics's performance in 2023 unquestionably demonstrated its absolute leading advantage as a leading company, confirmed the correctness and forward-looking nature of the brand strategy transformation centered on “quality and profit”, and is expected to further lead China's express industry towards high-quality growth.