Affected by the epidemic, investment and consumption will be significantly impacted in 2020, but export data are thriving. With the rapid recovery of China's exports, Sinotrans is accelerating the recovery of operating performance and continuing to expand its business scope. On December 9, 2020, Sinotrans Securities Affairs Representative and General Manager of the Capital Operation Department, Lu Ronglei, stated that the company has completed the acquisition of 100% equity in seven subsidiaries of the European company KLG, effectively supplementing Sinotrans’s landing service in Europe. To enhance overseas operations, the purchase price is expected to be no more than 386 million euros (about 3 billion yuan).

Regarding cross-border acquisitions, Lu Ronglei said that cultural integration is a key to whether cross-border and cross-cultural acquisitions are truly successful. After the acquisition of KLG, Sinotrans has maintained the vitality of the acquired company to the greatest extent on the premise of ensuring business collaboration, meeting the management requirements of state-owned enterprises for its subsidiaries and the compliance of listed companies. The acquisition of KLG is a very good practice, laying a good foundation for future potential acquisitions. In the future, KLG will be used as a unified platform for Sinotrans in Europe.

According to the data, on September 26, 2019, Sinotrans held an interim board meeting to review and pass the "Proposal on the Acquisition of the Equity Project of KLG in Europe" and agreed to acquire the entire project of 100% equity in the seven subsidiaries of KLG Europe Holding B.V. Program.

Sinotrans has completed the first settlement on December 12, 2019, namely the acquisition of 80% of the target company's equity, and on June 3, 2020, the acquisition of the remaining 20% of the equity.

The purchase price of this transaction is expected to be no more than 386 million euros (about 3 billion yuan).

Sinotrans is China's leading integrated logistics service provider and integrator, providing customers with customized professional logistics solutions and integrated full supply chain logistics services.

It is understood that the main business of Sinotrans includes professional logistics, agency and related businesses, and e-commerce business. Among them, professional logistics is the core business, focusing on high-growth, high-value-added industry segments and their upstream and downstream. The 2019 annual report shows that the logistics industry accounts for 99.28% of revenue.

Affected by the epidemic and other factors, Sinotrans's performance in the first half of the year declined, but with the rapid recovery of exports, the company's operating performance has accelerated.

Sinotrans's 2020 semi-annual report shows that the company achieved operating income of 39.691 billion yuan in the first half of the year, a year-on-year increase of 5.22%; net profit attributable to shareholders of listed companies was 1.215 billion yuan, a year-on-year decrease of 19.93%.

Sinotrans's third-quarter results showed that the company's revenue in the first three quarters of 2020 was 62.290 billion yuan, an increase of 11.52% year-on-year; net profit was 2.081 billion yuan, a year-on-year decrease of 1.69%. Among them, the company's operating income in the third quarter reached 22.599 billion yuan, a year-on-year increase of 24.62%; net profit reached 866 million yuan, a year-on-year increase of 44.43%.

At present, Sinotrans has an extensive and comprehensive domestic and overseas service network. The domestic service network covers 32 provinces, autonomous regions, municipalities directly under the Central Government and the Hong Kong Special Administrative Region. It has more than 10 million square meters of land resources and more than 4 million square meters in China It has warehouses, 8 inland water terminals and more than 3,700 meters of shoreline resources, and leases and operates approximately 3 million square meters of warehouse resources. Its own overseas network has covered 38 countries and regions and has 76 global operating outlets.

Sinotrans has abundant logistics resources such as logistics centers, container depots, and wharves in coastal ports, key domestic cities and key overseas regions. In addition, the Group has implemented industry-finance integration and industry-finance synergy with the finance, trade, park development, shipping, and global port business segments of China Merchants Group to provide customers with global logistics services.

Moreover, Sinotrans is one of the leaders in the cold chain logistics market. At present, the domestic cold chain logistics market is relatively fragmented, still in the cultivation stage, and has not yet formed a mature competition pattern. In June 2018, the company reorganized and established Sinotrans Cold Chain Logistics Co., Ltd. as a unified platform for the investment, management and operation of the company's cold chain logistics sector. The service products include fruits and vegetables, frozen meat and seafood.

It is worth mentioning that in the first three quarters, Sinotrans's R&D expenses reached 84.084.5 million yuan, a year-on-year increase of 259.79%. At present, Sinotrans has determined the wide application of five types of smart technologies: artificial intelligence, blockchain, cloud computing, big data, and the Internet of Things. Sinotrans will accelerate transformation and upgrading through innovation-driven and digital empowerment, and create an "integrated, open The supply chain logistics ecosystem of, sharing, coordination" helps global supply chain stability and international and domestic dual cycles to achieve high-quality development. Editor/Sang Xiaomei