① Earnings expectations are anticipated to increase due to Corona 19 and shipments increase ↑
[팍스넷뉴스 최홍기 기자] CJ Logistics is in full swing in facial expression management. This is because the controversy over the overwork of courier drivers that emerged last year led to an increase in courier costs as a result of increased expectations for earnings improvement, amid an increase in non-face-to-face shopping from Corona 19.
According to the logistics industry on the 3rd, the domestic parcel delivery volume last year was about 3.6 billion, an increase of 28% from the previous year. Of the 3.3 billion units processed by the top five companies, 1.7 billion are estimated to have been digested by CJ Logistics, the number one in the industry. According to industry estimates, if CJ Logistics delivered 1.7 billion units, this is an increase of more than 30% compared to 2019.
Accordingly, CJ Logistics’ earnings are also expected to improve significantly. This is because the parcel delivery business accounted for 27% of total sales, and as the number of corona19 confirmed cases increased in the fourth quarter, non-face-to-face services were rather spreading compared to the previous three quarters. As of the end of January, major domestic securities companies are also predicting that CJ Logistics will increase by 5% and 10.6% compared to 2019, with sales of 10.9387 billion won and operating profit of 339.7 billion won.
However, CJ Logistics seems to be unable to fully enjoy the joy of good performance. It is due to various noises following the controversy over overwork of courier workers that broke out last year. In fact, even after CJ Logistics Vice Chairman Park Geun-hee personally apologized and announced measures to prevent recurrence, news such as apocalypse, dismissal, and general strikes have been delivered, leaving the frame that workers are squeezing high blood to improve performance.
Apart from the controversy, CJ Logistics’ earnings are expected to improve this year as well. It is because there is a growing possibility that the delivery cost will increase after 8 years.
Although major logistics companies need to improve the treatment of courier operators, they are expressing difficulties saying that if they are excluded from the sorting process for this purpose, they will need additional personnel dedicated to the work. This is because the increase in fixed cost burdens is burdensome, as parcel delivery costs have rather declined despite increased shipments due to intensifying competition since 2012.
In fact, the average delivery cost in 2012 dropped from 2506 won to 2229 won in 2018. However, the average value of over-standard items and non-standard variant cargo in 2019 increased slightly from the previous year to 2269 won, but a common message in the logistics industry is that it should be at least 3,000 won considering the inflation rate.
Therefore, as there is a social consensus on improving the treatment of delivery drivers, the market view is that delivery costs are likely to become a reality this year. This is why CJ Logistics’ earnings will not improve again this year.
An official from the market said, “This controversy over the parcel delivery service will lead to an increase in parcel delivery costs and lead to normalization of profitability of companies. As the parcel delivery industry must continue to invest in large-scale facilities, the efforts of companies to increase the parcel cost will accelerate. In particular, CJ Logistics, which is the No. 1 in the industry, will show a remarkable increase.”
The official also said, “The increase in courier costs cannot be led by CJ Logistics or courier companies. It can be seen as unity, but the reason for the companies avoiding the official position is the same.” He interpreted it as being like helping the impression.”
However, CJ Logistics is in a position that it makes no sense about the market’s prospects. A company official said, “The increase of the delivery cost is not a matter that the company can arbitrarily decide.”
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