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BEST Inc. (BEST) Q2 2019 Earnings Call Transcript

By Motley Fool Transcribing – Updated Aug 15, 2019 at 3:44AM

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BEST earnings call for the period ending June 30, 2019.

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BEST Inc. (BEST -3.00%)
Q2 2019 Earnings Call
Aug 13, 2019, 7:30 a.m. ET


  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Good morning, and good evening, ladies and gentlemen. Thank you for standing by, and welcome to BEST Inc.'s second-quarter 2019 earnings conference call. [Operator instructions] With us today are Johnny Chou, BEST Inc.'s chairman and CEO; and Jenny Pan, principal accounting officer. Through today's agenda, Johnny will give a brief overview of business and operational highlights, then Jenny will explain the details of financial results.

Following the prepared remarks, you may ask your questions. Please note, this conference is being recorded. Please also note, this call is being webcast on BEST Inc.'s IR website at A replay of this call will be available after the call.

Investor presentation is also available on the IR website. Before it begins, I will read the safe harbor statement on behalf of BEST Inc. Today's discussion will contain forward-looking statements. These forward-looking statements are based on management's current expectations.

They involve inherent risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the management's control. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or others, except as required under applicable law. Please also note that certain financial measures that the company uses on this call are expressed on a non-GAAP basis, such as EBITDA, adjusted EBITDA, and non-GAAP net loss. The GAAP results and reconciliation of GAAP to non-GAAP measures can be found in BEST Inc.'s earnings press release.

Finally, please note that unless otherwise stated, all figures mentioned during this conference call are in RMB. Now I would like to turn the call over to Johnny Chou, chairman and CEO of BEST Inc. Johnny, please go ahead.

Johnny Chou -- Chairman and Chief Executive Officer

Thank you, operator. Good morning, and good evening, everyone. Welcome, and thank you for joining our 2019 second-quarter earnings call. BEST integrated supply chain and logistics networks continue to execute its strategy and deliver strong results despite competitive market dynamics and ongoing industry consolidation.

I'm pleased to report we achieved positive non-GAAP net income first time in the second quarter. Our core segments of express, freight, and supply chain management continued to gain market shares, reduced costs, and improved operating efficiency. While our Store+ segment continued to optimize its operation to reduce losses. UCargo and Global delivered tremendous growth and are contributing to future growth of the company.

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The overall macro environment validates our business strategies in a long-term forward-looking approach. In the second quarter of 2019, we continue to see accelerating demand for supply chain solutions and logistics services and a further industry consolidation. They are driven by: one, growth in domestic consumption, increase in disposable income, and consumer spending in low-tier cities, further online penetration of larger consumer goods, such as furnitures and hope appliances; Intensified competition, technology adoption to support the digital economy; Growth in cross-border commerce and economic expansion in Southeast Asia; Favorable government policies supporting the logistics industry. BEST technology-enabled integrated service platforms and a strong execution capability position us well to capitalize on these vast opportunities and succeed in a competitive market environment.

Now let me share some business highlights with you. BEST express continued to benefit from strong industry volume growth. For the quarter, it gained market shares by achieving above-market growth while reduced the costs and expenses significantly. Parcel volume exceeded RMB 1.9 billion, an increase of 49% year over year, which is 1.72 times of industrywide growth.

Market share increased to 12.2% from 10.5% in the same period of 2018. Due to the intense competition in the second quarter, ASP, including last-mile fees, decreased by 12.5% year over year. The decrease in ASP was offset by decreasing costs and operating expenses as we continue to optimize express network and invest in technology to improve operating efficiency. Cost per parcel decreased by 11.6% year over year highlighted by significant improvement in transportation and the labor costs.

Although gross profit per parcel decreased by 1 percentage point year over year, EBIT per parcel was not impacted due to the significant operating leverage and the proactive expense management. We do expect the pricing pressure to ease in the second half as we're approaching to peak season. BEST freight, our leading nationwide less-than-truckload platform continued to expand its last-mile coverage footprint. The total number of franchisee-operated service stations increased by 55% year over year to over 17,000 from 11,000 in the same period of 2018.

The expanded last-mile service coverage position us well to serve increased demand for e-commerce and to see very large item transactions. For the quarter, freight volume exceeded 1.73 million tonnes, an increase of 26.6% year over year, significantly higher than industry average. Gross profit margin increased by 1.2 percentage points year over year to 6.4%, as we will continue to optimize the network, improve operating efficiencies to drive down cost. For BEST supply chain management, our strategy to focus on FMCG and the fashion apparel segment is paying dividends as we continue adding new customers while growing franchise cloud OFC businesses.

The total number of orders fulfilled increased by 42% year on year to 86.7 million, of which the total number of orders fulfilled by franchise cloud OFCs increased by 79% to over 36 million. As of June 30, total GFAs of cloud OFCs increased by 19% year over year to 2.84 million square meters, of which over 1.2 million square meters were operated by franchisees. Gross profit margin improved by 1.1 percentage points to aid our business by growing the number of higher-quality franchise-backed labor stores while improving order qualities of membership stores. As a result, total number of all orders fulfilled decreased by about 13.2%, while revenue decreased by 1%, while gross profit margin improved by 2.5 percentage points year over year to 10.5%.

EBITDA losses also reduced by RMB 15 million compared to the same period of 2018. Total number of branded stores, including franchise and self-operated stores, increased by over 315% year over year to over 3,100 as of June 30, of which the number of franchise BEST-Neighbor stores increased to 2,751 from 476 in the same period of last year. Number of orders fulfilled for branded stores exceeded 214,000, accounting for almost 20% of total number of orders fulfilled. This represents a 13-percentage-point increase from the same period last year.

We are in the midst of conducting a strategic review of the Store+ business to fine-tune its model. We'll tell you more about it as we restructure the business. UCargo, our truckload solid brokerage platform continued to grow rapidly. The number of external transactions on the UCargo platform increased by 266,000 -- 266% year over year to over 94,000.

The number of registered agents on the UCargo platform increased over 22% year over year to over 4,800, and a number of registered trucks increased by about 33% year over year to nearly 295,000 as of June 30. In the second quarter, revenue generated from external customers increased significantly to RMB 521.8 million, which accounted for 5.9% of our total revenue. We are confident that with our leading technology infrastructure, transaction, transportation, operations expertise, and favorable government [Audio gap], UCargo platform is well-positioned to capture the enormous opportunities in China's truckload market and become the leader of the industry. BEST global continue to spend its cross-border largest businesses, enduring its presence in Southeast Asia.

As of June 30, BEST global sold in 18 countries and regions outside of Mainland China. We continue to grow operations in Southeast Asia. Our Thailand express and fulfillment business is growing rapidly, and we are ready to launch Vietnam nationwide express services. We will continue to look for opportunities to invest and expand our services and networks in Southeast Asia.

Best capital continue to provide financial solutions to our ecosystem participants and to contribute to improved overall operating efficiencies in our network. Overall, we delivered actual results in this quarter. Looking ahead, we are focused on executing our strategy of solid revenue growth, market share gain, cost structure improvements, quality of services, profitability, and investing in the future. I'm more confident than ever that our technology-enabled integrated supply chain and logistics platform is the right formula for long-term success.

With that, I will turn it over to Jenny, our principal accounting officer. Jenny, go ahead.

Jenny Pan -- Principal Accounting Officer

Thank you, Johnny. Hello, everyone. We've had a strong second quarter. Company's revenue was RMB 8.8 billion, representing a year-over-year increase of 31%.

Revenue, excluding stock of business increased by 35% year over year, which led to continued strong growth momentum of our core business. We also see solid bottom-line improvements in this quarter. We recorded positive non-GAAP net income of RMB 6.5 million, compared to a net loss of RMB 56 million for the same period of last year. Non-GAAP net income, excluding Store+ business, was RMB 107 million.

Adjusted EBITDA was RMB 148 million, a [Audio gap] 256% year over year. Adjusted EBITDA, excluding Store+ business, was RMB 247 million. Non-GAAP net loss for Store+ business was RMB 125 million. The company also recorded positive operating cash flow of RMB 334 million for the quarter and positive operating cash flow of RMB 128.7 million for the first six months of 2019, compared to net RMB 178.1 million for the same period of last year.

Reconciliation of the non-GAAP measures to comparable GAAP measures and the relevant adjustments can be found in our earnings press release. Now I would like to discuss key financial highlights during this quarter. On a year-to-year basis, express revenue increased by 30% to RMB 5.4 billion, primarily due to a 49% increase in parcel volumes. As Johnny mentioned, the decrease in ASP was largely offset by a decrease in cost and operating expenses as we continue to optimize network and invest in technology applications to improve operating efficiency.

Revenue per parcel decreased by 12.5% to RMB 2.86 per parcel. Cost per parcel decreased by 11.6% to RMB 2.73 per parcel -- of which, transportation costs decreased by 17.7% year over year to RMB 0.71 per parcel. Labor costs decreased by 31.5% to RMB 0.23 per parcel. Lease costs decreased by 15% to RMB 0.09 per parcel.

Other costs decreased by 32.2 -- 25.2% to RMB 0.14 per parcel. Last-mile delivery cost only decreased by 2.1% to RMB 1.55 per parcel in order to maintain service content and network stability. Gross profit increased to RMB 244 million, representing an increase of 6.7% year over year. Freight revenue increased by 27% year over year to RMB 1.3 billion, primarily due to a 26.6% increase in freight volume.

Unit economics continue to improve, driven by economics of skill, network planning, and product optimization. Revenue per tonne increased by 0.2% year over year to RMB 755 per tonne, while cost per tonne decreased by 1.1% to RMB 706.5 per tonne. Of which, transportation costs decreased by 8% to RMB 351, labor costs decreased by 7% to RMB 94, lease costs increased by 1.5% to RMB 55, and other costs increased by 10% to RMB 45. Gross profit margin was 6.4%, representing an increase of 1.2 percentage points compared to the same period of last year.

Gross profit increased by 55% year over year to RMB 83 million for the quarter. Supply chain management revenue increased by 20% year over year to RMB 599 million, primarily due to a 40% increase in order fulfilled by our cloud OFCs. Gross profit margin increased by 1 percentage point year over year to 8 point [Audio gap]. And gross profit increased by 36% year over year to RMB 52 million.

Store+ revenue decreased 1% year over year to RMB 791 million. Revenue slowdown is due to a decrease in total number of orders fulfilled for membership stores from our ongoing efforts to improve other quality. Gross profit increased to RMB 83 million from RMB 64 million year over year, while gross profit margin improved by 2.5 percentage points year over year to 10.5%. Our other service line, BEST UCargo, BEST capital and the BEST global continued their strong growth momentum and are becoming important contributors.

Revenue from those service lines increased significantly by 183% year over year to RMB 647 million, primarily due to the lesser growth of UCargo platform. Revenue generated from customers on UCargo platform increased significantly to RMB 132 million. Gross profit from other service lines increased by 74% year over year to RMB 57 million. Of the major operating expense items are excluding share-based compensation expense compared to the same period of 2018, selling expense as a percentage of revenue decreased by 0.6 percentage points to 2.4%.

General and administrative expense, as a percentage of revenue, decreased by 0.4 percentage points to 3.2%. Research and development expenses, as a percentage of revenue, remained flat. Excluding Store+ business, the selling, general, and administrative expense plus R&D expense, all excluding share-based compensation expense, as well, the percentage of the revenue of -- excluding Store+ revenue was at 4.6%. Net cash generated from operating activities was RMB 334 million, compared to RMB 432 million in the same quarter of 2018.

The decrease was due to the seasonal cash flow cycle, which was offset over the six-month period. Net cash generated from operating activities for the first six months in 2019 was RMB 128.7 million, compared to negative RMB 178.1 million for the same period in 2018, an improvement of RMB 306.8 million. Cash and cash equivalents, restricted cash and short-term investments in total were RMB 4 billion as of June 30, 2019, compared to RMB 3.9 billion as of March 31, 2019. Capex in the second quarter was RMB 380.9 million, USD 55.5 million or 4.3% of total revenue, compared to RMB 230.3 million or 3.4% of total revenue in the same period of 2018.

The increase in capex was primarily due to the upgrade of automation system in major hubs and its location centers. Now let's revisit our 2019 financial outlook. Based on current market conditions and operations, we maintain our full-year 2019 revenue guidance to be in the range of RMB 36.5 billion to RMB 37.2 billion. This represents the management comments and our prevalent expectation, which is subject to change.

With that, we will now open the call to Q&A. Thank you. Operator?

Questions & Answers:


[Operator instructions] Today's first question comes from Scott Schneeberger of Oppenheimer. Please go ahead.

Scott Schneeberger -- Oppenheimer and Company -- Analyst

Thanks very much. And good morning, good evening, everyone. I guess if we could just start out in the express segment, please. Could you address revenue per parcel going forward? Johnny, what do you expect in the back half of the year? And then obviously, correspondingly, how you're going to be managing your expenses to offset? Thanks.

Johnny Chou -- Chairman and Chief Executive Officer

OK. Scott, thank you for the questions. Looking forward, we are at -- somewhat at ease of the ASP pressure. So our expectation of Q3, ASP should be relatively stable as compared with Q2.

So probably a slight RMB 0.01 or RMB 0.02 increase. Q4, in general, will have a more upwards tick for the ASP as through -- running through high seasons of peak seasons. So that's what we are managing. Costs continue to coming down.

And we -- actually, we did a great job and doing a great job in the first half of the year. Actually, the overall cost has been significantly put down. If you look at the cost less of last mile, it's actually down 22%. But we can continue to see, I think, on the third quarter and fourth quarter, some of cost reduction in there.

Scott Schneeberger -- Oppenheimer and Company -- Analyst

Excellent. Thanks. And then switching up a little bit. I was curious if you could elaborate, please, on your mention of a strategic review of BEST store?

Johnny Chou -- Chairman and Chief Executive Officer

Right. So yes. So our purpose of mission for doing a Store+ is really, we feel that in a digital economy, the last mile becoming more and more important. And it's very inefficient, it's very wasteful and low efficient.

So we thought that with the technology and with the supply chain solutions, we are able to make it more efficient. So save the cost environmentally and everything else and make our consumer a good experience, a bad experience, etc. But it will take some time to continue to grow. So we look at the strategy as to how the next -- we continue -- everyone continue to do this, but is that going to be -- was that in a different way to do it, such as maybe a separate business or everything else and still on the table.

So we're looking at this as a -- basically, as a option, and we do have a review on that. But certainly, when we have a decision and approval of the board, then we will more of a -- allowed to let the investors know of this. So we're looking at doing -- constructively looking at all the business models and see how can we improve better.

Scott Schneeberger -- Oppenheimer and Company -- Analyst

OK. Thank you very much. I'll turn it over.


And our next question today comes from Baoying Zhai of Citi. Please go ahead.

Baoying Zhai -- Citi -- Analyst

Hi, Johnny. I have three questions. The first question is still regarding the express ASP. After the second quarter, we're seeing great pressure on the express ASP.

And you mentioned the third quarter relatively stable and with the RMB 0.01 to RMB 0.02 increase versus the second quarter, which means it's about RMB 1.32 to RMB 1.31, right? And this actually equivalent to 17% year-on-year decrease versus the two last set of quarters. And that the decline magnitude actually, should it be narrowing than the second quarter? I just want to confirm if my understanding is correct here. And on separate note, actually, we see you made a successful price hike in July and August. What -- actually -- what's the implication here? Will it help our ASP in third quarter? And -- or we can see if the [Inaudible] sum of the price hike will be actually used to other regions? So make the ASP decline is still significant but should be better than second quarter.

This is the first question regarding the express ASP.

Johnny Chou -- Chairman and Chief Executive Officer

OK. So this -- the first question is very similar to the last one from Scott. Yes. So the third quarter, we think the ASP -- and right now, it's at about -- second quarter is about RMB 1.3, RMB 1.31, so I think there's going to be relatively stable for the quarter.

Maybe have a little bit of uptick, but it's similar. With EU, yes. You are very informed that actually, the pricing -- pricing has been eased -- the pricing pressure is being eased. And I think I have a very good sense that as the peak season coming very soon.

So I think everybody is actually eased on the pressure. As to this gain is going to be used somewhere else and not, it depends on the market how -- we do not have any plan or any for now.

Baoying Zhai -- Citi -- Analyst

OK. So do you think the EU ASP is actually kind of hold a while for WoWo? Or do you think it's just temporary?

Johnny Chou -- Chairman and Chief Executive Officer

Hopefully, as the peak season -- arriving on the peak season, typically July and August -- early August, just couple of weeks, is the lowest for the year, there's a potential here. Later part of this month, it will start picking up the orders going to be picking up a little bit. So I -- hopefully that this will stay for the remaining period of the year.

Baoying Zhai -- Citi -- Analyst

OK. [Inaudible] for the quarter, right?

Johnny Chou -- Chairman and Chief Executive Officer

But then again, it's just an outlook. No guarantee for that, right.

Baoying Zhai -- Citi -- Analyst

OK. Yes. Understood. And my second question is on the freight.

Actually, freight is doing very well. ASP increase and market share increase was ultimate for the freight business? And is the successful freight experience could be used for our [Inaudible]?

Johnny Chou -- Chairman and Chief Executive Officer

Yes. So freight, we are enjoying a very good strong growth, as well as top line and bottom line. So margin continue to improve, costs could continue going down. So we're really having a good run on the freight side.

That's partially because we have done freight, investing the freight, somewhat time earlier. Again, the -- some of our other players, unlike express. So express was getting to the market somewhat late. So we're actually doing a catch-up game.

We -- I remember when time we're getting to this -- when we started doing express business, our volumes are about one-tenth -- our competitors are at 10 times, so 20 times bigger than our volume. Our market share was less than 1% in -- back to the 2010 when we started this. But after that nine years, we're doing a catch-up game, right? Every quarter, we've been doing catch up. So now we're very close.

So at least not 10 times, but maybe a couple of 20, 30, 40 percentage points to the top. But on the freight side, it is a completely different story, right, because we're always in a fairly good leading position. So yes, so we can learn from the freight is that how managing the freight network. As you see, turnout is very similar, except one is larger parcels and larger merchandise and others, just small parcel.

Yes. So that's what we'll say. I think freight is doing well, and we're enjoying the early move, the investment did earlier, and we kind of enjoy it for freight. Express, we're was doing a really big catch up from very [Inaudible].

Baoying Zhai -- Citi -- Analyst

So what's the outlook for freight -- But what's the outlook for freight here because freight is also -- has a very intensive competition right now, right? So -- but we still managed to increase ASP, as well as our max shares. So what's the outlook here?

Johnny Chou -- Chairman and Chief Executive Officer

Yes. So freight -- I think, freight, unlike -- the freight business is unlike express, right? Express is a small parcel. So when the volume goes up, you can increase the automation and a lot of equipments to automate it, and you can really handle a huge amount of orders. The freight side is more of -- still a more traditional manhandling because of the heavier use forklift and stuff like that.

Though we are -- right now, we are doing automation or some of these sort of things to see how we can help the freight to improve the operation efficiency and lower the cost. But freight and other assets that compete is still different in the operation side from different from the express side. So going forward, I think we're still going to gain the market share in the freight side, and costs still are going to be a gradual coming down. And the profitability that we think that's going to continue to improve sooner quarter per quarter.

Baoying Zhai -- Citi -- Analyst

OK. Thanks. And my last question is regarding the Alibaba's potential controlling over IPO. What do you think -- what's the implications to the industry competition and escape.

As we all know, Alibaba -- actually among them, Alibaba has a high shareholding in that. So we'll back to further cooperate with Alibaba going forward? And especially in terms of the Store+ refinancing, it is on the way there already or on schedule already?

Johnny Chou -- Chairman and Chief Executive Officer

Yeah, yeah. As been announced in the media, yes, Alibaba is putting more investment into the IPO. Everyone knows about that. I would think that competitive -- in a competitive landscape, as Alibaba invests in FTO and YTO and CTO, as well.

I think that the competitive landscape is it's not going to be changing drastically, continue to going to be able to -- every company is going to be to their best to improve the efficiency and the service quality. So as for Store+, as I had mentioned earlier to Scott, that we are looking at order of possibility to -- how to continue to bring the value to the last mile. And meanwhile, also reduce the losses to the group. And hopefully, we'll -- if you look at all our group, right now, the Store+ is the biggest drive into our performance.

So we are doing some operational review on that.

Baoying Zhai -- Citi -- Analyst

OK. Thanks, Johnny.


[Operator instructions] Today's next question comes from David Ross of Stifel. Please go ahead.

David Ross -- Stifel Financial Corp. -- Analyst

Yes, good morning, good afternoon, everyone. First question is just on, I guess, the competition over there. You talked about expanding into other markets, Thailand is going well and then to Vietnam. As you expand into those other markets, are you finding less competition than in China? Or is there a significant competition you have to compete against once you arrive in a new territory?

Johnny Chou -- Chairman and Chief Executive Officer

Actually, in the new territory, of course, there's less competition because there is not a very entrenched market leader in the market yet. And still, the markets -- still demand is growing very rapidly. And the need for infrastructure and the service capability and -- is already there. So it remind me like 10 years ago, China, when this all has just started.

Yes. So the question is that we see a tremendous growth opportunity but yet less a competitive landscape compared with China.

David Ross -- Stifel Financial Corp. -- Analyst

And then we've talked in the past about labor issues, finding enough people for express and for freight in China. What's the update on the labor situation over there?

Johnny Chou -- Chairman and Chief Executive Officer

Our labor situation is for tax, we are pretty good. We are not shortage of any so any workers, both express and freight. And part of the reason because consolidation in the industry that smaller players are getting out of the market. So -- and the -- and second is because the improvement of efficiency by very large investment in automation and technology, etc.

So actually, we have less people now in express. Freight, probably still not much more than what it was had in last fourth quarter last year. So we are actually not seeing this issue where we may not seeing a labor pressure or anything.

David Ross -- Stifel Financial Corp. -- Analyst

That's good. And then last question is just on inventories, whether it's what you're seeing is BEST supply chain or in talks with customers, what are they saying about current inventories levels right now? Are they too low, too high, just about right?

Johnny Chou -- Chairman and Chief Executive Officer

In inventory, I don't have exact customer law on inventory, but we do manage the warehouses. So I think the movement -- percentage of movement is somewhat slower. Order movement in and out is somewhat slow. I'm talking about per customer basis.

So basically, we get a lot of new customers, but in existing customers, somewhat a slower movement. That means you can't consider that as a inventory level higher.

David Ross -- Stifel Financial Corp. -- Analyst

Excellent. Thank you very much.


And our next question today comes from Eric Zong of Macquarie. Please go ahead.

Eric Zong -- Macquarie Group -- Analyst

Hi, Johnny. So I have one question, which is on the bottom line, right? So if we include the Store+ contribution in the second quarter, the ex-Store+ non-GAAP net profit are more than double, right? So I'm just wondering -- so I think, I guess, this is driven by a lower loss contribution from the headquarter. So I just wonder, so what's the reason behind such bigger change? And can this improvement sustain into the second half of 2019?

Johnny Chou -- Chairman and Chief Executive Officer

OK. So you're talking about Store+, the group ex-Store+. So the EBITDA has increased dramatically. That mainly reason is because one is operating scale, right? Because even though our margin is somewhat a little bit lower, on the about 0.3% lower.

But scale is larger, so you actually have more gross profit. The second is that our operating expenses and G&A, actually as a percentage of the sales, that should go down, as well. So that contributes significantly to the non -- the ex-Store+ business profitabilities. Hang on.

Eric, is that your question or I misunderstood your questions?

Eric Zong -- Macquarie Group -- Analyst

So yes, I just have one more follow-up question. So on the G&A costs, you mentioned ratio, right. So, if there are trend that's consistent maybe in the third quarter or fourth quarter of the year?

Johnny Chou -- Chairman and Chief Executive Officer

So you're talking about -- I maybe misunderstood you a bit. You're talking about, what? The --

Eric Zong -- Macquarie Group -- Analyst

Yes. So your guidance, maybe your expectation?

Johnny Chou -- Chairman and Chief Executive Officer

To allocate it, right?

Jenny Pan -- Principal Accounting Officer


Johnny Chou -- Chairman and Chief Executive Officer

Yes, that's what I said. So basically, what we are -- basically, we are breaking out -- the Store+ reporting is mainly have people, investors, and market can clear to see what is really the impact on that. So we basically took the -- and it can be allocated expenses. The allocated to a business group and something like myself or the headquarter.

And so there. So when you have allocated was reduced and also operating efficiency improved -- so the ex-Store+ margin actually improved in the -- so that's why we reported a adjusted EBITDA ex-Store+ of about RMB 289 million, so -- which is significant improvement from the last year.

Eric Zong -- Macquarie Group -- Analyst

OK. Thank you.


And thank you ladies and gentlemen. This concludes your question-and-answer session. I'd like to turn the conference back over to the management team for any final remarks.

Johnny Chou -- Chairman and Chief Executive Officer

So OK. Thank you for joining our call. And we appreciate your support of BEST. Please reach out to our investor relations team if you have any further questions.

We look forward to speaking to you soon. Thank you very much.


[Operator signoff]

Duration: 45 minutes

Call participants:

Johnny Chou -- Chairman and Chief Executive Officer

Jenny Pan -- Principal Accounting Officer

Scott Schneeberger -- Oppenheimer and Company -- Analyst

Baoying Zhai -- Citi -- Analyst

David Ross -- Stifel Financial Corp. -- Analyst

Eric Zong -- Macquarie Group -- Analyst

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