For participants only, and shall not be publicly released. SF Holding does not have authorized any media to retransmit the relevant content of its conference. Any authorized reprinting and forwarding are considered infringement, and SF reserves the right to pursue legal liability. The market is risky, and investment requires caution. We remind all investors to make investment decisions carefully. Please note that the presentation materials are available on our IR website. I'm Carol, SF IR Manager, to provide simultaneous interpretation together with Mark. Now I will translate for Mrs. Gan Ling, our Board Secretary.
[Foreign language]
Hello everyone, and thank you for joining us today. I'm Board Secretary Gan Ling. In this earnings call, our CFO, Alex Ho, will start by introducing the earnings highlights for the year. Then our Chief Marketing Officer, Mr. Xu Bensong, will give the business segment overview, followed by our Chief Operating Officer, Mr. Huang Sihai, to introduce operational updates. Next, Alex will go through the financial overview and ESG session. Finally, there will be a Q&A session on the Chinese channel. For any questions, please leave a message in the chat box or switch to the Chinese channel to raise the question. Now I'll hand over to Alex.
[Foreign language]
Good evening. Before we begin the formal earnings presentation, I would like to express my gratitude to all of you for your long-term support. It is because of you that we were able to complete the listing on the Hong Kong stock market in last November, becoming the first A-class H-share listed company in the express logistics industry. Tonight, we can see that a wider group of investors have joined the earnings call. Thank you all again. Throughout 2024, China's economy advanced steadily despite a complex and changing global landscape.
China's logistics industry, driven by policy tailwinds, technological innovation, and market demand, continues to grow rapidly. With the unique business model and leading integrated logistics capabilities, we continue to deliver strong results with clean management and quality growth with scale economies. In 2024, we delivered a total volume of 13.33 billion, up 11.3% year-on-year or 15.3% year-on-year, excluding Fengwang . The revenue was RMB 284.4 billion, up 10.1% year-on-year. Revenue from international business outgrew domestic business. Express and logistics revenue was RMB 205.8 billion, up 7.7% year-on-year.
Supply chain and international revenue reached RMB 70.5 billion, up 17.5% year-on-year, demonstrating our second-growth trajectory. On top of solid business growth, we continuously optimized the cost structure and improved management efficiency. We achieved EBITDA of RMB 32.7 billion, up by 11% year-on-year, with EBITDA margin of 11.5%. Profits attributable to owners of the company were at historical high at RMB 10.2 billion, up by 23.5% year-on-year, implying a net margin of 3.6%, up by 40 basis points year-on-year. ROE was 11.2%, up by 2 percentage points year-on-year. In addition, with abundant cash flow, we emphasized on shareholder returns.
From 2024 until the end of this February, including the proposed year-end dividend of 2024, we have invested a total of RMB 10.66 billion in dividends and share repurchase. In the future, we will continue to improve shareholder returns through multiple measures. Looking back on 2024, the key strategy for the year can be summarized as unite for shared goals, pioneer with steadfast drive. On one hand, we bolstered organizational vitality by upgrading the incentive system. For example, we provide more business authorizations to frontline employees.
We further activate the role of headquarters to support business regions, motivating all staff with aligned interests to stimulate entrepreneurship across the company. On the other hand, to serve the increasingly diversified customer demands, we entrenched the strategy of accelerating the penetration in various industries, expanding the supply chain solution in multiple industries to increase our penetration rate. Along with the rising trend of overseas expansion by Chinese enterprise in products, capacity, and brands, we deepened The One in Asia strategy, strengthened our capability to provide customized international supply chain solutions.
In addition, we continue to execute structural cost reduction with multi-network integration, entering a new normal, and operational transformation, unleashing benefits ahead of schedule. That was a brief earnings summary. Now I will hand over to our Chief Marketing Officer, Mr. Xu Bensong, to introduce the business segment performance.
[Foreign language]
Good evening, everyone. Now let me introduce the segment revenue growth. First, as in the pie chart, we have registered quality growth underpinned by both global and domestic drivers. China business continues to consolidate, and international business has emerged as our second growth engine. Now let's take a detailed look at each segment. In 2024, the revenue of time-definite express business grew by 5.8%, outpacing China's GDP growth. On one hand, we've continued to penetrate into diverse scenarios in consumer and industrial segments. In 2024, the five segments expressed parcel volume increased by 12% year-on-year.
The category has diversified away from commercial documents to consumer and industrial parcels, with consumer parcels accounting for more than 60% of the volume. We have also precisely identified the pain points in scenarios like entertainment, tourism, skin, traditional Chinese medicine, and supplements, and served the demands with our differentiated capabilities. On the other hand, with high-quality services, we also achieved rapid growth of return parcels in the context of fierce competition among e-commerce platforms.
In 2024, our revenue from Economy Express, excluding Fengwang , increased by 11.8%, driven by differentiated services and smart utilization of marginal resources. We insisted on the differentiated strategy on the e-commerce sectors, with parcel volume in Economy Express, including Fengwang , increased by 18% year-on-year in 2024, ahead of leading Tongda player. We deepened our partnership with the platforms. For example, we provided integrated warehouse and distribution solutions for multiple online supermarkets and partnered with major e-commerce platforms to launch the pilot service of selected courier for customers at a surcharge.
In addition, we have utilized the marginal capacity by launching promotions for selected routes. We use big data to recognize idle capacity and launch periodic promotions for certain routes. We also use smart pricing for lightweight yet high-volume products, such as smartphone cases, to drive revenue growth. In 2024, freight revenue increased by 13.8% year-on-year, with cost per kg reduced and profitability significantly enhanced. The structural cost-saving initiatives enabled us to offer more competitive prices and rapidly expand into markets such as industrial large items to enlarge the shipment volume.
As a result, we achieved better scale economy, and a flywheel of volume-based profit growth has emerged. Specifically, we achieved a rapid freight volume growth of over 20% in 2024, leading the industry in terms of scale. Specifically for industrial production scenarios, we have developed a less-than-truckload network covering more than 20,000 industrial zones. As a result, the shipment volume of items above 100 kg grew by over 30% year-on-year. Thanks to operational transformation, our freight sorting and courier efficiency both improved by 9% year-on-year.
Intercity segment recorded a strong performance in 2024, with revenue growth of 22% and net profit doubling. Since SF Intra-city is an independently listed company, please refer to the company's disclosure for more details. Finally, the supply chain and international segment revenue grew by 17.5% year-on-year. As a leading integrated logistics service provider, we provide end-to-end and customized services, including transportation, warehousing, customs clearance, and technology support to serve customers across various industries. In 2024, we achieved breakthroughs in multiple countries and sectors and won the bids for over 100 overseas supply chain projects.
In terms of cross-border consumption, we launched the next-day delivery service from China to Southeast Asia and actively expanded the fresh food inbound business from Southeast Asia, Europe, and the U.S. In 2024, the international express delivery revenue increased by more than 20% year-on-year. As mentioned, we have made a lot of breakthroughs in the past year, empowering our customers in various industries such as coffee and tea, trendy toy, auto, industrial, etc.
For example, in the trendy toy industry, we provide international express, integrated warehousing, and other delivery service to a leading brand, facilitating its expansion in Southeast Asia and delivery to Europe and the U.S. We provided end-to-end equipment export solution to a leading manufacturer of power battery materials, and facilitated cross-border delivery of consumer electronic raw materials for many well-known ODM customers. Next, please welcome our Chief Operating Officer, Huang Sihai, to introduce SF's operation update.
[Foreign language]
Good evening. Let me introduce our cost and operating update. In 2024, SF has adhered to lean management with structural cost reduction, deepening the operational transformation and network integration. Since the cost structure of KLN, also known as Kerry Logistics, is significantly different from that of SF Express, here we show the cost structure excluding KLN. Labor costs as a percentage of revenue increased 0.8 percentage points year-on-year. Courier staff is our core competitiveness, and we are committed to enhance their compensation and satisfaction to incentivize revenue generation.
We also improved their efficiency through operational transformation and automation equipment. Transportation costs as a percentage of revenue decreased 0.8 percentage points year-on-year. This is achieved by simplifying the network, optimizing the routes, as well as managing the procurement price. Other operating costs as a percentage of revenue decreased 1.2 percentage points year-on-year, as we continue to consolidate the sorting centers and enjoy better scale economy.
Regarding Ezhou Hub, Asia's largest air cargo hub, we had opened 55 domestic routes and 50 international routes by the end of 2024, and operated more than 27,000 domestic and international flights throughout the year. In last May, the Civil Aviation Administration approved the change of the airport's name to Ezhou Huahu International Airport. The airport with its new business card has achieved an annual cargo throughput of more than 1 million tons, with the growth rate ranking the first place nationwide.
In addition to the volume breakthroughs, we are also working with the government to promote industrial clusters' development in the area and have introduced investment projects worth billions of RMB. Multi-network integration and operational transformation has been our focus on cost control. On the left-hand side, it shows that multi-network integration has been generating continuous cost saving over the past four years. In 2024, the relevant cost reduction exceeds RMB 1.3 billion, growing by 17% year-on-year. As we continue to stimulate organizational vitality, frontline BUs will independently navigate the potential areas of integration as a normalized cost-saving measure.
On the right-hand side, it shows the operating transformation. For line-haul transportation, parcels are sorted and loaded onto cage trolleys at sorting clusters for direct transportation to the service area of couriers, skipping the handling and sorting process at service outlets. In the fourth quarter of 2024, the transformed areas achieved a net cost reduction per parcel. For line-haul, we built the industry's first unmanned sorting center designed for cage trolleys. We developed unmanned forklifts in some sorting centers, realizing the lights-out operation model. The annualized cost reduction for the sorting center exceeded RMB 16 million.
Besides, we have over 800 unmanned vehicles in use, covering various scenarios such as short-haul shuttle and delivery in industrial parks and campuses. We continue to lead the industry in innovation, and we are passionate in conducting more beneficial explorations for the industry. Our business relies on efficient operating infrastructure. We continue to invest as dual-cores to build long-term competitiveness and improve service quality and cost efficiency through lean management. We have invested to upgrade our service quality.
For example, we enhanced the end-to-end service for high-value parcels using separated sorting processes for commercial documents and designated dispatching for certain e-commerce platforms. We expand the regional coverage and increase the density of service outlets. We spent over RMB 60 million to guarantee high-value parcel delivery and over RMB 860 million in automation equipment over the past year. Based on the infrastructures, we improved the cost efficiency through lean management. It is mainly reflected in three aspects. Firstly, we reduced the number of transits.
With fewer but larger sorting centers, we are able to achieve faster transit by strengthening the routes. In 2024, we added nearly 440 direct lines for intercity transportation. Secondly, we optimized the resource structure by increasing the proportion of transportation resources with stable pricing and increased the portion of large capacity vehicles. Thirdly, we leaned operation across the full process, for example, renovating the sorting center with a second floor for warehousing and a first floor for sorting, and various measures to incentivize couriers to take the sales role. Technology innovation also empowers our daily operation.
For example, we used intelligent decision-making to push digital intelligence transformation. We also applied unmanned technologies in an early stage to help achieve a leap in operational efficiency. We will continue to invest in service improvement because only in this case is cost saving meaningful. Costs are shaped by design, and the design lies in the operational transformation and application of new technologies, not. Back to the CFO Alex Ho to present our financial result.
[Foreign language]
Thank you. We've already discussed the financial highlights. Now let's start from the gross profit on the next page. In 2024, the company reported gross profit of RMB 39.6 billion, up 19.5% year-on-year, with a margin of 13.9% and an increase of 1.1 percentage points year-on-year. Gross profit in the fourth quarter was the highest of the year at RMB 10.7 billion, with a margin of 13.9%. Thanks to the lean operation, our management expense, sales expense, and financial expense ratio decreased by 37 and seven BPS respectively year-on-year. In terms of cash flow, our operating cash flow reached RMB 32.2 billion, up by 21% year-on-year, maintaining a strong cash flow position.
Since CapEx peaked in 2021, and as we continue to focus on the ROI, the CapEx has declined year- over- year. In 2024, CapEx on assets was RMB 9.9 billion, down by 27% year-on-year. CapEx accounted for 3.5% of revenue, down by 1.7 percentage points year-on-year. We expect the CapEx to remain stable in 2025, with a decrease as a percentage of revenue. Thanks to abundant OCF and prudent CapEx, our free cash flow increased significantly by 70% to RMB 22.3 billion, setting a solid foundation for shareholder returns.
In terms of capital structure, in 2024, with a well-planned financial strategy, we repaid a part of the long-term and short-term debts, further reducing our debt-to-asset ratio to 52.1%, maintaining a healthy level. We announced the shareholder return plan for the next five years from 2024 to 2028 in March last year, in which we stated that the dividend payout ratio will be steadily increased from 35% in 2023. In 2024, we increased the dividend payout ratio to 40%, distributing interim and final dividends of RMB 4.1 billion in total, marking a year-on-year increase of 42%.
In addition, we distributed special one-time dividend of RMB 4.9 billion to shareholders before each share listing, elevating the annual payout ratio to 87% year-on-year. On top of that, we repurchased shares in due course to boost market confidence. We repurchased shares worth of RMB 4.76 billion from 2022 till the end of February this year. Most of the shares repurchased between 2022 and April 2024 were canceled, with a cancellation rate of 1.62%. The second stage of our 2024 repurchase program is still in progress, the purpose of which is also to be canceled, with the expected cancellation rate of at least 0.42%.
With the above-mentioned dividends and repurchases, from January 2024 till the end of February this year, we invested accumulated RMB 10.66 billion in shareholder return. In the future, we will normalize interim and final dividends payout and track the stock performance to repurchase in due course. While pursuing high-quality business development, we emphasize on green development and commit to environmental protection, steadily advancing toward our carbon goals.
In 2024, we achieved a 9.3% improvement in the carbon efficiency year-on-year by promoting low-carbon transportation, building green industrial parks, and developing sustainable packaging. The carbon footprint per parcel also decreased by 12% year-on-year, marking a significant progress towards our carbon goals for 2030. With relentless commitment to environmental protection, creating a caring workforce for employees, and charitable giving, SF's ESG practices are widely recognized by domestic and international rating agencies and media. It was among the leading logistics service providers in China and the world in MSCI, Sustainalytics, and CDP ratings.
That brings us to the end of the presentation. Now let's hand over back to our Board Secretary, Mrs. Gan Ling.
[Foreign language]
Thank you, Alex. Now we open the floor for Q&A session. Kindly note the Q&A function is not available on the English channel. Please leave your question in the chat box or switch to the Chinese channel to raise the question.
Hi, my name is Feng Qibin from CICC. First of all, we'd like to congratulate companies for achieving remarkable results for the 2024 full year. We've seen that the company has achieved remarkable growth and generative business in 2024. Our question is, what is the management outlook for time-definite and Economy Express in 2025? We've also seen increasing competition in the express delivery industry. What is the company's strategy specifically regarding ASP?
[Foreign language]
I'll translate for our CMO, Mr. Xu Bensong. In terms of business outlook in 2025, we'll take a customer-centric and market-oriented approach and develop trading strategies for each segment. Let's talk about two different segments. For a premium time-definite product, we'll further strengthen our brand and enhance exceptional service capabilities to enhance our market reputation. For ground time-definite product, we're seeking to expand incremental value and increase our market share. We hope to achieve a revenue growth higher of a high single-digit outpacing GDP.
For the economy segment, we aim to maintain above-industry volume growth by further expanding our scale to utilize idle capacity of our network. We're looking to have growth drivers for both of our premium time-definite product and our economy. For premium time-definite express, we strive for developing lighthouse processes. First, we look for service upgrade. We aim to provide services to cover customers' full-cycle demand. Second, we are focusing on precision marketing by leveraging our big data models to target users precisely and provide shipping service upgrade.
For capability improvement, we'll enhance our same-day delivery network and extend our product time for picking up intercity parcels, etc. For more dedicated services for specific logistics scenarios, namely air cargo delivery, we'll provide more specialized logistics solutions. Lastly, we'll also leverage our high-density network and superior pickup timeliness to continue to provide high-quality and stable return parcel services for e-commerce customers. For Economy Express, we'll scale up our business volume.
We'll promote structural cost reduction for e-commerce products and realize breakthroughs through better operating processes, and the cost savings could be used to benefit customers and bring in more incremental volume. We'll also continuously monitor and make full use of idle capacity, expanding the scale of economy parcels and e-commerce parcels, and engage in this market competition actively. We'll also solidify our focus on heavy items with weights ranging from 3 kg-20 kg, covering scenarios including household consumables, etc. We're aiming to achieve better economies of scale.
In terms of competitive strategies, we look for better competition in terms of value propositions rather than purely pricing. We started with time-definite express for now, it's been more than 30 years, providing highly differentiated and high-quality products. A lot of our rivals try to tap on the time-definite market, and they could hardly affect our very leading industry position. We believe that the real competition is not on price, but creating real value for the customers. One example is that our time-definite express market share is three times that of the first runner-up.
That has proven that our leading position and our—we are focusing on the right strategy of competing with high-quality service and leading and consolidating our industry leadership to provide better operational efficiency.
Hi, everyone. My name is Danny Su from JPMorgan. My question is, what is the plan of operational transformation this year, and what exactly are the upcoming cost reduction initiatives, and how does the recent decline in oil price impact asset cost-saving initiatives?
[Foreign language]
I'll translate for our COO, Mr. Huang Sihai. All of our transformation is for the ultimate purpose of better fulfillment of our customers' demand and equip SF with better compellingness to interface of competition from the industry. Our operational philosophy is to persist on long-term cost reduction and long-term value creation by strengthening our cost design and planning of capability. We're striving for better operational model breakthroughs and technology innovation to streamline our operational processes.
For instance, for our transit center, our business volume has increased 11% in terms of business volume, while we have a lower deployment of operational resources with a 20% reduction in development management costs. Our cost reduction will continue to follow our long-standing philosophy, as mentioned. Regarding the oil price, undeniably, the decline in oil price did have some positive impact on our operational costs. We want to emphasize that the effectiveness of cost reduction initiatives never solely relies on external resources.
The price volatility of external resources, it is more on our precise matching of capacity and parcels and more optimized route planning, scientific fleet choosing, and better scheduling of our fleet resources. Overall, we firmly believe the core of cost management lies in design, and the productivity is generated from execution.
Hi, my name is Shen Xiaofeng from Huatai Securities. I have two questions for the management team. What is the management team's view on the impact of recent policies, particularly on the product subsidy in 3C products? Also, the impact of tariffs on our international business?
[Foreign language]
For product subsidy, we want to emphasize that the product subsidy program covers not only mobile phones, but also home appliances, including pads, laptops, televisions, and also home- compliant wearables. In terms of volume, we have a substantial market share in both mainstream e-commerce platforms and also some of the merchants' private domain platforms. For instance, on the first data launch of product subsidy on 3C products, we fulfilled the delivery of the very first order on Tmall.
Another example is since the launch of the product subsidy on new 3C categories in January, our business volume has steadily increased given almost all platforms have got SF service, except for one, which Jingdong prioritizes its own self-built logistics arm. Geographically, we registered fastest growth in South China relative to the rest. Besides, our product subsidy also benefits our value-added services such as power on testing, verification, and activation of 3C products upon delivery, further boosting our revenue growth. For tariffs, on one hand, for exposure, e-commerce logistics account with very limited provision of SF business.
Since the kickoff of segmented tendering by some platforms last year, we have intentionally cut down on the size of this business and only retained non-e-commerce part with very low revenue contributions. Tariffs would have a relatively limited impact on our business. On the other hand, the new tariffs have accelerated the shift of logistic models for cross-border e-commerce platform from direct air shipment to semi-entrusted model of ocean-freight plus overseas warehouses. We are better positioned to provide given the strong presence of Kerry Logistics (KLN) in ocean-freight and overseas warehouses.
Hello. I'm Irene Lo from UBS. My question is, what is the company's plan for CapEx this year? With the strong improvement in the cash flow, is there still room for an increase in the dividend payout ratio? What is the company's guidance for 2025?
[Foreign language]
I will translate for CFO Alex Ho. For your first question on CapEx, in 2024, our CapEx on assets amounted to RMB 9.9 billion, representing a 27% decrease year-on-year. The percentage of revenue declined by 1.7 percentage points. In 2025, we expect the asset-related CapEx to remain stable with a slight decrease as a percentage of revenue. Our CapEx spending slows down in the second half of 2024 because some investments that were not made in time in the fourth quarter will be invested this year. As Sihai has introduced, we will further optimize the resource structure, increase the proportion of self-operated vehicles by replacing some vehicles.
Meanwhile, we will introduce additional air or cargo aircraft to strengthen the international network. We plan to invest in the following aspect: over 30% in transportation capacity, including aircraft and trucks. Around 20% will be invested in sorting centers. Around 10%-12% will be invested in industrial park construction, and another 10%-12% in technologies and KLN. The remainder is routine assets and others. The company's CapEx schedule will be updated according to business cases to ensure a favorable ROI. For your second question on dividend ratio, last year, we issued interim dividend, and this will become the norm going forward.
We also raised the payout ratio from 35% in 2023 to 40% year-on-year. For 2025, we will adhere to sustainable development with steady revenue growth and profitable improvement. There is still ample room for us to further improve the efficiency. We will carry out technological innovation, adhere to lean operation, and normalize the network integration and the operational transformation. We aim to build a streamlined and efficient network to drive structural cost reduction.
On the premise of ensuring service quality, we will optimize costs through a scale economy, and we will release part of the incremental cost savings back to our customers and continuously increase our market share in various industries.
Thank you.
Hi, my name is Yifan from Huachuang Securities. My question is more focusing on the company's freight business. What is the expected growth trend for freight business this year, and what is management's overall outlook on the industry and key growth drivers for this segment?
[Foreign language]
I will translate for COO, Mr. Huang Sihai. Now, we would like to recap on the industry landscape. The growth scale is steady, but at the same time, we've seen an increasing consolidation towards the nationwide leading players. According to some industry associations' statistics, nationwide freight players' business volume has registered year-on-year growth of around 10%. For SF, our freight business has a shipment of over 24 million tons with a 22% year-on-year growth.
Our market share in the freight business has continued to lead the industry. If we look at the manufacturing sector, we have seen the downreach of the channel and the penetration of e-commerce, which has led to order size being dissected into smaller in scale, but more frequent in more number of deliveries. Some of the designated players focusing on delivery line have a lack in insufficient resource deployment, and they have a lack behind in terms of service capability. That is why the players' growth of designated route players has registered negative growth.
In terms of top-layer strategic design, we have kept the parallel growth of both direct operations and franchising model. For directly- operated network, we are accelerating product upgrade to increase the deepen our market reach. For franchising network, we are expanding the product bandwidth to provide service across different scales. We believe that our service capability is the most and the driver for our growth in scale. You must have seen that SF really has a comprehensive upgrade of our product, providing the best quality and value in the industry. On one hand, we are introducing multi-layer expanding our product metrics for our freight and products.
On the other hand, we are increasing our geographical reach as well to serve our customers who are undergoing industrial transformation and upgrade. In terms of key strategic brand, we've seen that large-sized LTL market has shown a trend of redistribution and accelerating consolidation. That's why on the 20th of March, Suqian Zhuofeng has announced equity investment in the number one player, Deppon Logistics , to accelerate our focuses in the large-scale LTL segment to continuously optimize our costs in the Economy Express market. The combination of Shunfeng plus Suqian will continue to create better customer value and to lead the industry upgrade.
My name is Yan Hai from Shenwan Hongyuan Securities . My question is that after the acquisition of KLN in 2021 and Hong Kong IPO, what is the company's outlook for the international business?
[Foreign language]
I will translate for CFO Alex. In 2024, our international business outgrew almost doubled the domestic revenue growth. We foresee a structural and long-lasting growth of our international business. International business is our second growth driver. After the acquisition of KLN in 2021, we've been continuously collaborating with KLN from the previous sharing resource advantages to jointly using resource advantages to better serve customers. Leveraging KLN's extensive network, we have accelerated the implementation of our globalization strategy. We will accelerate the integration of resources and strengthen our core capabilities.
On the one hand, we will integrate our end-to-end capabilities, including air cargo aircraft and ocean freight resources of key destinations, 2B and 2C warehousing network, and combination of both self-owned and partnered overseas last-mile services. We also collaborated with KLN and DSC and the Industry Solution Center to leverage their understanding of the customer needs across the industries to improve the international supply chain solution. We will strengthen our international product portfolio by firstly achieving the leading position in international express delivery.
With The One in Asia strategy, we will provide port-to-port next-day delivery from China to Singapore, Malaysia, Thailand, and Vietnam, and upgrade to two-day delivery for core areas in Southeast Asia. Secondly, we will penetrate the cross-border supply chain market globally. We aim to extend the scale of overseas warehouses in Japan, South Korea, Australia, New Zealand, and multiple European countries. From a long-haul resource pool with self-owned and external resources, we want to break into more using scenarios. Thirdly, wider coverage of cross-border e-commerce logistics by reducing the end-to-end cost.
We not only serve e-commerce platforms, but also serve independent online sellers and SME clients. This will help us to smooth out the cost curve, especially during the slack and peak season of the e-commerce promotions. In summary, at this critical point for Chinese enterprise to expand overseas, we will accelerate the integration of resources to build a stronger international product portfolio. Specifically, in international express delivery and supply chain, we will endeavor to become the preferred logistic partner for Chinese enterprises.
We also noticed the volatility of the international trade environment and expect that the fluctuations in the supply chain will continue in this year. In the aspects of international freight forwarding, as the largest comprehensive logistics service provider in Asia and the fourth largest in the world, we will leverage Kerry Logistics (KLN)'s unique advantage in air and ocean freight and its strong market coverage in Asia to diversify our service portfolios. We will capture the opportunities brought by the reshapement of the global supply chain. Thank you.
Due to time constraints, we'll move on to the last questions for today.
Good evening, shun xin. My name is Han Yichao from Changjiang Securities. You mentioned that digitalization and technology-driven operational efficiency upgrade. We will also take this chance to ask about how the different new technologies, including self-driving logistic vehicles, DeepSeek LLM , and other new tech, help improve the company's operating efficiency and even potentially increase the group's revenue.
[Foreign language]
To start with, I want to emphasize that it is very committed to be a well-regarded, globally leading digital logistics solutions provider. We're also very committed to continuously leading industry in terms of innovation and more conductive exploration in terms of technology. This kind of exploration spans across product innovation, model innovation, management renovation, also the application and deployment of cutting-edge technology. In terms of self-driving vehicles, it's very assured we've deployed that in our different option scenarios, including collection and transit. We've already seen increasing efficiency and also cost reduction impact.
In 2025, our capital deployment in this area will be 10 times higher than ever. Following the opening up of the relevant policy, we believe that in the future, we'll have daily more than 110,000 rounds of cars in our different lanes to maximize efficiency. In terms of large language model, we will continue our continuous deployment of our self-perpetuating and forwarding large language model and the leveraging of DeepSeek and other very renowned LLM with applying these technologies in our different logistics scenarios. In client-facing ads, we've already made things easier for clients by allowing them to send parcel requests by simply typing a sentence or taking a photo.
In terms of operations, we leverage LLM to answer questions, identify and diagnose abnormal parcels holistically, and also alert about potential misordered parcels. In decision-making ads, we've leveraged intelligence algorithms and the application of such with utilizing our smart decision-making technology in site planning of road network optimization and scheduling, etc. In conclusion, we continue to push for accelerated technology operating in the industry.
This wraps up today's presentation section. For further questions, please reach out to our section of our official website.