PRESS RELEASE AND MEDIA

Kerry Logistics Network Limited (‘Kerry Logistics’; Stock Code 0636.HK) is set to capitalise on the growing potential of China’s e-commerce exports by joining hands with Spain’s national postal service Sociedad Estatal de Correos y Telégrafos, S.A. (‘Correos’) to establish a joint venture (‘JV’) to provide end-to-end cross-border e-commerce solutions from China to worldwide destinations, in which Kerry Logistics holds a majority interest.

Leveraging Kerry Logistics’ broad experience in origin sortation, line haul and customs clearance, and Correos’ years of expertise in the postal and commercial solutions, the JV aims to bring commercial services experience to the next level for customers including marketplaces and e-tailers. Cross-border e-commerce exports from China recorded a 67% year-on-year increase in 2018, amounting to RMB56.12 billion, according to China’s General Administration of Customs.

To fulfil an increasing emphasis on e-commerce parcel security and compliance, a world-class sortation centre will be set up in Southern China under the new JV, equipped with an automated sorting system and stringent parcel screening and security controls to ensure speedy parcel handling and full compliance. The facility, targeting to open in 2019 Q4, will occupy an area of over 200,000 sq ft and have an initial sorting capacity of 500,000 parcels per day.

William Ma, Group Managing Director of Kerry Logistics, said, “The JV combines the diverse capabilities of its two partners, each complementing the other to refine the process of e-commerce parcels handling and deliveries. As China’s cross-border e-commerce exports grow, we are determined to prepare ourselves for seizing emerging opportunities. Utilising our deep understanding of customers’ needs both in China and abroad, Kerry Logistics is confident in meeting the rapidly growing international demands through working closely with Correos.”

Juan Manuel Serrano Quintana, President of the Board of Directors of Correos, said, “The new partnership with Kerry Logistics presents a unique opportunity for Correos to capture the outbound e-commerce parcel deliveries from China, which is the largest trade and economic partner for Spain in Asia. It also offers a way forward for Correos to create a sustainable business model to meet the growing demand in the booming e-commerce business and the ever-changing customer needs.”

The fast-changing logistics landscape in China called for innovation and flexibility in order to capture and serve new and emerging business models and brands. Kerry Logistics will continue to broaden and deepen its reach in China selectively.