(Yicai Global) March 18 -- Chinese express delivery giant SF Holdings majorly increased its net profit last year amid the Covid-19 pandemic.

SF made CNY7.3 billion (USD1.1 billion) in net profit in 2020, up 26 percent from a year ago, driven by the busy e-commerce sector, the Shenzhen-based company said in its earnings report published yesterday.

Revenue was CNY154 billion (USD23.7 billion), jumping by 37 percent which is much more than the sector's average growth rate of 17.3 percent.

Third tier is the new second tier. Lower-tier cities are becoming the main areas of consumption growth potential as first and second-tier cities are slowing down, said the company.

Delivery volumes surged by 68 percent, also higher than the sector's average of 31 percent. SF's domestic market share grew to 9.8 percent, an increase of 2.2 percentage points from the previous year.

Prices are going down amid fierce rivalry. Each express delivery shipment costs CNY10.55 (USD1.60) on average whereas in 2007 the fee was CNY28.5. Price competition has become a major tool for e-commerce delivery companies to expand their market share, according to SF.

Even though traditional business made up more than 70 percent of SF's revenue in 2020, new business, and particularly intra-city and international delivery, was growing rapidly. New revenue streams' compound annual growth rate was 64.5 percent from 2018 to 2020.

The logistics firm was keeping up with the times. The company spent 16.5 percent more on technology investment at CNY4.3 billion last year.

SF’s stock price [SHE: 002352] fell 3 percent to CNY91.08 this afternoon.

Editor: Emmi Laine, Xiao Yi