Chinese e-commerce giant JD.com has had an excellent 2019. Turnover grew 25 %, while losses were turned into full-year profits again as it managed to keep costs under control.
Services grow in importance
JD.com recorded a full-year turnover of 576.9 billion yuan (74.4 billion euros) last year, an increase of 24.9 % compared to 2018. Retail sales increased by 22.7 % to 510.7 billion yuan (66 billion euros). Revenues from services (including advertisements, the marketplace and logistics services to third parties) increased by 44.1 % to 66.2 billion yuan (8.5 billion euros).
The operating result improved significantly compared to a year earlier, going from a loss of 2.6 billion yuan (350 million euros) to a profit of 9.0 billion yuan (1.1 billion euros). Among other things, JD.com succeeded in keeping costs under control: the relative weight of handling costs (purchasing, warehouses, customer service) fell half a percentage point to 6.4 % of total turnover. In addition, the company's real estate branch, JD Property, realised a capital gain of 3.88 billion yuan (500 million euros) on the sale of various properties.
For the first quarter of 2020, JD.com is counting on a turnover growth of at least 10%. This outlook is based on the current situation, the company says, and can still be adjusted in view of the uncertainties surrounding the development of the corona virus.