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Deutsche Post DHL Group Joe Joseph – Express Divisional CFOUS Investor Roadshow June 8-11
WE ARE IN THE RIGHT INDUSTRY
PAGE 2INVESTOR RELATIONS | JUNE 2015
Rivalry among existing competitors Moderate
Global TDI market is relatively small: ~2.5 mil shipments/day
FedEx and UPS capitalizing on strong domestic market in the US
TNT moving from integrator to freight forwarder losing int’l express market share
Threat of substitute products or services Low for substitution, high for general need
‘Express’ or ‘Deferred’
Opportunities through emerging eCommerce
Express industry sensitive to general economic development
Threat of new market entrants Low as barriers to entry are high
Only four global players (integrators) since 1970s/80s with well known brands
High capital requirements / asset intensive network
Economies of scale are key to profitability
Bargaining power of suppliers
Limited
Our biggest cost (~1/3 of revenue) is transportation which is a commodity
Our 2nd biggest cost (~1/4) is our workforce that is spread over the entire globe and the majority employed as front-liners
Fuel (~1/6) is the 3rd biggest cost and variation is recovered with the fuel surcharge
Bargaining power of buyers Limited
Large number of SME and individual customers with limited buying power
Complexity/risks of switching for large customers
No substitute for express (urgent / high value) shipments
-5%
2,70%5,30% 5,90% 5,90% 6,90% 7,10% 8,10% 7,80% 8,20% 7,40% 7,90% 7,70% 7,80% 7,30% 8,40% 8,10% 9,40% 8,50% 10,10% 9,60% 10,70% 9,80% 10,20%
DHL EXPRESS PERFORMANCE
PAGE 3INVESTOR RELATIONS | JUNE 2015
Over the last years and quarters DHL Express significantly improved its performanceEBIT excl. non recurring items (in m€)
-790
497
916 1,110 1,083 1,260
-1,000
-500
0
500
1,000
1,500
2,000
2009 2010 2011 2012 2013 2014
Reported EBIT (in m€)
Quarterly EBIT Margin Development (excl. non recurring items)
2011 2012
CAGR: 39.9%
2014
2013 201420102009
235
785916 997 1,071 1,260
20132012201120102009
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
FOCUSED FINANCIAL MANAGEMENT
PAGE 4INVESTOR RELATIONS | JUNE 2015
Profitable GrowthRevenue per Day (RpD)Shipment per Day (SpD)
Revenue per Shipment (RpS)Weight per Shipment (WpS)
Revenue per Kilo (RpK)
Cash Management
Topline / Revenue ManagementTopline / Revenue Management
Direct Cost
Management
Direct Cost
Management
Efficiency in Ground OperationsOperations Cost per Move (OCPM)
Direct Cost
Management
Direct Cost
Management
Leverage Aviation NetworkCost per Kilo (CpK)
Gross Profit Triangle
Reduce Indirect Cost Share of Revenue
PROFITABLE GROWTH: REVENUE KPIS
PAGE 5INVESTOR RELATIONS | JUNE 2015
SpD RpD
WpS RpK
Profitable Growth
Structural Trends
Active Management
Shipment and revenue growth influenced by various factors; no 1:1 link to profitability development
Global and regional GDP/Trade
Development
STRUCTURAL TRENDS AND ACTIVE REVENUE MANAGEMENT
PAGE 6INVESTOR RELATIONS | JUNE 2015
WpS RpK
Sales focus on SMEs helped to increase growth rate of smaller shippers (<25 shipments/month) significantly yoySME Focus
Faster growth of larger shippers
Customer with larger volumes (>500 shipments/month) grow faster than smaller customers driving average prices down
B2C
Focus on TDI (mostly high value, time sensitive and/or to “exotic” destinations) implies small but increasing portion of B2C; Piloting of advanced delivery options to address delivery cost challenge (i.e. failed delivery attempts and delivery density)
Balanced VolumeGrowth
Despite strong market position in AP and MEA, balanced growth in all regionsIntercontinental volume growth slightly stronger than intra-regional volumes
Product Mix Much stronger parcel growth compared to moderately growing document volumes changes product and weight mix
Middle Weight Campaign
Focus on sweet spot shipment in 30-70kg range where our value proposition is very strong
SPEED AND SERVICE DRIVE DHL’S AVIATION NETWORK STRUCTURE
PAGE 7INVESTOR RELATIONS | JUNE 2015
Over 300 Commercial Air Carriers with more than 1,770 daily flights
ONE VIRTUAL AIRLINE
Purchased Air
Dedicated Air Around 250 aircraft with 17 partner airlines on around 610 daily flights
Key Drivers• Service need• Sufficient capacity and frequency• Network cost considerations
Connecting over 500 airports and 22 major air hubs
OUR DEDICATED FLEET
PAGE 8INVESTOR RELATIONS | JUNE 2015
138RegionalAircraft
80FeederAircraft
34IntercontAircraft
Youngest intercontinental fleet in
the industry4 new aircraft in 2014
Average aircraft age 25 years
1.1% reduction in CO2output during 2014
The only Helicopter express delivery service
in the WorldGlobal access to small
markets (Africa)
DEDICATED AIR: INTERCONTINENTAL NETWORK
PAGE 9INVESTOR RELATIONS | JUNE 2015
• Competitive transit times, round-the-world, non-stop and next-day services• Eco-friendly services through modern, efficient and well utilized aircraft
NETWORK INVESTMENTS – ENABLING GROWTH
PAGE 10INVESTOR RELATIONS | JUNE 2015
Cincinnati (CVG) HUB Expansion 2014/15
Tokyo GTW 2014/15
New Singapore HUB 2014/15
Leipzig HUB Expansion 2014-2016
New Brussels HUB 2015/16
East Midlands HUB Expansion 2015
Saudi Arabia/ Egypt GTWs 2014/15
LHR Airport Expansion 2014
Deutsche Post DHL Group Investor RelationsJune 2015
Main operating and financial trends as expected
Q1 2015 HIGHLIGHTS
2015/16 guidance confirmed
Structural volume trends of dynamic parcel growth and letter decline once more confirmed in PeP with EBIT flat as revenue growth again offset by higher costs
Express growth momentum fully intact with volume growth feeding further margin increase to drive another strong EBIT performance and higher cash flow
Weak Forwarding performance: new management to review transformation course and focus on operating performance improvement
Supply Chain restructuring initiatives now in execution phase Cash Flow performance showing usual seasonal Q1 pattern with civil servant
pension payment and reversal of year-end effects
INVESTOR RELATIONS | JUNE 2015 PAGE 12
INVESTOR RELATIONS | JUNE 2015
Executing on our short-term agenda… Stabilize Forwarding operating performance while reviewing transformation course Execute Supply Chain restructuring measures Negotiate a wage agreement to ensure future competitiveness especially in Parcel Germany Continue investments in successful Express operations
…to build momentum for our long term strategic and financial goals:
DPDHL GROUP STRATEGIC AGENDA
PAGE 13
Leveraging growth in e-commerce and emerging markets, based on unrivalled, diversified business portfolio
Clear roadmap for margin and profit improvement
Flexible balance sheet and improving cash generation underpin payout policy
MANAGEMENT UPDATE ON DHL GLOBAL FORWARDING
PAGE 14INVESTOR RELATIONS | JUNE 2015
Management structure: Frank Appel, interim CEO DHL Global Forwarding, Freight Renato Chiavi, interim CEO DHL Global Forwarding Tobias Meyer, EVP Programs (Transformation) Amadou Diallo, CEO DHL Freight (unchanged)
Weak operational performance requires new management to review transformation course Unchanged commitment to transformation and to increase of efficiency of our Forwarding business Reviewing transformation course based on pilot country and organizational alignment analysis
First priority: renewed and intensive focus on improving underlying business performance
DHL SUPPLY CHAIN HAS 9 INITIATIVES TO DELIVER STRATEGY 2020
PAGE 15INVESTOR RELATIONS | JUNE 2015
1 Improvement of underperforming business
2 Operational standardization
3 Commercial standardization
FocusDrive standardization and reduce complexity…
4 Efficient and effective functions
5 Consistent and lean organization globally
6 Culture and mindset shift
ConnectCreate an effective organization globally…
8 Global sectors andproducts
7 Value added services
9 Geographical shift
GrowShift the portfolio…
…to address attractive segments
…to enable change…to increase efficiency
INVESTOR RELATIONS | JUNE 2015 PAGE 16
PeP: STRUCTURAL REDUCTION IN PERSONNEL FACTOR COSTS DUE TO LAUNCH OF NEW PARCEL DELIVERY UNITS
11.90-13.20
17.70
8.50*8.50* 8.50*
12.79
Degree of outsourcing
<5%33%95%100%100%
Deutsche Post AGDHL Delivery GmbH
0%
Wage costs at Deutsche Post AG significantly above competition Launch of new Delivery GmbHs reduces gap to competition since average wage level at
12.79 EUR/h instead of 17.70 EUR/h at DPAG
Average wages, in EUR/hCurrently ~6,000
employees
* Legal minimum wage
INVESTOR RELATIONS | JUNE 2015 PAGE 17
FIRST MILE: Marketplace offer rebranded and going international
PackstationPaketshops Delivery boxesDelivery at Home Parcel box
LAST MILE: Customer-centric range of delivery options with ~30.000 drop off points
PeP: CONTINUOUSLY OPTIMISING OUR PARCEL SERVICE OFFERING
Allyouneed.com Allyouneedfresh.com
• Re-branding of MeinPaket.de
• Launch in Poland
NEW
Steady increase in TDI market share driven by best-in-class global network and service levels
Growth accompanied by continuous strong margin increase; further improvement possible from network, efficiency and scale effects
Growth enabled by targeted investments into our network
Modernizing European air fleet, upgrading capacityand efficiency
Continued investment in hub and ground infrastructure across all geographies
Global TDI Revenue Market Share Development
DHL EXPRESS: SUCCESSFUL TDI STRATEGY
29% 31% 33% 34%
23% 22% 22% 22%
29% 29% 27% 26%
7% 6% 6% 6%12% 12% 12% 12%
2010 2011 2012 2013
DHL UPS FedEx TNT Others
1) Source: MI 2014 Study: AT, DE, DK, ES, FR, IT, NL, RU, TR, UK, BR, CA, CO, MX, US, CN, HK, IN, JP, KR, SG, AE, SA, ZA
Key Performance Drivers
+14% +9% +6%
+8% +3% +3%Marketgrowth1)
INVESTOR RELATIONS | JUNE 2015 PAGE 18
STRATEGY 2020: TOPLINE GROWTH AND MARGIN IMPROVEMENT
Continued focus on TDI with network, efficiency
and scale effects
Main Strategic Drivers
Stabilize Forwarding operatingperformance while reviewing
transformation course
Standardization, overheadleverage and contractportfolio enhancement
GDP growth assumptions
+5%+2%
Mature Regions
EmergingMarkets
INVESTOR RELATIONS | JUNE 2015 PAGE 19
Attractive growth in key addressable market segments within logistics
Estimated Market CAGR 2011‒2020, in EUR
+5-7% +8% +5-6%+4-5%+2-3%+5-6%
Parcel Germany InternationalExpress
Air FreightForwarding
ContractLogistics
Parcel Domestic International
Ocean FreightForwarding
Revenue mix shift to parcel and increased exposure to e-commerce
structural growth trend
All divisions will contribute towards >8% group EBIT CAGR target
FINANCE POLICY, UNCHANGED
Target / maintain rating BBB+
Dividend payout ratio to remain between 40–60% of net profit (continuity and Cash Flow performance considered)
Excess liquidity will be used for Stepwise pension funding
and / or
Share buybacks and/or extraordinary dividends
Dividend of EUR 0.85 per share
2014 DIVIDEND INCREASE OF 6% AND UNCHANGED FINANCE POLICY
Deployment of Free Cash Flow
2013
€ 0.65
53%40%
59%49%
2010
58%
2012
60%
2011
€ 0.70€ 0.70€ 0.80
50%Underlying Payout Ratio1)
€ 0.85
1) Adjusted for Postbank effects as well as non-recurring items
INVESTOR RELATIONS | JUNE 2015
2014
PAGE 20
EBIT GUIDANCE CONFIRMED FOR 2015/16/20
EUR bn 2015 2016 2020
PeP At least 1.3 above 1.3 ~ 3% CAGR 2013-20
DHL 2.1-2.25 2.45-2.75 ~ 10% CAGR 2013-20
CC/Other ~ -0.35 ~ -0.35 <0.5% of group revenue
Group 3.05-3.2 3.4-3.7 >8% CAGR 2013-20
INVESTOR RELATIONS | JUNE 2015 PAGE 21
FY 2015:
Free Cash Flow to exceed 2014 dividend
Tax rate around 18%
Gross Capex of around EUR 2.0bn
Divisional Information
INVESTOR RELATIONS | JUNE 2015 PAGE 22
DEUTSCHE POST DHL AT A GLANCE
Group
Brands
Corporate Divisions
63% market share in letter mail, 43% market share in German parcel market, selected international parcel activities Sales: EUR 15,686m EBIT: EUR 1,298mEmpl.2): 164,582
Post - eCommerce-Parcel
Global Time-Definite-International (TDI) leader with 34% market share
Sales: EUR 12,491m EBIT: EUR 1,260mEmpl.2): 73,009
Express
World´s largest Air and 2nd largest Ocean freight forwarder, No2 in European road freightSales: EUR 14,924m EBIT: EUR 293mEmpl.2): 44,311
Global ForwardingFreight
Global market leader, market share of 8% well ahead next biggest competitorsSales: EUR 14,737mEBIT: EUR 465mEmpl.2): 146,400
Supply Chain
Group revenues 1): € 56.6bn Group EBIT1): € 2.965bn Approximately 440,000 employees
1) Financial year 2014; 2) Average FTEs FY 2014
PAGE 23INVESTOR RELATIONS | JUNE 2015
Corporate Center / Other: Sales: EUR 1,343m; EBIT: EUR -351m
POST, E-COMMERCE & PARCEL
Focus. Connect. Grow.
INVESTOR RELATIONS | JUNE 2015 PAGE 24
1.738 1.727563 547
Q1 2014Q1 2015
-2.8%-0.6%
Q1 2015Q1 2014
m EUR
INVESTOR RELATIONS | JUNE 2015
Mail Communication revenue decline in line with modest volume decline (-1.7%)
Dialogue Marketing also with limited revenue decline as price increases mostly compensate volume decline (-9.8%)
Parcel Germany revenue growth outpacing strong volume growth of 11.0% supported by price increases
Robust organic growth in international Parcel activities in and outside of Europe, also supported by currency developments
PeP: GOOD GROWTH ACROSS OUR PARCEL ACTIVITIES
PAGE 251) Parcel Europe ex Germany; 2) Parcel outside Europe
Business HighlightsMail Communication revenue Dialogue Marketing revenue
Parcel Germany volumes Parcel Germany revenue
Parcel Europe revenue1) DHL eCommerce revenue2)
9471.062
+12.1%+11.0%m units
165 173 240 302
+25.8%+4.8%
Q1 2015Q1 2014 Q1 2015Q1 2014
Q1 2015Q1 2014 Q1 2015Q1 2014
m EUR
m EUR
m EURm EUR
246 273
PeP – DIVISIONAL RESULTS Q1 2015
INVESTOR RELATIONS | JUNE 2015 PAGE 26
EUR m Q1 2014 Q1 2015 Chg. Management comments
Revenue 3,960 4,101 +3.6% Revenue increase reflecting growth across eCommerce - Parcel activities as well as price increases in Post products
EBIT 396 399 +0.8% EBIT growth constrained by rise in wages and transportation costs as well as expenses for international expansion of eCommerce - Parcel
Operating Cash Flow 137 185 +35.0% OCF increase driven by positive working capital development
Capex 38 64 +68.4% Investments mainly directed to parcel infrastructure expansion
MAIL Division
Mail Communication
Dialogue Marketing
Press Services
Retail Outlets
Pension Services
Global Mail
Parcel Germany
Post
All letters including import /export fromand to Germany. Also includes newservices like E-Post and ADAC Postbus
2013 Revenue, restated: EUR 9,984m
eCommerce - Parcel
Domestic and cross-border parcels and parcel operations in selective markets
2013 Revenue, restated: EUR 5,307m
Asset shifts
Domestic Parcel in Czech Republic, Netherlands, Belgium,Poland and India
Post - eCommerce – Parcel: NEW REVENUE REPORTING STRUCTURE
Letters → Post
Parcels → eCommerce - Parcel
Before 2014 From 2014
INVESTOR RELATIONS | JUNE 2015 PAGE 27
eCommerce & Parcel
Market growth assumption (in EUR), 2011-20, p.a.:+5-7% Germany domestic; +8% international domestic Price regulation: No regulatory price cap
Post
Expected average letter volume decline of -2 to -3% p.a.Price regulation: price cap = CPI - 0.2% Stamp price increase1): +2.8% in 2013
+1.6% in 2014 +1.0% as of Jan 1, 2015
e-post revenues: > 300m in 2014
PeP 2020 TARGET: SUPPORTED BY MIX SHIFT TOWARDS PARCEL
PeP: Revenue Mix PeP: Market Assumptions
1)Average increase on basket of regulated products, applicable to EUR ~3.3bn directly affected Post revenue
E-commerce trend to continue to drive mix shift from letter toparcel products
INVESTOR RELATIONS | JUNE 2015 PAGE 28
19%
81% 64%
36%
2010 2014
Mail division excl. Parcel Parcel Germany
Post eCommerce - Parcel
128
6566
55
32
111
2012 Parcels per capita, p.a.
GERMANY IS TRAILBLAZER FOR EUROPEAN E-COMMERCE AND SERVES AS BENCHMARK FOR FUTURE GROWTH
Growth driver2018Parcels per capita, p.a.
CHUKDE
FR
CZBE
ESPL
AT
IT
DK
NL
SE
23
5115
126146
2412
242
639410410411
2
Extend & upgrade parcel infrastructure
Offer a broad range of recipient services
Build dense drop-point networks
CHUKDE
FR
CZBE
ESPL
AT
IT
DK
NL
SE
DHL Parcel Europe will boost European e-commerceby building a first-in-class parcel infrastructure across Europe
INVESTOR RELATIONS | JUNE 2015 PAGE 29
DHL PARCEL EUROPE BUSINESS MODEL IS UP AND RUNNING
Broad roll-out of B2C services, e.g.Substantial Parcelshop expansion
Cross-border tradelanes
Start of 6-day delivery in The Netherlands and Belgium
Polish eCommercemarket place up and running
weekmo-sa
All Parcel Europe countries offer B2X parcels to/from Germany, especially beneficial to extend already strong customer relationships in Germany
DHL ParcelshopsEurope, ex-Germany
Jan 14 Jan 15
~1,150
~3,000+ >100%
February 2015: market entry in Slovakia
INVESTOR RELATIONS | JUNE 2015
Strong increase in number of access/drop-off locations leads to significant upgrade in customer proximity
PAGE 30
Domestic delivery
Domestic B2X delivery in Poland, Czech Republic, The Netherlands, Belgium and Luxembourg, leveraging previously mainly B2B-focused assets shifted from DHL in 2014
&
INVESTOR RELATIONS | JUNE 2015 PAGE 31
Adding fulfillment services and products in collaboration with DHL Supply ChainUS Domestic distribution capacities
As part of Strategy 2020 we are moving up the e-commerce value chain
PeP: DHL eCommerce IS AN ESTABLISHED PLAYER IN THE US
eCommerce: leveraging established US presence
Combining domestic and international delivery with best-in-class supply chain technology
First dedicated e-fulfillment warehouse in Columbus,OH
Consolidation and sortation of domestic and international mail and parcels
#4 US in consolidatormarket for USPS (SmartMail® product)
INVESTOR RELATIONS | JUNE 2015 PAGE 32
Adding fulfillment services and products in collaboration with DHL Supply ChainDomestic distribution capacities
Domestic market leader for B2B and B2C parcels in India
PeP: BLUE DART PROVIDES BASE FOR DHL eCommerce IN ASIA
South Asia’s premier express and integrated package distribution company
52% market share in domestic air express in India
Blue Dart: front-end, customer interface and delivery; DSC: warehousing and 3PL
E-fulfillment facility in Delhi close to go-live with first global customer
As part of Strategy 2020 we are moving up the e-commerce value chain
WORKING DAYS GERMANY
2013 2014 2015 2016
Q1 61.6 62.2 62.2 61.2
Q2 60.3 59.3 59.3 62.3
H1 121.9 121.5 121.5 123.5
Q3 65.8 65.8 66 65,8
9M 187.7 187.3 187.5 189.3
Q4 60.2 60.9 63 62,2
H2 126 126.7 129 128
FY 247.9 248.2 250.5 251.5
INVESTOR RELATIONS | JUNE 2015 PAGE 33
EXPRESS
Focus. Connect. Grow.
INVESTOR RELATIONS | JUNE 2015 PAGE 34
INVESTOR RELATIONS | JUNE 2015
Strong start into the year with TDI volume growth of +7.1% ( MEA +12.4%, Europe +10.2%, Asia/Pacific +5.4%, Americas + 0.6%)
Volume growth outpacing revenue growth due to lower fuel surcharge
Strong focus on customers and service quality has driven further market share gains
Growth supported by continuous expansion and improvement of our leading global network, including hub investments across all major geographies
EXPRESS: STRONG TDI GROWTH CONTINUES
PAGE 35
Time Definite International (TDI)1)
Revenues per day in EUR m
Time Definite International (TDI)Shipments per day ‘000s
34,035,2
+3.5%
662709
+7.1%
Business Highlights
Q1 2015Q1 2014
Q1 2015Q1 2014
1) Currency translation impacts are eliminated. Data aggregated with same currency rate
EXPRESS – DIVISIONAL RESULTS Q1 2015
INVESTOR RELATIONS | JUNE 2015
EUR m Q1 2014 Q1 2015 Chg. Management comments
Revenue 2,879 3,240 +12.5% Strong TDI volume growth supported by positive FX effects. Organic revenuegrowth at 2.3% mainly impacted by significant decrease in fuel surcharge revenue
EBIT 276 332 +20.3% Strong EBIT growth driven by TDI volume growth and network efficiencies, EBIT margin up 60bp yoy to 10.2%
Operating Cash Flow 285 334 +17.2% Strong operating cash flow increase in line with trend in EBIT performance
Capex 39 75 +92.3% Main investments going towards hub and gateway infrastructure upgrade as well as air fleet modernization and expansion
PAGE 36
DHL EXPRESS: GLOBAL TDI MARKET SHARES
Continued TDI leadership across all regions outside the Americas
Global [EUR 20.1bn]
DHL TNT UPS FedEx Others
+x% Change vs 2012 MI study
44%
20%
11%
4%
21%
46%
32%
18%1%
3%
41%
25%
12%
10%
12%
Europe [EUR 6.0bn]Americas [EUR 6.8bn ] Asia Pacific [EUR 6.8bn]
+1%
+2%+1%
34%
26%
22%
6%12%
+1%Source: MI study 2014EU : AT, DE, DK, ES, FR, IT, NL, RU, TR, UKAM : BR, CA, CL, CO, CR, GT, MX, PA, PE, USAP : CN, HK, IN, JP, KR, SGGLOBAL : EU + AM + AP + (AE + SA + ZA)
INVESTOR RELATIONS | JUNE 2015 PAGE 37
DHL EXPRESS FOCUS ON TDI
Continue successful FOCUS strategy
TDI (Time Definite International)The premium segment within Express Industry
Time Definite = Dedicated delivery at a scheduled time of dayInternational = Cross-Border Shipment (intra- or between continents)TDI: requires dense and broad international network
TDD: Time Definite Domestic Revenue Share = Delivery at scheduled time within one country. DDI: Day Definite InternationalDDD: Day Definite DomesticACS: Air Capacity Sales (re-sale of spare capacity on dedicated fleet to optimize utilization, not sold by core Express sales teams)
DHL Express Core Product
58%12%
5%
14%
11%
2009 Revenue distribution
TDI TDD DDI DDD ACS / Other
75%
8%
3%2% 12%
2014 Revenue distribution
INVESTOR RELATIONS | JUNE 2015 PAGE 38
DHL EXPRESS: VIRTUAL AIRLINE MODEL & AIR CAPACITY SALES
Virtual Airline
Block Space Agreement, guaranteed air cargo product.
Express TDI core product, capacity based on average utilization, adjusted on a daily basis
CORE Flex & Air Capacity Sales Flex, a set amount of the Total Spare Capacity to be utilised for TDI core volume surge and/or air cargo filler traffic
Air cargo guaranteed, a set amount of the Total Spare Capacity guaranteed for priority traffic & key customers
Air Capacity Sales
Capacity Commitment
Approx. 500 airports and 22 major hubs connected through 1. Dedicated air: >250 aircrafts with 17 partner airlines on
>600 daily flights2. Purchased air: >300 commercial airlines with >1.700
daily flightsCORE
TDI CAPA-CITY
FLEX
ACS GUAR.
BSA
INVESTOR RELATIONS | JUNE 2015 PAGE 39
22%
26%
52%
0 - 90 Days (incl.Purchased Air)91 - 360 Days
Fixed
FORWARDING, FREIGHT
Focus. Connect. Grow.
INVESTOR RELATIONS | JUNE 2015 PAGE 40
INVESTOR RELATIONS | JUNE 2015
Air and ocean volume growth slowing, mainly due to EMEA and AP regions
GP/unit stable in Air Freight at low levels and Ocean Freight GP/unit decline reflect continued difficult industry environment
Weak divisional EBIT performance due to complexity of NFE implementation and associated organizational changes
New management sets priority on improving business performance – with unchanged commitment to transformation based on comprehensive review
GLOBAL FORWARDING, FREIGHT: WORKING TOWARDS STABILISATION
Air freight ‘000s Tons
Ocean freight ‘000s TEU1)
932935
+0.3%
688 704
Q1 2015
+2.3%
Q1 2014
1) Twenty Foot Equivalent Unit
Business Highlights
PAGE 41
Q1 2015Q1 2014
GLOBAL FORWARDING, FREIGHT– DIVISIONAL RESULTS Q1 2015
INVESTOR RELATIONS | JUNE 2015 PAGE 42
EUR m Q1 2014 Q1 2015 Chg. Management comments
Revenue 3,523 3,789 +7.6% Revenue increase driven by volume growth in ocean freight and FX
Gross Profit 843 859 +1.9% Continued difficult market environment with margin pressure in both AFR and OFR
EBIT 49 17 -65.3% Further affected by ongoing NFE transformation program and low GP/unit in AFR and OFR
Operating Cash Flow -100 -160 -60.0% Mainly reflecting EBIT decline and unfavorable working capital development
Capex 22 40 +81.8% Low capex reflecting asset light business model
SUPPLY CHAIN
Focus. Connect. Grow.
INVESTOR RELATIONS | JUNE 2015 PAGE 43
INVESTOR RELATIONS | JUNE 2015
Sound order intake in Q1 (EUR 260m) especially in Automotive, Consumer and Life Sciences & Healthcare
Revenue growth across all verticals, strongest in Automotive, Consumer sectors and Life Sciences & Healthcare
Further steps taken in implementing Strategy 2020 as presented at last Capital Markets Tutorial
Restructuring charges cover implementation of consistent and lean organizational structure, addressing underperforming business areas as well as productivity measures
SUPPLY CHAIN: SOLID PERFORMANCE GIVEN RESTRUCTURING
New signings, EUR m1)
Revenue by sector Q1 2015
175 260
Q1 2014 Q1 2015
1) Annualized revenue
23%
19%
20%
10%
11%
2%10% 5%
Technology
Life Sciences & Healthcare
Consumer
RetailOthers
Williams Lea
Energy
Automotive
Business Highlights
PAGE 44
SUPPLY CHAIN – DIVISIONAL RESULTS Q1 2015
INVESTOR RELATIONS | JUNE 2015 PAGE 45
EUR m Q1 2014 Q1 2015 Chg. Management comments
Revenue 3,506 3,942 +12.4%FX benefits mainly driven by stronger USD and GBP. Organic revenue up 0.8% supported by new business across all regions (UK,US and APAC) but still held back by a deliberate customer loss in North America
EBIT 85 53 -37.6% EBIT declining mainly due to restructuring costs as timing effects from real estate transactions
Operating Cash Flow 28 -112 n.a. Cash flow down yoy mainly due to timing effects
Capex 65 73 12.3% Higher capex reflecting phasing of new contract investments
SUPPLY CHAIN: TAKING PERFORMANCE TO THE NEXT LEVEL
ROCE, incl. Goodwill
DHL Supply Chain is a successful member of DPDHL family of divisions
12% 13% 14% 15%
2011 2012 2013 2014
Supply Chain Strategy 2020 set to deliver further performance improvement
Strong and increasing returns… …based on resilient, asset-light business model
18%
10%
27%
45%Warehousing
Transportation
Williams Lea
Value Added Services
1.8% 2.7% 2.9% 3.1% 3,2%
2010 2011 2012 2013 2014
4-5%
2020
EBIT marginNew 2020
margin target:
DPDHL Capital Markets Tutorial Workshop
London, November 13, 2014
http://www.dpdhl.com/en/investors/events_and_presentations/capital_markets_day.html
DPDHL Capital Markets Tutorial Workshop
London, November 13, 2014
http://www.dpdhl.com/en/investors/events_and_presentations/capital_markets_day.html
INVESTOR RELATIONS | JUNE 2015 PAGE 46
For more information
Appendix
INVESTOR RELATIONS | JUNE 2015 PAGE 47
Q1 REFLECTS TRANSFORMATION & RESTRUCTURING FOCUS
Flat Group EBIT with divisional performance showing the expected mixed picture
REVENUE EBIT
Q1 2014 Q1 2015 Change Q1 2014 Q1 2015 Change
PeP 3,960 4,101 +3.6% 396 399 +0.8%
Express 2,879 3,240 +12.5% 276 332 +20.3%
Forwarding, Freight 3,523 3,789 +7.6% 49 17 -65.3%
Supply Chain 3,506 3,942 +12.4% 85 53 -37.6%
Group 13,569 14,767 +8.8% 727 720 -1.0%
INVESTOR RELATIONS | JUNE 2015 PAGE 48
GROUP P&L Q1 2015
INVESTOR RELATIONS | JUNE 2015
EUR m Q1 2014 Q1 2015 Chg. Management comments
Revenue 13,569 14,767 +8.8% Revenue development supported by currency effects. Organic growth of 2.1% with growth in all four Divisions / industries. Impact also from lower energy prices
EBIT 727 720 -1.0% Group EBIT about flat as strong Express growth is offset by transformation and restructuring related costs in Forwarding and Supply Chain
t/o PeP 396 399 +0.8% Static operating profit as revenue growth driven by eCommerce - Parcel activities and price increases is countered by factor cost inflation
t/o DHL 410 402 -2.0%Continued strong performance across all major metrics in Express. Declines in Supply Chain and Forwarding, Freight EBIT mainly reflect planned restructuring and transformation initiatives
Financial result -80 -64 +20.0% Improvement driven by benefits from lower interest rate environment on interest expense for bonds and provisions as well as FX effects
Taxes -123 -115 +6.5% Tax rate of 17.5% in line with ~18% full-year guidance
Cons. net profit1) 502 495 -1.4% Net profit and EPS about flat, in line with stable operating profit development
EPS (in EUR) 0.42 0.41 -2.4% Strong increase in net profit attributable to non-controlling interests
PAGE 491) Attributable to Deutsche Post AG shareholders
EUR m Q1 2014 Q1 2015
Cash from operating activities before changes in Working Capital 793 737
Q1 cash generation as every year burdened by payment of full-year contribution for civil servant pension scheme (EUR 530m) Tight management of Group working capital helped to minimize flow-back of typical year-end cash effects
Changes in Working Capital -709 -658
Net cash from operating activities after changes in Working Capital 84 79
Net Capex -401 -526 Free Cash Flow decline due to increased capex spend reflecting continued investments in our growth markets as well as timing effects Net interest line benefitted from one-off effect of EUR 76m related to monetization of interest rate swaps
Net M&A 0 0
Net Interest -31 70
Free Cash Flow -348 -377 FFO/Debt at 24.9% (year-end 2014: 27.7%)
FREE CASH FLOW Q1 2015
Seasonal factors drive usual Free Cash Outflow in Q1
INVESTOR RELATIONS | JUNE 2015 PAGE 50
INVESTOR RELATIONS | JUNE 2015
Seasonality drives net debt increase as usual in Q1Annual contribution to civil servant pension of EUR 530m (o.w. 130m in EBIT/OCF and 400m in W/C)
NET DEBT (-)/LIQUIDITY (+)
PAGE 51
-2,077
70
-526
-658737
-1,499
Othereffects
Net capex
Changesin W/C
Net debt(Dec 31, 2014)
OCF before change in W/C
Net debt(Mar 31, 2015)
-201
in EUR m
Net interest
1551
1345
2010 2011 2012 2013 2014
INVESTOR RELATIONS | JUNE 2015
Sustained increase in Operating Cash Flow Provides funding for investment in future growth, in particular in Parcel and
Express While simultaneously driving improved Free Cash Flow generation
IMPROVING CASH FLOW GENERATION
PAGE 52
3,0402,989
2,2442)2,371OCF:1,927
in EURm
2010-14 CAGR:OCF: >10%
Net capex: >10%
FCF: >20%
1) includes net M&A and net interest 2) Adjusted for non-recurring items
Use of OCF: Net Capex Other1)
FCF
DBO pensions in Germany No regulatory funding requirement
Pensions paid partially from plan assets and partially from current OCF
Impact of declining discount rates Balance sheet: net pension provision up 1.5bn in Q1 2015
due to another step-down in Euro discount rate
P&L: slight increase in staff costs expected in 2015 (mainly due to higher current service costs), mostly offset by small decline in finance costs
Cash flow: cash outflow not directly affected as actual pension payments and employer contributions to plan assets not affected by fluctuations in applied discount rate levels
REMINDER ON PENSIONS: DEFINED BENEFIT OBLIGATIONS (DBO)
PAGE 53
7,138 8.635
10.96111.849
Net PensionProvision
Plan assets
Dec. 31, 2014
18,099Total DBO
2014 Q1 2015
Average Discount Rate (quarter-end) 2.62% 2.04%
EUR Discount Rate (quarter-end) 2.25% 1.50%
in EUR m
Lower discount rates increase balance sheet liability but have no direct impact on cash generation
INVESTOR RELATIONS | JUNE 2015
Mar. 31, 2015
20,484
Gross Capex / Sales ratio -Group & by division
0,0%
1,0%
2,0%
3,0%
4,0%
5,0%
6,0%
2007 2008 2009 2010 2011 2012 2013 2014
EXPRESS GROUP PeP SUPPLY CHAIN DGF
STABLE CAPITAL INTENSITY EXPECTED
INVESTOR RELATIONS | JUNE 2015 PAGE 54
GROUP AVERAGE
EXPRESS ~4%
SUPPLY CHAIN ~2%
PeP ~3%
FORWARDING ~1%
~3%
Gross Capex intensity, 2007–2014 average
STRATEGY 2015 HAS DRIVEN SIGNIFICANT OPERATING IMPROVEMENT
INVESTOR RELATIONS | JUNE 2015 PAGE 55
PeP: EBIT stabilization delivered DHL EBIT margins(2): good progress, more to come to contribute to ~10% DHL EBIT CAGR target
2010 Q1 2015
4.4%
2.7%1.8% 1.7%
1.120 1.107
1.199
1.286 1.298
2010 2011 2012 2013 2014
1)
1)in EUR bn
Strategy 2020 target:3% EBIT CAGR
2013-20
Strategy 2020 target:3% EBIT CAGR
2013-20
Strategy 2015 EBIT target:
min. EUR 1bn
10.2%
2.9%
1)Reported FY 12 EBIT including EUR -151m one-off effect from VAT settlement; Reported FY13 was restated by EUR ~60m for asset shift from DHL implemented on January 1, 20142)EBIT margin, last 12 months (rolling)
Express: strong improvement
Forwarding, Freight: currently affected by NFE and low GP margins
Supply Chain: steady progress
Group revenue footprint
22% 30%
78% 70%
Today Target
Mature Markets Emerging Markets
Building on our leading market positions in growth regions, 30% emerging market targets is AMBITIOUS BUT ACHIEVABLE
2020 target2013
OUR AMBITION FOR THE EMERGING MARKETS
INVESTOR RELATIONS | JUNE 2015 PAGE 56
FOCUS. CC/OTHER COSTS
0,1%
0,2%
0,3%
0,4%
0,5%
0,6%
0,7%
0,8%
2009 2010 2011 2012 2013 2020
TAR
GE
T
0.5%
Corporate bodies (e.g. CB, SVB)and legal obligations/ foundations
Investments into growth & cross-divisional initiatives
Core Corporate Center costs
CC / Other cost, as % of revenue CC / Other cost structure, 2014
20%
60%
20%
INVESTOR RELATIONS | JUNE 2015 PAGE 57
THIS PRESENTATION CONTAINS CERTAIN STATEMENTS THAT ARE NEITHER REPORTED RESULTS NOR OTHERHISTORICAL INFORMATION. THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO RISKS ANDUNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED INTHE FORWARD-LOOKING STATEMENTS. MANY OF THESE RISKS AND UNCERTAINTIES RELATE TO FACTORS THATARE BEYOND DEUTSCHE POST AG’S ABILITY TO CONTROL OR ESTIMATE PRECISELY, SUCH AS FUTURE MARKETAND ECONOMIC CONDITIONS, THE BEHAVIOR OF OTHER MARKET PARTICIPANTS, THE ABILITY TOSUCCESSFULLY INTEGRATE ACQUIRED BUSINESSES AND ACHIEVE ANTICIPATED SYNERGIES AND THE ACTIONSOF GOVERNMENT REGULATORS. READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESEFORWARD-LOOKING STATEMENTS, WHICH APPLY ONLY AS OF THE DATE OF THIS PRESENTATION. DEUTSCHEPOST AG DOES NOT UNDERTAKE ANY OBLIGATION TO PUBLICLY RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE OF THIS PRESENTATION.
THIS PRESENTATION DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TOSUBSCRIBE FOR OR BUY ANY SECURITY, NOR SHALL THERE BE ANY SALE, ISSUANCE OR TRANSFER OF THESECURITIES REFERRED TO IN THIS PRESENTATION IN ANY JURISDICTION IN CONTRAVENTION OF APPLICABLELAW.
COPIES OF THIS PRESENTATION AND ANY DOCUMENTATION RELATING TO THE OFFER ARE NOT BEING, ANDMUST NOT BE, DIRECTLY OR INDIRECTLY, MAILED OR OTHERWISE FORWARDED, DISTRIBUTED OR SENT IN ORINTO OR FROM AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD BEUNLAWFUL.
THIS DOCUMENT REPRESENTS THE COMPANY‘S JUDGMENT AS OF DATE OF THIS PRESENTATION.
DISCLAIMER
INVESTOR RELATIONS | JUNE 2015 PAGE 58
INVESTOR RELATIONS CONTACTS
Sarah Bowman• +1 212 381 3463 • E-mail: sarah.bowman@dpdhl.com
Sebastian Slania• +49 228 182 63203• E-mail: sebastian.slania@dpdhl.com
Martin Ziegenbalg, Head of Investor Relations• +49 228 182 63000• E-mail: m.ziegenbalg@dpdhl.com
Robert Schneider• +49 228 182 63201• E-mail: robert.schneider1@dpdhl.com
Christian Rottler• +49 228 182 63206• E-mail: christian.rottler@dpdhl.com
INVESTOR RELATIONS | JUNE 2015 PAGE 59
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