Slide 1: Q4/FY 2023 Results
Q4/FY 2023 RESULTS TOBIAS MEYER, GROUP CEO MELANIE KREIS, GROUP CFO DHL GROUP INVESTOR RELATIONS March 6th, 2024 1
Slide 2: Agenda
AGENDA CEO Update Financials & Outlook Q4/FY 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 6 MARCH 2024 2 2
Slide 3: 2023 Group Highlights
Management comments: The logistics industry saw further declines in B2B volumes in 2023, reflecting ongoing destocking by customers as well as a generally weak macro environment. Nevertheless, DHL Group delivered on its expectations, and even in adverse macro conditions, Group EBIT and FCF remain si
Slide 4: B2B volumes development
Management comments: Following the volatility of B2B volumes during the pandemic, customers reduced their B2B flows against slowing demand in order to bring down inventories. B2B development in 2023 (FY 2023 yoy: EXP B2B -1%, AFR -12%, OFR -6%) marked the second consecutive year of declining industr
Slide 5: B2C volumes development
Management comments: E-commerce has been a significant driver of our EBIT growth and FCF generation since more than a decade. While the pandemic led to increased volatility in B2C volumes, we expect e-commerce penetration to increase further and drive another decade of structural growth opportunity
Slide 6: Yield management discipline
Management comments: Yield management is another important driver behind our stronger operating and financial performance vs. pre-pandemic level. Again, this is not due to the pandemic but the fact that we have continuously optimized our yield structures and further sophisticated our well-establishe
Slide 7: Structural efficiency improvements
Management comments: As part of our digitalization agenda, we have rolled out automation, robotics, data analytics and now artificial intelligence supported solutions across our operations and regions. Besides improving service quality for our customers and working conditions for our colleagues, the
Slide 8: 2023 Group ESG targets delivered
Management comments: With our Sustainability Roadmap being fully integrated into Strategy 2025, we have maintained our focus on continued execution and investment in these important areas. The three KPIs shown here have been part of the Corporate Board's 2023 bonus framework. As of 2023, this practi
Slide 9: CEO Wrap-up
Management comments: The continued decline in B2B volumes in 2023 means that the industry has been facing the longest period of volume decline since at least the Great Financial crisis in 2008/09. We have pulled well-proven cost and pricing levers which allowed us to deliver Group EBIT and FCF signi
Slide 10: Agenda
AGENDA CEO Update Financials & Outlook Q4/FY 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 6 MARCH 2024 10 10
Slide 11: Q4 2023 Group EBIT of €1,642m (-15% yoy)
Management comments: Operational performance in Q4 2023 has benefitted from our e-commerce exposure to the B2C peak season. While this seasonal uplift has generated operating leverage in eCommerce and Parcel Germany, the heavy skew of peak season volume to the Asia-Outbound tradelane did not generat
Slide 12: FY 2023 revenue and EBIT overview
Management comments: Out of the three macro scenarios in our initial FY 2023 guidance, the most pessimistic scenario has materialized: there was no significant macro recovery in 2023. With FY 2023 Group EBIT of €6.3bn we delivered on our guidance which was above €6.0bn initially and had been increas
Slide 13: FCF conversion improvement
Management comments: Operating Cash Flow (-16%) broadly follows the EBIT development (-25%). Both OCF and FCF stay significantly above pre-pandemic levels. This step change in FCF conversion reflects the structural improvements we have implemented in our cash flow culture and steering. Capex flexibi
Slide 14: FY 2023 shareholder returns
Management comments: Despite weak macroeconomic environment, we continue to maintain our high cash flow conversion ratio and deliver on shareholder returns through our regular dividend and a multi- year share buy-back program, in line with our Finance Policy. FY 2023 shareholder returns Stable divid
Slide 15: Reliable capital allocation
Management comments: The sustainable increase in Cash Flow generation allows us to execute on all principles of our Finance policy. • Continued targeted investments in our core logistics operations, with flexibility to target attractive growth opportunities • Our dividend proposal for a flat FY 2023
Slide 16: Factors influencing 2024 guidance
Management comments: External factors have shown a continuation of the weak market environment so far this year. Activity levels are particularly subdued in Europe while the future development of China remains uncertain. Our 2024 guidance range is therefore driven by an expected EBIT decline in H1 b
Slide 17: 2024 and mid-term guidance
Management comments: 2024 EBIT guidance range reflects our expectation of a yoy decline in EBIT in H1 balanced by growth in H2 as macroeconomic conditions improve. The wider range for capex reflects that investment spending follows the underlying macro development – this capex flexibility is one maj
Slide 18: 2023 confirms strong financial performance through the cycle
Management comments: While FY 2023 EBIT is down yoy due to external market circumstances, our performance shows: • our agility to preserve EBIT and FCF generation, also against prolonged downturn • the confirmation of earnings and cash flow well ahead of pre-pandemic levels even without macro tailwi
Slide 19: Invitation: DHL Operations Tours
INVITATION DHL OPERATIONS TOURS STRATEGY 2030 INTRODUCTION MILAN, ITALY MIAMI, USA DHL Express hub tour DHL Express hub tour SEPT 30th MARCH 20th MARCH 22nd With DHL Group CEO (Tobias Meyer) 2024 MADRID, SPAIN BRUSSELS, BELGIUM DHL Express hub tour DHL Express hub tour, DHL Supply Chain site LONDON,
Slide 20: Appendix
APPENDIX Q4/FY 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 6 MARCH 2024 20 20
Slide 21: Express
Express Network profitability impacted by trade lane imbalance; Base pricing remains strong FY 2023 TDI Europe SpD TDI Americas SpD TDI APAC SpD TDI Global SpD 2023 TDI volume mix -3% yoy TDI Revenue / Day 1 2% B2C B2B 7% 46% 54% 2% -3% yoy +2% 2023 TDI revenue mix TDI Shipments / Day - 3% -3% -3% -
Slide 22: Global Forwarding, Freight
Global Forwarding, Freight Expected market trends: Volumes stabilizing and continued yield normalization FY 2023 Air Freight (AFR) Ocean Freight (OFR) 826 26% DGFF Gross Profit Margin 6 00 1 80 0 523 711 8 00 8 00 676 1 60 0 5 00 451 426 7 00 7 00 1 40 0 6 00 531 6 00 335 7% 4 00 1 20 0 5 00 5 00 Vo
Slide 23: Supply Chain
Supply Chain Delivering record EBIT in uncertain economic times FY 2023 New business gains total contract value split by sector, FY 2023 +4% yoy Retail/ e-Commerce 28% Organic revenue growth Consumer 22% Technology 16% €961m Automobility 10% EBIT Lifesciences - Healthcare 8% Engineering & Manufactur
Slide 24: eCommerce
eCommerce Seasonal acceleration in B2C – continued investments into long-term growth opportunity FY 2023 Total revenue mix Parcel revenue mix +5% yoy Organic revenue growth Europe 55% B2B 27% €292m Americas 35% EBIT B2C Asia 10% 73% 5% EBIT margin ▪ B2C peak season driving acceleration in Q4 volume
Slide 25: Post & Parcel Germany
Post & Parcel Germany Successful peak season management; significant capex cut to sustain cash generation FY 2023 Parcel Germany volumes/working day yoy +5% yoy Parcel volumes /working day 8% 7% 5% 2% 1% 0% -5% yoy Mail volumes/working day -14% -20% €421m Costs from wage agreement Q1 2022 Q2 2022 Q3
Slide 26: Group P&L and Cash Flow Summary
Q4/FY 2023 Group P&L and Cash Flow Summary in €m Q4 2022 Q4 2023 yoy in % FY 2022 FY 2023 yoy in % Q4 2022 Q4 2023 yoy in % FY 2022 FY 2023 yoy in % Revenue 23,776 21,348 -10.2% 94,436 81,758 -13.4% EBIT 1,922 1,642 -14.6% 8,436 6,345 -24.8% Other operating income 928 735 -20.8% 2,925 2,787 -4.7% De