Ctt - Correios De Portugal Sa · EURONEXT:CTT
Ctt - Correios De Portugal Sa — CTT – Correios de Portugal — 2025 Santander Iberian Conference
30 slides from Ctt - Correios De Portugal Sa's conference presentation, Jan 29, 2025
Slide 1: 2025 Santander Iberian Conference
2025 Santander Iberian Conference Wednesday, 29 January 2025 Guy Pacheco, CFO Nuno Vieira, IRO
Slide 2: Disclaimer
Disclaimer DISCLAIMER FORWARD-LOOKING STATEMENTS This document has been prepared by CTT – Correios de Portugal, S.A. (the “Company” or “CTT”) exclusively for This presentation contains forward-looking statements. All the statements herein which are not historical use during fall roadshow investor me
Slide 3: A leading e-commerce logistics player, delivering parcels to the whole of Iberia
A leading e-commerce logistics player, delivering parcels to the whole of Iberia CTT IN A NUTSHELL Originally a postal operator, CTT successfully evolved to become 8% 5-year CAGR a comprehensive Iberian e-commerce logistics player • Founded in 1520 • Publicly listed in 2013 • €748m market cap1 • Con
Slide 4: A balanced and highly synergic portfolio
A balanced and highly synergic portfolio CTT IN A NUTSHELL B2B / logistics B2C / retail Detailed ahead Detailed ahead Iberian e-commerce growth Fastest growing retail bank Growth focus engine franchise\in Portugal Express & Banco Parcels Growing towards another record year CTT Continue to grow drive
Slide 5: E&P is the key driver of topline growth and margin expansion
E&P is the key driver of topline growth and margin expansion EXPRESS & PARCELS E&P volumes Revenues Recurring EBIT million objects; LTM € million € million weight 21% 26% 30% 29% 35% -15% 0% 21% 13% 23% 3Q24LTM : 131 101 +7.4% 985 907 848 74 72 +7.5% 740 745 88 53 66 65 60 38 41 341 193 256 259 152
Slide 6: E-commerce flows are primarily international and cross-border
E-commerce flows are primarily international and cross-border EXPRESS & PARCELS | MARKET OPPORTUNITY On top of Asia to Europe (19% of total) Intra-Europe is one of the largest flows (17%) Potential growth in US to Europe (2%) Source: “IPC global e-commerce supply chain study 2023” – January 2024; Mc
Slide 7: New cross border opportunity to be a key growth driver
New cross border opportunity to be a key growth driver EXPRESS & PARCELS | MARKET OPPORTUNITY E-commerce volumes in Europe E-commerce as % of total retail sales Cross border as % of total e-commerce Revenues; € billions +6pp +15pp +9% CAGR +4pp +7pp 930 11 8 71 42 +12% 35 56 602 539 4 5 2023 2024 20
Slide 8: Iberian e-commerce is a sizeable market with high growth potential
Iberian e-commerce is a sizeable market with high growth potential EXPRESS & PARCELS | MARKET OPPORTUNITY Iberia is the 4th largest e-commerce market in Europe1 … but e-commerce2 penetration is still low, 2023 e-commerce share of total retail, % Portugal 7.5 3.0x € billion Romania 9.3 22.5 147.8 Ita
Slide 9: Comprehensive Iberian coverage in Express & Parcels
Comprehensive Iberian coverage in Express & Parcels EXPRESS & PARCELS 100% D+1 full geographical coverage in Iberia >130M 50% items per year (3Q24, LTM) Spanish customers choose a single operator in Iberia >550k items daily (3Q24) 121k Automatic sorting capacity (k sorts/hour; 3Q24) 73 Distribution
Slide 10: Continued volume growth in E&P Iberia
Continued volume growth in E&P Iberia EXPRESS & PARCELS | OPERATIONAL RESULTS E&P Iberia | CEP Volumes High quality and efficiency million items; % change vs. prior year • Maintain a quality service with high delivery efficiency +39.4% +46.2% rates despite an increase in daily volumes y.o.y in y.o.y
Slide 11: Growth is driving scale and margin expansion
Growth is driving scale and margin expansion EXPRESS & PARCELS | OPERATIONAL RESULTS E&P | Revenues E&P | Recurring EBIT € million; % change y.o.y. € million; % change y.o.y. 7.3% +44.4% +44.0% 5.3% 330.5 2.5% 229.5 187.8 9M22 9M23 9M24 Volume growth underpinning operational leverage
Slide 12: Excellent organic growth legitimizes non-organic acceleration
Excellent organic growth legitimizes non-organic acceleration Accelerate to leadership in Iberian e-commerce, expanding offer and strengthening customer relationship Diversify risk: new segments (B2B) and presence in the value chain (customs clearance) Effectively attack the international segment, o
Slide 13: Partnership structure to maximise focus on execution
Partnership structure to maximise focus on execution EXPRESS & PARCELS | PARTNERSHIP WITH DHL Structure ▪ Acquisition of 100% of DHL Parcel Portugal by CTT Expresso ▪ Acquisition of 25% indirect stake in DHL Parcel Iberia by CTT, through its sole shareholder Danzas ▪ Acquisition of 25% of CTT Expres
Slide 14: The most comprehensive pick-up and delivery network in Iberia
The most comprehensive pick-up and delivery network in Iberia EXPRESS & PARCELS | PARTNERSHIP WITH DHL Cross Border ✓ Leverage inbound flows combining DHL’s cross border expertise with CTT’s wide Iberian e-commerce last mile network ✓ Increase share in the outbound flows using DHL international netw
Slide 15: Iberian JV fully equipped to provide exceptional quality service
Iberian JV fully equipped1 to provide exceptional quality service EXPRESS & PARCELS | PARTNERSHIP WITH DHL Strong brand recognition in ~150m Parcels delivered >1m shipments of daily >3,300 employees Portugal and Spain processing capacity ~23,000 PUDOs ~1,000 Lockers 29 hubs 330 depots (10,000 to be
Slide 16: Growth optionality: Cacesa
Growth optionality: Cacesa EXPRESS & PARCELS | ACQUISITION OF CACESA Cacesa at a glance Fully aligned with CTT’s strategic roadmap 160m €104m €104m € Increase CTT’s presence in cross-border e-commerce shipments revenues2 EV3 >€5m flows incremental run-rate synergies at Strengthen CTT’s foothold in c
Slide 17: Strong and solid exposure to Spain, while providing further optionality
Strong and solid exposure to Spain, while providing further optionality EXPRESS & PARCELS | ACQUISITION OF CACESA Well-established in Customs in Bridging Europe and China Spain and Italy • China to Europe represents ~15-20% of global cross- border e-commerce orders +15 − Cacesa connects Europe and C
Slide 18: Cacesa’s acquisition and partnership with DHL are complementary
Cacesa’s acquisition and partnership with DHL are complementary EXPRESS & PARCELS | MARKET OPPORTUNITY % of total trade 2% 19% US to Europe Asia to Europe DHL differentiated characteristics to enhance CTT’s strong foothold to be further reinforced CTT’s presence in these flows in Iberia by acquisiti
Slide 19: Banco CTT: our second growth area
Banco CTT: our second growth area BANCO CTT CTT’s Brand Awareness CTT’s Retail Network % of population know very well know some what 569 branches spread across the country 99 99 100 100 100 100 212 of which with Banco CTT branches All 308 municipalities with a CTT store 86 83 85 84 83 85 65k unique
Slide 20: Banco CTT is the fastest growing banking franchise in Portugal
Banco CTT is the fastest growing banking franchise in Portugal BANCO CTT 676 Aug’20: 500,000 647 accounts, close to 2 Bn€ total assets 602 573 783k clients Oct’18: Introduction of 517 off-balance sheet saving 461 Sep’23: Scaling up for products profitable and sustainable May’19: growth Jan’17: 202 b
Slide 21: Focused on client growth and doubling-down efforts on engagement
Focused on client growth and doubling-down efforts on engagement BANCO CTT Client growth • 8 years / 780,000 clients • Strong net addition of x Client engagement • Converge client engagement towards incumbents’ levels x NII expansion • Managing the monetary context = Sustainable PBT growth • Higher
Slide 22: A clear strategy that rendered a proven business model
A clear strategy… that rendered a proven business model and… BANCO CTT Operating data Operating Income1,2 and Net Income1 of Banco CTT 9M24 € million 2023 120 17 Develop a sizable and high potential 676k current accounts retail client base 2022 110 15 48 2021 101 16 Leverage on CTT’s tradition on 20
Slide 23: Improved client engagement driving growth and profitability
Improved client engagement driving growth and profitability BANCO CTT Customer deposits1 Loans volumes2 Profit before Taxes3 € million, EoP € million, EoP € million; % change vs. prior year +46.0% +8.2% 3,968 908 839 Yield4 RoTE5: 8.6% 12.4% 6.4% 2,717 Sep-23 Sep-24 +25.9% 18.4 +8.7% 14.6 766 705 Yi
Slide 24: A balanced and highly synergic portfolio
A balanced and highly synergic portfolio CONSOLIDATED VIEW Revenues € million; % change vs prior year; % weight Iberian e-commerce growth engine +8% After another record year, while setting the +9% 1,062 foundations to unlock further growth 985 907 Leveraging new USO contract 341 442 (+31%) 40% E&P
Slide 25: Capital allocation priorities
Capital allocation priorities OUTLOOK AND CAPITAL ALLOCATION 1. Investment in business growth Organic growth: transformation, technology, capacity and Inorganic growth: M&A opportunities in e-commerce logistics maintenance capex related assets ✓ Cacesa: Agreement to acquire 100% shareholding ✓ DHL e
Slide 26: Keeping balance sheet flexibility post Cacesa & DHL
Keeping balance sheet flexibility post Cacesa & DHL FINANCIAL LEVERAGE EBITDA and leverage with Banco CTT under equity method1 € million EBITDA Net Debt / EBITDA (x) Net Debt ND/EBITDA ceiling envisaged in funding policy 2.5 <2.0x 2.16 1.72 1.64 Post Cacesa and DHL 1.60 1.44 245 182 186 177 154 113
Slide 27: To support our growth, we will continue to invest in our business
To support our growth, we will continue to invest in our business OUTLOOK Annual average Capex Key areas of investment € million Increasing sorting capacity across Iberia +16% 40-45 Developing lockers network in Portugal 37 and initiating expansion to Spain Transformational 50% 80% Investing in IT t
Slide 28: Growing revenues and EBIT
Growing revenues and EBIT Revenues Recurring EBIT Targets disclosed at the 2022 € million € million Capital Markets Day +7% .. +17%1 +6% ... +13%1 100 .. 120 1,100 ... 1,250 36% 9% mid-single 7% digit growth 88 80-90m 14% 985 907 63 7% 848 45% 10-20 61 65 745 49 60 36 44 434 37% 444 461 22 31 41 426
Slide 29: CTT is well positioned to become a full-fledged e-commerce logistics player
CTT is well positioned to become a full-fledged e-commerce logistics player WRAP UP Fastest growing e-commerce logistics player in Iberia • 4th largest e-commerce market in Europe with strong growth leveraged by market convergence • Market share expansion based on quality, commercial proactivity and
Slide 30: We make our path fully committed to deliver
Investor Relations Phone: +351 210 471 087 E-mail: investors@ctt.pt ctt.pt We make our path fully committed to deliver ctt.pt
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