Slide 1: Austrian Post Investor Presentation Q1-3 2019
AUSTRIAN POST Investor Presentation Q1-3 2019 Walter Oblin, CFO Vienna, 14 November 2019 INVESTOR PRESENTATION Investor Relations Vienna, 14 November 2019
Slide 2: Highlights and Overview
1. HIGHLIGHTS AND OVERVIEW 2. Strategy Implementation 3. Group Results Q1-3 2019 4. Outlook 2019 and 2020 INVESTOR PRESENTATION Investor Relations Vienna, 14 November 2019 2
Slide 3: Highlights Q1-3 2019
HIGHLIGHTS Q1-3 2019 Core operating business Revenue and earnings Q1-3 2019 Outlook 2019 and 2020 – Good operating mail and parcel – Revenue +3.2% to – 2019 with increasing revenue business EUR 1,462.2m and stable operating earnings – Elections as positive special – Good parcel revenue of +11.3% (EB
Slide 4: Q1-3 2019 revenue up by 3.2% thanks to robust mail business and strong parcel growth
Q1-3 2019 REVENUE UP BY 3.2% (+4.3% IN Q3) THANKS TO ROBUST MAIL BUSINESS AND STRONG PARCEL GROWTH Group: +3.2% (Q3: +4.3%) Revenue development – Strong Parcel & Logistics revenue growth, stable development in the Mail & Branch Network EUR m Parcel & Logistics: +11.3% (Q3: +18.4%) +3.2% – Ongoing po
Slide 5: Reported EBIT reduced by -8.4% in Q1-3 2019
REPORTED EBIT REDUCED BY -8.4% IN Q1-3 2019 Mail & Branch Network: – Good operating performance EBIT development – Provision for data protection in Q3 at EUR 19.8m – As a result EBIT decrease of EUR 11.9m in Q1-3 2019 EUR m (-25.7% in Q3) -8.4% Parcel & Logistics: 141.9 – EBIT up by EUR 0.9m in Q1-3
Slide 6: Strategy Implementation
1. Highlights and Overview 2. STRATEGY IMPLEMENTATION 3. Group Results Q1-3 2019 4. Outlook 2019 and 2020 INVESTOR PRESENTATION Investor Relations Vienna, 14 November 2019 6
Slide 7: Clear strategic priorities
CLEAR STRATEGIC PRIORITIES 01 Defending market leadership in the 02 Profitable growth in selected markets core business Safeguarding market Focusing and performance position in a competitive enhancement environment 03 Enhancing efficiency and flexibilisation of 04 Customer orientation and the cost s
Slide 8: Letter mail in Austria
01 LETTER MAIL IN AUSTRIA Letter Mail (millions of items) Ø -4.3% 939 931 866 832 763 728 723 Current Letter Mail trends Q1-3 2019 – Declining volumes based on e-substitution Operating (operating decline of about 3.1%) decline of – New product structure as at 1 July 2018 has about 3.1% been well rec
Slide 9: Further development of product portfolio and moderate price increase in 2020
01 FURTHER DEVELOPMENT OF PRODUCT PORTFOLIO AND MODERATE PRICE INCREASE IN 2020 AS PART OF AN INFLATION ADJUSTMENT New features of product portfolio Postal rate adjustments Domestic letters NEW as at 1 April 2020 in EUR rates – PRIO/ECO choice has been well received; Eco Letter Letter S 0.70 0.74 ea
Slide 10: International comparison: priority and non-priority rates in Europe
01 INTERNATIONAL COMPARISON: PRIORITY AND NON-PRIORITY RATES IN EUROPE Spain 0.74 4.46 Denmark 1.12 3.25 Italy 1.24 3.15 Iceland 0.97 2.54 Poland 1.48 1.84 Croatia 0.69 1.45 Finland 1.43 Slovakia 1.07 1.32 Romania 0.78 1.29 Bulgaria 0.74 1.25 Domestic standard Czech Republic 1.22 Norway 1.14 letter
Slide 11: Direct mail/media post in Austria
01 DIRECT MAIL/MEDIA POST IN AUSTRIA Direct Mail/Media Post (millions of items) Ø -1.1% 4,883 4,737 4,727 4,764 4,816 4,599 4,559 Current Direct Mail/Media Post trends Operating Q1-3 2019 3,822 3,659 3,703 3,777 3,834 3,630 3,667 decline of about – Operating volume decline in Austria of 3.8% in abou
Slide 12: Current trends in Austrian parcel business Q1-3 2019
01 CURRENT TRENDS IN AUSTRIAN PARCEL BUSINESS Q1-3 2019 Parcel volumes of Austrian Post (millions of parcels) Ø +8.8% ~125 108 97 Current trends in Austrian parcel business 80 81 Q1-3 2019 74 70 Rise of – Good operating parcel growth and 65 57 59 about 15% cooperation with DHL since August 2019 have
Slide 13: Cooperation between Austrian Post and Deutsche Post DHL Group started well
01 COOPERATION BETWEEN AUSTRIAN POST AND DEUTSCHE POST DHL GROUP STARTED WELL – Partnership of Austrian Post and Deutsche Post DHL Group in place since 1 August 2019 – Taking over about 140 employees – Integration of 3 logistics centres in Vienna, Enns and Graz completed on Enns LC schedule (investm
Slide 14: Austrian parcel business: growth forecast confirmed
01 AUSTRIAN PARCEL BUSINESS: GROWTH FORECAST CONFIRMED Parcel volume forecast of Austrian Post Volume forecasts of Austrian Post (millions of parcels) ~150 – Rise of the actual parcel volumes +115% up to about 800,000 parcels per ~125 Incl. day due to good organic growth and cooperation DHL-cooperat
Slide 15: Growth in selected markets
02 GROWTH IN SELECTED MARKETS Growth focus on Parcel & Logistics GERMANY AEP (51.5% stake, at-equity consolidation) CEE/SEE: Focus on the parcel business – Pharmaceutical wholesale joint venture – Good volume development, especially in Croatia – Revenue +15% in Q1-3 2019 to about EUR 360m and Bulgar
Slide 16: Development of a new financial services business
02 DEVELOPMENT OF A NEW FINANCIAL SERVICES BUSINESS Q3/Q4 2019 Q1 2020 Q2 2020 80/20 Joint Venture ECB approval – Finalise brand – Market launch of Closing of Bank of identity Bank of the Post the Post – Selection of product – Product launch Implement core IT partners concept system – Client/Custome
Slide 17: Capacity drive: accelerated investment programme
03 CAPACITY DRIVE Forecasted parcel volume growth leads to PARCEL CENTRE LOWER AT (HAGENBRUNN) accelerated investment programme 2019: Growth CAPEX of over EUR 50m planned; CAPEX (EUR m)1 + properties – about EUR 25m + sorting technology through DHL cooperation – about EUR 15m 139 >50 Growth CAPEX 10
Slide 18: Expansion of logistics infrastructure in Austria
03 EXPANSION OF LOGISTICS INFRASTRUCTURE IN AUSTRIA 2018 2019 2020 2021 2022 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 PC Lower Austria Hagenbrunn PC Styria Kalsdorf DB Thalgau PC Vorarlberg PC Tyrol PC Vienna-South PC = Parcel centre PC Upper Austria DB = Delivery base INVESTOR PR
Slide 19: Staff structure in Austria
03 STAFF STRUCTURE IN AUSTRIA Full-time equivalents in the Austrian core business (average for the period) 21,926 21,003 490 20,217 20,064 -137 FTE Change FY ‘18/Q1-3 ‘19 19,417 -794 Civil servants 1,891 18,790 18,233 17,692 2,490 3,350 17,463 17,644 17,508 -215 Employees old CWA 3,858 +872 Employee
Slide 20: Self-service solutions as a competitive advantage
04 SELF-SERVICE SOLUTIONS AS A COMPETITIVE ADVANTAGE Steady increase in use Q1-3 2019: >2.3m items Q1-3 2019: >2.8m items Q1-3 2019: >4.4m items 43,587 pick-up boxes 56,479 boxes at pick-up stations 431 drop-off boxes Jun.12 Sept.19 Nov.13 Sept.19 Jan.12 Sep.19 Number of solutions Items/month INVEST
Slide 21: Group Results Q1-3 2019
1. Highlights and Overview 2. Strategy Implementation 3. GROUP RESULTS Q1-3 2019 4. Outlook 2019 and 2020 INVESTOR PRESENTATION Investor Relations Vienna, 14 November 2019 21
Slide 22: Financial indicators at a glance
FINANCIAL INDICATORS AT A GLANCE Q1-3 2018 Q1-3 2019 Revenue (EUR m) 1,416.4 1,462.2 Revenue increase of 3.2% Stable margin due to IFRS 16 (shift from expenses to EBITDA margin (%) 14.6 14.8 depreciation/amortisation) EBIT margin below the previous year due to provision for EBIT margin (%) 10.0 8.9
Slide 23: Key income statement indicators
KEY INCOME STATEMENT INDICATORS Q1-3 Q1-3 IFRS 16 Q3 Q3 EUR m 2018 2019 % ∆ effects 2018 2019 Strong parcel growth and Revenue 1,416.4 1,462.2 3.2% 45.8 - 461.1 481.1 stable mail revenue Other operating income 73.9 113.9 54.1% 40.0 - 22.9 71.7 Positive net effect from claims related to non-wage labo
Slide 24: Mail & Branch Network division: revenue development Q1-3 2019
MAIL & BRANCH NETWORK DIVISION: REVENUE DEVELOPMENT Q1-3 2019 Letter Mail & Mail Solutions (EUR m) Direct Mail/Media Post (EUR m) – Operating volume decline of Letter Mail in Austria of – Operating volume decline in Austria of about 3.8% about 3.1% – Volume decrease in addressed direct mail in Austr
Slide 25: Mail & Branch Network division: income statement
MAIL & BRANCH NETWORK DIVISION: INCOME STATEMENT EUR m Q1-3 2018 Q1-3 2019 % ∆ Q3 2018 Q3 2019 Positive effects from elections in Q2 (European elections) and Revenue 1,027.3 1,033.5 0.6% 6.2 332.3 329.6 Q3 (Austrian parliamentary elections) and new product/ • Letter Mail & Mail-Solutions 585.2 604.3
Slide 26: Parcel & Logistics division: revenue development Q1-3 2019
PARCEL & LOGISTICS DIVISION: REVENUE DEVELOPMENT Q1-3 2019 Revenue development Parcel & Logistics Division: +11.3% (Q3: +18.4%) EUR m – E-commerce trend and cooperation with DHL produce +11.3% a further revenue increase 437.2 392.9 South East/Eastern Europe +8.1% (Q3: +8.6%) 84.9 – Positive revenue
Slide 27: Parcel & Logistics division: income statement
PARCEL & LOGISTICS DIVISION: INCOME STATEMENT EUR m Q1-3 2018 Q1-3 2019 % ∆ Q3 2018 Q3 2019 Revenue 392.9 437.2 11.3% 44.4 130.2 154.2 Revenue growth supported by DHL cooperation and despite • Premium 188.4 239.5 27.2% 51.1 65.1 92.8 own delivery by a large customer in Vienna; trend • Standard 163.5
Slide 28: Change in the balance sheet structure due to IFRS 16
CHANGE IN THE BALANCE SHEET STRUCTURE DUE TO IFRS 16 Balance sheet as at September 30, 2019 EUR m ASSETS 1,975.4 EQUITY & 1,975.4 LIABILITIES Liquid financial IFRS 16: Lease liabilities of 1,681.2 304.7 1,681.2 313.9 resources of EUR 311m Other financial EUR 305m 10.3 Cash/cash equivalents, 147.9 li
Slide 29: Robust cash flow Q1-3 2019
ROBUST CASH FLOW Q1-3 2019 EUR m Operating free cash flow of EUR 153.2m – Financial services compensation of EUR 20.5m for Q1-3 2019 already in the 2018 cash flow – IFRS 16 effect: EUR 26.3m expense in the cash flow from financing activities 228.6 Cash inflow from the real estate development project
Slide 30: Outlook 2019 and 2020
1. Highlights and Overview 2. Strategy Implementation 3. Group Results Q1-3 2019 4. OUTLOOK 2019 AND 2020 INVESTOR PRESENTATION Investor Relations Vienna, 14 November 2019 30
Slide 31: Outlook 2019 and 2020
OUTLOOK 2019 AND 2020 Market environment – In the medium-term, a decline of 5% in the traditional addressed mail business is further expected, especially against the backdrop of new e-Government solutions – Direct mail volumes are more volatile and vulnerable to economic cycles – Ongoing growth expe
Slide 32: Contact
CONTACT Austrian Post Financial calendar 2020 Investor Relations 12 March 2020 Annual Results 2019 Rochusplatz 1, 1030 Vienna 16 April 2020 Annual General Meeting Website: www.post.at/ir 28/30 April 2020 Ex-day/Dividend payment day E-mail: investor@post.at 14 May 2020 Interim Report Q1 2020 Telephon