Ctt - Correios De Portugal Sa · EURONEXT:CTT
Ctt - Correios De Portugal Sa — CTT – Correios de Portugal — FY2014 Earnings Presentation
27 slides from Ctt - Correios De Portugal Sa's earnings presentation, Mar 4, 2015
Slide 1: CTT – Correios de Portugal Full Year 2014 Results Presentation
CTT – Correios de Portugal Full Year 2014 Results Presentation “Delivering on the Promise” 4 March 2015
Slide 2: Disclaimer
Disclaimer DISCLAIMER This document has been prepared by CTT – Correios de Portugal, S.A. (the “Company” or “CTT”) exclusively for use during the presentation of the full year 2014 financial results. As a consequence thereof, this document may not be disclosed or published, nor used by any other per
Slide 3: Agenda
Agenda I 2014 highlights II Delivering on the promise III 2014 financial performance IV Strategic update and outlook V Appendix 3
Slide 4: 2014 highlights: Chairman & CEO's highlights of the year
2014 highlights Chairman & CEO’s highlights of the year Strong growth of EBITDA and Net profit Growth of revenues (for the first time in 6 years) and strict cost control Significant increase in the amount of proposed dividend together with reintroduction of variable pay for employees Success
Slide 5: CTT closes an eventful 2014, year of transition to full private ownership
2014 highlights CTT closes an eventful 2014, year of transition to full private ownership… 3 Mar 2015 €9.63 27 Mar: 4 Nov: 2.6% average price The Board approves the increase of the launch of the Postal Bank basket of USO services 22 May: 5 Sep: €0.40 / share Portuguese State dividend paid se
Slide 6: Reporting a strong set of results, delivering on the promise from the IPO
2014 highlights …reporting a strong set of results, delivering on the promise from the IPO Outlook Delivered 1 No Government involvement in management, company managed for all shareholders Successful conclusion of the full privatisation, resulting in a 100% free float company 2 1H14: goal of stabl
Slide 7: Successful conclusion of the full privatisation welcomed by the market
Delivering on the promise 1 Successful conclusion of the full privatisation welcomed by the market Shareholder structure CTT share price performance vs. PSI 20 Based on regulatory filings, as at 3 March 2015 Rebased at 100, as at 5 December 2013 1 # shares % capital 190 Sale of State Standard Life I
Slide 8: Reported revenues grow by 2.0%, after consecutive years of decline
Delivering on the promise 2 Reported revenues grow by 2.0%, after 5 consecutive years of decline 2014 reported revenues Revenues breakdown € million, % change vs. prior year, % of total reported revenues € million +2.0% Financial Services 10% +2.4% +13.0 +1.0 718.8 €74.9m (+23.1%) Express & Parcels
Slide 9: Transformation programme initiatives with substantial net positive impacts on costs
Delivering on the promise 3 Transformation programme initiatives with substantial net positive impacts on costs 2014 reported operating costs 1 Operating costs 1 breakdown € million, % change vs. prior year € million Other -10.2% €27.4m (-0.5%) 582.7 -3.1 -60.3 ES&S €237.7m (-1.8%) +4.5 -1.0 €523.1m
Slide 10: Significant non-recurring impacts on operating costs, affecting EBITDA
Delivering on the promise 3 Significant non-recurring impacts on operating costs, affecting EBITDA Non-recurring items impacting EBITDA € million Impact on Staff costs Impact on ES&S costs Reported revenues 718.8 Non-recurring -1.0 €1.0m non-recurring revenues in FS revenues Recurring revenues 717
Slide 11: Delivering profitability – like-for-like recurring EBITDA grows at double-digit rate
Delivering on the promise 4 Delivering profitability – like-for-like recurring EBITDA grows at double-digit rate 2014 recurring EBITDA 1 Recurring EBITDA 1 breakdown € million, % change vs. prior year, % of total recurring EBITDA 1 € million +9.9% Financial Services +13.0 -3.8 €37.4m (+36.4%) +10.9%
Slide 12: Business units performance
Delivering on the promise 4 Business units performance A Mail B Express & Parcels C Financial Services Addressed mail volumes decline slows Double-digit volumes growth in Portugal Savings & insurance placements more down to -5.7% (vs. -7.3% in 2013) (driven by B2C), albeit mitigated by a than
Slide 13: Preserving value and increasing profitability in the Mail business
Delivering on the promise 4A Preserving value and increasing profitability in the Mail business 2014 revenues by type Recurring EBITDA 1 € million, % change vs. prior year € million +5.5% USO Parcels Other €7.2m (-3.3%) €67.0m (-0.7%) 91.7 Bus. Solutions 86.9 €12.2m (-26.7%) -10.4% Editorial 25.8 23
Slide 14: E&P performance impacted by the ongoing restructuring process in Spain
Delivering on the promise 4B E&P performance impacted by the ongoing restructuring process in Spain 2014 revenues by region Recurring EBITDA 2 € million, % change vs. prior year € million Mozambique -30.2% €1.7m (+10.7%) 8.7 6.0 €129.0m -36.4% (-0.4%) 2.5 6.7% 1.6 7.2% 4.7% 4.5% Spain Portugal & oth
Slide 15: FS is a strong engine for growth, driven by a diversified portfolio of services
Delivering on the promise 4C FS is a strong engine for growth, driven by a diversified portfolio of services 2014 recurring revenues by type Recurring EBITDA 2 € million, % change vs. prior year € million +36.4% Other 1 37.4 €3.0m (-16.0%) Transfers €11.5m (-6.4%) 27.4 €73.9m (+21.4%) +15.5% 7.5 8.7
Slide 16: Significant Balance Sheet optimisation and streamlining measures implemented
Delivering on the promise 5 Significant Balance Sheet optimisation and streamlining measures implemented Equity Balance Sheet optimisation measures: € million Healthcare Benefits Plan: o +€83.0m non-recurring gain from the reduction of the responsibilities 2013 Equity 275.9 o -€23.4m corresponding
Slide 17: Operating free cash flow doubles, supporting high growth of dividend
Delivering on the promise 6 Operating free cash flow 1 doubles, supporting high growth of dividend Cash flow Dividend € million € million Reported Adjusted 1 Payout 140% 98% 90% 2013 2014 ∆% 2013 2014 ∆% 16.25% From operating activities 109.4 178.7 63% 50.5 101.1 100% 20.0% 69.75 From investing acti
Slide 18: Financial performance surpasses the outlook, already upgraded along the year
2014 financial performance Financial performance surpasses the outlook, already upgraded along the year Selected key financials Reported Recurring 1 € million 2013 2014 ∆% 2013 2014 ∆% • Goal of stable (+/-1% growth) Revenues 704.8 718.8 2.0% 704.8 717.8 1.8% revenues exceeded Operating costs 582.7
Slide 19: The Balance Sheet maintains solid net cash and liquidity position
2014 financial performance The Balance Sheet maintains solid net cash and liquidity position Balance Sheet € million Assets Liabilities & Equity 1,181 1,181 1,100 1,100 +28% 398 Financial Services payables 310 Δ Suppliers +€9m Cash & cash equivalents 545 +22% 665 Δ Others +€31m (taxes, staff) 15
Slide 20: Capture the future of communication leveraging on our competitive skills and advantages
Strategic update and outlook Capture the future of communication leveraging on our competitive skills and advantages Physical and digital convergence E-commerce growth CTT as a One-stop-shop Focus on the preservation of the Launch of the POSTAL III. Lançamento do Banco BANK Postal Capture the growth
Slide 21: 2015 outlook – launching the Postal Bank
Strategic update and outlook 2015 outlook – launching the Postal Bank Goal of growth in revenues, supported by MoU with Altice Revenues & o Structural decline in addressed mail volumes to slow down Volumes o Double-digit volumes growth in Express & Parcels (Portugal), driven by B2C Like-for-like
Slide 22: Appendix
y ae j Pa wy, cee eae,” 2014: Promise Delivered ee Appendix
Slide 23: Strong governance model and practices implemented
Appendix Strong governance model and practices implemented Board diversity 5 executive directors and 6 independent non-executive directors (majority) Lead independent director Vice-Chairman with a leadership role in relation to the non-executive directors 1 Audit Committee 3 non-executive independen
Slide 24: Transformation Programme with significant net positive impact on costs
Appendix Transformation Programme with significant net positive impact on costs Impacts on EBITDA & EBIT Impact on EBITDA & EBIT € million Impact only on EBIT Reported EBITDA 195.6 Non-recurring revenues -1.0 Reintroduction of variable compensation, based on performance – variable pay for Performa
Slide 25: Several impacts on corporate tax
Appendix Several impacts on corporate tax Corporate tax € million Current Tax (recurring) 2013 22.1 income tax 2013 deferred taxes -0.7 2013: & other Taxable profit increased circa €12m in 2014 vs. 2013 €21.5m Increase in Main differences between 2014 reported EBT and taxable profit include: +3.
Slide 26: Postal Bank project under development aligned with expected timeline
Appendix Postal Bank project under development aligned with expected timeline Key milestones 5 Aug. 2013 Submission of the Postal Bank project to the Bank of Portugal (BoP) 27 Nov. 2013 Conditional authorisation on Postal Bank Key takeaways: granted by BoP ▪ Project in line with expected timeline, 4
Slide 27: CTT - Correios de Portugal Contacts
ea CTT - Correios de Portugal 7) 4 _ 4 March 201! P y. \ 4 ctt Contacts: Phone: +351 210 471 857 E-mail: investors@ctt.pt
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