Ctt - Correios De Portugal Sa · EURONEXT:CTT
Ctt - Correios De Portugal Sa — CTT - Correios de Portugal — FY2020 Earnings Presentation
38 slides from Ctt - Correios De Portugal Sa's earnings presentation, Mar 16, 2021
Slide 1: FY20 Results Presentation
Ss FY20 Results Presentation ctt Committed to deliver 16 March 2021
Slide 2: Disclaimer
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Disclaimer DISCLAIMER This documenthas been prepared by CTT ~ Correios de Portugal, S.A. (the “Company” or "CTT") exclusively for use during the presentation of the full year 2020 results. As a consequence thereof, this document may not be disclosed or p
Slide 3: Committed to deliver
ctt Committed to deliver
Slide 4: Overview: a year marked by the pandemic impact
CEE RESULTS PRESENTATION | FULL YEAR 2020 Ove 4 A year marked by the pandemic impact on peoples and companies ») 4Q20, with the strongest EBITDA? since 1Q16, delivers on guidance at all levels ) Enabling the digital transformation of the Portuguese companies ) Strong volumes growth in parcels leads
Slide 5: Financial highlights
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe The recovery from the mid-year lows, provoked by the COVID-19 pandemic, accelerated in 4Q20, underpinned also by seasonal factors Financial highlights € million; % change vs. prior year FY19 A1Q20 42Q20 43Q20 44Q20 FY20 va) vu = u > uv a 4 <x ra) E c
Slide 6: Key developments and partnerships
CEE RESULTS PRESENTATION | FULL YEAR 2020 + New brand positioning, to reflect the Company's evolution + Launch of anew store concept with 24h self-service + Installation of new mixed-mail sorting machines, acquired as part of the project to modernize mail operations * Partnership with the Portuguese
Slide 7: Investing in the e-commerce ecosystem in Portugal and Spain
ect RESULTS PRESENTATION | FULL YEAR 2020 ..especially in the Express & Parcels business, where CTT continues to invest, partner and lead in the development of the e-commerce ecosystem in Portugal and in Spain * Partnership with Lidl to install co-hosted parcel lockers. At year end, CTT's PUDO netwo
Slide 8: Stellar year for Express & Parcels
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe Stellar year for Express & Parcels, which is turning into a true growth engine for CTT, as investments in e-commerce infrastructure meet strong demand, spurred by the pandemic Express & Parcels volumes million items; % change vs. prior year BB Portug
Slide 9: Banco CTT reached the profitability milestone
pect RESULTS PRESENTATION | FULL YEAR 2020 Ove » Banco CTT reached the profitability milestone in only the 5" year of its existence, demonstrating the business model's resilience in a year of relevant impairments across the financial sector Banco CTT loans / deposits stock & quarterly production € m
Slide 10: Mail revenues breakdown
CEE RESULTS PRESENTATION | FULL YEAR 2020 € million; % change vs. prior year Mail pressured by reduced activity of large corporate clients, suchas utilities, banks, telecoms and public administration 39.1 (-12.5%) International inbound mail 38.9 (-16.0%) International outbound mail Ove 10 Internatio
Slide 11: Financial Services volumes remained stable
pect RESULTS PRESENTATION | FULL YEAR 2020 Woe 11 Financial Services volumes remained stable, despite the challenging operational environment for high-street retail, benefitting from CTT’s close ties with the population Public debt placements € million; % change vs. prior year 1,355.2 » Public debt
Slide 12: Leading on sustainability
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Leading on sustainability Alignment with the UN Sustainable Development Goals + Carbon Emissions CO, tons (scopes 1+2+3) vs. 2013 base year (CTT science-based target) 2013 2020 (60.5kt) -22.3kt (-26.9%) CTTis committed to reduce absolute emissions by 30%
Slide 13: Committed to deliver
ctt Committed to deliver
Slide 14: Key financial indicators
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Underpinned by seasonal factors, 4Q20 confirmed the recovery trend... Key financial indicators € million; % change vs. prior year Quarter Full year 4919 4920 A% 2019 2020 A% Revenues? 200.7 211.0 5.1% 740.3 745.2 0.7% Operating costs + 1725 178.1 3.3% 63
Slide 15: Revenues and revenue breakdown
ect RESULTS PRESENTATION | FULL YEAR 2020 Woe 1s ..as dynamic performances by the growth levers Express & Parcels and Banco CTT compensate the revenues decline in the legacy businesses Revenues? Revenues? breakdown € million; % change vs. prior year € million; % change vs. prior year; % of total 40.
Slide 16: Operating costs
ft. Cc tt RESULTS PRESENTATION | FULL YEAR 2020 Woe 16 Like-for-like operating costs increased only in Express & Parcels, as aresult of the robust growth in volumes Operating costs+ Operating costs! breakdown € million; % change vs. prior year € million; % change vs. prior year; % of total | Staff 6
Slide 17: EBITDA to EBIT bridge
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 17 The business interruption in Mail during the lockdown and the subsequent slow recovery weighed on profitability, given the unsustainable regulatory & pricing framework EBIT €million EBITDA contribution +15.5 €million 48.9 || == -14 -34.0 Mail & ot
Slide 18: Cash flow and net financial debt
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Woe The net cash position and the net financial debt remained stable FY20 Cash flow 31 December 2020 Net financial debt+ € million; impact on cash flow vs. prior year € million _————— 90.5 (-11.0) (+) Cash & cash equivalents. 518.2 EBITDA Specific items
Slide 19: Committed to deliver
ctt Committed to deliver
Slide 20: Mail volumes decline accelerated in 2020
ect RESULTS PRESENTATION | FULL YEAR 2020 The mail volumes decline accelerated in 2020 due to the pandemic; the trend is expected to improve in 2021 CTT addressed mail volumes evolution Million items; CAGR (%) 2001 Peak yearin mail volumes 2020 2021E 1,355 c.-62% 517 470-480 2001-2011 2012-2014 2015
Slide 21: New concession contract critical for universal postal service
ft CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 21 Anew and improved concession contract will be critical to restore the sustainability of the universal postal service * Itis critical to redefine anew sustainable concession contract in 2021, to restore the pricing lever and improve operational flex
Slide 22: European peers' USO financing and price comparison
pect RESULTS PRESENTATION | FULL YEAR 2020 Woe 22 European reference peers have been financing the USO mostly via price increase or direct public funding (subsidies or SGEl) If CTT would normalize prices with European peers, the implicit price increase would be significantly high Registered Standard
Slide 23: New distribution model in 2021
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 The implementation of anew distribution modelin 2021 is expected to increase productivity and cargo capacity Route with 2 different parts (1 slow/1 fast) 2/3 1/3 of distribution of distribution time time 5 im 5km AllMail & Priority Mail & Parcels Parcels
Slide 24: Positioned across the e-commerce value chain
ft CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 24 CTT is uniquely positioned to provide services across the whole e-commerce value chain... E-commerce offer mm 2 Bog L lad iN (4 Value — ol yy Chain Marketing / P i Advertising Online sales S Recepti Modular E&P offer dott Traditional Partnerships P
Slide 25: E-commerce growth potential in Iberia
RESULTS PRESENTATION | FULL YEAR 2020 ect ..coupled with the potential for e-commerce growth in Iberia, it enables profitability improvements and promotes the turnaround of the Spanish operation Percentage of e-commerce in retail sales 2020; International Post Corporation database data 3.1% (2015) P
Slide 26: Banco CTT key priorities
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 26 Banco CTT aims to continue the strong growth trend, consolidating its profitability and leveraging on digital capabilities Key priorities 32." 8 payshop Reinforce digital Accelerate growth Sustain growth Refund business Convert into value player n
Slide 27: 2021 outlook and dividend proposal
CEE RESULTS PRESENTATION | FULL YEAR 2020 Ove The agent that best combines physical & digital dimensions in supporting companies’ digitalization, with particular emphasis on e-commerce E-commerce parcels, Banco CTT, new postal Financial Services and Business Solutions growth offsetting the mid-to-hi
Slide 28: Committed to deliver
ctt Committed to deliver
Slide 29: Assets, liabilities and equity
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 29 Equity increased by 14.4%, due to Net profit generation and healthcare plan actuarial gains Assets Li s & Equity € million €million Net FS payables of €239m & €236mas of a Dec-19 & Dec-20, €135minowncash Financial Services respectively Cash & cash
Slide 30: Mail results
ect RESULTS PRESENTATION | FULL YEAR 2020 Mail revenues generation and profitability levels significantly impaired by the atypical volumes decline in 2020, higher than expected at the start of the year, due to the pandemic Revenues? EBITDA2 EBIT € million; % change vs. prior year € million; % change
Slide 31: Express & Parcels results
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Strong parcels growth is translating into improved profitability in both Portugal and Spain Revenues EBITDA12 EBIT 2 Consolidated view; € million; % change vs. prior year € million; % change vs. prior year € million #214% +107.3% +131.5% +228.9% 14% +107
Slide 32: Banco CTT results
RESULTS PRESENTATION | FULL YEAR 2020 ect Banco CTT reaches profitability for the first time in its short 5-year history Revenues EBITDA? EBIT € million; % change vs. prior year € million € million; % change vs. prior year 4126.5% -7.8% — +95.5% +330.5% Netinterestincome €17.3m (+35.6%) o 46 Interes
Slide 33: Financial Services & Retail results
ect RESULTS PRESENTATION | FULL YEAR 2020 Woe 33 Financial Services & Retail provides a solid contribution to group profitability, despite the challenging environment for brick-and-mortar retail Revenues? € million; % change vs. prior year Savings & insurance €23.2m +13.9%) Money orders €6.0m (+7.5%
Slide 34: Consolidated income statement
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Consolidated Income statement Income statement Reported With Banco CTT under Emilion equity method 2019 2020 2019 2020 Revenues 740.3 745.2 695.3 679.2 Operating costs 638.8 654.7 593.0 604.5 EBITDA 101.5 90.5 102.3 747 EBITDA including IFRS 16 128.3 118
Slide 35: Consolidated balance sheet
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Consolidated Balance sheet Balance sheet Emilion Reported With Banco CTT under equity method 31-Dec-19 31-Dec-20 31-Dec-19 31-Dec-20 Non-current assets 1,734.7 1,984.3 615.8 638.8 Current assets 778.8 910.6 456.9 484.0 Assets 2,513.4 2,894.9 1,072.8 1,12
Slide 36: Consolidated cash flow statement
ft. CEE RESULTS PRESENTATION | FULL YEAR 2020 Woe 36 Consolidated Cash flow statement Cash flow Reported With Banco CTT under equity method Emilion 2019 2020 420/19 2019 2020 420/19 EBITDA 101.5 90.5 -11.0 102.3 747 -27.6 Specific items affecting EBITDA 16.8 7.0 -9.9 15.3 6.8 -8.6 Capex 45.4 33.4 -1
Slide 37: Specific items
ft. ctt RESULTS PRESENTATION | FULL YEAR 2020 Specific items with reduced impact on the FY20 P&L Specific items € million Reported 2019 2020 EBIT excluding Specific items 65.5 41.5 Specificitems 18.2 7.0 Revenues -0.6 -07 @e— Staff costs 11.9 3.9 @——_ ES&S & other op. costs 7.0 38 e—— EBIT 47.3 34.5
Slide 38: Investor Relations contacts
From aparcel to whatever you want From a parcel to whatever you dream of CTT Correios de Portugal, S.A. Investor Relations ctt Committed to deliver Contacts: Phone: +351 210 471087 E-mail: investors@ctt.pt We connect people and companies From aparcel to whatever you wish for ctt.pt
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