Slide 1: Q3 2023 Results
Q3 2023 RESULTS TOBIAS MEYER, GROUP CEO MELANIE KREIS, GROUP CFO DHL GROUP INVESTOR RELATIONS November 8th, 2023 1
Slide 2: Agenda
AGENDA Q3 2023 Group Highlights Q3 2023 Financials Strategic Outlook Q3 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 8 NOVEMBER 2023 2 2
Slide 3: Group Highlights
Management comments: Despite the continued weak freight markets, DHL Group is on track to deliver on its FY 2023 EBIT and FCF targets. With expected €3bn FCF (excl. Net M&A), cash generation will hence exceed the 2023 dividend payment (€2.2bn) significantly. This strong cash flow – even in the curre
Slide 4: B2C volumes development
Management comments: B2C volumes continue to show good resilience with e-commerce gaining further share of retail sales. E-commerce volumes remain in growth territory for Parcel Germany and B2C Europe; the yoy comparison in DHL Express has improved from -7% yoy in Q2. We certainly expect e-commerce
Slide 5: B2B volumes development
Management comments: B2B volumes in Express and Global Forwarding remained sequentially about stable in Q3; activity levels have not worsened but there have also been no relevant signs of cyclical recovery and related inventory restocking so far. As in previous economic cycles, Express B2B volumes k
Slide 6: Current / Shorter-term main Group priorities
Management comments: DHL Group has approached the uncertain 2023 circumstances based on different scenarios as laid out in our initial EBIT guidance. This early preparation has allowed us to address the continued weak freight market environment by taking timely and efficient measures on indirect cos
Slide 7: DHL Group: Unique core logistics portfolio
Management comments: Q3 results once again show how our diversified portfolio makes EBIT and cash generation more resilient in economic downturns. While diversified, all our businesses focus on core logistics and hence benefit from common structural trends like e-commerce and new forms of global tra
Slide 8: Highly motivated team amidst challenging circumstances
Management comments: As a global logistics service provider, the engagement of our ~600,000 colleagues is key and we hence aspire to be the “Employer of Choice” for all our colleagues. We measure our employee engagement annually through our well-established Employee Opinion Survey. 2023 results show
Slide 9: Agenda
AGENDA Q3 2023 Group Highlights Q3 2023 Financials Strategic Outlook Q3 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 8 NOVEMBER 2023 9 9
Slide 10: Q3 2023 Group EBIT of €1,372m (-32% yoy)
Management comments: In Q3 2023, the end markets across our divisions have continued to develop largely in line with the L-scenario of our initial 2023 guidance assumptions. While B2C volumes have stayed more resilient, there has been no trend change towards volume recovery in our B2B markets yet. W
Slide 11: Deep-dive: Express
Management comments: Q3 Express TDI shipments/day have developed very similarly to Q2. The volume development has hence stabilized but not worsened; still, Q3 2023 marked the 9th consecutive quarter of yoy TDI shipment/day decline for Express. While we continue to successfully mitigate the operating
Slide 12: Deep-dive: Supply Chain
Management comments: Supply Chain stands out against the overall trend in freight markets, with an 11th quarter of yoy EBIT growth. While not immune to cyclical fluctuations, this shows the resilience of the business model based on long-term contracts. Current growth momentum is mainly driven by the
Slide 13: Group Financial Highlights
Management comments: Group OCF decline mainly reflects the EBIT development, coupled with yoy lower working capital inflow in Global Forwarding, Freight as a result of overall normalization in volume and freight rates and change in provisions. FCF declined less than OCF yoy due to lower net capex an
Slide 14: 2023 guidance confirmed for two remaining macro scenarios
Management comments: We fully confirm our expectation to the sensitivities of the individual macroeconomic scenarios as laid out in our previous guidance updates this year. However, the V-shape scenario can meanwhile be excluded as the actual market development did not show a recovery so far. As of
Slide 15: 2023 guidance confirmed; scenarios aligned to macro environment
Management comments: As the V-shape scenario can now be excluded, we have confirmed FY 2023 guidance for the two remaining scenarios, leading to updated ranges for Group and DHL EBIT. In light of the macro uncertainties and reduced capex in P&P Germany, we expect gross capex spending at the lower en
Slide 16: Agenda
AGENDA Q3 2023 Group Highlights Q3 2023 Financials Strategic Outlook Q3 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 8 NOVEMBER 2023 16 16
Slide 17: Balanced approach to manage market uncertainties
Management comments: In light of the multiple current uncertainties, we are striving to take balanced short-term mitigation actions to not compromise our ability to fully leverage intact structural growth drivers. In that, we are drawing on our strong experience from managing economic cycles. As ref
Slide 18: DHL Group with strong base for Strategy 2030
Management comments: The name change to DHL Group implemented earlier this year punctuates the transformation of the former state-owned German Postal operator into a leading global logistics company. While this is reflected in the strong global footprint of our 5 operating divisions, DHL Group has a
Slide 19: Conclusion
Management comments: The short conclusion along three time horizons: • In the short-term, we are successfully mitigating the challenging economic environment, while generating significant FCF even in current circumstances • We are ready and will benefit from the return of positive operating leverage
Slide 20: DHL Express Hub Tour Invitation
INVITATION DHL EXPRESS HUB TOUR DATE LOCATION NOV BRU Brussels, Belgium 29th 2023 YHM Hamilton/Toronto, Canada SIGN UP VIA IR@DHL.COM FOR INVESTORS ONLY Q3 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 8 NOVEMBER 2023 20 20
Slide 21: Appendix
APPENDIX Q3 2023 RESULTS | DHL GROUP INVESTOR RELATIONS | 8 NOVEMBER 2023 21 21
Slide 22: Global Forwarding, Freight
Global Forwarding, Freight Expected main business trends, in line with industry peers Air Freight Ocean Freight 9 00 826 6 00 1 80 0 Q3 2023 523 711 1 60 0 8 00 -14% yoy 676 5 00 451 -2% yoy 426 -44% -25% 1 40 0 7 00 -38% yoy -37% yoy -24% yoy -20% yoy 4 00 1 20 0 6 00 5 00 1 00 0 Revenue yoy Gross
Slide 23: eCommerce
eCommerce Continued investments in structural long-term e-commerce growth 80,000 service points & 20,000 parcel lockers in Europe Q3 2023 Strategic partnership -1% +3% with Cainiao in Poland Revenue yoy B2C Europe volume yoy Acquisition of MNG 4% Kargo in Turkey closed EBIT Margin Strategic partners
Slide 24: Post & Parcel Germany
Post & Parcel Germany Confirmation of structural trends; regulation limits adequate measures Parcel Germany volumes/working day yoy Q3 2023 8% 7% 2% 1% 0% +7% -4% Parcel volumes/WD* yoy Mail volumes/WD* yoy -15% €115m 5% -20% Costs from new wage EBIT margin agreement Q1 2022 Q2 2022 Q3 2022 Q4 2022
Slide 25: P&L and Cash Flow Summary
P&L and Cash Flow Summary On track to deliver on 2023 guidance with 9M EBIT of €4.7bn and 9M FCF of €2.5bn in €m P&L Highlights Q3 2022 Q3 2023 yoy in % Cash Flow Statement Q3 2022 Q3 2023 yoy Revenue 24,038 19,398 -19.3 EBIT 2,029 1,372 -657 EBIT 2,029 1,372 -32.4 Depreciation/amortization 1,057 1,