Ctt - Correios De Portugal Sa · EURONEXT:CTT
Ctt - Correios De Portugal Sa — CTT - Correios de Portugal — Q1 2021 Earnings Presentation
34 slides from Ctt - Correios De Portugal Sa's earnings presentation, 2021
Slide 1: 1Q21 Roadshows Presentation
1Q21 Roadshows Presentation wi fe a ha oo »y ctt Committed to deliver
Slide 2: Disclaimer
pect 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 first quarter 2021 results. As a consequence thereof, this document maynot be disclosed or published, nor used by any other perso
Slide 3: fect —
a A, , fect — _ — _— ctt Committed to deliver
Slide 4: CTT is a leading logistics and financial services provider with 4 business units
ft. Ctt —intropuction 4 CTT is aleading logistics and financial services provider with 4 business units... €million Revenues YoY growth (%) Revenues YoY growth (%) & Addressedmail 383.5 -11.9% Portugal 1180 20.2% Unaddressed mail 66 -22.3% ‘ Spain 72.3 39.6% Revenues: 745.2 ; Business 159 54.8% p Ma
Slide 5: Supported by common infrastructure, robust brand and economies of scale
ft. Ctt —intropuction 5 .. supported by common infrastructure, robust brand and enjoying significant economies of scale Strategic Assets Distribution Network iia 5,693 & 4,312 @® 3,511 | 225 Human resources Mailmen & women Operational fleet Delivery offices Retail Network 562 @ 1,804 € 81k —= Human
Slide 6: Mail volumes decline accelerated in 2020 due to the pandemic
pect INTRODUCTION 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 mait volumes 2020 2021E 1,355 c.-62% 517 470-480 2001-2011 2012-2014 2015-2016 2017-2019 2020 202
Slide 7: New concession contract critical to restore universal postal service sustainability
pect INTRODUCTION 7 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 flexibility Mail Universal * For CTT
Slide 8: New distribution model in 2021 to increase productivity and cargo capacity
ft. Ctt —intropuction 8 The implementation of anew distribution modelin 2021 is expected to increase productivity and cargo capacity time time 5 im) Skm All Mail & Priority Mail & Parcels Parcels Route density Skm skm Slow part Fast part Priority Mail & part Parcels 4, & 7km All Mail & Parcels Fast
Slide 9: CTT positioned across the whole e-commerce value chain
pect CTT is uniquely positioned to provide services across the whole e-commerce value chain... INTRODUCTION E-commerce offer iN Value oe ore CA Chain Marketing / . i Advertising Online sales 5 Reception Modular E&P offer d tt Traditional Partnerships Pick-up & Easy return Online and ro) -pt avsho lo
Slide 10: E-commerce growth in Iberia enables profitability improvements
pect INTRODUCTION 10 ..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) PT IT ES FR GR AT NO F
Slide 11: Banco CTT aims to continue strong growth trend
pect INTRODUCTION 1. Banco CTT aims to continue the strong growth trend, consolidating its profitability and leveraging on digital capabilities Key priorities 321" Be payshop Reinforce digital Accelerate growth Sustain growth Refund business Convert into value player nature Increase commercial Conti
Slide 12: Committed to deliver
Committed to deliver P (ov h gai” Ys |
Slide 13: Record quarterly parcels performance boosts group revenues and profits
ft. CEE tq2ticHucHts 7 Record quarterly parcels performance boosts group revenues and profits FS&Rremainsa strong contributorto profitability, despite the challenges for brick & mortar retail due tothe 1Q21 lockdown Resilient mail revenues, as strong mix & pricing effects y in higher-value mail Reco
Slide 14: Significant revenues growth, driven by parcels, leads to profitability expansion
ft. CEE tq2ticHucHts 7 Significant revenues growth, driven by parcels, leads to profitability expansion Express & Parcels Banco CTT Mail & other? Recurring Recurring Recurring Recurring Revenues EBIT Revenues EBIT Revenues EBIT Revenues EBIT €63.4m €2.5m €21.2m €1.4m €108.6m €4.9m €12.1m €6.2m (+70.
Slide 15: A quarter of continued investment and expansion of products and services
ft CEE tq2ticHucHts s A quarter of continued investment and expansion of CTT’s products and services offer A Governmental working group has been createdto carry out an analysis of the Postal Act and of the Universal Service requirements for the new concession contract CTT elected as aTrusted Brandby
Slide 16: Banco CTT long-term partnership with Sonae Financial Services
ft. CEE tq2ticHucHts Banco CTT has established an important long-term partnership with Sonae Financial Services Banco CTT has become the lender for the CartGo Universo credit book AX él il a Cartdo Universo overview: More than 850k clients and market share higher than 13% Close to 1 billion transact
Slide 17: Record performance by Express & Parcels
pect 1921 HIGHLIGHTS v7 Record performance by Express & Parcels, as CTT’s investments in e-commerce infrastructure continue to meet strong demand, also spurred by the lockdown restrictions Express & Parcels volumes million items; % change vs. prior year . ae {Portugal parcels volumes (excl. cargo) +
Slide 18: Banco CTT activity remained resilient
pect 121 HIGHLIGHTS 18 Banco CTT activity remained resilient, despite the lockdown restrictions impact on the points of sale Banco CTT S.A. — business volumes evolution € million except otherwise indicated Mortgage loans Customer deposits & Off-Balance sheet savings 1) customer deposits Off-Balance
Slide 19: Mail highlights
Cht — tq2tHicHucHts € million; % change vs. prior year Ordinary mail pressured byreduced activity of large corporate clients, suchas utilities, banks, telecoms and public administration 10.4 (+15.2%) International inbound mail 10.1 (+3.3%) International outbound mail Letter mail Higher-value mail Ad
Slide 20: Solid performance by Financial Services & Retail
ft. CEE tq2ticHucHts vo Solid performance by Financial Services & Retail, considering the challenging environment for high-street retail, as aresult of the restrictions imposed by the state of emergency Public debt placements € million; % change vs. prior year » Year-on-year decline stems from the f
Slide 21: Financials
ect Financials. | ctt Committed to deliver
Slide 22: Key financial indicators: robust revenues growth and operational leverage
ft. Cit rinanciats The robust revenues growth led to substantial improvement in operational leverage and meaningful increases in all profitability metrics Key financial indicators € million; % change vs. prior year 1Q19 1Q20 1Q21 A%19/21 A% 20/21 Revenues* 176.9 179.9 205.3 16.1% 14.1% Operating cos
Slide 23: Extraordinary performance by Express & Parcels drove revenues expansion
fe cit rnanciats 23 Extraordinary performance by Express & Parcels, benefiting also from the lockdown impacts, drove strong revenues expansion Revenues? Revenues? breakdown € million; % change vs. prior year € million; % change vs. prior year; % of total Mail & other? 108.6 (-1.4%) a 205.3 y -0.9 10
Slide 24: Operating costs increased mostly in parcels
ft. Ct Ananciats oa Operating costs increased mostly in parcels, as a direct result of the substantial growth in volumes Operating costs? Operating costs? breakdown € million; % change vs. prior year € million; % change vs. prior year; % of total +12.9% +19.3 | Staff 89.2 (+1.0%) External Supplies H
Slide 25: EBIT margin increased on operational leverage
ft cit rnanciats 25 EBIT margin increased as a result of the expanding operational leverage in Express & Parcels and Banco CTT Recurring EBIT+ €million 462.2% EBITDA? contribution: +€5.3m +6.9 15.0 FS&R Mail & other? 9.3 Ah BancoCTT Express & Parcels 1Q20RecurringEBIT Mail & other? AExpress & Parcel
Slide 26: Own cash increased by c.€10m in the quarter
ft. Cit rinanciats Own cash increased by c.€10m in the quarter 1Q21 Cashflow € million; impact on cash flow vs. prior year EOITOA |i 29.2 45.3 Non-cash items? 5.0 (-1.5) Specific items impacting EBITDA I 8 (+09) Capex 59 (-0.3) Change in working capital ere (-3.3) Operating cash flow EE 12. (+1.0) T
Slide 27: Key Balance sheet detail
pect Key Balance sheet detail FINANCIALS 31 March 2021 Balance sheet € million; % change vs. 31 Dec 2020 2,967 Fixed tangible Equity assets Other liabilities 363 Other assets | Ey) Employee benefits (1) Employee benefits tax credits Financial debt (ST<) Cash & cash equivalents i i Financial Servic
Slide 28: Express & Parcels: exceptional growth of parcels volumes and revenues
pect FINANCIALS 28 Exceptional growth of parcels volumes and revenues provides a considerable boost to profitability Revenues EBITDA! 2 EBIT2 Consolidated view; € million; % change vs. prior year € million € million » » Portugal €35.1m(+43.8%) 2 § 5.5 4.0 Parcels €30.6m (+61.8%) 2 3 Cargo €2.5m(-9.9
Slide 29: Banco CTT benefits from significant operational leverage
ft. Cit rinanciats 29 Banco CTT is starting to benefit from significant operational leverage, as the fixed-cost infrastructure is largely in place Revenues € million; % change vs. prior year 48.7% Other Fees & commissions income Netinterestincome ..by type: Other Off-Balance sheet savings Cards & ac
Slide 30: Banco CTT cost of risk low while capital and liquidity ample
pect FINANCIALS 30 Banco CTT cost of risk remains low while capital and liquidity are ample 31 March 2021 Banco CTT Balance Sheet (> Non-performing exposures? 40.8 2.9 27.4 Other 2.5 Auto Mortgage Dec-20 Mar-21 Cost of risk 1.0% 0.5% NPEratio 2.5% 3.6% ©) Capitatand liquidity CET1 ie Spry Fully, ° i
Slide 31: Mail profitability impaired by atypical volumes decline
ft. CEE rinanciats 31 Mail profitability continues to be impaired by the atypical volumes decline, exacerbated by the lockdown measures Revenues? EBITDA2 EBIT € million; % change vs. prior year € million € million Transactional €92.5m 62.5%) 8.0% -10.0% 15.4 4.7 3 Advertisi €4.3m (-16.0%) 4. vertisi
Slide 32: Financial Services & Retail comparison impacted by Jan-20 public debt placements
ft. CEE rinanciats 32 Financial Services & Retail comparison impacted by the Jan-20 public debt placements and the lockdown effects Revenues EBITDAt EBIT € million; % change vs. prior year € million € million -15.6% -14.8% 7.3 7.2 Savings & insurance €6.8m (-21.8%) 6.2 6.2 Money orders €1.5m (-2.6%)
Slide 33: Continued acceleration of digital initiatives; FY21 EBIT outlook
é.ctt FINANCIALS Continued acceleration of the digital initiatives will further strengthen our competitive position ( The COVID-19-related uncertainty is gradually fading away Given the above-mentioned dynamics, CTT now expects ' toachieve around €60m in EBIT in FY21 33
Slide 34: CTT Investor Relations contacts
CTT Correios de Portugal, S.A. Investor Relations Contacts: Phone: +351 210 471 087 E-mail: investors@ctt.pt ctt.pt oe wi Gt Mle oy Froma parcel to whatever you want Froma parcel to whatever you wish for Froma parcel to whatever you dream of We connect people and companies
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