DHL Express (Page 29), DHL Global Forwarding, Freight (Page 35), DHL Supply Chain (Page 41), DHL Ecommerce Solutions (Page 48), P&P Germany (Page 54)
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Q2 2021 INVESTOR PRESENTATION INVESTOR RELATIONS AUGUST 2021 DEUTSCHE POST DHL GROUP INVESTOR RELATIONS | AUGUST 2021 Content DPDHL Group Highlights Page 3 Strategy 2025 Page 19 Divisional Deep-Dives DHL Express (page 29), DHL Global Forwarding, Freight (page 35), DHL Supply Chain (page 41), DHL eCommerce Solutions (page 48), P&P Germany (page 54) Financial Backup Page 60 INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 2 Content DPDHL Group Highlights Page 3 Strategy 2025 Page 19 Divisional Deep-Dives DHL Express (page 29), DHL Global Forwarding, Freight (page 35), DHL Supply Chain (page 41), DHL eCommerce Solutions (page 48), P&P Germany (page 54) Financial Backup Page 60 INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 3 CONNECTING PEOPLE. IMPROVING LIVES. THE GLOBAL LOGISTICS POWERHOUSE – SERVING B2C/B2B TRADE IN 220+ COUNTRIES CONSISTENT & SUSTAINABLE STRATEGIC FOCUS LEADER IN DIGITALIZING GLOBAL E-COMMERCE LOGISTICS SUPPLY CHAINS ATTRACTIVE & RELIABLE DIVIDENDPOLICY INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 4 GROUP REVENUE, Q2 2021 €19,473m yoy: +€3,536m (+22.2%) +1,435 +1,096 +31.8% +582 Divisional +26.5% +272 +286 revenue +21.3% growth yoy +23.4% +7.4% in €m DHL Express DHL Global DHL Supply Chain DHL eCommerce P&P Germany Forwarding, Freight Solutions Organic Growth Group: +24.6% +35.6% +29.3% +23.4% +27.1% +7.3% INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 5 GROUP EBIT, Q2 2021 €2,083m yoy: +€1,171m (+128%) in €m DHL Global DHL eCommerce Group Functions / DHL Express Forwarding, Freight DHL Supply Chain Solutions P&P Germany Consolidation 1,177 312 198 116 315 -35 +108% +64% +500% +>1,000% +19% +75% Q2 2020: €565m Q2 2020: €190m Q2 2020: €33m Q2 2020: €1m Q2 2020: €264m Q2 2020: €-141m Significant EBIT growth Continued high parcel Q2 2021 includes Record EBIT/GP vs Q2 2020 driven by Balanced growth in B2B Continued high B2C volumes; Mail volume €44m positive effect, conversion of 34% in DGF B2B recovery, expansion and B2C volumes with volumes delivered recovery mainly driven by mainly related to the driven by increasing of e-fulfilment activities consistent yield alongside strong cost and DM products. Ongoing group’s minority stake in volumes, tight markets as and improved efficiency. management continues yield management. Q2 focus on efficient cost Global-e. well as ramp-up of EBIT margin of 6%, to drive high network margin at 8%. structures and network internal process recovering beyond pre- 2020 included €-7m utilization and 20% EBIT utilization while improvement. EBIT COVID-19 levels. 2020 included €-30m asset impairments and margin. asset impairments. continuing to build out €-90m StreetScooter margin up to 6%. 2020 included €-62m parcel infrastructure. refocusing asset impairments. INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 6 B2B recovery continuing across full DHL logistics spectrum DHL Express TDI B2B Shipments/Day growth yoy DGF Air Freight volume growth yoy 36% >25% Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 DSC Organic revenue growth yoy DGF Ocean Freight volume growth yoy 23% 21% Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 7 E-commerce volumes still above high 2020 base levels in Parcel Germany Volume Parcel Germany, per month (2019-2021) 200 2021 2020 2019 +13% 150 Parcel Germany Q2 Volume Growth, yoy 100 50 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 8 B2C activities remain on sustained high levels in DeCS portfolio Parcel volumes by country, DHL eCommerce Solutions 2019 Data points indexed to Jan 2019 (=100) 2020 Netherlands UK Parcel 2021 200 200 100 100 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Eastern Europe United States 200 200 100 100 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 9 DHL Express: Balanced B2B-B2C growth drives high & efficient network utilization DHL Express TDI Shipments/Day, per month (2019-2021) 200 2021 2020 2019 +20% 150 DHL Express Q2 TDI Shipments/Day Growth, yoy Broadly diversified TDI growth in all regions with double-digit 100 growth in both B2B (>25%) and B2C (>10%). 50 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 10 2021 base assumptions confirmed . Expect B2C growth normalizing in course of 2021 from elevated levels . Continued and gradual B2B recovery globally B2C growth showing expected normalization Divisional activity levels, yoy change by quarter B2B recovery continued Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 11 Our approach to H2 & beyond Priority on sustainable, profitable growth, not short-term maximization Basic volume trend assumptions confirmed; uncertainty on timing/shape of growth normalization in H2, especially on B2C . B2C growth normalization: Short-term consumer behavior linked to numerous factors . B2C volume development so far shows similar trend but different read market by market . B2B recovery expected to continue Our guiding principle: Ensure and maintain high service levels . Be prepared for another strong peak season with strong focus on quality, with usual implied cost build-up . Beyond short-term uncertainty, best capabilities and service levels are key success factors Guidance implications: Conservative for 2021, confident towards 2023 . Actual volume outcome in H2 remains to be seen – volume shortfall risk considered in 2021 guidance . Strong belief in long-term elevated e-commerce levels: short-term trajectory unknown, but expect growth out to 2023 INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 12 Cost inflation constantly addressed through yield & contract management DHL Express DGFF DSC DeCS P&P Germany Inflation based pricing: Freight rate Transportation costs Transport provided development is inherent based on management Regular general price €24bn to gross profit fee and partly open- increase (GPI) Regular general price management (38% of total) book contracts increase (GPI), based on Regular general price Note: Union agreement bottom-up local market increase (GPI), based on extended until situation, incl. inflation; bottom-up local market 1.1.2023, providing full Emergency Situation situation, incl. inflation visibility on wage Staff costs Surcharge (ESS) Inflation-linked pricing increase: 3.0% (1.1.21) Offset by improvements and labour and 2.0% (1.1.22) €22bn in labour productivity (35% of total) optimization Opportunistic fuel Fuel costs Fuel price fluctuations Fuel surcharges / pass- Reflected in local cost & hedging, many districts Fuel surcharge are reflected in freight through as part of €1.7bn yield management served by foot / bike / rate movements customer contracts (3% of total) trike delivery INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 13 2021 and 2023 guidance in € bn EBIT 2021 Guidance Mid-term Guidance Group >7.0 (from >6.7) 2023 Group EBIT >7.4 (from >7) Free Cash Flow DHL 5.7-5.8 (from >5.4) ~9 2021-2023 cumulative P&P Germany 1.7-1.8 (from ~1.7) Gross Capex (excl. leases) ~11 Group Functions ~-0.4 2021-2023 cumulative Free Cash Flow >3.2 (from >3.0) Gross Capex ~3.9 (from ~3.8) (excl. leases) Tax Rate ~28% (from 26-28%) Base assumptions: Note: . B2C growth normalizing in the course of 2021 . 2021 guidance includes extraordinary effect of ~€-0.2bn for . Continued and gradual B2B recovery globally one-time covid bonus INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 14 Strong balance sheet and liquidity position LIQUIDITY 1.5x No financial covenants on bonds and syndicated credit facility Net Debt / EBITDA (Dec 31st, 2020) €4.5bn Maturity Profile, Senior Bonds Cash & cash Average time to maturity 5.8 years equivalents 2021 maturity of €750m senior bond was redeemed in Q1 2021. (Dec 31st, 2020) €m Leases 10,459 €2.0bn Syndicated credit Related to multi- year commitment facility runs until 2025 on operating (undrawn) assets 8,677 ~€1.2bn 0 500 500 700 1,250 500 750 750 750 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2,469 Bilateral uncommitted 2021 in €m credit lines (undrawn) Net Debt EBITDA INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 15 Sustainable improvement in cash generation puts us in position to balance growth investments and shareholder returns New . Long-standing Finance Policy 2021/22 provides definition of excess liquidity SBB In m€ and clear principles on its usage FCF 2016/17 . Strong 2020 FCF led to significant 2,535 Dividend payment Share excess liquidity generation in 2020 Buyback . In line with Finance Policy principles, new Share Buyback program announced on March 8th: 1,422 . Size: up to €1bn . Schedule: 12 months . Start: May 2021 FY 20 First period of excess liquidity excess . Current status: liquidity https://www.dpdhl.com/en/investors/s hares/share-buy-backs.html 2010 2011 2012 2013 2014* 2015 2016* 2017* 2018 2019 2020 *2014: Adjusted for voluntary pension funding (€2bn) and non-recurring items; Adjusted for voluntary pension funding (2016: €1bn, 2017: €0.5bn) INVESTOR PRESENTATION | DEUTSCHE POST DHL GROUP | AUGUST 2021 16 Shareholder return based on strong operating performance – Executing on our Finance Policy Dividend per share (2010-2020) FINANCE POLICY 1.35 € . Target / maintain rating BBB 1.15 € 1.15 € 1.15 € . Dividend payout ratio to remain between 40–60% 1.05 € of net profit (continuity and Cash Flow performance 0.85 € 0.85 € considered) 0.80 € 0.70 € 0.70 € 0.65 € FY20 dividend proposal: €1.35; 49% pay-out 60% .