ANNUAL REPORT 2010 I 01 THE GROUP Group Group / Target-Performance Structure Comparison Deutsche Post DHL is the world’s leading mail and logistics services group. The Deutsche Post and dhl corporate brands offer a one-of-a-kind portfolio of logis- tics (dhl) and communications (Deutsche Post) services. The Group provides its customers with both easy-to-use standardised products as well as innovative and tailored solutions ranging from dialogue marketing to industrial supply chains. About 470,000 employees in more than 220 countries and territories form a global network focused on service, quality and sustainability. With programmes in the areas of climate protection, disaster relief and education, the Group is committed to social responsibility. The postal service for Germany. The logistics company for the world. dp-dhl.com 01.1 Selected key fi gures (continuing operations) 2009 2010 + / – % Q 4 2009 Q 4 2010 + / – % Profi t from operating activities (ebit) before non-recurring items € m 1,473 2,205 49.7 526 593 12.7 Non-recurring items € m 1,242 370 –70.2 662 68 –89.7 Profi t / loss from operating activities (ebit) € m 231 1,835 > 100 –136 525 – Revenue € m 46,201 51,481 11.4 12,389 13,871 12.0 Return on sales1) % 0.5 3.6 – –1.1 3.8 – Consolidated net profi t / loss 2) € m 644 2,541 > 100 –283 487 – Operating cash fl ow € m 1,244 1,927 54.9 974 1,025 5.2 Net liquidity (–) / net debt (+) 3) € m –1,690 –1,382 –18.2 – – – Return on equity before taxes % 3.0 29.8 – – – Earnings per share4) € 0.53 2.10 > 100 – 0.24 0.40 – Dividend per share € 0.60 0.655) 8.3 – – – Number of employees6) 436,651 421,274 –3.5 – – – 1) ebit / revenue. 2) Excluding non-controlling interests, including Postbank. 3) For the calculation please refer to page 49 of the Group Management Report. 4) Including Postbank. 5) Proposal. 6) Average fte s. Cross-references Websites MAIL EXPRESS GLOBAL FORWARDING, FREIGHT SUPPLY CHAIN BEING YOUR CHOICE Our Strategy 2015 has gained a foothold and we are on course to becoming the provider, investment and employer of choice. In all of our divisions, we offer customers services that make their lives easier and have lasting value. Investors can rely on our transparency, improved profi tability and organic growth and our employees receive attractive career development opportunities, a safe and healthy working environment and an inspiring exchange of ideas. We strive to be your choice on all counts. Provider of choice Investment of choice Employer of choice WWW.DP-DHL.COM/EN/INVESTORS.HTML II 02 GROUP STRUCTURE Corporate Center Finance, Board department Chief Executive Offi cer Global Business Services Personnel Board member Dr Frank Appel Lawrence Rosen Walter Scheurle Functions Corporate Offi ce Corporate Controlling hr Standards Germany Corporate Legal Corporate Accounting and hr Guidelines Personnel Corporate Executives Reporting and Labour Management Corporate Communications Investor Relations hr mail Corporate Development Corporate Finance Corporate Regulation Corporate Internal Audit / Management Security Corporate First Choice Taxes Corporate Public Policy Global Business Services and Responsibility (Group-wide services: Procurement, Real Estate, Global Customer Solutions Finance Operations etc.) (gcs) hr dhl International dhl Solutions & Innovations (dsi) Divisions global forwarding, Board department mail express freight supply chain Board member Jürgen Gerdes Ken Allen Hermann Ude Bruce Edwards Brand Deutsche Post dhl dhl dhl dhl Business units / regions Mail Commu- Global Mail Europe Global Forwarding Supply Chain nication Parcel Americas Freight Williams Lea Dialogue Germany Asia Pacifi c Marketing eemea Press Services (Eastern Europe, Value-Added the Middle East Services and Africa) Retail Outlets Pension Service III 03 TARGET-PERFORMANCE COMPARISON 2010 2011 Group / Target-Performance Structure Comparison GOALS RESULTS GOALS ebit before non-recurring items1) ebit before non-recurring items ebit Group: € 2.0 billion to € 2.1 billion. Group: € 2.2 billion. Group: € 2.2 billion to € 2.4 billion. mail division: € 1.1 billion mail division: € 1.15 billion. mail division: € 1.0 billion to € 1.2 billion. to € 1.1 billion. dhl divisions: over € 1.3 billion. dhl divisions: € 1.45 billion. dhl divisions: € 1.6 billion to € 1.7 billion. Corporate Center / Other: Corporate Center / Other: Corporate Center / Other: approximately €– 0.4 billion. approximately €– 0.4 billion. approximately € – 0.4 billion. Consolidated net profi t Consolidated net profi t Consolidated net profi t Improved net profit excluding Net profi t excluding non-controlling Continue to improve net profit non-controlling interests compared interests: € 2.54 billion. before effects from the measure- with the previous year (€ 644 million). ment of the Postbank instruments, in line with operating business. Capital expenditure (capex) Capital expenditure (capex) Capital expenditure (capex) Increase investments from € 1.17 billion Invested: € 1.26 billion. Increase to no more than € 1.6 billion. (2009) to no more than € 1.3 billion. Restructuring Restructuring Revenue Cash outfl ow due to measures im- Cash outfl ow due to measures Revenue, particularly that of the dhl plemented in 2009 of approximately implemented in the previous year: divisions, to increase by our expected € 1 billion. € 0.8 billion. mid-term growth rate of approxi- mately 7 % to 9 %. 1) Forecast increased over the course of the year. CONTENTS A GROUP MANAGEMENT REPORT 19 B CORPORATE GOVERNANCE 111 CONSOLIDATED FINANCIAL C STATEMENTS 137 D FURTHER INFORMATION 229 Detailed table of contents CONTENTS The Group I Group Structure II Target-Performance Comparison III Being your Choice 2 Letter to our Shareholders 15 A GROUP MANAGEMENT REPORT 19 Business and Environment 21 Deutsche Post Shares 34 Economic Position 37 Divisions 50 Non-Financial Performance Indicators 70 Further Developments 87 Outlook 88 B CORPORATE GOVERNANCE 111 Report of the Supervisory Board 113 Supervisory Board 117 Board of Management 118 Mandates held by the Board of Management 122 Mandates held by the Supervisory Board 123 Corporate Governance Report 124 CONSOLIDATED FINANCIAL C STATEMENTS 137 Income Statement 139 Statement of Comprehensive Income 140 Balance Sheet 141 Cash Flow Statement 142 Statement of Changes in Equity 143 Notes to the Consolidated Financial Statements of Deutsche Post ag 144 D FURTHER INFORMATION 229 Index 231 Glossary 232 Graphs and Tables 233 Contacts 234 Multi-Year Review IV Events VI Mail communication,communication, the the future future reshaped reshaped p. p. 4 Logistics solutionssolutions that that transcend transcend borders borders p.p. 6 Reliability thatthat creates creates value value p. 8 Development thatthat unlocksunlocks potentialpotential p.p. 10 The company of my choice 5 Provider of choice MAIL COMMUNICATION, THE FUTURE RESHAPED The 66 million mail items delivered each working day in Germany make Deutsche Post the largest postal company in Europe. Every day, we win over customers with reliable quality, a formidable network, decades of experience and proximity. Innovative products round off our portfolio. The e-Postbrief product, which we launched successfully in 2010 in Germany, is one of these innovations. The e-Postbrief brings secure, confidential and reliable communication to the internet. Being your choice because of: Security Trust Reliability Provided your mobile phone has Quick Recognition software, you can photograph this code to directly access further information on our website. WWW.DP-DHL.COM/EN/MEDIA_RELATIONS/EVENTS/ INFORMATION: FURTHER PRESS_CONFERENCE_E-POSTBRIEF_LAUNCH.HTML Your choice – a case study MY CHOICE, FOR GOOD REASON. The situation: A consumer wishes to accept an offer from her insurance company and purchase house- hold insurance. Our solution: She sends an e-Postbrief online to the insurance company. The benefit: By using e-Postbrief, the insurance company can be absolutely certain of the customer’s identity. Both parties save time and benefit from simplified handling processes. Even consumers use the e-Postbrief product to send documents quickly, securely, confidentially and reliably. 5 6 7 Provider of choice LOGISTICS SOLUTIONS THAT TRANSCEND BORDERS As the world’s leading logistics company, dhl streamlines complex processes, making our customers’ lives easier. We’re the world’s largest provider of air freight and the number two in ocean freight and we work to ensure that all kinds of shipments are transported from the factory to the shop fl oor by air or sea. In the freight forwarding business, we develop customised transport solutions, provide capac- ity and co-ordinate the transport of goods and information for our customers in more than 150 countries. All this requires a global network, a dedicated workforce and innovative transport solutions. Being your choice because of: Customer proximity Dedication Innovation Provided your mobile phone has Quick Recognition software, you can photograph this code to directly access further information on our website. WWW.DHL.COM/EN.HTML INFORMATION: FURTHER 6 Your choice – a case study MY CHOICE, FOR GOOD REASON. The situation: A European retail chain wants to import elec- tronic parts from Asia. It needs transit times shorter than what ocean freight can deliver but wants to avoid high air freight costs. The solution: A multimodal solution that combines ocean and air freight is developed using dhl seair, which offers lower transport costs with faster transit times. The benefit: Importers gain a considerable competitive edge with this reliable and cost-effective solution and reduce co2 emissions compared with pure air transport. Business customers fi nd personal dedication and tailored logistics solutions at dhl that are all-around satisfying. 7 8 9 Investment of choice RELIABILITY THAT CREATES VALUE Deutsche Post DHL is striving to be an attrac- tive investment and therefore to become the industry’s profitability leader. With this in mind, we took extensive action to increase our efficiency over the past few years. We are now setting our sights on organic growth in revenue and earnings.