Fourth quarter 2019 results Analyst call Jean-Paul V an Avermaet, CEO Leen Geirnaerdt, CFO 17 March 2020
Investor presentation 4Q19 Interim financial report 4Q19 Financial Calendar Disclaimer 04.05.2020 (17:45 CET) This presentation is based on information published by bpost Group in its Fourth Quarter 2019 Press Release and 2019 Annual Report, made available on March, 17 th 2020 at 5.45pm CET on corporate.bpost.be/investors. This information forms regulated information as defined in the Royal Decree of 14 November 2007. The information in this document Quarterly results 1Q20 may include forward-looking statements 1 , which are based on current expectations and projections of management about future events. By their nature, forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other factors because they relate to events and depend on circumstances that will occur in the future whether or not outside the control of the Company. Such factors may cause 13.05.2020 actual results, performance or developments to differ materially from those expressed or implied by such forward- looking statements. Accordingly, no assurance is given that such forward-looking statements will prove to have been correct. They speak only as at the date of the Presentation and the Company undertakes no obligation to update these Ordinary General Meeting of Shareholders forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. This material is not intended as and does not constitute an offer to sell any securities or a solicitation of any offer to purchase any securities. 18.05.2020 Ex-dividend date 20.05.2020 Payment date More on corporate.bpost.be/investors 1 as defined among others under the U.S. Private Securities Litigation Reform Act of 1995 2 4Q19 Analyst Presentation
Highlights of FY19 FY19 Results in line with guidance T opic Results Last outlook for 2019 Group adjusted € 310.8m Adjusted EBIT EBIT above € 300m 8.1% EBIT margin € 257.4m Adjusted EBIT margin Mail & Retail between 11-13% 12.4% EBIT margin Parcels & € 65.8m Adjusted EBIT margin towards Logistics Eurasia the high end of the 6-8% range 7.9% EBIT margin Parcels & € -3.0m Adjusted EBIT slightly below Logistics N. Am. break-even -0.3% EBIT margin Capex € 162.3m € 150m - € 185m € 0.73 gross per share At least 85% of 2019 BGAAP Dividend net profit of bpost SA/NV (85% pay-out ratio) 3 4Q19 Analyst Presentation
Final gross dividend of € 0.11/share proposed to AGM FY19 to reach a total gross dividend payment of € 0.73/share Based on the communicated dividend policy, taking into account the interim dividend paid and subject to Board and Shareholders’ meeting approval, the Board of Directors proposes a gross final dividend of € 0.73/share. € million FY19 bpost S.A./N.V. FY19 net profits after tax 172.6 Total proposed dividend for 2019 146.0 Payout ratio 85% Interim dividend paid in December 2019 (€, gross per share) 0.62 Proposed final dividend to be paid in May 2020 (€, gross per share) 0.11 Total proposed dividend for 2019 (€, gross per share) 0.73 4 4Q19 Analyst Presentation
Highlights of 4Q19 4Q19 4Q19 fully in line with our expectations Group operating Mail & Retail Parcels & Logistics Parcels & Logistics income Eurasia N. Am. € 1,113.8m € 51.5m € 13.9m € 10.6m 9.6% EBIT margin 5.9% EBIT margin 2.7% EBIT margin • T otal operating income at • T otal operating income at • T otal operating income at € 536.8m (-2.3%) resulting from € 234.4m. Excluding the net € 395.3m (+3.8%), supported domestic mail decrease and YoY impact of contingent by FX, confirms positive deconsolidation of Alvadis considerations reversals, commercial development, growth of +8.8% driven by partly offset by 2018 customer • Underlying mail volume decline Parcels BeNe (+22.4%) churn and repricing impact limited to -5.5% supported by Group adjusted EBIT favourable phasing effect in • Strong organic Parcels BeNe • TCV at $ 385m above FY target transactional and small growth volumes at +24.3% driven by • Adjusted EBIT mainly impacted € 69.2m in advertising mail e-commerce growth and by costs related to new client DynaLogic • Adjusted EBIT impact launches 6.2% EBIT margin (-36.8%) from top-line • Adjusted EBIT excluding the evolution and higher payroll & elements mentioned above and project costs a goodwill impairment in 4Q18 increased by € 6.6m (+115%) driven by business performance 5 4Q19 Analyst Presentation
4Q19 EBIT driven by strong PaLo Eurasia performance 4Q19 offset by 4Q18 positive elements, mail volume decline and higher opex € million 156.9 13.1 -30.0 -1.7 -4.9 -87.7 -51.2 Includes € -16.7m net impact of 69.2 contingent considerations 143.8 5.8 reversals (€ -18.2m on DynaGroup & de Buren in 4Q18 € -32.4m excluding 2 and € +1.5m on Leen Menken in items positively 4Q19) impacting 4Q18: Adjusted 1 (1) € 7.9m gain on sale of 63.4 OBX and (2) € 10.9m Reported IAS19 non-cash gain related to group insurance EBIT Mail & PaLo PaLo Corporate EBIT 4Q18 Retail Eurasia N. America 4Q19 1 Adjusted previously called Normalized, change of terminology “Adjusted” in order to align the label of this APM to the ESMA guidelines, definition and approach remain unchanged. Adjusted excludes items that are non-recurring in nature and significant (> € 20m). All profits or losses on disposal of activities are adjusted whatever the amount they represent, as well as the amortization and impairment on the intangible assets recognized throughout the Purchase Price Allocation (PPA) of the acquisitions. Reversals of provisions whose addition had been excluded from income are also adjusted whatever the amount they represent. 4Q19 Analyst Presentation 6
Key financials 4Q19 4Q19 € million Reported Adjusted 1 1 Amortization of intangibles recognized 4Q18 4Q19 4Q18 4Q19 % ↑ 4Q19 IFRS16 during PPA is adjusted, leading to increase in EBIT (€ 5.8m) and income tax expense (€ +0.7m) Total operating income 1,131.6 1,113.8 1,131.6 1,113.8 -1.6% Operating expenses 925.2 987.4 925.2 987.4 6.7% +28.1 EBITDA 206.4 126.3 206.4 126.3 +28.1 -38.8% Adjusted FCF excludes the cash Radial 2 receives on behalf of its customers for Depreciation & Amortization 62.6 62.9 49.5 57.1 -27.6 performing billing services EBIT 143.8 63.4 156.9 69.2 +0.5 -55.9% 1 1 Margin (%) 12.7% 5.7% 13.9% 6.2% Financial result -8.1 -26.7 -8.1 -26.7 -2.6 Profit before tax 140.5 43.0 153.6 48.8 -68.2% Income tax expense 35.9 1 15.2 38.2 1 16.5 Net profit 104.6 27.8 115.4 32.4 -71.9% FCF 221.8 127.2 186.0 83.8 +25.5 -54.9% 2 2 bpost S.A./N.V. net profit (BGAAP) 78.1 54.4 78.1 54.4 -30.4% Net Debt at 31 December 344.8 779.9 344.8 779.9 +432.3 Capex 48.5 73.2 48.5 73.2 50.9% Average # FTEs and interims 39,496 38,730 39,496 38,730 1 Unaudited figures 4Q19 Analyst Presentation 7
Results by segment 4Q19 4Q19 € million M&R PaLo Eurasia PaLo N. Am. Corp Eliminations Group External operating income 486.8 229.9 392.5 4.6 0.0 1,113.8 Intersegment operating income 50.0 4.5 2.8 105.7 -163.0 0.0 Total operating income 536.8 234.4 395.3 110.3 (163.0) 1,113.8 Operating expenses 466.4 215.9 369.9 98.3 -163.0 987.4 EBITDA 70.4 18.5 25.4 12.0 126.3 Depreciation & Amortization 20.7 5.4 18.1 18.8 62.9 Reported EBIT 49.7 13.2 7.3 -6.8 63.4 Margin (%) 9.3% 5.6% 1.9% -6.2% 5.7% Adjusted EBIT 51.5 13.9 10.6 -6.8 69.2 Margin (%) 9.6% 5.9% 2.7% -6.2% 6.2% 8 4Q19 Analyst Presentation
Mail volume decline and deconsolidation of Alvadis 4Q19 – M&R drove top line decrease M&R external operating income, € million Domestic Mail Transactional Proximity and convenience retail network Operating income decline at € -10.6m i.e. -7.2% underlying volume decline 4Q18 506.0 supported by phasing of 2020 - € -1.1m working day impact (1 day Revenue growth of € +3.5m excluding administrative mailings towards December less in 4Q19 vs. 4Q18) deconsolidation effect of Alvadis since 2019 ahead of the 2020 price increases. September 2019 (€ -10.3m impact on Transactional -4.8 1 - € -3.1m elections held in 4Q18 No change in structural trends: continued 4Q19) driven by Ubiway and bpost retail. - € -17.0m volume e-substitution by big senders and SMEs, (-5.5% underlying volume decline) higher acceptance of e-documents at the -1.5 Advertising receivers’ side and digitization of C2B 2 - € +10.6m price/mix communication through smartphone 1 2 3 1 4 apps. Press -4.2 3 Proximity and Advertising Value added services 4 convenience -6.8 Press retail network +0.5% underlying volume decline Higher revenues from fines management -6.5% underlying volume decline driven by Value added (excluding elections). offset by lower revenue from document e-substitution and rationalization. -1.8 5 services management and phasing out of e-ID First visible effects of marketing & sales activities. project aimed at re-boosting advertising mail. 4Q19 486.8 -19.2 2 3 5 9 4Q19 Analyst Presentation
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