I nvestor presentation First quarter 2 0 1 8 May - June 2 0 1 8
I nvestor presentation first quarter 2 0 1 8 Contents Financial Calendar bpost at a glance Relationship with State – 34 More on corporate.bpost.be/ investors Management – 35 Highlights 1Q18 – 4 2 1 .0 6 .2 0 1 8 Outlook 2018 – 5 More detail on 1 Q1 8 Overview – 6 Capital Markets Day (Brussels) EBITDA bridge – 37 Products – 7 Key financials – 38 Strategy – 8 0 8 .0 8 .2 0 1 8 Revenues – 39 Domestic Mail: volume & revenue – 9 Domestic Mail – 40 ( 1 7 :4 5 CET) Domestic Mail: regulation – 10 Parcels – 41 Quarterly results 2Q18 Domestic Parcels – 11 Additional sources of revenues – 42 International Parcels – 12 & 13 Costs – 43 0 7 .1 1 .2 0 1 8 Additional sources of revenues – 14 Cash flow – 44 M&A strategy – 15 ( 1 7 :4 5 CET) Radial – 16-21 Additional I nfo Quarterly results 3Q18 DynaGroup – 22 European mail market – 46 Ubiway – 23 0 3 .1 2 .2 0 1 8 Key contacts – 47 Transformation – 24 ( 1 7 :4 5 CET) Vision 2020 – 25 & 26 Interim dividend 2018 announcement Productivity – 27 Hybrid network – 28 1 0 .1 2 .2 0 1 8 Stakeholders – 29 CSR strategy – 30 Payment date of the interim dividend Dividend policy – 31 Summary of key financials FY17 – 32 Balance sheet – 33 Disclaim er This presentation is based on information published by bpost in its First Quarter 2018 Interim Financial Report, made available on May, 2 nd 2018 at 5.45pm CET, and in its 2017 Annual Report both available 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 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 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 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. 1 as defined among others under the U.S. Private Securities Litigation Reform Act of 1995 2
bpost at a glance
bpost at a glance Highlights of 1 Q1 8 Revenues up 2 7 .0 % € 9 1 6 .2 m • Driven by acquisitions and continued strong parcels growth, partly offset by declining Domestic Mail revenues Underlying Dom estic Mail evolution -6 .6 % • -6.6% vs. the best quarter of 2017 at -4.7% • Transactional Mail at -6.7% improved vs. FY17 at -8.1% • Advertising Mail impacted by phasing towards 2Q18 and one-off campaigns last year Outstanding parcels perform ance + 2 8 .3 % • Domestic: continued double-digit volume growth driven by thriving e-commerce and C2C; price/ mix effect of -6.1% fully mix related • Logistic Solutions: mainly driven by Radial acquisition (€ + 193.4m) + € 1 9 8 .0 m Organic costs im pacted by higher parcels volum es, w age drift & absenteeism + € 2 3 1 .5 m • Opex influenced by acquisitions (€ + 212.5m) • Organic cost increase mainly in payroll & interim, transport, rent & project related costs € 1 4 0 .2 m EBI TDA below last year, in line w ith guidance BGAAP net profit of bpost SA/ NV € 7 2 .3 m 2 0 1 8 outlook: norm alized EBI TDA at the low end of the range due to m ail volum e decline, absenteeism and productivity in parcel sorting; dividend at least € 1 .3 1 4
bpost at a glance Outlook for 2 0 1 8 1 Norm alized EBI TDA at the low end of the € 5 6 0 to 6 0 0 m range Dividend paym ent at least at the sam e level as 2 0 1 7 Revenues Operating expenses Increase driven by: Increase driven by: • Growth in dom estic parcels: volume double • Increase in transport cost (reflecting growth in digit, price/ mix effect between -3% and -6% International Parcels & Mail) • Continued growth in international parcels • Consolidation of acquired businesses supported by newly acquired businesses • Salary indexation expected as of November • Stable Radial revenues 2018 • Partly offset by volume decline in dom estic • Radial costs impacted by phase out w ebstore m ail 2 up to -7% , average domestic mail business and higher than expected opex price/ mix effect of + 4% (medical benefits & inflation) not fully compensated by productivity improvements • Continued decline in Banking & Financial revenue • Partly compensated by continued productivity im provem ents and optim ized FTE m ix and • Continued cost optim ization Capex • Recurring & Vision 2020 investments and business development investments for new subsidiaries (Radial, Ubiway and Dynagroup) for an estimated total amount of ~ € 140m 1 Outlook for 2018 includes the acquisitions of Radial, Bubble Post, Leen Menken, I mex, M.A.I .L., I nc. and Active Ants 2 2Q18 will count 1 working day less on stamps, 3Q18 will count 1 working day more on franking machines and 2 more on stamps and 4Q18 will count 2 working days more on franking machines vs. the same quarters of 2017. 5
bpost at a glance Belgium ’s leading postal operator Built on strong foundations and w ith am bitious targets Leading m arket position in the 8 .1 m € 3 .0 bn resilient Belgian m ail m arket with a letters handled every day revenues balanced regulatory framework 1 9 0 ,0 0 0 Focused m ail and parcels business € 5 9 8 .0 m parcels handled every day with a proven strategy for profitable 1 9 .8 % growth EBITDA 6 6 2 6 7 4 Scope for continued cost post franchised im provem ents offices post points € 5 0 1 .6 m 1 6 .6 % Strong financial perform ance 5 EBIT supporting a high level of cash flow sorting centres generation and dividends € 3 2 9 .3 m 2 6 ,9 0 6 Proven perform ance track record net profit average # FTE & interims 2017 figures (normalized) 6
bpost at a glance A m odern and diversified m ail operator Revenues % of total Transactional m ail € 808m 27% Dom estic Mail One integrated Advertising m ail € 253m 8% dom estic € 1,353m distribution 45% Press € 293m 10% netw ork for mail and parcels Dom estic € 224m 7% I nternational Parcels player I nternational € 223m 7% € 796m hubs in London LHR and 26% Brussels Logistic Solutions € 349m 12% strategically located facilities in US, Canada, the Netherlands, I nternational m ail € 160m 5% Germany, Spain, Additional Poland, China, HK, Value added services € 102m 3% Singapore, Australia sources of and New Zealand revenues Banking and finance € 183m 6% € 3 ,0 2 4 m 1 € 832m 27% € 98m 3% Distribution revenues 2017 Retail & Other 2 € 289m 10% 1 45% Domestic Mail, 26% Parcels, 27% Additional sources of revenues and 1% Corporate revenue 2 I ncluding a.o. SGEI compensation for the retail network, philately and retailer products 7
bpost at a glance Focused strategy to create value and rew ard shareholders W e are W e W e are W e are m ail grow lean, agile & flexible @core 8
bpost at a glance W e are m ail - w e continue to focus on core m ail business Volum e & revenue drivers Transactional m ail • E-substitution (volume impact): mainly banking/ insurance & telco & utilities combined with higher acceptance of e-documents at the receiver’s side • Rationalization (volume & price impact): systematic optimization of outgoing mail flows resulting in lower volumes which shift towards cheaper products • Consolidation of m ail volum es (price impact): smaller mail volumes are bundled by consolidators I llustration for search, number of times considered important per 100 purchases, Advertising m ail end-to-end • Strongly linked to GDP grow th (+ 1.7% in 2017, forecast 2018: + 1.8% ) • Marketing m ix is more balanced betw een different channels • Focus on 6 key segm ents with growth potential: retail & distribution (food + non-food), automotive, FMCG (food), retail fashion, home, SMEs Press Distribution of newspapers and periodicals are both part of the SGEIs 1 • • Revenues consist of: • Compensation from the Belgian State: agreed in the newspapers and periodicals contracts (cfr. p. 33) • Invoices sent directly to the editors 1 Services of General Economic I nterest 9
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