presentation h1 2015 (pdf)

Deutsche Post DHL Group Q2 2015 resultsLawrence A. Rosen, CFO6 August 2015

Q2 EBIT development reflects PeP strike and execution of Strategy 2020

Q2 2015 HIGHLIGHTS

2015 guidance adjusted to include one-off strike effect, 2016/20 guidance confirmed

DPDHL GROUP | Q2 2015 RESULTS | 06 AUGUST 2015 PAGE 2

Investing to position our businesses for sustained growth in line with strategic and financial objectives of Strategy 2020

Express performance continues strong trajectory with further9% TDI volume growth driving 14% EBIT increase

• PeP wage agreement sets solid foundation, with one-off EBIT impact from strike of ~ EUR -100m in Q2

• Forwarding turnaround measures in execution, newtransformation course to be set in the next months

• Supply Chain accelerating restructuring measures2009 2015 2020

SUMMARY OF MAJOR EFFECTS ON Q2 RESULTS

PAGE 3DPDHL GROUP | Q2 2015 RESULTS | 06 AUGUST 2015

Division

Non-recurring effects (+/-)

Net EBIT impact (Q2 yoy)

Strategic rationale

Strike effects:Revenue lost / delayed No wage costs for striking employees Costs for alternative labor / overtime

PeP Global Forwarding, Freight Supply Chain

~ EUR -100m EUR +18m

Disposal of Sinotransstake (EUR +99m)One-time costs for turnaround measures (EUR -81m)

King´s Cross stake sale driving significantly higher real estate related income(EUR +53m)Restructuring costs (EUR -55m)

EUR -2m

Tarif negotiations settled with more competitive long-term wage structure

1. Stabilization of operating performance

2. Review course of transformation

King´s Cross sale provided opportunity to accelerate restructuring process

-+

-

+

-

+

-

GROUP P&L Q2 2015

DPDHL GROUP | Q2 2015 RESULTS | 06 AUGUST 2015

EUR m Q2 2014 Q2 2015 Chg. Management comments

Revenue 13,695 14,700 +7.3% Positive currency effects support revenue growth. Organic revenue slowdown to 0.6% reflects PeP strike effects as well as impact from lower energy prices

EBIT 656 537 -18.1% Group EBIT decline with strong Express growth being offset by strike effect and continued weakness in Forwarding

t/o PeP 189 75 -60.3% EBIT decline due to ~ EUR -100m strike effects

t/o DHL 542 535 -1.3% Express continues strong growth path. Supply Chain and Forwarding, Freight EBIT supported by asset sales while continuing transformation / restructuring

Financial result -97 -101 -4.1% Slightly below previous year due to currency effects

Taxes -70 -65 +7.1% H1 tax rate of 16.5%, reflecting new full year estimate

Cons. net profit1) 461 326 -29.3% Net profit and EPS primarily affected by EBIT decline

EPS (in EUR)2)0.38 0.27 -28.9%

PAGE 41) Attributable to Deutsche Post AG shareholders; 2) Undiluted

2015 EBIT GUIDANCE ADJUSTED FOR PEP STRIKE EFFECT

EUR bn 2015 2016 2020

PeP At least 1.2 (from at least 1.3) > 1.3 ~ 3% CAGR 2013-20

DHL 2.1-2.25 2.45-2.75 ~ 10% CAGR 2013-20

CC/Other ~ -0.35 ~ -0.35 < 0.5% of group revenue

Group 2.95-3.1(from 3.05-3.2) 3.4-3.7 > 8% CAGR 2013-20

FY 2015:

Free Cash Flow to exceed 2014 dividend

Tax rate around 16.5% (from around 18%)

Gross Capex of around EUR 2.0bn


2016 and 2020 Guidance confirmed

EUR m Q2 2014 Q2 2015

Cash from operating activities before changes in Working Capital 729 335

OCF generation reflects overall EBIT decline, restructuring cash-outs and smaller pension funding in a subsidiaryStrong management of working capital continues to contribute positively vs prior year

Changes in Working Capital -246 -69

Net cash from operating activities after changes in Working Capital 483 266

Net Capex -235 -382 Cash out for Capex increasing in line with full-year expectationRise in net M&A proceeds resulting from disposals of Sinotransstake in DGF and King´s Cross development stake in DSCInterest expense decline reflecting lower interest rate environment

Net M&A 3 219

Net Interest -43 -36

Free Cash Flow 208 67 FFO/Debt at 26.3% (March 31: 24.9%)

FREE CASH FLOW Q2 2015

EBIT decline, asset sales and capex increase main influences on FCF



Seasonality drives usual Q2 net debt increase with annual DPDHL dividend payment of EUR 1,030bn

NET DEBT (-)/LIQUIDITY (+)

PAGE 7

-2,989

34 -908

-7271,072-1,499

Net Othereffects

incl. M&A

Net capex

Changesin W/C

Net debt(Dec 31, 2014)

OCF before change in W/C

Net debt(Jun 30, 2015)

75

in EUR m

Net interest

-1,036

Dividend Paid

N.B: Net pension provision down EUR 2.7bn to EUR 5.9 bn (from EUR 8.6 bn at end of Q1) reflecting discount rate increase during Q2

1,576 1,520510 501

Q2 2014Q2 2015

-1.8%-3.6%

Q2 2015Q2 2014

m EUR


Diligent preparation, good execution as well as employee commitment allowed to minimize customer disturbance from strike actions

Mail Communication (-5.3%) and Dialogue Marketing (-12.8%) volume development notably affected by the strike as well as price increases

Unabated strong volume and revenue growth in Parcel Germany, despite strike effects

Continued growth in international Parcel activities in and outside of Europe supported by positive currency developments

Despite strike impacts, revenue growth in eCommerce - Parcel continued to outweigh Post revenue decline

PeP: STRONG OPERATING EFFORT TO CONTAIN STRIKE IMPACTS

PAGE 81) Parcel Europe ex Germany; 2) Parcel outside Europe

Business HighlightsMail Communication revenue Dialogue Marketing revenue

Parcel Germany revenue Parcel Germany volumes

Parcel Europe revenue1) DHL eCommerce revenue2)

+9.3%

163 177 232 293

+26.3%+8.6%

Q2 2015Q2 2014

Q2 2015Q2 2014 Q2 2015Q2 2014

m EUR

m EUR

m EURm EUR

906990

+8.1%m units

Q2 2015Q2 2014

236 255

PeP – DIVISIONAL RESULTS Q2 2015



Revenue 3,642 3,712 +1.9% Revenue increase reflecting growth across eCommerce - Parcel activities as well as price increases in Post products, offsetting Post volume weakness due to strike

EBIT 189 75 -60.3% EBIT decline mainly due to ~ EUR -100m strike related effects

Operating Cash Flow 188 169 -10.1% Strong working capital management helps to offset large part of EBIT decline

Capex 62 127 >+100% Capex well above last year, reflecting planned investment increase in Parcel activities

LONG TERM WAGE AGREEMENT FINALIZED


Comprehensive package for all stakeholders safeguarding PeP competitiveness and facilitating further profitable growth

Tariff agreement until Jan 31, 2018• 1 October 2015: one-time payment 400€• 1 October 2016: +2.0%• 1 October 2017: +1.7%

No change to 38.5 working hours Extension of no redundancy agreement until 2019 No more outsourcing limit for parcel delivery, but job

commitment for current DP parcel delivery staff; no outsourcing of letter or joint delivery until end 2018

DHL Delivery entities remain in place: expect further hiring of dedicated Parcel delivery employees to support dynamic Parcel growth

DHL : LOGISTICS PROVIDER FOR FC BAYERN CHINA STORE


• DHL eCommerce enables FC Bayern to merchandise goods in China via a flagship store on Alibaba’s Tmall

• DHL eCommerce provides full cross-border logistics solution, including customs & returns

• Service execution provided in cooperation with DHL Supply Chain, DHL Global Forwarding and local partners

eCommerce

DHL eCommerce: strong capabilities for international e-commerce tradelanes

DHL Service OfferingDHL eCommerce also responsible for:

WEBSHOP & LISTING, MARKETING, CUSTOMER SERVICE, ORDER MANAGEMENT & ACCOUNTING


Continued strong growth with TDI volume +8.6% Comprehensive global footprint paying off as

Europe volumes (+14.4%) shows strongest growth in Q2 ahead of MEA (+9.2%) and Asia/Pacific (+6.1%)

Decline in Americas volumes (-2.4%) reflects change in customer mix; very solid growth in base revenue/day in the region, i.e. excluding fuel surcharge and FX effects

Growth again ahead of market driven by focus on offering best and fastest premium service for our TDI customers

Slower revenue increase compared to volume growth due to lower fuel surcharge, as in Q1

EXPRESS: STRONG TDI GROWTH CONTINUES

PAGE 12

Time Definite International (TDI)1)

Revenues per day in EUR m

Time Definite International (TDI)Shipments per day ‘000s

36.838.2

+3.8%

700760

+8.6%

Business Highlights

Q2 2015Q2 2014

Q2 2015Q2 2014

1) Currency translation impacts are eliminated. Data aggregated with same currency rate

EXPRESS – DIVISIONAL RESULTS Q2 2015



Revenue 3,089 3,455 +11.8%Continued strong TDI volume growth supported by positive FX effects. Organicrevenue growing +2.7%, impacted by significant decrease in fuel surchargerevenue

EBIT 331 376 +13.6% Strong EBIT growth driven by continued TDI volume increase, EBIT margin up 20bp yoy to 10.9%

Operating Cash Flow 345 262 -24.1%

Reduction in OCF mainly due to large utilization of a restructuring provision related to 2008/09 US Express restructuring (EUR ~50m cash out; provision at EUR ~200m now)

Capex 85 154 +81.2% Acceleration in line with investment plans. Continue to invest principally in international hub and gateway infrastructure upgrade

PAGE 13


DHL NETWORK INVESTMENTS – ENABLING EXPRESS GROWTH

PAGE 14

Tokyo GTW 2014/15

New Singapore HUB 2014/15

Saudi Arabia/ Egypt GTWs 2014/15

LHR Airport Expansion 2014

Cincinnati (CVG) HUB Expansion 2014/15

East Midlands HUB Expansion 2015

New Brussels HUB 2015/16

Leipzig HUB Expansion 2014-2016

Continued network investments across all regions cement service leadership as a key driver of our TDI growth


Air freight volumes decline due to active yield management in competitive markets. Ocean volume flat, mainly due to continued weakness in Asian exports

GP/ton in Air Freight increased by 9.5% GP/TEU in Ocean Freight declined 6.3%

Division GP flat reflecting continued market challenges as well as currency effects

Thorough review of EBIT performance by new divisional management led to turnaround and transformation agenda. First organisational measures implemented during Q2

GLOBAL FORWARDING, FREIGHT: FOCUS ON BUSINESS TURNAROUND

Air freight ‘000s Tons

Ocean freight ‘000s TEU1)

1,007 933

-7.3%

748 750

Q2 2015

+0.3%

Q2 2014

1) Twenty Foot Equivalent Unit

Business Highlights

PAGE 15

Q2 2015Q2 2014

GLOBAL FORWARDING, FREIGHT– DIVISIONAL RESULTS Q2 2015



Revenue 3,638 3,778 +3.8% Revenue increase driven by FX effects. Organic revenue down -1.5%

Gross Profit 885 897 +1.4% Persistent difficult market environment with underlying GP margin pressure, despite positive FX effects

EBIT 102 40 -60.8% Further affected by ongoing transformation and turnaround program as well as difficult market conditions, partially offset by Sinotrans stake sale

Operating Cash Flow 45 125 >+100% Improving on better working capital management

Capex 60 34 -43.3% Capex decrease reflects decreased investments for NFE

MANAGEMENT AGENDA DEFINED AND IN EXECUTION MODE


Adjust organizational structureRe-empower countries and re-establish stronger accountabilityRe-enable staff and adjust incentives

Improve absolute Gross ProfitIncrease and improve cost performanceSpecific country focus Improve service performance

Sharpen commercial focusInvest in skills and capabilities though “Certified” programReview and renew our IT with a business-centric approach

First changes to improve operating performance implemented, next turnaround measures in execution, decision on IT renewal expected in next months

RE-EMPOWER: TURN AROUND: REGAIN LEADERSHIP: CURRENTPRIORITY


Sound order intake in Q2 (EUR 266m) especially in Technology, Consumer and Life Sciences & Healthcare

Strong growth in developed markets, also Asia Pacific with substantial volume and new business growth

Further steps taken in implementing Strategy 2020 as presented at November 2014 Capital Markets Tutorial

Restructuring charges cover implementation of consistent and lean organizational structure as well as addressing underperforming business areas

SUPPLY CHAIN: ACCELERATING RESTRUCTURING EFFORTS

New signings, EUR m1)

Revenue by sector Q2 2015

335 266

Q2 2014 Q2 2015

1) Annualized revenue

Business Highlights

PAGE 18

23%

19%

20%

9%

11%

3%10% 5%

Technology

Life Sciences & Healthcare

Consumer

RetailOthers

Williams Lea

Energy

Automotive

SUPPLY CHAIN – DIVISIONAL RESULTS Q2 2015



Revenue 3,618 4,045 +11.8%FX continues to support revenue development. Organic revenue growth was 0.7% reflecting termination of larger customer contract in 2014 as well as lower fuel prices

EBIT 109 119 +9.2%Higher real estate related income driven by King´s Cross stake sale allowed to accelerate restructuring charges to EUR 55m. Good contribution to EBIT growth from new business start-ups

Operating Cash Flow -6 -34 <-100% OCF decline reflects volume, FX and timing related working capital movements

Capex 62 63 +1.6% Capex spending in line with last year, mainly supporting new contract start-ups

FURTHER IMPORTANT STEPS TAKEN IN LINE WITH STRATEGY 2020


Strategic ambitions and priorities clearly defined in the divisions

PeP

Continued profitable mix shift towards Parcel growth needs to be based on sustainable, competitive wage structure in Germany

Tariff negotiations successfully concluded

Express

Maintain successful TDI focus while cementing global competitive advantage through ongoing targeted investments

Continuous network renewal & expansion

DGFF

Transform internal process and IT platform to establish efficient cost structure and improve customer service

Short-term operating actions initiated, IT decision to follow soon

Supply Chain

DSC Strategy 2020 addressing the key levers of Earnings Growth Model along Focus – Connect –Grow pillars

Execution based on an actionable, prioritized plan

2009 2015 2020

presentation h1 2015 (pdf)

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