Deutsche Post Ag S/Adr

Ladies and gentlemen, thank you for standing by. Welcome, and thank you for joining the DHL group conference call. Please note that the call will be recorded. You can find the privacy notice on dhl.com. Throughout today's presentation, all participants will be in a listen-only mode. The presentation will be followed by a question and answer session. If you wish to ask a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. Instructions will also follow at the time of Q&A. I would now like to turn the conference over to Martin Ziegenbalg, head of investor relations. Please go ahead.

All right, thank you, and I welcome you all on the Q2 26 conference call of DHL Group. You've seen our full set of reporting out today. We've got with us here Group CEO, Tobias Meyer, Group CFO, Melanie Kreis. It's going to be the usual procedure. After your presentations, Tobias and Melanie, we go straight into Q&A. And then with that, over to you, Tobias.

Good morning, thank you, Martin. We had indeed a good second quarter as DHL Group, with group revenue accelerating to 13% year-on-year, as you see on page 2 of the presentation, and increasing by 30%. We had a good flow-through of the increased business through the bottom line due to The effects that we also spoke about in recent quarters, our fit for growth program, which we executed, but also continued good management of both yields as well as capacity and thereby our cost base, especially in express. The free cash flow reflects that we are in a growth situation with some build-up of working capital, as you would expect, but also one extraordinary item driven by the refunds of the AIPA tariff, which are currently reversed, as you will be aware of. So we had some temporary increases in cash flow, given that we received payments in the last days of June, which are currently in the process of being repaid to customers. We are very satisfied with the acceleration of our growth path throughout the first half of this year, with significant increases in the volume that we transported in our express network, but also and many more. Thank you very much. The continued uncertainty and volatility around us, the confidence to increase our guidance as we have communicated on July the 7th and also to increase our share buyback program which will extend until the end of next year and increase to a value of up to 6.5 billion as the cumulative amount. Going into some details on page three, you see the development of group revenue growth. We also showed here the organic development excluding FX, which is by far the bigger effect, and M&A. So we had talked about some headwinds going away already with the reporting on the first quarter. Those headwinds particularly relate to FX with the strong appreciation of the euro against other currencies, including the US dollars in February and March of 2025. That has now cycled out and we basically have no major effects as it relates to FX on revenue and earnings in the second quarter, but also the volume development with the initial waves of tariffs The second quarter has a lower baseline as it relates to volume. So those were headwinds that we anticipated going away. But as you see on the right side here highlighted on page three for the express network, the weight that we carried in that network. We had a quarter on quarter increase of about six percentage points of volume. That figure is relatively stable if you compare to 2019 or whether you compare it to 2024. So that gives you a sense how the underlying business has developed and the really positive momentum that has unfolded in the second quarter on a very broad base across business that we have increasing customer demand and also growth in the sectors that we targeted. As shown on page four, our strategy is 2030 is now in full execution with our focus on top line growth, but also profitability accelerators. So this is just a reminder on what we're working on. How that unfolds and what we're exactly targeting for Express is highlighted on page five. This is a longer term graph, the share of the integrator industry, the Express players relative to the total air freight market. We started collectively in the late 60s, early 70s. If you look at UPS, FedEx and us in particular, and others. At that time the business was very much focused on documents, so not much tonnage, not much kilos transported. That has changed over the years with the integrated industry taking a growing share of the general air freight market and we expect that to continue We had this post-COVID normalization that was strongly driven also by a shift of e-commerce shipments leaving the integrator networks for cheaper ways of transportation, bulk charters and injection into lower cost last mile networks. We now are strongly focused on growth in industrials, so B2B, and we believe that both our cost position relative to the general air freight market, but also our value proposition has improved and increased, and this gives us the opportunity for significant share gains and continuing the Thank you very much. Page six provides some examples on how we sell and what we sell based on. So it is the reliability is the speed and the predictability of the integrator model, which is superior on those dimensions to the general air freight product. And that is attractive not only for small spare parts, but also for bigger parts like turbines, be that for the use in aviation or for power generation, for the supply chain of complex high value products. What you see, especially in IT and data center logistics, especially we've played a significant role in the semiconductor industry now for about 20 years. It's a vertical that was added to the integrator focus area about 20 years ago. Now it is also Thank you very much. It is the most efficient air cargo fleet around and that is different than what we had in terms of scale and relative cost position 20 years ago. So that there is a natural and attractive play for us in those verticals. Beyond that, we continue to broaden our capability set to be an attractive provider to more industries in the space of new energy shown on page seven. That is particularly the handling of DG, of dangerous goods of different categories, but especially also batteries where there's a strong need to build up not only the supply chain for new goods, be that inbound to manufacturing or the distribution of such, but also increasingly spare parts, spare parts as it relates to full-scale batteries for EVs but also spare parts in areas like wind energy where remote places have to be reached at an increasing amount to keep those machines running and provide the needed parts for such installations. Data center logistics is something that is in full swing with significant building taking place, especially in the United States, where we also increased our business there. That is in two areas, mainly in the international transportation along that value chain, so inbound to the data center construction site, but also and increasingly so upstream. and then the staging of material and sequencing at or near the construction sites of those facilities. There's obviously high urgency to bring such sites into operation and that urgency then translates into goods that need interim storage and sequencing. to alleviate bottleneck capacities at the construction and us also taking over even certain installation services on site. So that's the two areas we also expect significant spare parts business to follow as those installations mature. That is an area where we are traditionally very strong with our service logistics business. The journey on life science and healthcare also continues. This is a longer term play for us where we systematically build out capacity, but also capabilities, especially on the express side to offer an end-to-end cold chain service in the express network. So this is something that did not have a significant impact on top line or bottom line in the quarter, but remains important for the mid to long-term growth of the group overall and supply chain global forward and express in particular. As relates to the profit accelerators on page eight, we continue to do professional yield management. In this case, we highlight the example of a parcel in Germany where you see the development of volume and revenue. and thereby I can conclude on the yield measures that we have taken. This remains obviously very important that we pass on inflationary effects, be that from labor or be that From fuel and other input components for fuel, we want a recovery mechanism and that is also for the group overall how it played out for the second quarter that we recovered the additional cost that we had through the elevated prices of fuel. Fit for Growth, we have successfully and ahead of time executed and achieved our objectives as it relates to the savings. We'll obviously continue to be very mindful about productivity and efficiency in the different parts of the business. We'll continue to deploy technology to leverage efficiency potentials and realize such. So it's not that we in any way lose focus on such opportunities, but as a structured program that was also meant to react to the changes we saw in the market post-COVID, we have achieved our objectives. and we will now have a more embedded approach again, which again does not mean that we lose focus on the absolute necessity to remain cost competitive. The same is true as it relates to our investments. We continue to spend diligently and enable new growth. So we are very mindful not to increase the capital intensity in our existing business, but we want to fuel growth Thank you very much for joining us. and also increasingly automate and deploy robotics in those solutions which means that the new businesses that we onboard there has a certain requirement to spend capex which we happily do since such business is creative not only to the top line but also to the bottom line of our business. On page nine is the outlook, which is unchanged since the publishing of the preliminary results on July the 7th. So we now expect to exceed 6.5 billion euros EBIT for the full year of 2026, with a split that you see below the increase coming from the DHL divisions whilst PNP and group functions stay unchanged. Also, free cash flow and gross capex guidance remains unchanged as the midterm outlook, which is also unchanged. With that, I'll hand over to Melanie for some more details on the divisional developments.