FY 2015 Results March 22, 2016
Opening Remarks (€m)
FY 2014
FY 2015
Var %
Revenues
28,512
30,739
+8 %
EBIT
691
880
+27 %
Net Profit
212
552
+160 %
ROBUST CASH GENERATION DPS 34 €/CENTS 2
Investor Relations
Delivering against plan
PROFITABLE, CASH GENERATIVE SERVICE INFRASTRUCTURE ‘‘Superior returns in Transaction Banking and Asset Gathering’’ ‘‘Growth in Insurance and Asset Management’’
‘‘Turnaround in Mail – Growth in Parcels’’
ROE: FY15 30% vs. 24% FY14
GWP +18% in FY15 Operating Costs -4.1% vs FY14 Parcels Volumes +12% vs FY14
FY 2015 NUMBERS SUPPORT EXECUTION OF OUR PLAN EBIT €880m
Cash distributed €444m Investor Relations 3
FY 2015: Figures Highlights Financial Services (€m)
Insurance Services (€m)
Mail & Parcels (€m)
Poste Italiane Group (€m)2 7.8% 30,739 28,512
1%
1%
13.7%
Revenues1
(3.2%)
66%
70%
19%
17% 5188.634
14%
13%
21,415
18,840
(4.4%) 5,358
5,188
4,074
FY 2014
FY 2015
FY 2014
FY 2015
3,893
FY 2014
FY 2015
FY 2014
FY 2015
Mail & Parcels
Financial Services
Insurance Services
Other
21.4% 27.4%
930 766
880
17.3%
Operating Profit
415
691
487
n.m. FY 2014
FY 2014
FY 2015
FY 2014
FY 2015
FY 2014
(504)
1. 2.
FY 2015 FY 2015
(568)
Investor Relations
Net of Intersegment revenues Including other segments (PosteMobile and “Consorzio Telefonia Mobile”)
4
Total Asset Under Management / Administration FY 2014
FY 2015 +3.1%
462 €bn
476 €bn Postal Saving Books
92.2 20%
114.4 25%
44 9%
Average Deposits 211.3 46%
105.9 22%
Postal Bonds
Funds and Net Technical Reserves
118.7 25%
45.2 10% 206.1 43%
Robust clients’ asset base with a well balanced mix
Investor Relations 5
Focus on Financial Services (1/3) – Revenues Evolution
Revenues (€m) 5,358
-3.2%
5,188
229 290
241 305
1,154
1,058
1,640
1,610
2,045
1,974
FY 2014
FY 2015
Current Accounts /APM1
Postal Savings
Distribution
Payment Cards Fees
Fees from Transaction Banking2
1.
Current accounts /Active Portfolio Management includes interests income, realized capital gain and income from financial assets at FVTPL (Fair Value through profit or loss)
2.
Transaction banking includes: payment slips, F24, money transfers, pension cheques and other revenues from current accounts. Net of intercompany values
6
Investor Relations
Focus on Financial Services (2/3) – Revenues Breakdown Revenue source
2015 €m
Returns on Current
1,974
Account Deposits
-3.5%
Fees from Postal
1,610
Savings Collection
-1.8%
Fees from
1,058
Transaction Banking
-8.3%
Distribution Fees
Payment Card Fees
Total Revenues
Rationale
2015 vs 2014 (var. % )
Lower revenues mainly due to interest rate reduction
Lower Postal Saving total collection
Decrease mainly due to payments slips and F23/F24
305
Better performance on personal loans
+ 5.2%
and other personal financing products
241
Increase of Postepay cards issued
+ 5.2%
5,188 -3.2%
7
Investor Relations
Focus on Financial Services (3/3) – Active Portfolio Management Average Deposit1 (€m)
Active Portfolio Management Return2 (€m) Average return (% )
+2.8%
43,953
45,169
Unrealized gains (€m )
5,660
P ortfolio duration (years)
5,382
3
4.6%
4.4%
4,467
5,434
5.2
2,045 38,571
FY 2014
5.6
1,974
39,509
FY 2014
FY 2015
Avg deposits from Public Administration
Entirely invested in floating rate deposit c/o MEF
Avg deposits from Retail and Corporate customers
Entirely invested in Italian Government bonds
FY 2015
Investor Relations
1.
Including current accounts, time deposits and repurchase agreements
2.
Including interest income and realized capital gains
3.
Average yield calculated as interest income and realized capital gains on total financial assets
8
BancoPosta Regulatory Framework and Capital Position Capital Requirements (€m)
Capital Position 1 (€m)
CET1 Capital
RWA
Market risk
12,250
11,779
4
21 158
Leverage ratio %
1,009
981
942 35 117
12,613
5
26 166
CET1 ratio %
7
3.3%
3.3%
3.2%
15.3%
15.9%
15.5%
Counterparty risk Credit risk
785
797
810
1799.0
1949.0
1949.0
FY 2013
FY 2014
FY 2015
FY 2013
FY 2014
FY 2015
Operational risk
BancoPosta regulatory framework aligned to Basel III standards effective December 2014
Key regulatory constraints: 8% min. CET1 ratio2 / 3% min. leverage ratio
ROE 3 FY15 30% (vs FY14 24%) 1.
CET1 Capital numbers already include the net profit related to
2.
10,5% Min. CET1 ratio required to distribute earnings
3.
ROE defined as net earnings/CET 1 capital (excluding valuation reserves)
Investor Relations 9
Focus on Insurance Services – Group GWP and Technical Reserves Evolution
Group GWP Evolution (€bn)
Group Net Technical Reserves Evolution (€bn)
Investment Portfolio Breakdown Life guaranteed (Ramo I) investment mix
Reduction of Life-linked due to increasing demand of traditional products
• Avg. portfolio rating: BBB • Avg. investment portfolio duration: ~6 years
+15%
100.3 4%
87.2 +18%
15.5
11%
16%
14%
18.2 80%
FY 2014
FY 2015
FY 2014
FY 2015
75%
FY 2014
Govies
FY 2015
Corporate Bonds
Alternative Funds
Investor Relations 10
Strong Solvency II under our approved standard model
Estimated Sensitivities of Coverage Ratio
BASE €m 6.841
Interest Rate UP (+100 bps)
- 91 pts
314%
Gov. Spread UP (+100 bps)
- 115 pts
290%
Coverage Ratio
405%
1.687 Ultimate Forward Rate to 3.2% (-100 bps) SCR
- 2 pts
403%
OF Eligible
Investor Relations 11
Focus on Mail & Parcels (1/2) – Volumes and Revenues Evolution Volumes - Mail (m)
4,324
Volumes - Parcels (m)
-9.0%
1,284 46 1,093
76
3,937
+12.4%
86 14 3 7
13 5 6
1,152 42
216
207
1,685
1,556
FY 2014
FY 2015
29
20
980
Unrecorded Mail and Philately
Recorded Mail
Direct Marketing and Unaddressed Mail
Integrated Services
32
33
FY 2014
FY 2015
B2B
B2C
C2C
International
Other
Other
Revenues - Mail & Parcels (€m)
4,074
-4.4%
3,893
Investor Relations FY 2014
FY 2015
12
Focus on Mail & Parcels (2/2) – Revenues, Cost Structure and Profitability
Total Revenues (€m)
Operating Costs (€m)
Operating Profit (€m)1
-4.1% -5.1%
8,658
9,162
8,216
4,584
8,784
99 235 614
127 32 530
6,066
5,977
2,148
2,118
n.m.
4,323
-4.4%
4,074
3,893
FY 2014
FY 2014 Market Revenues
FY 2015 Infrasegement Revenues
FY 2014
FY 2015
FY 2015
Cost of Goods Sold
Labour Costs
Depreciation & Amortization
Other
(504)
Intersegment Costs
(568)
Investor Relations 1.
Includes intersegment revenues
13
Total Group Operating Costs Evolution Group Operating Costs (€m)
-2.4%
9,548
9,322
671
581
2,648
2,590
6,229
6,151
FY 2014 Labour Costs
FY 2015
Costs of Goods Sold
Depreciation and Amortization
Investor Relations 14
Cost Structure at Consolidated Level – Focus on labour costs (€m)
-1.3%
6,229 6,151
FY 2014
145K
FY 2015
Avg. workforce
144K
Investor Relations 15
From Group EBIT to Net Income (€m)
880
53
(381)
552
EBIT
Net Financial Income
Taxes
Net income
Proposed DPS 34 Euro/CENTS Investor Relations 16
Group Capital Expenditures Capex evolution (€m) 488 437
FY 2014
FY 2015
Capex Breakdown by Division (%) 100%
100%
3% 1%
8%
83%
86%
FY 2014
FY 2015
13%
Mail&Parcels / Network
6%
Other
Financial Services
17
0%
Insurance Services
Investor Relations
Cash Generation Profile (€m) 2015
(488)
2
1,099 611
1
FFO
Capex
1
FFO - Capex
2014
(437) 1,062 625
FFO1
1.
Capex
Calculated as: Net Income + D&A + Net provisions for risks and charges – Use of Provisions for risks and charges + Net change in employee termination benefits and pension plans + Other (Details in Appendix)
2.
Including goodwill and fair value of the technology platform of SDS acquired by PosteVita (about €m 20)
18
1
FFO - Capex
Investor Relations
Mail & Parcels and Other Services Net Financial Position (€m)
+1,753
720
1,608 1.608
5
302
(656)
76
(1.451) (1,451) Net Financial Position FY 2014
Funds from Operation (FFO)
Change in Working Capital
Capex
Net Dividend Cash In and other Equity movements
Other
Net Financial Position FY 2015
Investor Relations 19
2016: Year two of our five year plan
How the year started – main items
Robust inflows towards postal savings products and current accounts Continuing growth in insurance; new offer in asset management In Mail & Parcels: deployment of the new delivery process
Minimum 80% pay-out confirmed for FY 2016 Investor Relations 20
Appendix
Group Profit & Loss Statement – FY 2015
€m
FY 2014
FY 2015
Var.%
9,150
8,810
(3.7%)
15,472
18,197
17.6%
3,772
3,657
(3.0%)
118
75
(36.9%)
28,512
30,739
7.8%
Personnel costs
(6,229)
(6,151)
(1.3%)
Other operating expenses
(3,038)
(3,444)
13.3%
(17,883)
(19,683)
10.1%
Depreciation & amortization
(671)
(581)
(13.4%)
EBIT
691
880
27.4%
6
53
n.m.
Profit before tax
697
933
33.9%
Tax
(485)
(381)
(21.4%)
Net income
212
552
160.8%
P&L Revenue from sales and services Insurance premium revenue Other income from financial and insurance activities Other operating income
Sales
Net change in technical provisions for insurance business and other claims expenses
Net interest income / (Expense)
Investor Relations 22
Group Key Balance Sheet Items – FY 2015 €m
FY 2014
FY 2015
Var.%
Cash & Equivalents
1,704
3,142
84.4%
BancoPosta related Cash
2,873
3,161
10.0%
Receivables & Inventory
2,751
2,158
(21.6%)
142,689
160,090
12.2%
Tangible and Intangible Assets
2,892
2,796
(3.3%)
Other
6,051
4,489
(25.8%)
158,960
175,836
10.6%
1,422
1,453
2.2%
Financial liabilities
55,359
57,478
3.8%
Technical Reserves
87,220
100,314
15.0%
6,541
6,933
6.0%
150,542
166,178
10.4%
Shareholders capital
1,306
1,306
-
Reserves
7,112
8,352
17.4%
8,418
9,658
14.7%
158,960
175,836
10.6%
Balance sheet
Financial Assets
Total Assets Trade Payables
Other Total Liabilities
Totale Equity Total Liabilities & Equity
Investor Relations 23
Group Cash Flow Statement – FY 2015
€m
FY 2014
FY 2015
Var.%
Net income
212
552
n.m.
Depreciation and amortization
671
581
(13.4%)
Net provisions for risks and charges
412
454
10.2%
(245)
(392)
60.0%
(77)
(65)
(15.6%)
2
0
n.m.
87
(31)
n.m.
1,062
1,099
3.5%
(429)
2,162
n.m.
633
3,261
n.m.
(437)
(488)
11.7%
Net change in subsidiaries and associates
5
(211)
n.m.
Disposals
9
5
(44.4%)
Cash flow from investments
(423)
(694)
(64.1%)
Dividend paid
(500)
(250)
(50.0%)
549
(1,414)
n.m.
49
(1,129)
n.m.
259
1,438
n.m.
Cashflow statement
(Use of Provisions for risks and charges) Net change in employee termination benefits and pension plans (Gains) / Losses on disposals Other FFO Change in working capital Cash flow from operations Capital expenditures
Cash Flow from financial assets and liabilities Cash flow from financing Net change in cash
Investor Relations 24
Group Working Capital – FY 2015
FY 2014
FY 2015
Var.%
3,761
2,346
(37.6%)
139
134
(3.6%)
3,540
3,258
(8.0%)
Deferred tax assets
702
623
(11.3%)
Current tax receivables
659
72
(89.1%)
Trade payables
(1,422)
(1,453)
2.2%
Other liabilities
(2,658)
(2,945)
10.8%
Deferred tax liabilities
(1,047)
(1,177)
12.4%
(24)
(53)
n.m.
3,650
805
(77.9%)
€m Working Capital Trade receivables Inventories Other receivables and assets
Current tax liabilities Working Capital
Investor Relations 25
Change in Group Working Capital – FY 2015 €m
Var.%
FY 2014
FY 2015
(14)
1,415
n.m.
7
5
(28.6%)
(1,034)
282
n.m.
(29)
79
n.m.
59
587
n.m.
Trade payables
(99)
31
n.m.
Other liabilities
256
287
12.1%
Deferred tax liabilities
542
130
(76.0%)
Current tax liabilities
(77)
29
n.m.
(389)
2,845
n.m.
25
16
(36.0%)
(71)
42
n.m.
(543)
(210)
(61.3%)
535
(535)
n.m.
14
4
(71.4%)
(40)
(683)
n.m.
(429)
2,162
n.m.
Change in Working Capital Trade receivables Inventories Other receivables and assets Deferred tax assets Current tax receivables
Total Financial Income on discounted receivables Net write-downs and loss on receivables Deferred tax on fair value changes and TFR actuarial income Cancellation of shareholder receivables CE 16/07/08 (Legge di stabilità 2015) Reinsurers' technical reserves Adjustments (non monetary items and shareholders' Change in Working Capital per cash flow statement
26
Investor Relations
Mail & Parcels Key Balance Sheet Items – FY 2015
€m
FY 2015
€m
Assets Property, plant and equipment Investment property Intangible assets Investment accounted for using the equity method Financial assets Trade receivables
Equity adn Liabilities
439 954 5 157
Current tax assets
Provisions for risks and charges
1,885
Other receivables and assets
Trade receivables
2,604
61
446
Inventories
Totale Equity
2,144
Deferred tax assets Total Non-current assets
FY 2015
295
Employee termination benefits and pension plans
1,330
Financial liabilities
1,251
Deffered tax liabilities
25
Other liabilities
72
6,091
Total Non-current liabilities
2,973
131
Provisions for risks and charges
696
1,823
Trade payables
97
Current tax liabilities
1,301 0
Other receivables and assets
293
Other liabilities
1,423
Financial assets
436
Financial liabilities
1,190
Cash and cash equivalents Total Current assets Total Assets
1,316 4,096
Total Current liabilities
10,187
Totale Equity and Liabilities
4,610 10,187
Investor Relations 27
Mail & Parcels and Other Services Net Debt Breakdown – FY 2015
€m
FY 2014
FY 2015
Var.%
Cash and Cash Equivalents
320
1,332
n.m.
Current Financial Assets
183
169
(7.7%)
(1,351)
(516)
(61.8%)
Current part of long term debt
(13)
(14)
7.7%
Other current financial liabilities
(24)
(21)
(12.5%)
(1,388)
(551)
(60.3%)
Current Net Financial Position
(885)
950
n.m.
Long term debt
(400)
(400)
-
Bonds
(796)
(798)
0.3%
(66)
(56)
(15.2%)
Non Current Financial Position
(1,262)
(1,254)
(0.6%)
Net Financial Position
(2,147)
(304)
(85.8%)
654
553
(15.4%)
(1,493)
249
n.m.
811
668
(17.6%)
(769)
(615)
(20.0%)
(1,451)
302
n.m.
Net Debt - Mail & Parcels and Other Services
Short term debt
Current Financial Position
Other non current financial liabilities
Non curernt financial assets Net Financial Position - Mail & Parcel and Other Sercvices Intersegment financial receivables Intersegment financial payables Net Financial Position (net of intersegments) 1
Investor Relations 1.
Including a Net Financial Position of Other Services (38 Eurom in 2015 and 30 Eurom in 2014)
28
Other Services – Poste Mobile Key Financials €m
FY 2014
FY 2015
Var.%
325
334
2.5%
240
242
1.0%
86
91
6.8%
(25)
(22)
(12.4%)
(239)
(242)
1.5%
62
70
12.7%
P&L Total revenue
o/w Market revenue o/w Intercompany revenue Personnel costs Other operating expenses EBITDA
EBITDA marg in
1 9 .0 %
Depreciation and amortisation EBIT
EBIT marg in
2 0 .9 %
(48)
(39)
(20.0%)
14
31
127.9%
4 .2 %
9 .3 %
Non-operating income/(expenses)
(0)
(1)
114.4%
Profit before taxes
13
30
128.4%
Taxes
(5)
(11)
109.8%
8
19
141.4%
57
56
(2.1%)
(51)
(29)
43.2%
(6)
1
118.6%
3,098
3,471
12.1%
5.7
5.2
(8.6%)
Profit after taxes Cash flow statement FFO Cash flow from investments Net change in cash Other key data Average number of users (sim cards -#k) ARPU (€)
Investor Relations 29
Financial Services – Cost Structure and Profitability at Divisional Level
Financial Services – Operating Costs (€m)
Financial Services – Operating Profit (€m)1
-5.2%
4,996 4,737
80
+21.4%
132
930
4,561
766
4,292
116 239
126 187
FY 2014
FY 2015
Cost of Goods Sold
Labour Costs
Intersegment Costs
Other
FY 2014
FY 2015
Investor Relations 1.
Includes intersegment revenues
30
Insurance Services – Cost Structure and Profitability at Divisional Level
Insurance Services – Operating Costs (€m)
Insurance Services – Operating Profit (€m)1
Change in Insurance Technical Provisions
19,683 17,883 +129% +17.3%
1,245
487 415 695
544 69
455
396 23 56
27 68
FY 2014
FY 2015
Cost of Goods Sold
Labour Costs
Intersegment Costs
Other
FY 2014
FY 2015
Investor Relations 1.
Includes intersegment revenues
31
Segment Flow Description – FY 2015 (€m) Mail & Parcels Including Network Total Revenues
Financial Services
Insurance Services
Poste Italiane Group2
8,216
5,667
21,415
M arket Revenues
3,893
5,188
21,415
I ntersegm ent Revenues
4,323
479
0
(8,784)
(4,737)
(20,928)
(29,859)
Operating Costs
30,739
Personnel Costs
(5,977)
(126)
(27)
(6,151)
Other Operating Costs 1
(2,680)
(319)
(763)
(4,025)
(19,683)
(19,683)
N et change in Technical Provisions I ntersegm ent Costs
(127)
(4,292)
(455)
Operating Profit (Loss)
(568)
930
487
880
Investor Relations 1. 2.
Including external costs, and D&A Including Other Services (Poste Mobile)
32
Contact Us
Poste Italiane Investor Relations Office Head of IR Luca Torchia Tel: +39 06 5958 2273 Email:
[email protected] Poste Italiane, Viale Europa 175, 00144, Rome, Italy www.posteitaliane.it/en/investor-relations 33
Disclaimer This presentation contains certain forward-looking statements that reflect the Company’s management’s current views with respect to future events and financial and operational performance of the Company and its subsidiaries. These forward-looking statements are based on Poste Italiane S.p.A.’s current expectations and projections about future events. Because these forward-looking statements are subject to risks and uncertainties, actual future results or performance may differ materially from those expressed in or implied by these statements due to any number of different factors, many of which are beyond the ability of Poste Italiane S.p.A. to control or estimate precisely, including changes in the regulatory environment, future market developments, fluctuations in the price and availability of fuel and other risks. You are cautioned not to place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this presentation. Poste Italiane S.p.A. does not undertake any obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation. This presentation does not constitute a recommendation regarding the securities of the Company. This presentation does not contain an offer to sell or a solicitation of any offer to buy any securities issued by Poste Italiane S.p.A. or any of its subsidiaries. Pursuant to art. 154-BIS, par. 2, of the Unified Financial Act of February 24, 1998, the executive in charge of preparing the corporate accounting documents at Poste Italiane S.p.A., Luciano Loiodice, declares that the accounting information contained herein corresponds to document results, books and accounting records.
34