bpost SA/NV

Earnings Release • May 2, 2016

First quarter 2016 results

Analyst call

Koen Van Gerven, CEO Koen Beeckmans, CFO

Brussels – May 2, 2016

Investor presentation - Interim financial report 1Q16

Financial Calendar

More on corporate.bpost.be/investors

11.05.2016 Ordinary General Meeting of Shareholders

17.05.2016 Ex-dividend date

19.05.2016 Payment date of the dividend 08.08.2016 (17:45 CET) Quarterly results 2Q16

09.11.2016 (17:45 CET) Quarterly results 3Q16

05.12.2016 (17:45 CET) Interim dividend 2016 announcement

08.12.2016 Ex-dividend date (interim dividend)

12.12.2016

Payment date of the interim dividend

Disclaimer

This presentation is based on information published by bpost in its First Quarter 2016 Interim Financial Report, made available on May, 2nd 2016 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 may include forwardlooking statements1, 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.

Highlights of 1Q16

Revenues down 2.0%

• Resilient Domestic Mail performance and Parcels growth offset by anticipated lower SGEI compensation

Improved underlying Domestic Mail evolution

• Driven by advertising mail

Outstanding domestic parcels performance, slow-down of international due to strong USD

• Domestic: double-digit volume growth driven by e-commerce and C2C; price/mix effect of -4.6% fully mix related
• International: US flows hampered by strong USD, continued growth to & from China

Cost savings on track and delivered on all cost items

• Underlying average FTE reduction of 7341 for the quarter

¹ i.e. excluding 379 additional FTEs and interims for higher parcels & solutions volumes, Deltamedia integration, new subsidiaries and absorption of holidays leading to a reported average reduction of FTEs and interims of 355

-4.0%

€ 604.5m

+14.6%

+ € 0.5m

- € 15.2m

Resilient domestic mail trend and parcels growth combined with further cost reductions led to EBITDA uplift of €+3.2m, thereby fully absorbing the lower SGEI compensation on our bottom-line.

4

Normalized1, € million

Summary of key financials 1Q16

€ million

	Reported
	1Q15	1Q16	% Δ
Total operating income (revenues)	616.6	604.5	-2.0%
Operating expenses	443.9	428.7	-3.4%
EBITDA	172.7	175.9	1.8%
Margin (%)	28.0%	29.1%
EBIT	151.6	153.9	1.5%
Margin (%)	24.6%	25.5%
Profit before tax	149.0	149.3	0.2%
Income tax expense	52.4	53.4
Net profit	96.6	95.9	-0.7%
FCF	298.1	245.9	-17.5%
bpost S.A./N.V. net profit (BGAAP)	87.3	90.0	3.0%
Net Debt/ (Net cash), at 31 March	(785.1)	(792.2)	0.9%

Total operating income (revenues) € million

		1Q15	SGEI	Organic	1Q16	% Org
	Transactional mail	232.6	-	-8.8	223.7	-3.8%
Domestic mail	Advertising mail	64.7	-	0.4	65.1	0.6%
	Press	74.0	-1.4	0.3	72.9	0.4%
	Domestic parcels1	39.5	-	3.6	43.1	9.1%
Parcels	International parcels	41.2	-	0.5	41.7	1.2%
	Special logistics	2.6	-	-0.5	2.1	-19.0%
	International mail	45.3	-	-5.9	39.3	-13.1%
Additional sources	Value added services	24.3	-	1.5	25.8	6.2%
of revenues	Banking and financial	51.7	-3.0	-0.2	48.5	-0.4%
	Other	29.4	-2.8	-1.7	24.9	-5.7%
	Corporate	11.4	-	5.9	17.4	51.9%
TOTAL		616.6	-7.2	-4.9	604.5	-0.8%

¹ Defined as domestic and Belgian in- and outbound

1Q16

7

Improved domestic mail underlying volume trend of -4.0% driven by advertising mail

Total operating income (revenues), € million

• Transactional Mail: continued e-substitution without notable acceleration, shift towards cheaper products (less registered letters).
• Advertising Mail: good direct mail performance in focus sectors, and strong quarter in unaddressed.
• Press: slightly better volume trend versus FY15, mainly driven by periodicals.

	Reported		Underlying 1,2
	FY15	1Q16	FY15	1Q16
Transactional mail	-5.1%	-5.6%	-5.3%	-5.3%
Advertising mail	-6.9%	0.1%	-4.9%	0.1%
Press	-2.8%	-2.6%	-2.8%	-2.6%
Domestic Mail	-5.3%	-4.2%	-5.0%	-4.0%

¹ 1Q16 had the same number of business working days as 1Q15 except for stamps which had 1 working day less in 1Q16 vs. 1Q15

² FY15 corrected for requalification of advertising mail to administrative mail.

Excellent growth in domestic parcels but slow-down of international

Total operating income (revenues), € million

Additional sources of revenues mainly affected by international mail in part compensated by continued growth in solutions

Total operating income (revenues), € million

• Impact of consequent execution of price strategy (no price discounts granted) to safeguard reasonable profit margins
• Positive contribution of solutions mainly driven by telco contract for decoder swap (€ +0.8m) and City Depot (€ +0.2m).
• Mainly impacted by lower volumes of financial transactions managed on behalf of the Belgian State.
• Mainly decreasing volumes in philately (€ -0.6m) and lower sales of retailer products (€ -0.9m; mainly utility company front office)

9

All cost items contributed to € 15.2m of cost savings

Operating expenses excl. depreciation and amortization, € million

• Decrease in transport costs linked to the evolution of international activities.
• Average reported FTE reduction of 355 FTE leading to € -5.2m cost savings, underlying FTE reduction is 734 for the quarter.
• Favourable FTE mix of € -4.9m thanks to the recruitment of auxiliary postmen (€ -2.2m) and the reduction of management level FTE (€ -2.6m)
• Negative price effect of € +3.1m explained by phasing elements (a.o. holiday pay related Alpha departures) and merit increase
• Mainly lower 3rd party costs (€ -1.3m), maintenance costs (€ -1.2m) and energy costs (€ -1.3m), partly offset by higher other operating costs
• Higher increase of recoverable VAT (from 14% in 2015 to ~19% in 2016) for 1Q16 expenses (€ -0.8m)
• Higher increase of recoverable VAT for costs and capex incurred in previous years (€ -3.0m).

1Q16

Decrease in operating FCF mainly driven by SGEI, Alpha payouts and acquisitions.

€ million 1Q15 1Q16 Delta Cash flow from operating activities +306.6 +281.1 -25.5 Cash flow from investing activities -8.5 -35.1 -26.6 Operating free cash flow1 +298.1 +245.9 -52.1 Financing activities -0.2 -2.1 -1.9 Net cash movement +297.9 +243.9 -54.0 Capex -11.4 -12.4 -1.0 Lower compensation and changed payment terms for SGEI: € -36.8m • Lower income tax paid in 1Q16 vs. 1Q15 relating to previous years: € +21.3m • • Alpha pay-outs: € -12.0m • Excluding the above: Results of operating activities: € +5.7m • • Working capital evolution: € -3.8m, mainly due to Social Security payment terms • Proceeds sale of buildings: € +7.3m Capex: € -1.0m • Final payment for acquisition SPE in Poland: € -0.2m • • Acquisition FDM in Australia: € -12.1m • Purchase 24.5% additional shares in LGI: € -20.7m Payment of a dividend to minority interests: € -2.0m •

Strong balance sheet structure

€ million

Mar 31, 2016 Dec 31, 2015

Mar 31, 2016 Dec 31, 2015

Outlook for 2016¹

Top line

• Underlying Domestic Mail volume decline between 5 and 6%²
• Compensation for SGEI: € 26.8m lower than in 2015 excluding inflation and volume impact
• Domestic Parcels: double digit volume growth
• International Parcels: continued growth in flows from the US but at a slower pace mainly due to strong US dollar

Costs

• Productivity improvements: low end of 800 to 1,200 FTE/year range excluding impact of Deltamedia integration.
• Strong focus on all cost items and factor cost levers (e.g. abolishment of Saturday compensation, tax shift).

Recurring EBITDA and dividend payment at the same level as 2015

FCF

• Gross capex: c. € 80.0m
• Cash generation from operating activities will be negatively impacted by lower compensation and changed payment terms for SGEI (€ -36.8m), the Alpha pay-outs and a settlement on terminal dues with another postal operator.
• ¹ Outlook 2016 excludes the impact of the acquisition of the Belgian activities of Lagardère Travel Retail
• ² 2Q16 will count 2 working days more, 3Q16 will count 1 day less (except for stamps which will count the same number of days) and 4Q16 will count 1 day less vs. same quarter of 2015.

Key contacts

Baudouin de Hepcée Director External Communication, Investor Relations & Public Affairs	• Email: baudouin.dehepcee@bpost.be Direct: +32 (0) 2 276 22 28 • • Mobile: +32 (0) 476 49 69 58 Address: bpost, Centre Monnaie, 1000 Brussels, Belgium •
Saskia Dheedene Manager Investor Relations	Email: saskia.dheedene@bpost.be • Direct: +32 (0) 2 276 76 43 • • Mobile: +32 (0) 477 92 23 43 Address: bpost, Centre Monnaie, 1000 Brussels, Belgium •