Quarterly Report • Nov 19, 2020
Quarterly Report
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| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | ||
|---|---|---|---|---|---|---|---|
| Revenue | € m | 46,385 | 47,690 | 2.8 | 15,552 | 16,244 | 4.4 |
| Profit from operating activities (EBIT) | € m | 2,870 | 2,881 | 0.4 | 942 | 1,377 | 46.2 |
| Return on sales 1 | % | 6.2 | 6.0 | – | 6.1 | 8.5 | – |
| EBIT after asset charge (EAC) | € m | 914 | 889 | –2.7 | 277 | 726 | >100 |
| Consolidated net profit for the period 2 | € m | 1,765 | 1,677 | – 5.0 | 561 | 851 | 51.7 |
| Free cash flow | € m | –296 | 1,460 | >100 | 507 | 1,264 | >100 |
| Net debt 3 | € m | 13,367 | 13,774 | 3.0 | – | – | – |
| Earnings per share 4 | € | 1.43 | 1.36 | – 4.9 | 0.45 | 0.69 | 53.3 |
| Number of employees 5 | 543,715 | 550,051 | 1.2 | – | – | – |
1 EBIT / revenue. 2 After deduction of non-controlling interests. 3 Prior-year amount as at 31 December. 4 Basic earnings per share. 5 Headcount at the end of the reporting period, including trainees.
No material changes were made to the Group's organisational structure during the reporting period.
A special bonus of €300 to each of our employees in recognition of their achievements in recent months resulted in additional staff costs in the third quarter of 2020 of €163 million.
No significant changes were made to our portfolio in the third quarter of 2020.
Group revenue for the third quarter of 2020 rose by 4.4 % to €16,244 million, despite the factthat currency effects reduced revenue by €653 million. The proportion ofrevenue generated abroad increased from 70.4 % to 71.3 %. Revenue for the first nine months of the year increased by 2.8 % to €47,690 million. The nine-month figure was likewise significantly reduced by currency effects of €847 million.
Other operating income rose from €438 million to €525 million in the third quarter, due in part to the reversal of StreetScooter provisions.
Materials expense increased significantly compared with the third quarter of 2019 by €297 million to €8,158 million, due in particularto increases in transport costs. Staff costs increased by €228 million year-on-year to €5,425 million as a result of the €300 special bonus payment made to each employee in the third quarter of 2020. Depreciation, amortisation and impairment losses decreased slightly by €15 million to €902 million in the reporting period. In the third quarter of 2019, impairment losses had been recognised for restructuring the eCommerce Solutions division. Other operating expenses fell by €123 million to €996 million, due among other things to lower travel expenses.
Group EBIT for the third quarter of 2020 increased considerably over the prior-year figure with a 46.2 % rise to €1,377 million. Group EBIT for the first nine months of 2020 was up slightly on the prior-period amount with an increase of €11 million to €2,881 million. In contrast, net
€ m
| EAC | 914 | 889 | –2.7 | 277 | 726 | >100 |
|---|---|---|---|---|---|---|
| Asset charge | –1,956 | –1,992 | –1.8 | – 665 | – 651 | 2.1 |
| EBIT | 2,870 | 2,881 | 0.4 | 942 | 1,377 | 46.2 |
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
finance costs increased from €173 million to €183 million, owing primarily to the negative effects of measuring stock appreciation rights (SAR s) at fair value. Profit before income taxes was up by €425 million on the third quarter of 2019 to €1,194 million. Income taxes rose by €117 million to €286 million, with one reason being an increase of two percentage points on the prior-year quarter's tax rate.
At €908 million, consolidated net profit significantly exceeded the €600 million profit generated in the third quarter of 2019. A total of €851 million is attributable to Deutsche Post AG shareholders and €57 million to non-controlling interest shareholders. Basic earnings per share improved from €0.45 to €0.69 and diluted earnings per share from €0.45 to €0.67.
EAC rose from €277 million to €726 million in the third quarter of 2020, mostly due to the sharp increase in EBIT. The imputed asset charge decreased slightly from the prior-year amount, due in particular to a decline in net working capital.
The FFO to debt performance metric for the first nine months of 2020 increased compared with 31 December 2019, because funds from operations increased at a greater rate than debt. The increase in funds from operations was largely the result of higher operating cash flow before changes in working capital. Reported financial liabilities grew, due chiefly to the issuance ofthree bonds in May. The adjustment for pensions increased due to lower plan assets and a slight increase in pension obligations. Bond proceeds and positive free cash flow generated additional surplus cash and near-cash investments in the first nine months of 2020, even after considering the shareholder dividend payment.
| € m | ||
|---|---|---|
| 1 Oct. | ||
| 1 Jan. to | 2019 to | |
| 31 Dec. | 30 Sept. | |
| 2019 | 2020 | |
| Operating cash flow before changes | ||
| in working capital | 6,045 | 7,167 |
| Interest received | 82 | 74 |
| Interest paid | 608 | 570 |
| Adjustment for pensions | 190 | 144 |
| Funds from operations, FFO | 5,709 | 6,815 |
| Reported financial liabilities 1 | 16,974 | 19,287 |
| Financial liabilities at fair value | ||
| through profit or loss 1 | 23 | 50 |
| Adjustment for pensions 1 | 4,872 | 5,417 |
| Surplus cash and near-cash | ||
| investments 1, 2 | 1,916 | 3,924 |
| Debt | 19,907 | 20,730 |
| FFO to debt (%) | 28.7 | 32.9 |
1 As at 31 December 2019 and 30 September 2020, respectively.
2 Reported cash and cash equivalents and investment funds callable at sight, less cash needed for operations.
Capital expenditure for property, plant and equipment and intangible assets acquired (excluding goodwill) declined to €683 million in the third quarter of 2020, down from €854 million in the prior-year period. The decrease was due to the fact that the majority of investments for the renewal of the intercontinental Express aircraft fleet were made during the third quarter of the previous year. In this context, four aircraft have been put into operation thus far during 2020.
Net cash from operating activities rose from €1,869 million in the third quarter of 2019 to €2,385 million in the third quarter of 2020. All non-cash income and expenses were adjusted based on EBIT. Cash inflow from changes in working capital amounted to €445 million, and thus on prior-year level (€455 million).
Net cash used in investing activities declined by €437 million to €313 million. The prior-year figure related primarily to expenses for the renewal of the Express intercontinental aircraft fleet. In the reporting period, repayment of a promissory note loan was largely responsible for cash inflows of €226 million arising from changes in current financial assets.
Free cash flow improved significantly in the third quarter of 2020 from €507 million to €1,264 million.
Net cash used in financing activities rose from €1,125 million in the third quarter of 2019 to €2,262 million. This was because the dividend of €1,422 million for financial year 2019 was not paid until 1 September 2020, following the postponed Annual General Meeting.
Cash and cash equivalents rose from €2,862 million as at 31 December 2019 to €4,285 million.
| € m | ||||
|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | Q 3 2019 | Q 3 2020 | |
| Net cash from operating activities | 3,386 | 4,781 | 1,869 | 2,385 |
| Sale of property, plant and equipment and intangible assets | 104 | 84 | 15 | 42 |
| Acquisition of property, plant and equipment and intangible assets | –2,679 | –1,663 | – 816 | – 607 |
| Cash outflow from change in property, plant and equipment and intangible assets |
–2,575 | –1,579 | – 801 | – 565 |
| Disposals of subsidiaries and other business units | 678 | 4 | 21 | 0 |
| Acquisition of subsidiaries and other business units | –14 | 0 | – 6 | 0 |
| Acquisition of investments accounted for using the equity method and other investments |
– 8 | –13 | 1 | 0 |
| Cash inflow / outflow from divestitures / acquisitions | 656 | – 9 | 16 | 0 |
| Proceeds from lease receivables | 19 | 17 | 6 | 5 |
| Repayment of lease liabilities | –1,418 | –1,416 | – 471 | – 466 |
| Interest on lease liabilities | –310 | –298 | –106 | – 96 |
| Cash outflow for leases | –1,709 | –1,697 | – 571 | – 557 |
| Interest received | 59 | 51 | 22 | 14 |
| Interest paid | –113 | – 87 | –28 | –13 |
| Net interest paid | – 54 | –36 | – 6 | 1 |
| Free cash flow | –296 | 1,460 | 507 | 1,264 |
The Group's total assets amounted to €53,284 million as at 30 September 2020, up from €52,169 million as at 31 December 2019.
Non-current assets decreased from €37,117 million to €36,371 million. Intangible assets fell by €289 million to €11,698 million, primarily due to currency effects. Currency losses also affected property, plant and equipment, which declined from €21,303 million to €21,096 million. Other non-current assets dropped by €158 million to €237 million, mostly on account of actuarial losses thatreduced pension
assets. Current assets rose sharply from €15,052 million to €16,913 million, mainly owing to the increase of €1.4 billion in cash and cash equivalents. In addition, current financial assets rose by €459 million to €853 million, largely because we invested cash in money market funds.
Equity attributable to Deutsche Post AG shareholders declined to €13,116 million (31 December 2019: €14,117 million). Consolidated net profit for the period increased this figure, whilst actuarial losses on pension obligations, the dividend payment and currency effects decreased it. Financial liabilities increased from €16,974 million to
€19,287 million, due chiefly to the bonds issued in May. Provisions for pensions and similar obligations rose by €380 million to €5,482 million. By contrast,trade payables decreased significantly by €779 million to €6,446 million at the reporting date.
Our net debt rose from €13,367 million as at 31 December 2019 to €13,774 million as at 30 September 2020, because the increase in financial liabilities exceeded the increase in financial assets.
| Financial liabilities 1 Cash and cash equivalents Current financial assets Positive fair value of non-current financial derivatives 2 |
2,862 394 1 |
4,285 853 1 |
|---|---|---|
| 16,624 | 18,913 | |
| Current financial liabilities | 2,916 | 3,145 |
| Non-current financial liabilities | 13,708 | 15,768 |
| € m | 31 Dec. 2019 |
30 Sept. 2020 |
1 Less operating financial liabilities.
2 Reported in non-current financial assets in the balance sheet.
| € m | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| adjusted 1 | adjusted 1 | |||||
| Revenue | 11,131 | 11,654 | 4.7 | 3,692 | 3,817 | 3.4 |
| of which Post Germany | 5,999 | 5,819 | –3.0 | 2,010 | 1,894 | – 5.8 |
| Parcel Germany | 3,443 | 4,076 | 18.4 | 1,143 | 1,338 | 17.1 |
| International | 1,594 | 1,671 | 4.8 | 514 | 560 | 8.9 |
| Other / Consolidation | 95 | 88 | –7.4 | 25 | 25 | 0.0 |
| Profit from operating activities (EBIT) | 708 | 918 | 29.7 | 304 | 320 | 5.3 |
| Return on sales (%) 2 | 6.4 | 7.9 | – | 8.2 | 8.4 | – |
| Operating cash flow | 475 | 1,008 | >100 | 355 | 323 | – 9.0 |
Third-quarter 2020 volumes were up by 11.6 % in the German parcel business, primarily due to the sustained rise in e-commerce volumes. Supported in part by price increases, revenue rose even more sharply by 17.1 %.
Import business continued to recover in the third quarter. Declines in letter mail volumes – especially from Asia and the rest of Europe – were offset by growth in parcel volumes.Goods and document exports performed similarly. Whilst revenue from letter mail declined, goods shipments registered considerable growth. Thiswas attributable above all to the extremely positive trend on European trade lanes.
1 Reported figures adjusted to reflect new product structure and reclassifications.
2 EBIT / revenue.
Division revenue was up 3.4 % year-on-year to €3,817 million in the third quarter of 2020. The increase was driven in particular by growth in the German parcel business, in addition to the impact of an additional 0.2 working days compared with the prior-year period.
Since the first quarter of 2020, revenue from transporting documents and goods across Germany's borders has been presented as International revenue.
In the third quarter of 2020, letter mail volumes dropped below the prior-period level. Mail Communication revenue declined slightly.
Dialogue Marketing registered significant declines in both addressed and unaddressed mail. The downturn was attributable to pandemic-related cuts in advertising budgets since the middle of March.
| € m | 9 M 2019 adjusted 1 |
9 M 2020 | + / – % | Q 3 2019 adjusted 1 |
Q 3 2020 | + / – % |
|---|---|---|---|---|---|---|
| Post Germany | 5,999 | 5,819 | –3.0 | 2,010 | 1,894 | – 5.8 |
| of which Mail Communication | 3,859 | 4,006 | 3.8 | 1,316 | 1,285 | –2.4 |
| Dialogue Marketing | 1,558 | 1,297 | –16.8 | 506 | 444 | –12.3 |
| Other / Consolidation Post Germany | 582 | 516 | –11.3 | 188 | 165 | –12.2 |
| Parcel Germany | 3,443 | 4,076 | 18.4 | 1,143 | 1,338 | 17.1 |
1 Reported figures adjusted to reflect new product structure and reclassifications.
| Mail items (millions) | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| adjusted 1 | adjusted 1 | |||||
| Post Germany | 11,682 | 10,371 | –11.2 | 3,840 | 3,448 | –10.2 |
| of which Mail Communication | 4,768 | 4,667 | –2.1 | 1,578 | 1,490 | – 5.6 |
| Dialogue Marketing | 5,973 | 4,957 | –17.0 | 1,959 | 1,715 | –12.5 |
| Parcel Germany | 996 | 1,116 | 12.0 | 329 | 367 | 11.6 |
1 Reported figures adjusted to reflect new product structure and reclassifications.
Division EBIT increased by 5.3 % in the third quarter of 2020 to €320 million, mainly as a result of higherrevenue in the German parcel business and strict cost management. The figure for EBIT includes the special bonus payment to employees totalling €51 million, plus a non-recurring payment of €42 million made in connection with the recently concluded wage negotiations in Germany.
| € m | |
|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
|---|---|---|---|---|---|---|
| Revenue | 12,458 | 13,536 | 8.7 | 4,247 | 4,869 | 14.6 |
| of which Europe | 5,554 | 5,686 | 2.4 | 1,858 | 2,012 | 8.3 |
| Americas | 2,614 | 2,819 | 7.8 | 911 | 1,005 | 10.3 |
| Asia Pacific | 4,438 | 5,093 | 14.8 | 1,525 | 1,823 | 19.5 |
| MEA (Middle East and Africa) | 909 | 909 | 0.0 | 306 | 322 | 5.2 |
| Consolidation / Other | –1,057 | – 971 | 8.1 | –353 | –293 | 17.0 |
| Profit from operating activities (EBIT) | 1,428 | 1,711 | 19.8 | 454 | 753 | 65.9 |
| Return on sales (%) 1 | 11.5 | 12.6 | – | 10.7 | 15.5 | – |
| Operating cash flow | 2,321 | 3,001 | 29.3 | 898 | 1,266 | 41.0 |
1 EBIT / revenue.
| € m per day 1 | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| Time Definite International (TDI) | 49.7 | 54.3 | 9.3 | 49.0 | 58.5 | 19.4 |
| Time Definite Domestic (TDD) | 4.6 | 5.0 | 8.7 | 4.6 | 5.1 | 10.9 |
1 To improve comparability, product revenue was translated at uniform exchange rates. Product revenue is also the basis for the weighted calculation of working days.
| Items per day (thousands) | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| Time Definite International (TDI) | 979 | 1,033 | 5.5 | 962 | 1,114 | 15.8 |
| Time Definite Domestic (TDD) | 512 | 582 | 13.7 | 505 | 588 | 16.4 |
Revenue in the division increased by 14.6 % in the third quarter of 2020 to reach €4,869 million. This includes currency losses of €279 million, excluding which revenue grew by 21.2 %. The revenue figure also reflects the fact thatfuel surchargeswere lowerthan in the previous yearin allregions. Excluding currency effects and fuel surcharges, third-quarter revenue rose by 23.5 %.
The positive momentum in international Express volumes seen at the end of the second quarter continued in all regions during the third quarter. Per-day revenue and shipment volumes were up in both product lines in the third quarter.
Revenue in the Europe region increased by 8.3 % to €2,012 million in the third quarter of 2020. Excluding currency losses of €37 million, revenue rose by 10.3 %. In the TDI product line, per-day revenue was up by 10.6 % and per-day shipment volumes by 11.2 %.
In the Americas region, revenue increased by 10.3 % to €1,005 million in the third quarter of 2020. This figure includes currency losses of €96 million; growth excluding currency effects was 20.9 %. Per-day TDI volumes were up 24.7 % compared with the previous year. Revenue per day increased by 19.6 %.
In the Asia Pacific region, revenue improved by 19.5 % to €1,823 million in the third quarter of 2020. The revenue figure includes currency losses of €95 million. Revenue growth excluding currency effects was 25.8 %. In the TDI productline,revenue per day was up by 27.4 % and per-day volumes by 18.6 %.
Revenue in the MEA region (Middle East and Africa) increased by 5.2 % to €322 million in the third quarter of 2020, including currency losses of €26 million. Revenue growth excluding currency effects was 13.7 %. Per-day TDIrevenue increased by 21.3 %, and per-day volumes were up by 20.5 %.
Driven by strong growth in time-definite volumes, division EBIT climbed significantly by 65.9 % year-on-year to €753 million in the third quarter of 2020.
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
|---|---|---|---|---|---|---|
| Revenue | 11,274 | 11,524 | 2.2 | 3,716 | 3,752 | 1.0 |
| of which Global Forwarding | 7,956 | 8,443 | 6.1 | 2,645 | 2,728 | 3.1 |
| Freight | 3,405 | 3,164 | –7.1 | 1,090 | 1,050 | –3.7 |
| Consolidation / Other | – 87 | – 83 | 4.6 | –19 | –26 | –36.8 |
| Profit from operating activities (EBIT) | 348 | 418 | 20.1 | 124 | 155 | 25.0 |
| Return on sales (%) 1 | 3.1 | 3.6 | – | 3.3 | 4.1 | – |
| Operating cash flow | 415 | 404 | –2.7 | 175 | 445 | >100.0 |
1 EBIT / revenue.
Revenue in the division amounted to €3,752 million in the third quarter of 2020, an increase of 1.0 % over the priorperiod figure. In the Global Forwarding business unit, revenue rose by 3.1 % compared with the third quarter of 2019 to €2,728 million. Gross profit for the Global Forwarding business unit dipped slightly below the prior-year level of €637 million to €633 million.
In our air freight business, we registered a year-on-year volume decrease of 14.1 % in the third quarter of 2020. The decrease was mainly due to declines in shipments to China and from the United States. Air freight revenue rose by 21.6 % in the third quarter, and gross profit improved by 8.8 %. In addition to improvements in our global infrastructure, utilisation of a central system for sourcing air freight capacity contributed to the revenue increase. As expected, airfreightrates for specific trade lanes (e. g. Europe–China)
began to normalise in the third quarter. However, rates remain above the prior-year level on most trade lanes.
Ocean freight volumes were down 10.5 % in the third quarter of 2020, and ocean freight revenue fell by 9.2 % compared to previous year. Gross profit was up by 3.6 %. The share of revenue associated with industrial project business and reported under Other dropped to 30.0 % (prior-year quarter: 35.3 %). Gross profit from industrial project business decreased by 22.6 %.
| Total | 7,956 | 8,443 | 6.1 | 2,645 | 2,728 | 3.1 |
|---|---|---|---|---|---|---|
| Other | 1,716 | 1,567 | – 8.7 | 583 | 503 | –13.7 |
| Ocean freight | 2,733 | 2,509 | – 8.2 | 917 | 833 | – 9.2 |
| Air freight | 3,507 | 4,367 | 24.5 | 1,145 | 1,392 | 21.6 |
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| € m |
| Thousands | |||||||
|---|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | ||
| Air freight | tonnes | 2,657 | 2,314 | –12.9 | 882 | 758 | –14.1 |
| of which exports | tonnes | 1,499 | 1,318 | –12.1 | 502 | 437 | –12.9 |
| Ocean freight | TEU 1 | 2,412 | 2,100 | –12.9 | 847 | 758 | –10.5 |
1 Twenty-foot equivalent units.
Revenue in the Freight business unit decreased by 3.7 % year-on-yearto €1,050 million in the third quarter of 2020, due in part to currency losses of €5 million. Volumes grew slightly by 0.7 %. Gross profit forthe business unit declined by 1.8 % to €272 million.
Despite lower volumes, division EBIT rose from €124 million to €155 million in the third quarter of 2020. The increase was predominantly attributable to strict cost management.
| € m | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| adjusted 1 | adjusted 1 | |||||
| Revenue | 9,936 | 9,039 | – 9.0 | 3,370 | 3,080 | – 8.6 |
| of which EMEA (Europe, Middle East and Africa) | 5,029 | 4,415 | –12.2 | 1,666 | 1,500 | –10.0 |
| Americas | 3,435 | 3,330 | –3.1 | 1,223 | 1,144 | – 6.5 |
| Asia Pacific | 1,490 | 1,309 | –12.1 | 487 | 441 | – 9.4 |
| Consolidation / Other | –18 | –15 | 16.7 | – 6 | – 5 | 16.7 |
| Profit from operating activities (EBIT) | 735 | 251 | – 65.9 | 162 | 111 | –31.5 |
| Return on sales (%) 2 | 7.4 | 2.8 | – | 4.8 | 3.6 | – |
| Operating cash flow | 526 | 365 | –30.6 | 369 | 276 | –25.2 |
1 Prior-year figures adjusted due to reclassifications.
2 EBIT / revenue.
Revenue in the division was down by 8.6 % to €3,080 million in the third quarter of 2020. Revenue decline, which was less than in the previous quarter, was among other things attributable to reduced business activity, especially in the Auto-mobility sector in the EMEA and Americas regions. Business disposals and negative currency effects of €172 million also contributed to the decrease in revenue on the prior-year quarter.
Total revenue: €3,080 million
| of which Retail | 29 % |
|---|---|
| Consumer | 23 % |
| Technology | 14 % |
| Auto-mobility | 13 % |
| Life Sciences & Healthcare | 10 % |
| Others | 6 % |
| Engineering & Manufacturing | 5 % |
| of which Europe, Middle East, Africa, Consolidation | 49 % |
| Americas | 37 % |
| Asia Pacific | 14 % |
In the third quarter of 2020, the division concluded additional contracts worth around €407 million in annualised revenue with both new and existing customers. The Retail, Life Sciences & Healthcare andConsumer sectors accounted for the majority of the new business, with a strong contribution from e-commerce solutions. The annualised contract renewal rate remained at a consistently high level.
Earnings in the division came to €111 million in the third quarter of 2020 (previous year: €162 million). Earnings recovered compared to the previous quarters because of increasing customer activity. The third quarter of 2019 had been impacted by non-recurring expenses of €8 million. The third quarter of 2020 included expenses for the special bonus of €52 million.
| € m | ||||||
|---|---|---|---|---|---|---|
| 9 M 2019 | 9 M 2020 | + / – % | Q 3 2019 | Q 3 2020 | + / – % | |
| Revenue | 2,958 | 3,374 | 14.1 | 964 | 1,216 | 26.1 |
| of which Americas | 834 | 1,134 | 36.0 | 273 | 432 | 58.2 |
| Europe | 1,696 | 1,833 | 8.1 | 541 | 625 | 15.5 |
| Asia | 427 | 411 | –3.7 | 148 | 160 | 8.1 |
| Other / Consolidation | 1 | – 4 | <–100 | 2 | –1 | <–100 |
| Profit / loss from operating activities (EBIT) | – 40 | 83 | >100 | 6 | 76 | >100 |
| Return on sales (%) 1 | –1.4 | 2.5 | – | 0.6 | 6.3 | – |
| Operating cash flow | 128 | 300 | >100 | 80 | 127 | 58.8 |
1 EBIT / revenue.
The division generated revenue of €1,216 million in the third quarter of 2020, up 26.1 % on the prior-year figure. The increase was driven by growth in B2C volumes, which led to higher revenue in all regions. Excluding currency losses of €49 million, total revenue was up 31.2 % on the prior-year quarter.
Division EBIT rose to €76 million in the third quarter of 2020 (previous year: €6 million). The third quarter of 2019 had been negatively impacted by netrestructuring expenses of €4 million, and the third quarter of 2020 was impacted by the special bonus payment of €10 million.
The economic outlook for 2020 improved considerably in the third quarter, even though the impact of the pandemic on businesses and consumers is still highly uncertain. IHS Markit now expects the global economy to shrink by just 4.8 %. A decline of 9.9 % is forecastfor globaltrade volumes. For the coming months, IHS Markit expects the upswing in global economic activity to weaken notably. The biggest risks to economic recovery are additional restrictions being imposed in the fight againstthe pandemic, including temporary lockdowns in some countries, as well as rapidly rising unemployment and loan default rates and a "hard" Brexit looming at the end of the year.
Inlight ofits recent earningsmomentum,on7 October 2020 the Group raised its outlook for full-year 2020. Reported Group EBIT is now expected to reach between €4.1 billion and €4.4 billion. In anticipation of a very strong holiday season at the end of the year, driven in particular by dynamic e-commerce growth, we are focused on securing all necessary resources required to maintain a high level of service quality. Achieving the upper end of our EBIT guidance will mainly depend on whether the volume development will allow efficient utilisation of our networks.
The Group continues to expect EBIT of around €1.5 billion for the Post & Parcel Germany division. For the DHL divisions, we are now forecasting EBIT of between €3.3 billion and €3.6 billion. EBIT of approximately €–700 million is expected for Corporate Functions. This includes negative effects of around €350 million as part of the still applicable expenses of around €400 million for the realignment of StreetScooter activities that were previously announced. The remaining amount of around €50 million will be booked in 2021.
Free cash flow is now expected to total more than €2.0 billion in full-year 2020 with total capital expenditure still expected to come in at around €2.9 billion. This figure includes non-recurring effects resulting from the special bonus payment of €300 to each employee plus the nonrecurring expense of €42 million incurred for employees of the Post & Parcel Germany division in connection with the recently concluded wage negotiations, as well as approximately €300 million forthe renewal ofthe intercontinental Express aircraft fleet.
COVID-19 is having different effects on our company. Whilst some business units have been negatively affected, others have seen a positive impact. Despite COVID-19, our customers' payment behaviour has so far not deteriorated significantly overall.However, we cannotrule out payment defaults caused by the pandemic in the future. Overall, COVID-19 represents a risk of medium significance. We now assess the aggregate impact of foreign currency effects as representing a risk of medium significance.
In its capacity as a consumer of postal services, a German courier, express and parcel (CEP) association filed an action against the pricing approvals granted – in what is known as a "price-cap procedure" – by the Bundesnetzagentur (BNetzA – German Federal Network Agency) on 4 December 2015 for the years from 2016 to 2018. In addition,the association joined forces with another provider of postal services to file a further action with the Administrative Court againstthe pricing approvals granted by the Federal Network Agency on 12 December 2019 for the years from 2019 to 2021.
On 27 May 2020, the German Federal Administrative Court ruled on the action brought against the pricing approvals for the years from 2016 to 2018. The only one of those approvals thatthe court deemed unlawful concerned the increase in the price of a standard domestic letter to €0.70. The ruling is only directly applicable to the plaintiff. The Federal Administrative Court has setthe amountin dispute at a mid-range, four-digit euro amount.
In the grounds for its decision, the court stated that the pricing approval in question was unlawful because the method used to calculate the allowable profit margin under the amended provisions of the 2015 Post-Entgeltregulierungsverordnung (PEntgV – Postal Rate Regulation Act) was not in compliance with the provisions of the Postgesetz (PostG – German Postal Act) regarding the authority to issue statutory instruments. The German government plans to remedy this formal deficiency through an amendment to the Postal Act, which will allow previous regulatory practice to continue by and large.
It cannot currently be ruled out that the effects of the court's decision on existing pricing approvals or on future price-cap procedures could be negative for Deutsche Post. According to current assessments, this represents a medium risk.
The Group's overall opportunity and risk situation did not otherwise change significantly during the third quarter of 2020 compared with the situation described in the 2019 Annual Report beginning on page 63. Based upon the Group's early warning system and in the estimation of its Board of Management, there were no identifiable risks for the Group in the current year which, individually or collectively, cast doubt upon the Group's ability to continue as a going concern. Nor are any such risks apparent in the foreseeable future.
€ m
SELECTED FINANCIAL INFORMATION
| 9 M 2019 | 9 M 2020 | Q 3 2019 | Q 3 2020 | |
|---|---|---|---|---|
| Revenue | 46,385 | 47,690 | 15,552 | 16,244 |
| Other operating income | 1,787 | 1,496 | 438 | 525 |
| Changes in inventories and work performed and capitalised | 188 | 225 | 47 | 88 |
| Materials expense | –23,459 | –24,070 | –7,861 | – 8,158 |
| Staff costs | –16,021 | –16,377 | – 5,197 | – 5,425 |
| Depreciation, amortisation and impairment losses | –2,718 | –2,865 | – 917 | – 902 |
| Other operating expenses | –3,293 | –3,187 | –1,119 | – 996 |
| Net income / loss from investments accounted for using the equity method | 1 | –31 | –1 | 1 |
| Profit from operating activities (EBIT) | 2,870 | 2,881 | 942 | 1,377 |
| Financial income | 146 | 182 | 30 | 41 |
| Finance costs | – 621 | – 625 | –191 | –209 |
| Foreign currency income / loss | 1 | – 46 | –12 | –15 |
| Net finance costs | – 474 | – 489 | –173 | –183 |
| Profit before income taxes | 2,396 | 2,392 | 769 | 1,194 |
| Income taxes | – 527 | – 574 | –169 | –286 |
| Consolidated net profit for the period | 1,869 | 1,818 | 600 | 908 |
| attributable to Deutsche Post AG shareholders | 1,765 | 1,677 | 561 | 851 |
| attributable to non-controlling interests | 104 | 141 | 39 | 57 |
| Basic earnings per share (€) | 1.43 | 1.36 | 0.45 | 0.69 |
| Diluted earnings per share (€) | 1.41 | 1.33 | 0.45 | 0.67 |
| € m |
|---|
| ----- |
| 31 Dec. 2019 | 30 Sept. 2020 | |
|---|---|---|
| ASSETS Intangible assets |
11,987 | 11,698 |
| Property, plant and equipment | 21,303 | 21,096 |
| Investment property | 25 | 14 |
| Investments accounted for using the equity method | 123 | 99 |
| Non-current financial assets | 759 | 733 |
| Other non-current assets | 395 | 237 |
| Deferred tax assets | 2,525 | 2,494 |
| Non-current assets | 37,117 | 36,371 |
| Inventories | 396 | 464 |
| Current financial assets | 394 | 853 |
| Trade receivables | 8,561 | 8,397 |
| Other current assets | 2,598 | 2,685 |
| Income tax assets | 232 | 229 |
| Cash and cash equivalents | 2,862 | 4,285 |
| Assets held for sale | 9 | 0 |
| Current assets | 15,052 | 16,913 |
| TOTAL ASSETS | 52,169 | 53,284 |
| 31 Dec. 2019 | 30 Sept. 2020 | |
|---|---|---|
| EQUITY AND LIABILITIES | ||
| Issued capital | 1,236 | 1,239 |
| Capital reserves | 3,482 | 3,490 |
| Other reserves | –700 | –1,452 |
| Retained earnings | 10,099 | 9,839 |
| Equity attributable to Deutsche Post AG shareholders | 14,117 | 13,116 |
| Non-controlling interests | 275 | 244 |
| Equity | 14,392 | 13,360 |
| Provisions for pensions and similar obligations | 5,102 | 5,482 |
| Deferred tax liabilities | 56 | 46 |
| Other non-current provisions | 1,650 | 1,709 |
| Non-current financial liabilities | 13,736 | 15,787 |
| Other non-current liabilities | 360 | 325 |
| Non-current provisions and liabilities | 20,904 | 23,349 |
| Current provisions | 964 | 1,016 |
| Current financial liabilities | 3,238 | 3,500 |
| Trade payables | 7,225 | 6,446 |
| Other current liabilities | 4,913 | 5,143 |
| Income tax liabilities | 519 | 470 |
| Liabilities associated with assets held for sale | 14 | 0 |
| Current provisions and liabilities | 16,873 | 16,575 |
| TOTAL EQUITY AND LIABILITIES | 52,169 | 53,284 |
€ m
| 9 M 2019 | 9 M 2020 | Q 3 2019 | Q 3 2020 | |
|---|---|---|---|---|
| Consolidated net profit for the period | 1,869 | 1,818 | 600 | 908 |
| Income taxes | 527 | 574 | 169 | 286 |
| Net finance costs | 474 | 489 | 173 | 183 |
| Profit from operating activities (EBIT) | 2,870 | 2,881 | 942 | 1,377 |
| Depreciation, amortisation and impairment losses | 2,718 | 2,865 | 917 | 902 |
| Net income / loss from disposal of non-current assets | – 485 | 28 | 0 | – 9 |
| Non-cash income and expense | – 44 | 93 | 7 | 15 |
| Change in provisions | – 458 | 18 | –336 | – 69 |
| Change in other non-current assets and liabilities | 128 | – 80 | 67 | – 46 |
| Dividend received | 2 | 2 | 0 | 1 |
| Income taxes paid | – 602 | – 556 | –183 | –231 |
| Net cash from operating activities before changes in | ||||
| working capital | 4,129 | 5,251 | 1,414 | 1,940 |
| Changes in working capital | ||||
| Inventories | – 63 | –73 | 24 | – 60 |
| Receivables and other current assets | – 619 | – 517 | 230 | 83 |
| Liabilities and other items | – 61 | 120 | 201 | 422 |
| Net cash from operating activities | 3,386 | 4,781 | 1,869 | 2,385 |
| Subsidiaries and other business units | 678 | 4 | 21 | 0 |
| Property, plant and equipment and intangible assets | 104 | 84 | 15 | 42 |
| Other non-current financial assets | 37 | 32 | 14 | 12 |
| Proceeds from disposal of non-current assets | 819 | 120 | 50 | 54 |
| Subsidiaries and other business units | –14 | 0 | – 6 | 0 |
| Property, plant and equipment and intangible assets | –2,679 | –1,663 | – 816 | – 607 |
| Investments accounted for using the equity method and other investments |
– 8 | –13 | 1 | 0 |
| Other non-current financial assets | – 4 | –7 | –3 | 0 |
| Cash paid to acquire non-current assets | –2,705 | –1,683 | – 824 | – 607 |
| 9 M 2019 | 9 M 2020 | Q 3 2019 | Q 3 2020 | |
|---|---|---|---|---|
| Interest received | 59 | 51 | 22 | 14 |
| Current financial assets | 782 | – 456 | 2 | 226 |
| Net cash used in investing activities | –1,045 | –1,968 | –750 | –313 |
| Proceeds from issuance of non-current financial liabilities | 196 | 2,475 | 29 | 35 |
| Repayments of non-current financial liabilities | –1,724 | –1,532 | –768 | – 573 |
| Change in current financial liabilities | 295 | –103 | –127 | –11 |
| Other financing activities | 19 | –72 | – 6 | – 51 |
| Cash paid for transactions with non-controlling interests | – 5 | – 6 | 0 | 0 |
| Dividend paid to Deutsche Post AG shareholders | –1,419 | –1,422 | 0 | –1,422 |
| Dividend paid to non-controlling interest shareholders | –137 | –147 | –129 | –131 |
| Purchase of treasury shares | –11 | – 45 | –1 | 0 |
| Proceeds from issuing shares or other equity instruments | 11 | 0 | 11 | 0 |
| Interest paid | – 423 | –385 | –134 | –109 |
| Net cash used in financing activities | –3,198 | –1,237 | –1,125 | –2,262 |
| Net change in cash and cash equivalents | – 857 | 1,576 | – 6 | –190 |
| Effect of changes in exchange rates on cash and cash equivalents |
39 | –153 | 18 | – 94 |
| Changes in cash and cash equivalents associated with assets held for sale |
31 | 0 | –2 | 0 |
| Cash and cash equivalents at beginning of reporting period | 3,017 | 2,862 | 2,220 | 4,569 |
| Cash and cash equivalents at end of reporting period | 2,230 | 4,285 | 2,230 | 4,285 |
| € m | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Post & Parcel Germany 1 |
Global Forwarding, Express Freight |
Supply Chain 1 | eCommerce Solutions |
Corporate Functions | Consolidation 1, 2 | Group | ||||||||||
| 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | |
| External revenue | 10,851 | 11,329 | 12,185 | 13,246 | 10,580 | 10,802 | 9,861 | 8,976 | 2,799 | 3,277 | 109 | 60 | 0 | 0 | 46,385 | 47,690 |
| Internal revenue | 280 | 325 | 273 | 290 | 694 | 722 | 75 | 63 | 159 | 97 | 962 | 1,122 | –2,443 | –2,619 | 0 | 0 |
| Total revenue | 11,131 | 11,654 | 12,458 | 13,536 | 11,274 | 11,524 | 9,936 | 9,039 | 2,958 | 3,374 | 1,071 | 1,182 | –2,443 | –2,619 | 46,385 | 47,690 |
| Profit / loss from operating activities (EBIT) | 708 | 918 | 1,428 | 1,711 | 348 | 418 | 735 | 251 | – 40 | 83 | –309 | – 500 3 | 0 | 0 | 2,870 | 2,881 |
| of which net income / loss from investments accounted for using the equity method |
0 | 0 | 2 | 2 | 0 | 0 | 7 | 3 | – 5 | –35 | –3 | 0 | 0 | –1 | 1 | –31 |
| Segment assets 4 | 5,904 | 6,017 | 15,640 | 15,444 | 8,714 | 8,626 | 7,898 | 7,899 | 1,723 | 1,684 | 5,495 | 5,179 | – 83 | – 81 | 45,291 | 44,768 |
| of which investments accounted for using the equity method |
0 | 0 | 34 | 43 | 22 | 21 | 14 | 15 | 32 | 0 | 21 | 19 | 0 | 1 | 123 | 99 |
| Segment liabilities 4 | 2,707 | 2,691 | 3,801 | 3,840 | 3,058 | 2,963 | 3,144 | 2,734 | 629 | 663 | 1,530 | 1,496 | – 62 | – 60 | 14,807 | 14,327 |
| Net segment assets / liabilities 4 | 3,197 | 3,326 | 11,839 | 11,604 | 5,656 | 5,663 | 4,754 | 5,165 | 1,094 | 1,021 | 3,965 | 3,683 | –21 | –21 | 30,484 | 30,441 |
| Capex (assets acquired) | 284 | 330 | 1,523 | 691 | 73 | 63 | 232 | 252 | 80 | 62 | 382 | 220 | –2 | 0 | 2,572 | 1,618 |
| Capex (right-of-use assets) | 26 | 12 | 724 | 715 | 105 | 133 | 422 | 684 | 84 | 104 | 622 | 297 | 0 | 0 | 1,983 | 1,945 |
| Total capex | 310 | 342 | 2,247 | 1,406 | 178 | 196 | 654 | 936 | 164 | 166 | 1,004 | 517 | –2 | 0 | 4,555 | 3,563 |
| Depreciation and amortisation | 224 | 240 | 969 | 1,028 | 189 | 186 | 650 | 632 | 156 | 121 | 493 | 574 | –1 | –1 | 2,680 | 2,780 |
| Impairment losses | 0 | 0 | 0 | 0 | 0 | 0 | 34 | 60 | 3 | 5 | 1 | 20 | 0 | 0 | 38 | 85 |
| Total depreciation, amortisation and impairment losses |
224 | 240 | 969 | 1,028 | 189 | 186 | 684 | 692 | 159 | 126 | 494 | 594 | –1 | –1 | 2,718 | 2,865 |
| Other non-cash income (–) and expenses (+) | 138 | 247 | 253 | 402 | 32 | 55 | 155 | 158 | 51 | 55 | 27 | 87 | 1 | 0 | 657 | 1,004 |
| Employees 5 | 157,004 | 156,511 | 96,507 | 98,169 | 44,265 | 42,548 | 156,697 | 157,776 | 30,878 | 29,470 | 12,629 | 12,653 | –1 | 0 | 497,979 | 497,127 |
1 Prior-period amounts adjusted. 2 Including rounding. 3 Of which StreetScooter €–306 million (previous year: €–64 million). 4 As at 31 December 2019 and 30 September 2020. 5 Average FTEs.
| € m | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Post & Parcel Germany 1 |
Express | Global Forwarding, Freight |
Supply Chain 1 | eCommerce | Solutions | Corporate Functions | Consolidation 1, 2 | Group | ||||||||
| 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | 2020 | |
| External revenue | 3,602 | 3,705 | 4,158 | 4,763 | 3,493 | 3,516 | 3,341 | 3,056 | 923 | 1,183 | 35 | 21 | 0 | 0 | 15,552 | 16,244 |
| Internal revenue | 90 | 112 | 89 | 106 | 223 | 236 | 29 | 24 | 41 | 33 | 335 | 369 | – 807 | – 880 | 0 | 0 |
| Total revenue | 3,692 | 3,817 | 4,247 | 4,869 | 3,716 | 3,752 | 3,370 | 3,080 | 964 | 1,216 | 370 | 390 | – 807 | – 880 | 15,552 | 16,244 |
| Profit / loss from operating activities (EBIT) | 304 | 320 | 454 | 753 | 124 | 155 | 162 | 111 | 6 | 76 | –111 | –39 | 3 | 1 | 942 | 1,377 |
| of which net income / loss from investments accounted for using the equity method |
0 | 0 | 1 | 1 | 0 | 0 | 2 | 1 | –2 | 0 | –2 | 0 | 0 | –1 | –1 | 1 |
| Capex (assets acquired) | 98 | 167 | 472 | 288 | 22 | 23 | 81 | 83 | 23 | 36 | 159 | 86 | –1 | 0 | 854 | 683 |
| Capex (right-of-use assets) | 0 | 10 | 184 | 208 | 23 | 44 | 146 | 186 | 37 | 18 | 345 | 93 | 1 | 0 | 736 | 559 |
| Total capex | 98 | 177 | 656 | 496 | 45 | 67 | 227 | 269 | 60 | 54 | 504 | 179 | 0 | 0 | 1,590 | 1,242 |
| Depreciation and amortisation | 77 | 87 | 334 | 335 | 62 | 61 | 214 | 203 | 57 | 41 | 169 | 176 | –2 | –1 | 911 | 902 |
| Impairment losses | 0 | 0 | 0 | 0 | 0 | 0 | 9 | 0 | –3 | 0 | 0 | 0 | 0 | 0 | 6 | 0 |
| Total depreciation, amortisation and impairment losses |
77 | 87 | 334 | 335 | 62 | 61 | 223 | 203 | 54 | 41 | 169 | 176 | –2 | –1 | 917 | 902 |
| Other non-cash income (–) and expenses (+) | 24 | 64 | 103 | 194 | 11 | 8 | 23 | 56 | 15 | 5 | 1 | –26 | 0 | 0 | 177 | 301 |
1 Prior-period amounts adjusted. 2 Including rounding.
Effective 1 January 2020, the fulfilment activities of Home Delivery GmbH were transferred from the Post & Parcel Germany segmentto the Supply Chain division. The prior-period amounts were adjusted accordingly.
| € m | ||
|---|---|---|
| 9 M 2019 | 9 M 2020 | |
| Total income of reported segments | 3,179 | 3,381 |
| Corporate Functions | –309 | – 500 |
| Reconciliation to Group / Consolidation | 0 | 0 |
| Profit from operating activities (EBIT) | 2,870 | 2,881 |
| Net finance costs | – 474 | – 489 |
| Profit before income taxes | 2,396 | 2,392 |
| Income taxes | – 527 | – 574 |
| Consolidated net profit for the period | 1,869 | 1,818 |
| Basic earnings per share | € | 1.43 | 1.36 |
|---|---|---|---|
| Weighted average number of shares outstanding | number | 1,233,639,577 | 1,236,180,385 |
| Consolidated net profit for the period attributable to Deutsche Post AG shareholders | € m | 1,765 | 1,677 |
| 9 M 2019 | 9 M 2020 |
Balance at 1 January – 4 –1 Purchase of treasury shares1 0 –2 Issue / sale of treasury shares 3 3 Balance at 31 December / 30 September –1 0 Total at 31 December / 30 September 1,236 1,239
| 9 M 2019 | 9 M 2020 | ||
|---|---|---|---|
| Consolidated net profit for the period attributable to Deutsche Post AG shareholders | € m | 1,765 | 1,677 |
| Plus interest expense on the convertible bond | € m | 6 | 6 |
| Less income taxes | € m | 1 | 1 |
| Adjusted consolidated net profit for the period attributable to Deutsche Post AG shareholders | € m | 1,770 | 1,682 |
| Weighted average number of shares outstanding | number | 1,233,639,577 | 1,236,180,385 |
| Potentially dilutive shares | number | 20,209,961 | 25,638,807 |
| Weighted average number of shares for diluted earnings | number | 1,253,849,538 | 1,261,819,192 |
| Diluted earnings per share | € | 1.41 | 1.33 |
Treasury shares
| Deutsche Post DHL Group – Quarterly Statement as at 30 September 2020 | 18 |
|---|---|
| ----------------------------------------------------------------------- | ---- |
Headquarters Investor Relations 53250 Bonn Germany
Tel.: + 49 (0) 228 182-6 36 36 Fax: + 49 (0) 228 182-6 31 99 E-mail: ir @ dpdhl.com
Tel.: + 49 (0) 228 182-99 44 Fax: + 49 (0) 228 182-98 80 E-mail: pressestelle @ dpdhl.com
Published on 10 November 2020.
The English version of the quarterly statement as at 30 September 2020 of Deutsche Post DHL Group constitutes a translation of the original German version. Only the German version is legally binding, insofar as this does not conflict with legal provisions in other countries. Deutsche Post Corporate Language Services et al.
| Results of financial year 2020 |
9 March |
|---|---|
| Results of the first quarter of 2021 |
5 May |
| 2021 Annual General Meeting |
6 May |
| Dividend payment |
11 May |
| Results of the first half of 2021 |
5 August |
| Results of the first nine month of 2021 |
4 November |
Other dates, revised dates and information regarding live webcasts:
The document at hand is a quarterly statement pursuant to section 53 of the Börsenordnung für die Frankfurter Wertpapierbörse (BörsO FWB – exchange rules for the Frankfurt Stock Exchange), as amended on 18 November 2019. It is not an interim report as defined in International Accounting Standard (IAS) No. 34. The accounting policies applied to this quarterly statement generally derive from the same accounting policies as used in the preparation of the consolidated financial statements for financial year 2019, with the exception of the new pronouncements required to be applied as at the beginning of the year. However, those standards had no material impact on the financial statements.
This quarterly statement contains forward-looking statements. Forward-looking statements are not historical facts. They also include statements concerning assumptions and expectations. These statements are based upon current plans, estimates and projections, and the information available to Deutsche Post AG at the time this quarterly statement was completed. They should not be considered to be assurances of the future performance and results contained therein. Instead, they depend on a number of factors and are subject to various risks and uncertainties (particularly those described in the "Changes in forecasts, opportunities and risks" section) and are based on assumptions that may prove to be inaccurate. It is possible that actual performance and results may differ from the forward-looking statements made in this quarterly statement. Deutsche Post AG assumes no obligation beyond the statutory requirements to update the forward-looking statements made in this quarterly statement. If Deutsche Post AG updates one or more forward-looking statements, no assumption can be made that the statement(s) in question or other forward-looking statements will be updated regularly.
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