CTT - Correios De Portugal (CTT) Q4 2024 earnings summary

Executive summary

• Achieved FY24 guidance with €85M recurring EBIT, driven by 38% year-over-year growth in logistics and banking, and record Express & Parcels performance; revenues reached €1,107.3M, up 12.4%.

• Operating cash flow rose 6.7% to €70M, with free cash flow at €62.8M; net debt/EBITDA at 1.6x, maintaining a flexible balance sheet.

• Major M&A activity included the acquisition of CASESA/Cacesa and a joint venture with DHL, supporting diversification and Iberian e-commerce logistics leadership.

• Dividend policy maintained with €0.17 per share (52% payout, 3.1% yield) and ongoing €25M share buyback.

• Achieved 2025 revenue and Banco CTT targets a year early, reflecting strategic execution.

Financial highlights

• Full-year revenues exceeded €1.1B, up 12.4% year-over-year, with Express & Parcels leading at 40.6% growth.

• Recurring EBIT for logistics and bank grew 38% year-over-year, surpassing guidance; recurring EBIT was €85.1M, down 2.7% year-over-year due to specific items.

• Net profit for the year was €45.5M, down 24.7% year-over-year due to higher costs and lower financial services results.

• Free cash flow reached €62.8M; net cash position at €68.1M.

• CapEx increased to €46.4M, focused on capacity, network expansion, and IT systems.

Outlook and guidance

• 2025 guidance targets recurring EBIT (excluding CASESA/Cacesa and DHL) above €100M, with revenues between €1.1B and €1.25B.

• Continued organic growth expected, with further margin expansion in Express & Parcels and normalized financial services placements.

• CapEx guidance reiterated at €40M–€45M, skewed to the high end due to network investments.

• Board proposes a €0.17/share dividend (3.1% yield, 52% payout) and cancellation of up to 8.5M shares.

• Mail price increase of 6.9% already applied from February 1.