Balance sheet disclosures

22 Intangible assets

Overview

With the final purchase price allocations for MNG Kargo and DHL Logistics LLC-SO, their opening balance sheets changed, leading to a €44 million reduction in the intangible assets recognized as of December 31, 2023, notes 2 and 4. Information on the impairment losses included in amortization and impairment losses can be found in note 16.

Purchased software, concessions, industrial rights, licenses and similar rights and assets are reported under purchased intangible assets. Internally generated intangible assets relate to development costs for internally developed software.

Allocation of goodwill to CGUs

For the purposes of annual impairment testing in accordance with IAS 36, the Group determines the recoverable amount of a CGU, or a group of CGUs, on the basis of its value in use. This calculation is based on projections of free cash flows that are initially discounted at a rate corresponding to the posttax cost of capital. Pretax discount rates are determined iteratively.

The cash flow projections are based on the detailed planning for EBIT, depreciation and amortization, and capital expenditure adopted by management, as well as changes in net working capital, and take both internal historical data and external macroeconomic data into account. The cash flow forecasts include the planned expenses for decarbonization measures to achieve the targets for reducing emissions by 2030. These will expand the use of sustainable fuels and technologies in fleets and buildings.

From a methodological perspective, the detailed planning phase covers a three-year planning horizon from 2025 to 2027. By contrast, an extended planning phase of five years was applied for the eCommerce CGU. The eCommerce division has not yet reached a steady state. This is attributable to relatively high levels of planned capital expenditure over the next few years, during which the estimated EBIT will not yet reflect business growth. The expectation is that a stable state will be achieved in 2029. Planning is supplemented by a perpetual annuity representing the value added from 2028 onward, or following the extended planning phase. This is calculated using a long-term growth rate, which is determined for each CGU or each CGU group separately and is shown in the table below. The growth rates applied are based on long-term real growth figures for the relevant economies, growth expectations for the relevant sectors and long-term inflation forecasts for the countries in which the CGU or CGU groups operate. The cash flow forecasts are based both on past experience and on the effects of the anticipated future general market trend. In addition, the forecasts take into account growth in the respective geographical submarkets and in global trade, and the ongoing trend toward outsourcing logistics activities. Cost trend forecasts for the transport network and services also have an impact on value in use. A key planning assumption for the impairment test is the EBIT margin for the perpetual annuity.

The pretax cost of capital is based on the weighted average cost of capital. The (pretax) discount rates for the significant CGU or CGU group and the growth rates assumed in each case for the perpetual annuity are shown in the following table:

On the basis of these assumptions and the impairment tests carried out for the individual CGUs or CGU groups to which goodwill was allocated, it was established that the recoverable amounts for all CGUs or CGU groups exceed their carrying amounts. No impairment losses were recognized on goodwill in any of the CGUs or CGU groups as of December 31, 2024.

When performing the impairment test, DHL Group conducted sensitivity analyses for the individual CGUs or CGU groups in accordance with IAS 36.134 for potential changes to the EBIT margin, the discount rate and the growth rate. These analyses – which included varying the essential valuation parameters within an appropriate range – did not reveal any risk of impairment to goodwill.

23 Property, plant and equipment

Overview of property, plant and equipment, including right-of-use assets

Disclosures on right-of-use assets are contained in note 42. Property, plant and equipment increased as a result of capital expenditure.

Additions to transport equipment include additional expenditure of €170 million (previous year: €244 million) for the electrification of the fleet of pickup and delivery vehicles. The additional expenditure for investments in technologies for making new buildings climate-neutral amounted to €34 million (previous year: €38 million).

Advance payments on items of property, plant and equipment are only reported where the Group has paid advances in connection with incomplete transactions. They relate, in particular, to the renewal of the Express air fleet.

24 Investment property

The investment property largely comprises leased property encumbered by heritable building rights and developed and undeveloped land. Of the €9 million of property reported as of December 31, 2024 (previous year: €13 million), €4 million consists of right-of-use assets (previous year: €8 million).

25 Investments accounted for using the equity method

Net income from investments accounted for using the equity method fell by €128 million to €33 million. This was largely due to the change in consolidation method for DHL Logistics LLC-SO (formerly Danzas AEI Emirates LLC) and the income this generated in December 2023. Since DHL Global Forwarding acquired the remaining 60% of the shares, the company has been fully consolidated. Net income of €33 million from investments accounted for using the equity method primarily comprises income of €52 million from the sale of 1.0% of the shares in Global-E, Israel, and negative effects from the ongoing equity method valuation.

The table below is an overview of the carrying amount in the consolidated financial statements and selected financial data for those companies that, both individually and in the aggregate, are not of material significance for the Group:

The lower carrying amount for associates resulted predominantly from the negative equity method measurements for the current year. The increase in the carrying amount of joint ventures primarily relates to the addition of the Italian joint venture Locker Italia Sp.A., which is 50% owned by DHL Group.

26 Financial assets

Noncurrent financial assets rose, largely due to the increase in lease assets, to an increase in the fair values of pension plans in the United States and to derivatives for future transactions. In current financial assets, there was an increase in the notional amounts of currency derivatives with hedge accounting and in the fair values of currency derivatives, due to movements in the underlying exchange rates.

Expected credit loss needs to be identified for debt instruments and lease assets recognized at amortized cost. Based on the expected credit loss model (impairment model), a loss allowance must be recognized for the expected credit loss. These financial instruments were recognized in Stage 1 at the reporting date. They were neither past due nor impaired. There were no indications as of the reporting date of any poor performance of the debt instruments and lease assets. There was no reclassification between the stages in the fiscal year. The following table documents the loss allowance for debt instruments of €905 million (previous year: €830 million) and lease assets of €872 million (previous year: €679 million) recognized at amortized cost.

No cash flows from the debt instruments above were modified in the fiscal year and no changes were made to the model for determining risk parameters.

The lease assets relate primarily to receivables from certain embedded subleases, note 7. The nominal amounts of the outstanding lease payments have the following maturity dates:

Further details on leases can be found in note 42.

27 Other assets

The increase in prepaid expenses is attributable primarily to the Global Forwarding, Freight division and relates to higher prepayments for transport services at the end of the year.

Of the tax receivables, €506 million (previous year: €533 million) relates to VAT, €158 million (previous year: €135 million) to customs and duties, and €50 million (previous year: €43 million) to other tax receivables.

Pension assets increased, primarily because of remeasurements in the United Kingdom, note 37. The reimbursement rights newly recognized in the United Kingdom in the reporting year resulted in additional remeasurements in the statement of comprehensive income in the amount of €27 million. These had no impact on the development of net pension provisions.

The emissions certificates item comprises the carrying amounts of certificates held as part of the emission-trading systems in the EU and the United Kingdom.

Miscellaneous other assets include a large number of individual items.

28 Deferred taxes

Deferred taxes have not been recognized for tax loss carryforwards not expected to be utilized in the amount of €1,195 million (previous year: €1,209 million). Of these, €448 million (previous year: €407 million) is attributable to tax loss carryforwards from US subsidiaries for state taxes. The tax loss carryforwards for which no deferred tax assets were recognized do not expire prior to 2030. Moreover, deferred tax assets have not been recognized for temporary differences not expected to be utilized in the amount of €95 million (previous year: €482 million).

Deferred taxes have not been recognized for temporary differences of €772 million (previous year: €749 million) for accrued earnings of subsidiaries, because these temporary differences will probably not reverse in the foreseeable future.

29 Inventories

The changes in finished goods and work in progress largely relate to real estate development projects. Adequate impairment losses were recognized.

30 Trade receivables

Trade receivables from customer relationships amounting to €11,198 million were due within one year as of the reporting date (previous year: €10,537 million). They are held primarily with the aim of collecting the principal amount of the receivables. These items are therefore assigned to the “held to collect contractual cash flows” business model and measured at amortized cost. Trade receivables changed as follows:

Trade receivables include accrued revenue amounting to €1,069 million (previous year: €976 million).

Loss rates

The following table provides an overview of loss rates by age band that were used in the Group for the fiscal year under review:

Trade receivables are derecognized when a reasonable assessment indicates they are no longer recoverable.

Factoring

In the 2024 fiscal year, there were no material factoring agreements in place that obliged the banks to purchase existing and future trade receivables.

31 Cash and cash equivalents

Of the €3,619 million in cash and cash equivalents, €1,477 million was not available for general use by the Group as of the reporting date (previous year: €1,598 million). Of this amount, €1,429 million (previous year: €1,516 million) was attributable to countries where exchange controls or other legal restrictions apply (mostly China, India and Thailand) and €48 million (previous year: €82 million) primarily to companies with noncontrolling-interest shareholders.

32 Assets held for sale and liabilities associated with assets held for sale

Planned sale of eCom Portugal

In mid-December 2024, the Spanish company DHL eCommerce and the Portuguese company CTT Expresso entered into a strategic partnership with the aim of leveraging the growth potential in the e-commerce and parcel market in Spain and Portugal. The companies will establish specialized joint ventures for this purpose. DHL eCommerce will sell 100% of the shares in DHL Parcel Portugal to the new joint venture. The assets and liabilities were reclassified as of December 31, 2024, to the balance sheet items “assets held for sale” and “liabilities associated with assets held for sale.” The transaction and the planned partnership are subject to regulatory approval.

Sale of aircraft

The sale of aircraft and engines planned in the previous year was completed in the 2024 fiscal year. The income of €7 million is reported in other operating income.

33 Issued capital and purchase of treasury shares

On February 6, 2024, the KfW sold 50 million shares from its holding in Deutsche Post AG. Following the sale of these shares, the KfW had a 16.45% shareholding. With the capital reduction that took place in May 2024, its proportion of the share capital of Deutsche Post AG increased again and stands at 16.99% as of December 31, 2024 (previous year: 20.49%). Free float accounts for 79.11% of the shares at the reporting date (previous year: 74.82%) and the remaining 3.90% (previous year: 4.69%) of shares are owned by Deutsche Post AG. The KfW is the largest shareholder in Deutsche Post AG and holds the shares in trust for the federal government.

Changes in issued capital

With the authorization granted by the Annual General Meeting on May 4, 2023, the Board of Management resolved on May 2, 2024, to reduce the issued capital by €39 million through the retirement of 39,059,409 treasury shares. The issued capital is now composed of 1,200,000,000 (previous year: 1,239,059,409) no-par-value registered shares (ordinary shares) with a notional interest in the issued capital of €1 per share and is fully paid up. The issued capital thus amounts to €1,200 million (previous year: €1,239 million).

Authorized and contingent capital

The Articles of Association can be accessed on the company’s website or in the electronic company register. They may also be viewed in the commercial register of the Bonn Local Court.

Authorization to acquire treasury shares

By way of a resolution adopted by the Annual General Meeting on May 4, 2023, the company is authorized to acquire treasury shares in the period to May 3, 2028, of up to 10% of the share capital existing when the resolution was adopted. The authorization permits the Board of Management to exercise it for every purpose permitted by law, and in particular to pursue the goals mentioned in the resolution by the Annual General Meeting. In addition, the Board of Management is authorized to acquire treasury shares totaling up to 5% of the share capital existing when the resolution was adopted by means including using derivatives. The prior resolution dated May 6, 2021, and the authorization granted until May 5, 2026, to purchase treasury shares were revoked for the period beginning when the new authorization took effect.

SHARE BUYBACK PROGRAM

In February 2022, the Board of Management of Deutsche Post AG passed an initial resolution on a share buyback program for up to 50 million Deutsche Post AG shares at a total purchase price of up to €2 billion. On February 14, 2023, the Board of Management resolved to increase the number of shares to be repurchased to up to 105 million and the total purchase price to up to €3 billion. On February 12, 2024, the Board of Management of Deutsche Post AG resolved to further increase the number of shares to be bought back to up to 130 million and the total purchase price to up to €4 billion. The repurchased shares will either be retired, used to service long-term executive remuneration plans and employee participation programs, or used to meet potential obligations if rights accruing under the 2017/2025 convertible bond are exercised. The buyback will end no later than December 2025.

Detailed information on the individual tranches can be found in the following table.

SHARE-BASED REMUNERATION PROGRAMS

Treasury shares were also acquired to settle the 2023 SMS tranche and claims to matching shares under the 2019 tranche. The 1.4 million shares were acquired at an average price per share of €38.91 for a total of €55 million. Three million shares were issued to executives at a cost of €119 million and an average price per share of €39.46.

There was no settlement of the 2020 PSP tranche, as the performance targets were not achieved in the 2024 fiscal year. A total of 0.4 million shares were issued to the executives concerned to settle the Employee Share Plan. Employees participating in the myShares plan received 0.2 million shares.

Deutsche Post AG held 46,783,573 treasury shares as of December 31, 2024 (previous year: 58,079,379).

Disclosures on corporate capital

In the 2024 fiscal year, the equity ratio (total equity divided by total assets) was 34.6% (previous year: 34.2%). The corporate capital is monitored using the net gearing ratio, which is defined as net debt divided by the total of equity and net debt.

34 Reserves

34.1 Capital reserves

34.2 Retained earnings

In addition to the changes from dividend distributions, changes from remeasurements of the net pension provisions and the recognition of consolidated net profit, retained earnings also include the changes from capital increases and decreases, which are described in more detail in the following:

Tranche VI of the share buyback program 2022/2025, with a total volume of up to €500 million, began on December 3, 2024, and is being implemented by an independent financial services provider until June 30, 2025, on the basis of an irrevocable agreement. At the time the agreement was concluded, the resulting obligation was charged in full to retained earnings and recognized as a financial liability. It was reduced by the buyback transactions carried out by December 31, 2024. The obligation to repurchase shares after December 31, 2024, is included in the amount of €366 million.

35 Equity attributable to Deutsche Post AG shareholders

The equity attributable to Deutsche Post AG shareholders in the 2024 fiscal year amounted to €23,793 million (previous year: €22,475 million).

Dividends

Dividends paid to the shareholders of Deutsche Post AG are based on the net retained profit of €8,872 million reported in Deutsche Post AG’s annual financial statements in accordance with the HGB. The Board of Management is proposing a dividend of €1.85 per no-par-value share carrying dividend rights (proposed and distributed in the previous year: €1.85). This corresponds to a total dividend of €2,132 million. Moreover, the Board of Management is proposing to transfer €1,500 million from net retained profit to other earnings reserves. The amount of €5,240 million remaining after deduction of the planned total dividend and the transfer to other earnings reserves will be carried forward to new account. The final total dividend will be based on the number of shares carrying dividend rights at the time the Annual General Meeting resolves upon the appropriation of the net retained profit on the day of the Annual General Meeting.

36 Noncontrolling interests

This balance sheet item includes adjustments for the interests of non-Group shareholders in consolidated equity from acquisition accounting, as well as their interests in profit or loss. The following table shows the companies to which the noncontrolling interests relate:

There are material noncontrolling interests in the following two companies:

DHL Sinotrans International Air Courier Ltd. (Sinotrans), China, which is assigned to the Express segment. DHL Group holds a 50% interest in the company. Despite DHL Group not having a majority of voting rights, the company is fully consolidated. Sinotrans provides domestic and international express delivery and transport services. The company is fully integrated into the global DHL network and operates exclusively for DHL Group. Due to the arrangements in the Network Agreement, DHL Group is able to prevail in decisions concerning Sinotrans’ relevant activities. Sinotrans has therefore been consolidated although DHL Group holds only 50% of the company’s share capital.

Deutsche Post AG holds a 75% interest in Blue Dart Express Limited (Blue Dart), India, which is assigned to the eCommerce segment. Blue Dart is a courier service provider.

The following table gives an overview of the aggregated financial data of Sinotrans and Blue Dart:

The portion of other comprehensive income attributable to noncontrolling interests largely relates to the currency translation reserve. The changes are shown in the following table:

37 Provisions for pensions and similar obligations

The Group’s most significant defined benefit retirement plans are in Germany and the United Kingdom. A wide variety of other defined benefit retirement plans in the Group are to be found in the Netherlands, Switzerland, the United States and a large number of other countries. There are specific risks associated with these plans along with measures to mitigate them.

37.1 Plan features

Germany

In Germany, Deutsche Post AG has an occupational retirement benefit arrangement based on a collective agreement, which is open to new hourly workers and salaried employees. Depending on the weekly working hours and wage/salary group, retirement benefit components are calculated annually for each hourly worker and salaried employee and credited to an individual pension account. A 2.5% increase on the previous year is included in every newly allocated component. When the statutory pension falls due, the hourly workers and salaried employees can choose whether to receive payment as a lump sum or in installments, or lifelong monthly benefit payments that increase by 1% each year. The large majority of Deutsche Post AG’s obligations relate to vested entitlements of hourly workers and salaried employees from a previous agreement, and to legacy pension commitments toward former hourly workers and salaried employees who have left or retired from the company. In addition, retirement benefit arrangements are available to executives below the Board of Management level and to specific employee groups through deferred compensation, in particular. For information on the pension scheme for the Board of Management, see note 47.2.

The prime source of external funding for Deutsche Post AG’s respective retirement benefit obligations is a contractual trust arrangement, which also includes a pension fund. The trust is funded on a case-by-case basis in line with the Group’s finance strategy. In the case of the pension fund, the regulatory funding requirements can, in principle, be met without additional employer contributions. Part of the plan assets consists of real estate that is leased out to the Group on a long-term basis. In addition, Versorgungsanstalt der Deutschen Bundespost (VAP – Deutsche Bundespost institution for supplementary retirement pensions), a shared pension fund for successor companies to Deutsche Bundespost, is used for some of the legacy pension commitments.

Individual subsidiaries in Germany have defined-benefit retirement plans that were acquired in the context of acquisitions and transfers of operations and that are closed to new entrants. Contractual trust arrangements are in place for two subsidiaries for external funding.

United Kingdom

In the United Kingdom, the Group’s defined benefit pension arrangements are closed to new entrants and for further service accrual.

The Group’s defined benefit pension arrangements in the United Kingdom have mainly been consolidated into a Group plan with different sections for the participating divisions. These are funded mainly via a Group trust. The amount of the employer deficit contributions must be negotiated with the trustee in the course of funding valuations, which are carried out every three years and most recently in 2024. Normal contribution amounts no longer accrue because the arrangements have been closed.

Other

In the Netherlands, collective agreements require that those employees who are not covered by a sector-specific plan participate in a dedicated retirement plan. The largest of these retirement plans was converted into a defined contribution pension plan in the year under review. In Switzerland, employees receive an occupational pension in line with statutory requirements, where pension payments depend on the contributions paid, an interest rate that is fixed each year, certain annuity factors and any pension increases specified. A separate plan providing for lump-sum payments instead of lifelong pension payments exists for specific higher wage components. In the United States, the companies’ defined benefit retirement plans have been closed to new entrants and accrued entitlements have been frozen.

The Group companies fund their dedicated defined benefit retirement plans in these three countries primarily by using respective joint funding institutions. In Switzerland, both employers and employees contribute to plan funding. In the United States, no regularly recurring contributions are currently made in this regard – with the exception of some limited employer deficit contributions that are currently expected to continue until 2027.

37.2 Financial performance of the plans and determination of balance sheet items

The present value of defined benefit obligations, the fair value of plan assets and net pension provisions changed as follows:

In the year under review, the remeasurements caused net pension provisions to fall. Total payments amounting to €100 million are expected with regard to net pension provisions in 2025. Of this amount, €50 million is attributable to the Group’s expected direct benefit payments and €50 million to expected employer contributions to pension funds.

The settlement payments for the year under review resulted mainly from the conversion of a defined benefit retirement plan into a defined contribution retirement plan in the Netherlands. This resulted in settlement payments of €1,198 million and settlement gains of €14 million.

The reimbursement rights newly recognized in the United Kingdom in the reporting year resulted in additional remeasurements in the statement of comprehensive income in the amount of €27 million. These had no impact on the development of net pension provisions.

The disaggregation of the present value of defined benefit obligations, fair value of plan assets and net pension provisions, as well as the determination of the balance sheet items, is as follows:

In the “Other” area, the Netherlands, Switzerland and the United States account for a share in the corresponding present value of the defined benefit obligations of 2%, 34% and 14%, respectively (previous year: 46%, 19% and 8%, respectively). The change in the share accounted for by the Netherlands is attributable to the conversion of a defined benefit retirement plan into a defined contribution retirement plan.

Additionally, the Group had reimbursement rights in Germany related to former Group companies in the amount of €8 million (previous year: €9 million) and reimbursement rights in the United Kingdom related to state institutions in the amount of €27 million (previous year: €0 million), both to be reported separately under financial assets. Corresponding benefit payments are being made directly by the former Group companies in Germany and the state institutions in the United Kingdom.

37.3 Additional information on the present value of defined benefit obligations

The significant financial assumptions are as follows:

The discount rates for defined benefit obligations in the eurozone and the United Kingdom were each derived from an individual yield curve comprising the yields of AA-rated corporate bonds and taking into account the expected payment profile and duration. For other countries, the discount rate for defined benefit obligations was determined in a similar way, provided there was a sufficiently deep market for AA-rated (or, in some cases, AA- and AAA-rated) corporate bonds. By contrast, government bond yields were used for countries without a deep market for such corporate bonds. The calculation of the Group’s discount rates was refined at the end of 2024 and standardized in terms of the approaches used in the major countries. For the United Kingdom, United States and Switzerland, this did not result in any changes to the discount rates used to calculate the present values of the defined benefit obligations compared with the previous approach to determining the discount rate. For the other countries, there were only immaterial effects overall on the present value of the defined benefit obligations and on other comprehensive income (before tax) in the 2024 fiscal year and on the service cost and net interest cost in the 2025 fiscal year.

For the annual pension increase in Germany, fixed rates in particular must be taken into account, in addition to the assumptions shown. The effective weighted average therefore amounts to approximately 1.00% (previous year: 1.00%).

The most significant demographic assumptions made relate to life expectancy and/or mortality. For the Group companies in Germany, they are based on the HEUBECK-RICHTTAFELN 2018 G. Life expectancy for the retirement benefit plans in the United Kingdom was based mainly on the S4NMA_H/S4DFA tables of the Continuous Mortality Investigation (CMI) of the Institute and Faculty of Actuaries, adjusted to reflect plan-specific mortality according to the latest funding valuation. Future mortality improvements were taken into account based on the current CMI projections model and an updated long-term trend assumption. For other countries, their own country-specific current standard mortality tables were used.

If one of the significant financial assumptions were to change, the present value of the defined benefit obligations would change as follows:

These are effective weighted changes in the respective present value of the defined benefit obligations, for example taking into account the largely fixed nature of the pension increase for Germany.

A one-year increase in life expectancy for a 65-year-old beneficiary would increase the present value of the defined benefit obligations by 2.81% in Germany (previous year: 4.16%) and by 2.53% in the United Kingdom (previous year: 2.31%). The corresponding increase for other countries would be 1.68% (previous year: 2.78%) and the total increase would be 2.60% (previous year: 3.41%).

When determining the sensitivity disclosures, the present values were calculated using the same methodology used to calculate the present values as of the reporting date. The presentation does not take into account interdependencies between the assumptions; rather, it supposes that the assumptions change in isolation. This would be unusual in practice, since assumptions are often correlated.

The weighted average duration of the Group’s defined benefit obligations as of December 31, 2024, was 11.7 years in Germany (previous year: 12.0 years) and 10.8 years in the United Kingdom (previous year: 12.1 years). In the other countries it was 12.2 years (previous year: 15.1 years), and in total it was 11.5 years (previous year: 12.6 years).

A total of 29.5% (previous year: 30.3%) of the present value of the defined benefit obligations was attributable to active beneficiaries, 17.2% (previous year: 19.5%) to formerly employed beneficiaries and 53.3% (previous year: 50.2%) to retirees.

37.4 Additional information on the fair value of plan assets

The fair value of the plan assets can be disaggregated as follows:

Quoted market prices in an active market exist for around 55% (previous year: 60%) of the total fair values of plan assets. The remaining assets for which no such quoted market prices exist are attributable as follows: 17% (previous year: 17%) to real estate, 15% (previous year: 12%) to fixed income securities, 6% (previous year: 5%) to insurances, 3% (previous year: 3%) to alternatives and 4% (previous year: 3%) to other. The majority of the investments on the active markets are globally diversified, with certain country-specific focus areas.

Real estate included in plan assets in Germany with a fair value of €1,501 million (previous year: €1,615 million) is occupied by DHL Group.

Asset-liability studies are performed at regular intervals in Germany and the United Kingdom, as well as, among other places, Switzerland and the United States, for the purpose of matching assets and liabilities; the strategic allocation of plan assets is adjusted accordingly. Strategic asset allocation for the respective plans is mainly carried out on the basis of the structure of the underlying obligations. As part of this, different strategies are pursued in some individual countries. These strategies include, among others, the comprehensive hedging of obligations (liability-driven investment) and securing of future cash flows (cash-flow-driven investment). The common factor in the strategies is that they are determined in consideration of the respective regulatory framework and in consideration of return expectations and the risk-bearing ability of the company. Due to the plan-related derivation of the capital investment strategies in consideration of the specific economic parameters, there are significant differences in the alignment of the investments.

ESG criteria are taken into account in the management of pension assets, in particular as part of risk management and thus as part of the long-term direction of the investment strategy.

37.5 Risk

Specific risks are associated with the defined benefit retirement plans. This can result in a (negative or positive) change in DHL Group’s equity through other comprehensive income, whose overall relevance is classed as medium to high. In contrast, a low relevance is attached to the short-term effects on staff costs and net finance costs. Potential risk mitigation is applied depending on the specifics of the plans.

Interest rate risk

A decrease (increase) in the respective discount rate would lead to an increase (decrease) in the present value of the total obligation and would in principle be accompanied by an increase (decrease) in the fair value of the fixed income securities contained in the plan assets. Further hedging measures are applied, in some cases using derivatives.

Inflation risk

Pension obligations – especially relating to final salary schemes or schemes involving increases during the pension payment phase – can be linked directly or indirectly to changes in inflation. The risk of increasing inflation rates with regard to the present value of the defined benefit obligations has been mitigated in the case of Germany, for example, by switching to a system of retirement benefit components and, in the case of the United Kingdom, by closing the defined benefit arrangements. In addition, fixed rates of increase have been set and increases partially capped, and/or lump-sum payments have been provided for. There is also a positive correlation with interest rates.

Investment risk

The investment is in principle subject to a large number of risks; in particular, it is exposed to the risk that market prices may change. This is managed primarily by ensuring broad diversification and the use of hedging instruments.

Longevity risk

Longevity risk may arise in connection with the benefits payable in the future due to a future increase in life expectancy. This is mitigated, in particular, by using current standard mortality tables when calculating the present value of the defined benefit obligations. The mortality tables used in Germany and the United Kingdom, for example, include an allowance for expected future increases in life expectancy.

38 Other provisions

Other provisions break down into the following main types of provision:

Changes in other provisions

The provision for other employee benefits covers, among other things, workforce reduction expenses such as severance payments, partial retirement and early retirement as well as stock appreciation rights (SARs) and anniversary payments. The increase results primarily from higher additions to the obligations for pension plans in the United States compared to the previous year.

Loss reserves consist mainly of outstanding-loss reserves and IBNR (incurred but not reported) reserves, note 7. The increase is attributable to a rise in claims, higher risk factors and revised estimates.

The provision for aircraft maintenance relates to obligations for major aircraft and engine maintenance by third-party companies. The increase results primarily from additional aircraft, price increases in the aviation industry and maintenance standards.

Of the tax provisions, €79 million (previous year: €67 million) relates to VAT, €19 million (previous year: €25 million) to customs and duties and €69 million (previous year: €71 million) to other tax provisions.

Miscellaneous provisions include a large number of individual items. The risks from business activities relate primarily to provisions for guarantees and compensation payments to customers, as well as provisions for losses from onerous contracts. In addition, miscellaneous provisions include the obligation to return CO₂ emissions certificates and restructuring provisions.

Maturity structure

The maturity structure of the provisions recognized in the 2024 fiscal year is as follows:

39 Financial liabilities

The amounts due to banks comprise mainly current overdraft facilities and loans due to various banks.

Other financial liabilities primarily include, alongside a large number of smaller items, the obligation of €366 million for the repurchases still to be carried out from the sixth tranche of the share buyback program and the liability of €145 million for the acquisition of the remaining shares in the Monta Group.

Bonds

The 2012/2024 bond of Deutsche Post AG was fully redeemed in December 2024.

On March 25, 2024, Deutsche Post AG issued a bond with a volume of €1 billion. The twelve-year term ends on March 25, 2036. The bond has a fixed interest rate of 3.5% per year. The proceeds will primarily be used for general company purposes, including the refinancing of existing financial liabilities.

Convertible bond

The convertible bond issued carries a conversion right that allows holders to convert the bond into a predetermined number of Deutsche Post AG shares.

In addition, Deutsche Post AG was granted a call option allowing it to repay the bond early at face value plus accrued interest if Deutsche Post AG’s share price more than temporarily exceeds 130% of the conversion price applicable at that time. The convertible bond has a debt component and an equity component. In subsequent years, interest will be added to the carrying amount of the bond, up to the issue amount, using the effective interest method and recognized in profit or loss.

40 Other liabilities

All items that relate to transactions with employees are reported under liabilities to employees.

Of the tax liabilities, €668 million (previous year: €735 million) relates to VAT, €652 million (previous year: €661 million) to customs and duties, and €219 million (previous year: €194 million) to other tax liabilities.

Miscellaneous other liabilities include a large number of individual items.

Maturity structure

There is no significant difference between the carrying amounts and the fair values of the other liabilities due to their short maturities or near-market interest rates. There is no significant interest rate risk because most of these instruments bear floating rates of interest at market rates.

41 Trade payables

Trade payables increased by €156 million to €8,635 million (previous year: €8,479 million). Trade payables are unsecured. Given its short-term nature, the carrying amount constitutes a reasonable approximation of fair value.

Supplier finance arrangements

Supplier finance arrangements are in place for liabilities of €349 million. Of that total, trade payables account for €336 million, of which financial service providers have already settled €263 million. Supplier finance arrangements worth €13 million are attributable to financial liabilities, for which the suppliers have already received payments of €3 million from financial service providers.

The Group would not be exposed to significant liquidity risk even without the supplier finance arrangements, as the scope of the liabilities covered by these arrangements is limited and makes up only a small proportion of trade payables, and the Group has access to other sources of financing on similar terms.

There are liabilities subject to supplier finance arrangements in 26 countries.

The high maxima are linked to the specific payment terms in the individual countries. The maximum for Europe is attributable to Spain and Italy, for Latin America to Brazil and for Asia to the Philippines, resulting in maximum maturity periods exceeding 90 days.