Financial position

Financial management is a centralized function in the Group

The Group’s financial management activities include managing liquidity along with hedging against fluctuations in interest rates, currencies and commodity prices, arranging Group financing, issuing guarantees and letters of comfort and liaising with rating agencies. Responsibility for these activities rests with Corporate Finance at Group headquarters in Bonn, which is supported by three Regional Treasury Centers in Bonn (Germany), Weston (Florida, USA) and Singapore. The regional centers act as interfaces between Group headquarters and the operating companies, advise the companies on financial management issues and ensure compliance with Group-wide requirements. Corporate Finance’s main task is to minimize financial risk and the cost of capital in addition to preserving the Group’s financial stability and flexibility over the long term.

Creating value through transparent and effective capital allocation

The Group’s finance strategy builds on the principles and aims of financial management. It takes into account the shareholders’ interests and the lenders’ requirements, focusing on value creation through a transparent and effective allocation of capital. It also aims to maintain financial flexibility and a low cost of capital for the Group with a high degree of continuity and predictability for investors, and to support the Group’s sustainability targets. One key component of the strategy is a stand-alone target rating between “Baa1” and “A3” and “BBB+” and “A–,” respectively. The strategy also sets clear priorities for the allocation of available liquidity and the strength of the balance sheet. Funding business operations, financing organic investments and making regular dividend payments are given precedence. Thereafter, additional dividend payments or share buybacks as well as inorganic growth will be considered.

Cash and liquidity managed centrally

The cash and liquidity of our globally operating subsidiaries are managed centrally by Corporate Treasury. Approximately 80% of the Group’s external revenue is consolidated in cash pools and used to balance internal liquidity needs. In countries where this practice is ruled out for legal reasons, internal and external borrowing and investment are managed centrally by Corporate Treasury. In this context, we observe a balanced banking policy in order to remain independent of individual banks. Our subsidiaries’ intra-Group revenue is also pooled and managed by our in-house bank (intercompany clearing) in order to avoid paying external bank charges and margins. Payment transactions are executed in accordance with uniform guidelines using standardized processes and IT systems. Many Group companies pool their external payment transactions in the intra-Group Payment Factory, which executes payments on behalf of the respective companies via Deutsche Post AG’s central bank accounts.

Limiting market risks

To limit market risks, the Group makes use of primary and derivative financial instruments. Interest rate swaps are used to hedge against interest rate risks, and forward transactions are used for currency risks. We pass on most of the risk arising from commodity price fluctuations to our customers and, to some extent, use commodity swaps to manage the remaining risk. The parameters, responsibilities and controls governing the use of derivatives are laid down in internal guidelines.

Flexible and stable financing

The Group covers its long-term financing requirements by means of equity and debt. This ensures our financial stability and also provides adequate flexibility. Our most important source of funds is net cash from operating activities.

We also have a syndicated credit facility with a total volume of €4 billion that creates a secure, long-term liquidity reserve. The credit facility was extended by one year in 2025 and runs until 2030 with a further one-year extension option. It does not contain any further covenants concerning the Group’s financial indicators and, thanks to our solid liquidity situation, it was not drawn down during the reporting period.

As part of our banking policy, we spread our business volume widely and maintain long-term relationships with the financial institutions we entrust with our business. We meet our borrowing requirements primarily through independent sources of financing, such as bonds and leases. Most debt is taken out centrally in order to leverage economies of scale and specialization benefits and hence minimize borrowing costs.

In March 2025, we issued three bonds with different maturities and a volume of €2,250 million. In June 2025, we also issued a bond with a volume of €900 million. This was followed in November 2025 by bond issues with an aggregate principal amount of €1,350 million. Additionally, the convertible bond 2017/2025 in the amount of €1 billion was repaid in June 2025. Information on bonds is contained in note 39 to the consolidated financial statements.

Group’s credit rating affirmed

In December 2025, Moody’s Investors Service affirmed our credit rating at “A2” with a stable outlook. Additionally, Fitch Ratings affirmed our credit rating at “A-” with a stable outlook in July 2025. The solid investment-grade ratings ensure unfettered access to the capital market. The following table shows the ratings as of the reporting date and the underlying factors. The complete and current analyses by the rating agencies and the rating categories can be found on our website.

Liquidity and sources of funds

As of the reporting date, the Group reported centrally available liquidity in the amount of €2.2 billion (previous year: €1.4 billion), which is comprised of cash and cash equivalents as well as current financial assets. Due to our solid liquidity situation, the syndicated credit line in the amount of €4 billion was not drawn. The following table gives a breakdown of the financial liabilities reported in the balance sheet. Further information on available liquidity and financial liabilities can be found in notes 44.1 and 39 to the consolidated financial statements.

Capital expenditure for acquired assets slightly below prior-year level

Investments in acquired property, plant and equipment and intangible assets (excluding goodwill) amounted to €2,950 million in the 2025 fiscal year (previous year: €3,066 million). Please refer to notes 10, 22 and 23 to the consolidated financial statements for a breakdown of capex into asset classes and regions.

As before, capital expenditure in the Express division related to buildings and technical equipment. Continuous maintenance and renewal of our Express aircraft fleet represented an additional focus of investment spending, with part of this relating to right-of-use assets. In the Global Forwarding, Freight division, we invested primarily in warehouses, office buildings and IT. In the Supply Chain division, the majority of funds were invested to support customer implementations in all regions, primarily in the EMEA and Americas regions. In the eCommerce division, most of the capital expenditure was attributable to network expansion in the Netherlands, Poland, India and Turkey. In the Post & Parcel Germany division, we invested chiefly in the expansion of our infrastructure and vehicle fleet. Investment in the acquisition and development of property continued in the 2025 fiscal year. An additional key focus, as in previous years, was expanding Packstations. At Group Functions, investments were mainly made in IT solutions, the vehicle fleet and buildings.

Increase in net cash from operating activities

Net cash from operating activities rose from €8,722 million to €9,119 million in the 2025 fiscal year. Alongside improved EBIT, lower income tax payments were the primary contributor. In contrast, the change in working capital resulted in a cash outflow of €368 million. This was €163 million more than in 2024.

Increased acquisitions as part of Strategy 2030 contributed significantly to the increase in net cash used in investing activities from €2,392 million to €4,720 million. Payments for the acquisition of subsidiaries and other business units resulted primarily from the acquisitions of the CRYOPDP Group and of SDS Holdings Inc. in the Supply Chain division. Payments for investments accounted for using the equity method and other investments chiefly reflected the merger of DHL eCommerce UK with Evri Group. Cash paid for other noncurrent financial assets rose significantly from €19 million to €347 million, primarily due to a loan we issued to a company belonging to the pension fund in Germany. Spending on current financial assets increased by €1,176 million compared with 2024 to €1,218 million, primarily as a result of short-term investment of cash in the money market.

Free cash flow fell from €2,944 million to €2,295 million. Excluding the payments for acquisitions and divestitures, free cash flow increased by €246 million to €3,201 million.

Net cash used in financing activities decreased from €6,347 million to €4,418 million. The bonds issued with a total principal of €4.5 billion were the primary contributor to this change. Repayment of the convertible bond 2017/2025 resulted in a cash outflow of €1 billion. Payments for the acquisition of treasury shares in the amount of €1,446 million (previous year: €1,234 million) were incurred due in particular to the current share buyback program. With an unchanged dividend per share and a lower number of shares carrying dividend rights, the dividend distribution to our shareholders fell by €46 million to €2,123 million. Cash and cash equivalents fell from €3,619 million as of December 31, 2024, to €3,376 million.