Bpost Sa Ord

Ladies and gentlemen, hello and welcome to the BPOST Group third quarter 2025 analyst conference call. On today's call, we have Mr. Philippe Darcien, CFO. Please note, this call is being recorded and for the duration of the call, your line will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing pound key 5 on your telephone keypad to register your question. If you wish to withdraw your question, please dial pound key 6 on your telephone keypad. I will now hand over to your host, Mr. Philippe Darcien, CFO, to begin today's conference. Please go ahead, sir.

Thank you very much. Good morning, ladies and gentlemen. Welcome to all of you, and thank you for joining us. I'm pleased to present you our third quarter result as CFO for the BPOS group. Chris, our CEO, could not make it today, and I have with me Antoine Lebec from Investors Relation. We posted the materials on our website this morning. We will walk you through the presentation, and then we'll take your questions. As always, two questions each. We'll ensure everyone gets a chance to be addressed in the upcoming hour. I'll start with the quarterly financial, then move on our financial outlook and provide an update on our key transformation initiative for 2025. As you can see on the highlights on page 3, our group operating income for the third quarter amount to 1 billion 30 million euros, remaining broadly stable year on year and almost at constant scope as FACI has already contributed for two months in the same period last year. As usual, the summer quarters show some seasonal softness, but beyond this, we saw a mix of different factors. At Radial US, we continue to see the expected impact for the 2024 contract termination, but even more this time, the materialization effect of those announced earlier this year. As a reminder, these are the same ones that led us to take an impairment at the beginning of the year. Altogether, those elements more than offset the extra months of Stasi contribution in the quarter. At the same time, we continue to see good volume growth in Asian cross-border activities. And while in Belgium the domestic mail volumes declined, this was partially compensated by a decent volume growth in parcels. Our group adjusted EBIT came at minus 3 million euros, representing a year-on-year decrease of 16.3 million, mainly driven by radial US, where despite sustained margin action, the revenue shortfall due to the anticipated churn and seasonal softness did not allow full absorption of fixed costs in the quarter. More broadly, at BPOS group level, the results we are presenting today are in line with our expectations, and we reconfirm our EBIT outlook at around €180 million for the year 2025. On slide four, you will note that the 14 million decline in net profits mirrors the EBIT evolution, as in the same period last year, the acquisition debt was already unbalanced, and the financial result remained broadly stable. Let's move now to the details of our three segments. I'm on page five with Benny Last Mile segment. We see that the revenue declined by 9 million, amounting to 512 million euros. Domestic mail recorded around 16 million decline in revenue, of which 10 million stem from transactional and advertising mails, and 6 million from press. Excluding press, mail volume contracted by 9.4% in the quarter compared to only 6.7% last year, which had benefited from the election uplift in September 2024. The decline in mail volume had a negative effect. revenue impact of around 20 million euros, of which was partially compensated by half through a positive price and mixed effect of 4.7 or roughly 10 million euros. As a result, domestic mail revenues were down by 4.6% or minus 10% year over year. On parcels, revenue increased by 4 million or 3.2% year on year, reflecting a volume growth of 2.8% and a slightly positive price mix effect of 0.5% in this quarter. On the volume side, the reported 2.8% actually correspond to an average growth of 4.4% per working day. Over the past months, this momentum has been mainly supported by the outperformance of marketplace, notably boosted by sales events and continued strength in the apparel segment. Let's move to the P&L of last mile on page 6. Including some higher intersegment revenues from inbound cross-border volumes handled in the domestic network, our total operating income was slightly down by 1.4%, or minus 8 million euros. at the same time on the cost side our opex including dna remain broadly stable and mainly reflects two effects lower ft is resulting from lower volume and efficiency gain notably from the reorganization of our distribution rounds and retail offices which are progressing in line with plan And on the other end, high salary cost per FTE, around up to 2% year over year, following the March 25 salary indexation. In contrast with the first half of the year, when EBIT had contracted sharply by almost 64 million year on year, mainly due to the end of the press concession in June 24, we see that despite structural male decline, Parcel growth and initial effects of our organization are helping to attenuate EBIT erosion. Moving on to 3PL on page 7. 3PL revenues were broadly stable overall as two offsetting events came into play. First effect, 3PL Europe, where revenue increased by 62 million, we benefited from one additional month of Stasi revenue in the quarter, along with continued commercial expansion of retail and active events in Europe. That said, sales from existing customers, or the famous sense of sale, remain soft and even negative in certain geographies during the quarter. As a side note, since we are one year after the acquisition of Stasi, there will be no further consolidation impact going forward. And as we are now advancing in the integration of Stasi, Radial Europe and ActiveFence, we are really starting to operate as one single business unit, as explained at our Capital Market Day in June. Our P&Ls being increasingly managed together, this means that from now on, we will only report on 3PL Europe as one single business and gradually phase out standalone reporting from individual entities. Second effect, in 3PL North America, revenue decreased by 15 million euros. At constant exchange rate, this corresponds to a decrease of 24%. Mainly driven by revenue churn from contract announced in 2024, and even more so from those announced early 2025, partially offset by in-year contribution of new customers, around 60% of which are radial fast-track customers, as represented to you at our Capital Market Day. While we are seeing positive and encouraging signs on that front, And I'll come back to that in a moment. We are still feeling the impact as expected of the churn. But we continue to execute our self-development plan, and we are confident that these efforts will pay off, but it needs a bit of patience. Let's move on to the P&L of 3PL on slide 8. With this, the total operating income slightly increased by 1.1%, while our operating expense and DNA increased by 4.8%. Primarily driven by, in Europe, static consolidation impact and one-off reorganization costs, including site closures and relocation of customers. To further accelerate 3PL Europe integration and cost structure optimization. And in North America, lower variable OPEX in line with the revenue development at Radial US and sustained variable contribution margin close to record high level. The EBIT evolution at Radial US is certainly one of the key highlights of this quarter performance and also the main reason for the gap versus market expectation. Despite one additional month of static contribution, the minus 30 million EBIT decline in 3PL from plus 1.7 million last year indeed clearly reflects the situation at Radial US. After three consecutive years of contraction, reviews are now about 45% below their peak level in Q3 2022. And in this quarter, the combined effect of churn and seasonal softness limited our ability to fully absorb fixed costs, despite strong VCM discipline and tight cost control. Ironically, we are now at a point where revenue has reached their lowest level ever, and yet our VCM margin stands at an all-time high. Looking ahead, the solution lies in top-line recovery, and on that front, we are executing our plan and making good progress. Moving on to cross-border on page 9. Cross-border euro revenue increased by €11 million, or plus 14% year over year. This growth was driven by strong volume increase from Asia across all major destinations, notably Belgium, fueled by large Chinese platforms and the US. Across borders of North America, Landmark Global continues to face the broader tariff environment that is weighing on existing business and delaying new opportunities. However, this was offset by strong domestic volume in Canada, resulting in an overall plus 1.4% revenue increase for North America, including a 6% negative FX impact. Overall, our cross-border operating income increased by roughly 12 million or 8.7%. As shown on page 10, our OPEX and DNA increased at the same time by 9.6%, mainly reflecting higher transportation costs linked to the volume growth I just mentioned. EBIT slightly increased to above 17 million with a margin of 11.5%, reflecting a slight delusion from commercial products. Moving on to corporate segment on page 11. Adjusted EBIT improved by 1 million to minus 9 million, as cost containment measures across spend categories helped offset higher payroll driven by more empties and March 25 salary indexation. Then we move to the cash flow on slide 12. The net cash outflow for the quarter amounts to minus 16 million, representing an improvement of 275 million year on year, mainly reflecting the acquisition of Stasi last year, which was partially funded in cash for a bit less than 300 million. Besides that, the remaining items to flag are the followings. Cash flow from operating activities before change in working cap stood at 71 million and decreased by 7 million year over year, mainly reflecting higher corporate tax payment. Change in working capital and provision amounted to 17 million. The plus 16 million variance is primarily explained by the settlement of some terminal dues and some client balances. The net cash outflow from investing activities totaled $28 million, driven by our capex for international e-commerce logistics, parcels lockers, and capacity expansion. Also, our domestic fleet was considered into this $28 million. These items constitute the main valuation in our free cash flow. The net cash outflow for financing activities amounted to minus $0.06 million and mainly consisted of lease liabilities outflows while we had on top of the acquisition debt last year. This brings us now to the outlook and our strategic priorities of 2025. Outlook 2025. We presented our group EBIT outlook of the range 150 to 180 million back in February, and during the Q2 result in August, we indicated that we were targeting the upper end of the range. With a year-to-date EBIT of 97 million euros, The results we are presenting today are broadly in line with our plan, now allowing us to confirm our full-year outlook at around 180 million euros. This implies achieving an EBIT of around 80 to 85 million in Q4, compared with 80 million in the same quarter last year. Sorry, compared to 84 million last year, which we are cautiously optimistic about. Based on current assumption and expectation, we believe this is achievable, particularly thanks to our preparation and readiness for an efficient peak execution across the group. In North America, we validated client volume capacity plan. We are secure to hiring over 4,100 seasonal workers to ensure full site coverage and put peak incentive plans in place. In Benelast Mine, beyond the usual measures, we have implemented additional productivity initiatives, including tracking performance at each distribution offices and sites, and setting up a national tool to further optimize interim and reinforcement of the planning. Of course, we remain vigilant amid challenging market conditions, notably as volume development and the phasing out of end-of-year peak volumes in Belgium and internationally remain uncertain and partially beyond our control. To wrap up on our outlook, we are also updating our CAPEX guidance with a download revision from 180 to 140 million. This reflects our disciplined approach to spending in Belgium and in the US and a strategic facing towards 2026. Overall, we remain focused on prioritization and value creation, ensuring that every euro invested is where it has the highest impact in the group. Finally, as we usually do, I take a few minutes to walk you through the progress we've made on our transformation plan for the last months. As part of our Reshape 2029 journey, we present it to you as a Capital Market Day. So when it comes to the update on the strategic initiative, Bepoz continues to accelerate its transformation, shifting firmly toward becoming an international logistic and parcel operator. Let me walk you through the tangible progress we've made across our segment. I start with Benelas Mile. Following two successful pilot phases, we launched our nine delivery service on October 15. as new B2B service consisting in a nine-time delivery solution targeted at technicians and field workers that helps eliminate detours from two central depots and save up to one and an hour and a half per day for these technicians and field workers. In practice, parcels are collected by people until 6 p.m. on working days, sorted overnight and then delivered before 7 a.m. to selected parcel lockers of our network across Flanders, Brussels and Wallonia. The service is exclusively available for B2B shipment, internal deliveries or business-to-business exchanges requiring high level of reliability. Meanwhile, still in Belgium, our BB box network of parcel lockers continue to expand strongly. We have now around 2,000 active units with 800 more contracted. Most of them located in prime location and high traffic venues like supermarkets. As announced recently with Lidl, we target to have 240 lockers by the end of this year, which represents nearly 10% of the targeted APM capacity. We currently install up to 12 new lockers per day, and by the end of this year, we intend to have 2,500 lockers installed in Belgium. On our future operating model, one of the pillars is bulk rounds, consisting in dedicated parcels rounds in bulk, serving pickup and drop-off points, including lockers. Here as well, after a successful pilot phase, this model is now fully operational across all sorting centers, servicing 26 distribution offices and handling over 12,000 parcels a day. Before end 2025, we will extend to 29 offices with a capacity close to 21,000 parcels a day. This bulk model is set to become a cornerstone of our 2026 peak strategy capable of managing nearly half of the out-of-home volumes. Let's shift to 3PL Europe. We are entering into a new chapter in leadership with Rainer Kiefer taking over as CFO of 3PL Europe and Stasi Americas as of January 2026. Succeeding Thomas Mortier, who announced earlier this year his intention to step down at the end of the year and will move into a part-time advisory role starting January 2026. Heiner brings extensive experience from DSV and DB Shankar with a strong track record in transformation and scaling across Europe. This appointment reflects our ambition to accelerate the transformation of the 3PL business, strengthen our European footprint, and drive value creation across the full spectrum of contract logistics, fulfillment, and omni-channel solutions. With Toma supporting this transition and Heiner taking the helm, we are confident that the business is well positioned to execute the next phase of our growth strategy. In parallel, the integration of Stasi remains firmly on track. As cost synergies start to materialize in the second half of the year, we expect to over-deliver on our 2025 synergy targets. And the 2026 targets are already secured, fully in line with what we presented to you at the Capital Market Day. And in 3PL US, our radial fast track rollout is ahead of our plan. 16 customers are already live, and two more are set to launch in the fourth quarter 2025, each contributing an average ACV between $4 and $5 million. The in-year revenue from FastTrack is already exceeding internal targets, providing strong momentum in the U.S. and validating the scalable potential of the model. As Chris mentioned it last time, there's still a lot of work ahead of us, and the first results are not always immediately visible in the P&L. This is notably the case this quarter in the U.S., That said, we are confident that we are on the right track and focused on doing the right things to deliver sustainable results. We are now ready to take your questions. Again, two questions each will allow every one of you to be addressed in the upcoming hour. Operator, please open the line for questions.

Ladies and gentlemen, as a reminder, if you'd like to ask a question or contribute on today's call, please dial pound key 5 on your telephone keypad. To enter the queue, if you wish to withdraw your question, please dial pound key 6 on your telephone keypad. Please also ensure your line remains unmuted locally. You will be advised when to ask your question. The next question comes from Frank Klassen from DeGroof Petercam. Please go ahead. Yes, good morning, gentlemen. Good morning.

My two questions. Good morning. First of all, on radial, minus 25 organically in Q3, could you split the minus 25 between, let's say, the negative from same source cells and the impact of the churn, and what Is this, let's say, and what can we expect going forward? Is this the bottom or do you expect an improving trend in the coming quarters? So that's my first question. My second question on Stacey, I understand that you don't break down the EBIT anymore or give the separate EBIT, but could you elaborate on how the profitability is developing? Is it according to plan? I recall that you had a sort of guidance or let's say target of 10% to 12% EBIT for Stasi. Is that still valid? Could you elaborate on that? Thank you.

Okay. Thank you for your two questions. So let's start with Radial. Indeed, we observe a severe decrease in the current quarter, which is mostly explained by the churn. Again, the churn coming that was announced in 2024 that has a full year impact in 2025, and some churn that were announced at the beginning of the year, and then they're only materializing now. I have one very specific example in mind where the customer said, we're going to stop one of the two warehouses in the first, sorry, in the third quarter, so meaning now. So this is part of the explanation, and this is the bulk of it. Same-store sale evolution is not positive, but nowhere near what we observed in the recent quarters. If you recall, we had a terrible sequence of, if it's in 2024, minus four, the beginning of the year, we peaked. Wrong word, but it's a high amount, even if it's a negative one, around 9% in the fourth quarter 2024. The beginning of the year was also in negative territories, lower than the minus 9, and now we are slightly negative. But it's not what it mainly explains the different impact on the EBIT. Simply why? Because the basis at which it applies is also by far lower. This being said, very important to notice that the variable contribution margin has been extremely high. Again, sustained quarters after quarters, which is a positive sign. So that's for radial. Sorry, and there was a subset in your question about what is the trend. The trend for us is twofold. So we have launched in the first quarter of this year our new product offering or service offering, which is radial fast track that aims at offering solutions which are more flexible, standardized solutions. easy to onboard type of solution, also very asset-light in terms of CapEx and automation, and it's picking up. It's picking up. We have signed 16 customers. We will onboard another two between now and the end of the year. Also important to notice that we will be onboarding customers nearly close to the peak, which shows how flexible this solution is to onboard new customers. Historically, it was taking roughly 12 months to onboard new customers at Radial because of the high level of customization in the processes and also in the IT systems. So, in terms of trends, we are optimistic about the product that we have launched because we see it's picking up. There is traction on the market. On the other hand, we need to be realistic. When we are losing customers average size between 50 and 70 million euros, while the ACV of the fast track typical customers is around 5, you can do the math as well as me, it takes time to be able to compensate this churn. We are also not aware of any new customers who have announced their departure in the near future. That's for Radial. So for Stasi, it's going according to plan. Yes, it's going according to plan. The EBIT margin is a bit on the low end of the range this quarter, which is mostly explained by the fact that As I said it, and again, we already announced that there is no news in that one, that we want to operate on a geographical platform as one entity, one go-to market. So we have several territories like Belgium, the Netherlands, UK, Germany, Italy, where we're really operating as one. And the local managers there, They look at their portfolio of customers, what is their need, what is the solution, the operational solution available to serve those customers, and also the footprint. And some movement has been already initiated to relocate customers where they better fit with the requirement of the customer and also optimizing the footprint. It's also the case in the U.S. where one warehouse has been shut down and customers have been transferred to a new site. In Germany, the former site of Stasi Germany in Dorsen has been shut down and customers have been transferred to a former regular site in Halle. In the Netherlands, in the Active Events portfolio, we have decided to close one of the two warehouses in Nieuweken, and those customers have been transferred to Roosendaal. So these transfers demonstrate that we really want to operate at a local level as one, but it has, unfortunately, on the short term, some cost. There is some cost attached to shutting down warehouses, and to move customers. But it's all for the better. It's to serve the customer the best possible way and the most efficient way on those territories.

Well, thank you very much for the elaborate answer. Thank you.

As a reminder, if you wish to ask a question, please dial pound key 5 on your telephone keypad. The next question comes from Hank Slotboom from The Idea. Please go ahead.

Good morning, Philippe. One question from my side. We've been hearing a lot about levies on Chinese goods. The French want to do it unilaterally. The Dutch have already said they might follow the French maybe already as soon as the 1st of January of next year. Now, personally, I don't think that two euros per parcel will stop the avalanche of parcels to Europe. It will simply be relocated. What does the situation look like in Belgium? And I don't know if they have similar ideas to do things unilaterally. And, well, could it be the case that you benefit from it if stuff is not flown at Schiphol Amsterdam Airport, but at Liège or Brussels instead provided, of course, that there are no drugs over there.

So, thank you for the question, Henk. Indeed, the situation in Belgium is that the government is thinking of putting two euro per parcel levy. Now, it leads to a lot of questions. So there is also who's going to collect these two euros, which is a very practical problem. And there is no answer to that. Of course, we are not, we are there to carry the parcels. We are not there to collect this kind of surcharge or taxes, levies, whatever you name it. So there will definitely be a question of implementation. Interestingly enough, we had a discussion yesterday with one of our board members who's coming from the Nordic, who faced a bit the same situation, and it took more than 12 months to find the technical solution to implement it. So it's still an intent at this stage. There is no implementation date decided, and indeed it will be difficult to implement. Your comment about, of course, if other countries are deciding for these levies, let's say in the Netherlands, France, Germany, it could lead to additional volumes in Belgium, but anyway, it would only be a temporary solution. So, at this stage, it's a very good question, but it's a big question mark when it comes to the implementation date and also the practicalities behind it.

Can I ask an add-on to that, Philippe? Sure. If I look at, for example, Austria Post or Polish Post and that sort of things, they've been entering alliances with, for example, Temur and Cheyenne, who want to move part of their logistics, and then I'm talking about warehousing and that sort of things, to Europe. You have a fantastic network of fulfillment centers with Radio Europe, with ActiveBands, with Stasi. Is anything there being discussed with the large Chinese platforms?

So, again, a very good question from you, Hank, as usual. There are movements, indeed. We see the Chinese are coming closer to Europe. They are also thinking of implementing themselves in Turkey, which is also close to Europe. Indeed, it's a movement that we see in the market, but I will not comment any further at this stage.

Okay. Respect that. Okay. Thank you very much, Philippe. You're welcome.

The next question comes from Marco Limite from Barclays. Please go ahead.

Hello, Marco. Hi. Thanks for taking my question. So I've got two follow-up questions. One is on Radial US. Do we have to think about Q4 as the last quarter of year-over-year decline in revenues, and therefore we should expect growth from next year is the first question? And second question, on South Sea Europe, I mean, if I look at the Q3 numbers, it feels like that most of the decline year over year is coming from radial US, but at the same time, we've got one month more of radial Europe in the base now. So, you know, we basically have got 3PL Europe being flat despite growth and despite an additional month. And on top of that, you're also talking about synergies being ahead. So, you know, just the math doesn't work for me. Why over a year, things are flat, despite tailwinds from synergies and an additional month. So, if you can clarify. Thank you.

Good. I'll start with Radial. No. In 2026, there still might be some decline in top line because there will be the full impact of the customer's churn that you observe in 2025. Of course, the one announced in 2024 will be over in 2025, but there are some of them that will have an impact in 2026. It's being said what is really important for us to look at is the profitability and the cash generation profile and the quality of the portfolio. I really want to remind what we said at the Capital Market Day. Not only we want to go for the mid-market, not to have big customers dependent on too big customers. We are requiring huge investment in terms of customization of system, high automation. We want to move out of that one, and it will be gradually phased out. And we want to reinforce ourselves, our presence. in other type of customers. ACV of Radial Fast Track is in the range of 5 million, so totally different. But also, and equally important in my eyes, is also the portfolio itself in terms of the number of verticals where we want to operate in. In the past, it was focused on only two. We really want to broaden that one. And we see first signs of positive results going into that direction. So, but again, as I said, and again, I'm also repeating what we said at the time of the Capital Market Day, it's a long journey. It's not a one or two quarter journey. It's a long journey to move from big anchor customer focused or very capital intensive and focus on two verticals to something which is more nimble and flexible going forward. But again, the math plays against us when it comes in terms of timing. So there will be a delay between the moment we could see growth again. to be totally honest, transparent, but also totally aligned with what our forecasts are. So there is nothing, no news on that one. There is no change of strategy. There is no acceleration or degradation of the situation. It's happening as we had planned to do it. When it comes to... Yes, sure.

Sorry to interrupt. Can I just follow up on this one? Yes. So is there is that more or other large customers are going to, let's say, leave Radio US in the future because you are moving type of strategy, type of service?

The risk is always there, Marco. This being said, very interestingly enough, very interestingly, in our Radio Fast Track customers, we have 16 of them that we have new ones, but there is also two of them that were former customers old solution type of customers move to radial fast track. This also demonstrates that we have now, with this solution, capabilities to address their demand.

Thank you. And Radio Europe or TPL Europe?

Yeah, yeah, yeah, I didn't forget. Don't worry. So on Stacey, the math adapts, but there will maybe, we need to remind all the elements of the equations. So, first one, and this is the vast majority, it's all about the cost relating to the optimization of the operations in different geographies, in the U.S., in the Netherlands, in Germany. That explains a chunk of the fact that, indeed, when you do the math, you don't see growth when it comes to Stacey. And there is also, but to a lesser extent, some softness in certain territories, and I'm mostly thinking about France, where the same store sale has been negative in the quarter. On the other hand, as a positive note, in France, we are not seeing the departure of any customers.

Okay, very clear. Thank you.

The next question comes from Mark Zwartzenberg from ING. Please go ahead.

Hello, Mark. Yeah, good morning. Good morning. Thanks for taking my questions. I also have a bit of a follow-up on Radial US, because I think you mentioned you also see a significant decline still in Q4, and that fits also with the story, with the mentioning of the churn of the larger accounts. I think originally there was a sort of a guise of minus 10 to 20, I believe a bit, on the full year top line, which would indicate still say mid single digit, double digit, let's say 15 maximum during year decline if you plug in say minus 20. Is that still an applicable guide as they were looking at still an a double-digit decline of around 15% for Q4, just to get a bit of more feel on the movement of radio, because it's quite big numbers we're talking.

Okay.

That's my first question. Yeah, yeah, please go ahead.

You want me to take it immediately? So it's more in the range... Yeah, that's easier, yeah. Yeah, I think. It's more in the range 15 to 20.

Q4 we're talking about.

Yes, yes, yes, yes, yes. Yeah.

Yeah, yeah. Sorry, I'm writing this down quickly. Okay, thanks. That's very helpful. And then on the parcel volumes, so the working day adjusted number is plus 4.4.

Yes.

That's a slight improvement from Q2, but how do you, was it stable through the quarter, and how are you looking to the big season? Do you already have a bit of an indication on the big events for Q4, what do you expect there? Because I think also here the guidance was more like a mid single digit to high single digit growth. It looks now more like on the low end of the mid single digit. What are your thoughts there? What kind of trends do you see?

In fact, there is one very important element. It's not that it's totally new this year, but we see, and typically in Belgium, we see more and more Before, the peak was very focused on one or two days. And, by the way, in Belgium, we have the peak, but with also Christmas and Sinterklaas. So, in fact, it's the month end of November and the month of December, which are, in fact, higher months. Unlike what we see in the U.S., when you see the peak, it's a couple of days. So it's more spread all over that period, combined with the fact that we see more and more our customers the one selling directly to the customers or through platform, offering throughout the year a promotion, discount, and this kind of stuff. So it's very difficult to predict how it will look like. But for sure, we see it become that higher activity is spread over more days or weeks than it was in the past.

Do you see September, October trending higher than the 4.4?

In that range.

So it's rather stable, but that's currently the trend?

Yes. That's correct? Absolutely.

And then lastly, I know you're not disclosing it, but could you give a bit of an indication of the average contribution of Stasi, because it's still important to model that properly also through the quarters, because we saw quite a missed on the consensus on particularly the 3PL division and whether that's TASI or whether that's Radial US or whether that's the extra cost would be helpful to have a bit more granularity. Can you help us there?

I can help you in repeating what I told you, is that the big chunk of the fact that it doesn't grow is linked to this optimization, cost optimization, operational optimization, which is the majority of the variance, and the rest coming from same sourcing.

You could count on the... and a bit of impact from the fine-tuning of the optimization of the warehouses. Is that how we should see it?

Yes.

And how long will that take, that optimization of the warehouses? Until when should we pencil that in, that the margins may be a bit more at the low end?

So, I would say... In fact, the more the people will start working together and depending on the customer need, it might lead to additional ones. This one were the obvious one. And I would say in the next two quarters, I'm not expecting any side closures or major side closures. Major side closures, no. But it's an ongoing process.

So for two quarters, you... Yeah, exactly. So we will see a little bit of double running cost in the meantime, and then after that we should see the efficiencies coming through.

I hope it will come faster. I hope it will come faster, but it's not to be excluded that we might decide here or there to restructure on another warehouse. There is one that was already planned in the U.S. By the way, it was a journey, nearly three years journey at the time of the acquisition of Amware by Stassi. They have looked at the portfolio, and we were totally aware of that because it was an element that was shared with us at the time of the acquisition. They knew that they had a plan to restructure three warehouses. They have done one in 24. There is a second one in 25, and there will be the third one in 26.

And then thinking about 26, we should see in higher EBITs, then what we probably will see in 2025, is that the path towards your long-term outlook? Don't you see a higher appetite?

Don't drag me into a budget discussion and a guidance for 26. We will come to you on that one when we publish the tour. But I give you some element. I have the impression of painting an impressionist painting with dots of colors, some pointeism. So I'm doing some pointeism on the U.S. But don't drag me where I don't want to be dragged.

It's the time of the year. All right. Thanks very much for your elaborate answers. Thanks.

Welcome, Mark.

The next question comes from Mark Zeck from Kepler Shoebrew. Please go ahead.

Good morning. Thank you for taking my questions too, if I may. First one on, again, Radial US. Could you give us a bit of feeling about, let's say, the top five customers at Radial US. How much of sales is that, broadly speaking? And for these customers, is there kind of a contract renegotiation period, upcoming end of 25 or early in 26? contracts mostly locked in for a longer period of time? That would be my first question. And second question also on let's say the broader U.S. business. I believe we've seen quite a bit of pull forward. buying into the U.S. imports for the first nine months of the year were pretty good, I believe, into the U.S., but we see container imports or container arrivals that U.S. imports are dropping quite sharply now in Q4. Is your business in the U.S. mostly related to ocean freight? So should we expect a bit of a negative business development on same-store sales as well for RTLVS, or are you kind of afraid, exposed from that category, where we still see quite good numbers, I would say, in the overall market? That's my two questions.

Thank you. Okay. Let me start with the second one. It's a bit of both. And, of course, all your comments are valid. And we are exposed to air freight and ocean freight. I give you a very practical example. In one of the customers that we have onboarded with Radial Fast Track, it's a fashion brand coming from Australia who wanted to be implemented in the U.S., So they wanted to have fulfillment there. And we are hearing from customers, some other customers, that they want to be in the U.S. rather than systematically air freighting stuff. By the way, it's no different than what we're seeing with the Chinese platform now. Let's refer to the comment or the question earlier on the Chinese want to be implemented there. to implement themselves in Europe to avoid tariffs. It's the same that we are seeing in the U.S. We have a very practical example, as I said, of one who really has decided to come physically in the U.S. And there we have definitely a role to play and a good service offering. When it comes to radial, I also want to, do we have big renewal in the pipe for the coming quarters? The answer is no. We already have renewed some of them in the course of 2025. And there, I want to reiterate something which is extremely, extremely important. In the past, what we saw at Radial, especially with the big customers, the situation was the following. They were asking for a lot of customization, a lot of automation. that typically pass on to the customer over a period of six to eight years, while we were having contracts of roughly four years. And at the same time, we had also our warehouses locked for a period of seven to eight years. And in many instances, what we saw is the customer left or didn't renew the contract, and we were there even if there was some provision in the contract with unamortized portion of own developments and the liability link with these warehouses. Since the last 18 months, all renewal or all new contracts signed are coterminous with the lease of the warehouses. So it's also important to look at what could be the impact of the customer. So, in fact, the radial situation we are in right now is absolutely not the same as the one we saw years ago.

Thank you.

Ladies and gentlemen, there are no further questions, so I will hand it back to Philippe to conclude today's conference. Thank you.

Thank you very much, guys, for your intense question session. You know Antoine is always there to do the follow-up with you in the coming days and weeks. Let's stay in touch, and next time we'll see, we'll be able to demonstrate that we have executed the PIC in a qualitative and efficient way. Thank you very much. Have a good day.

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