Inpost Sa

Good morning, my name is Gabriela Burdach and I'm the Investor Relations Director at InPost. Welcome to InPost Q3 2023 earnings call. A quick disclaimer, today's call includes forward-looking statements that are subject to risks and it is possible that the actual results may differ materially. The call is being recorded and it will be available at our IR website shortly after the call. After the slides, we will have a Q&A session and today's presenters are Rafał Brzoska, CEO, Michael Rouse, CEO International, and Adam Aleksandrowicz, CFO. I am now pleased to hand over to our CEO, Rafał, over to you.

Good morning. Thank you, Gabi, and thank you all for joining us this morning. Let me start with the broader perspective. We are operating in nine European countries and have significant exposure to the largest e-commerce markets in the region, the UK, France, and Spain. On the slide, you can see data as of the end of the third quarter. However, currently we have already deployed over 33,000 APMs in Europe, 36% of which are situated outside of Poland. Including our PUDO points, we have over 62,000 locations across Europe, which makes us one of the leading out-of-home delivery companies in Europe. Moving on to the next page, I'm thrilled to share with you some of our impressive Q3 2023 highlights. On a group level, despite a still challenging macro backdrop and pretty soft September, in Q3, we achieved a very strong volume growth of 18% year-on-year and revenue of almost 2.1 billion polysloty, corresponding to a 22% increase compared to Q3 2022. The growth in volume, which underpinned our operating leverage, together with the continuous improvements in our logistics and our repricing strategy, helped us achieve a fantastic 40% growth in adjusted WDA at group level. The positive free cash flow and adjusted WDA growth led to a decrease in net leverage ratio to 2.6 times compared to 3.2 times at the end of last year. In Poland, we witnessed a substantial 24% year-on-year revenue growth, together with a 13% year-on-year increase in parcel volumes. This impressive performance led to an EBDA margin of 46%, which exceeded last year's result. On the other hand, in our international markets, volumes and revenues increased by 28% and 20% respectively. We continue to expand our international network, increasing the number of out-of-home points. And in the UK, we are now the number one APM network. And for the first time, we have achieved a positive adjusted BDA, thanks to the strong demand for our services and delivery on strategy. During our Q2 earnings call, I highlighted that we had delivered a very important goal that we had for this year, which consisted in addressing the logistics bottleneck in the UK. This quarter, we have achieved an additional goal, a massive achievement in my opinion, reaching profitability in the UK. This was accomplished with a market offering that is still partially limited as the B2C segment in the UK is still to be launched. Next page, please. As you can see in these three charts, in our main geographies, we are still outperforming the overall e-commerce market. This means that we are continuing to expand our market share. This is still the case in Poland as well, where we deliver half of the e-commerce parcel in the market and we continue to outpace our competitors in terms of growth. We are continuing gaining market share in mondial relay markets as well. And in the UK, our volume growth starts by impressive 182%, while the market contracted by 5%. Next page, please. As you may have already seen in the media, we have announced that in 2024, we will be the official partner of the legendary Tour de France cycling race. Where did the idea for this partnership come from? We share the same values, ecological transport, passion for competition, and of course, speed. We also share a passion for innovation, focus on performance, and a commitment to caring for the local communities and the environment. At InPost, for many years, we have been encouraging the use of zero emission means of transport, such as bicycles. Moreover, the partnership with Tour de France is a great opportunity for us to increase our brand awareness among European consumers, especially those in France. Let's jump into the business update about Poland. We can have a look at each geography in more detail, but let's start with our most important market. In Poland, as you know, we are the market leading e-commerce delivery provider. We have the most widespread and convenient network for our customers. And over 60% of the Polish population already live within a seven minute walking distance to our lockers, increasing to 87% in urban areas. We provide easy access to our services for customers and of course are available when and where they need us. What's even more impressive is that our new APMs utilization rates have steadily increased post installation and remained very high in line with the utilization rate trends of our older machines. This is a strong indication that our continuous efforts to improve convenience have resulted in growing adoption as well as utilization. This also continues to prove that our APM network in Poland can still expand at attractive utilization and ROI levels. On the next page, more details about our engines of growth in Poland. Our mobile app has over 11 million users, almost 20% more than a year ago. We have a growing and loyal customer base of over 17 million APM users in Poland. 90% of our total volume is attributable to our most loyal users, those that receive 13 passes or more a year. These customers drive and post growth and contribute to our outperformance of the Polish commerce market compared to most of Europe. Recent third-party studies confirm our data. As you can see in the chart on the right-hand side, customers in Poland favor parcel lockers to other delivery methods and have a clear preference for in-post versus other providers. When shopping online, 93% of customers that use APM's delivery choose in-post. We significantly stand out compared to our competitors. Another third-party market research we have received just recently is showing our APM's record net promoter score of 80 points, a much higher level than our to-do competitors. This grew from 78 we showed on our last earnings call. Simply, impulse lockers are unbeatable solution for customers. I'll now hand over to Michael for a short update on our international business. Thank you.

Thanks, Rafa. Good morning, everyone. Now let's go through our international business update, starting with a snapshot of all our international markets. Our international business is gaining momentum. 60% of the group's total out-of-home delivery points are now located outside of Poland. Our international PUDO points have grown by 20% in Q3 2023 compared to the same time last year, and our international APM network has now increased by 60% year over year. In terms of volumes, one third of the total group volume is now generated by our international markets, and these are growing faster than Poland, with a 28% increase year over year in Q3. All our geographies are important, however, we're now going to look more specifically in the UK market and Mondial Relay, as these are our primary focus in terms of network expansion, CapEx allocation and growth potential within the international segment. So let's start with Mondial Relay. Our key priorities for Mondial Relay remain the same, expanding our APM network and merchant base, as well as focusing on improving the quality of our service as we strive to build a D plus one service covering all of France. As we presented during the Capital Markets Day, these investments will underpin our growth, driving our B2C market share forward, and encouragingly, we continue to observe positive flywheel traction and momentum with further market share gains in a weakening market. The increase in number of APMs in the mondial relay markets has already allowed us to gain market share. Over the past year, our APM network has grown by nearly 3,000 machines. In France, one third of the population now live within a seven minute walk from an in-post location with significant headroom for density expansion. The volume delivered by Mondial Relay via APMs in Q3 was three and a half times higher than the previous year. Impressively, APMs accounted for 17% of total Mondial Relay volumes, underscoring their growing importance in our delivery network. This KPI grows significantly every quarter, demonstrating the continued adoption of the French shopper to the automated PUDO alternative. The volume growth in the last quarter was driven all by B2C, up 24% against the declining B2C market segment. This is highly encouraging and aligning perfectly with our strategic objectives. What's even more remarkable is that a substantial 40% of the total volume growth was attributed to B2C deliveries via APMs. As our merchants start to differentiate APMs in their checkouts and with the successful launches of major new clients such as Zalando, T-Mill and Lidl in Q3. To further emphasize, our strategy has differentiated Mondialis' significant number two now in the French market and created a gap to the nearest number three player. We are investing in quality and scaling the network whilst absorbing significant market inflation as we've made a conscious choice to not pass this through us. Taking market share and creating consumer and merchant adoption to APMs is at the forefront of changing market dynamics. We're not at the critical masses yet in location density, and France has a much larger geography to serve D plus one, but we're on track and growing our share. Now moving on to the UK market, we have some exciting news to share and building on Raphael's earlier comments. I'm thrilled to announce that in the last quarter, we've achieved the coveted position of being the number one APM network in the UK. Our network is already the largest, but we're not stopping there. We have ambitious plans to deploy even more APMs to meet the growing demand we're seeing in this market. And to couple with this announcement, we've also launched our partnership with the Royal Mail to offer nationwide locker-to-door in Q3 to complement our successful locker-to-locker solution that has been live since Q3 last year. As you can see on the left-hand side chart, our number of out-of-home points increased by almost 60% year-over-year. And in core cities, we have over half of the population within a walking distance to the nearest APM. Secondly, in Q3-23, for the first time ever, the UK segment has become profitable. This was made possible by our unique and high-quality service, the increased capacity unlocked by our logistics and network density and expansion, but most critically, creating the right effect of operating leverage as we've now scaled to nearly 6,000 locations. The charts at the center of the slide and on the right-hand side show the effect of this on volumes and growing utilization of our APMs. I'll now hand over to Adam to talk about the financials in more detail. Thank you.