Inpost Sa

Good morning, my name is Gabriela Burdach and I'm the Investor Relations Director at InPost. Welcome to InPost's third quarter 2024 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. This call is being recorded and the recording will be available on our IR website shortly after we wrap it up today. After the slides, we will have Q&A session. Today's presenters are Rafał Brzoska, CEO, Michael Rouse, CEO International, and Javier Van Engelen, CFO of InPost Group. Now I'm pleased to hand over to our CEO, Rafał, over to you.

Good morning, everyone. Thank you, Gabi, and thank you all for joining us today. Last quarter marked another period of strong growth and strategic progress for InPost. Group parcel volume rose 25% year-on-year, and revenue grew at a comparable rate. Our adjusted EBITDA increased by over 33% compared to the same time last year, and the group adjusted EBITDA margin reached 34%. Q3 was another great quarter for Poland. Our revenue grew by 23% and our adjusted BDA margin reached a solid 46%, which is in line with our outlook. Our international markets also performed exceptionally well last quarter, with parcel volume increasing by 32%, matching revenue growth. Our adjusted EBDA grew by nearly threefold and our margin was double digits at 14%. Javier will explain on the financials later, but let me first share some updates on our network development. One of our key strategic priorities is to continue to expand our pan-European out-of-home network with a particular focus on APM deployment. We are leading out of home network in Europe with nearly 79,000 points, which already includes over 43,000 of APMs. Our extensive local network solidifies our position as number one in key markets such as the UK, France, and of course, Poland. During the last 12 months, we deployed a record number of lockers installing over 10,000 new machines across Europe. And during the last quarter alone, we added over 3,000 machines, which, by the way, is also another record deployment. This accelerating expansion is a testament to the growing demand for our services and our ability to swiftly scale operations. I cannot emphasize that enough. Our robust network is not simply about number of APMs. It provides unparalleled convenience and accessibility for our customers, making us the preferred out of home delivery solution across the continent. Let's move to the next slide, which addresses market trends. As in previous quarters, we continue to gain market share across all our key geographies. In Poland, it is particularly noteworthy that we have expanded our market share further, even as the leading player. In mondial relay countries, our growth has outpaced overall e-commerce parcel growth, with volumes in the strategically important B2C sector rising by an impressive 24% year-on-year. Last quarter was also exceptionally strong for C2C, resulting in a total mondial relay volume increase of 17%. In the UK, we are continuing to develop volume and we remain focused on network development to expand even further. Having completed the Mensis acquisition in October, we are now a stronger player with fully in-house logistics to out-of-home points. Moving on to our business update for Poland. Here in Poland, we have further strengthened our leadership by consistently expanding our network. Over the past 12 months, our network has grown by 15% with the addition of more than 3,000 new machines. This expansion not only broadens our reach, but also reinforces our position as the clear leader in Poland's out-of-home delivery market. Our parcel volumes increased by 21% year-over-year, APM volume was up by 17%, and to-door deliveries experienced dynamic growth of 40%, largely driven by the expansion of Asian e-commerce platforms. Our APM volumes grew faster than locker expansion, highlighting the consistent increase in network utilization. It is worth noting that despite our network already having best-in-class utilization, we continue to improve these rates year over year. Let's move on to the next slide. In Poland, we continue to build a strong community of loyal and engaged users. Today, we have nearly 19 million active APM users with 13 million of them using our mobile app. Our impulse pay service is also gaining immense traction with over 6 million registrants to date. Our customer satisfaction remains exceptional with an impressive NPS of 80 for parcel sending and collecting. For a long time, InPulse has held the number one position as the preferred APM delivery method. According to the latest GMS report, we are currently the top choice for two-door delivery as well. This dedicated community is fundamental to our success, which is why we launched the loyalty program designed to further engage and reward our users. I will talk about that on the next slide. As you are aware, we are very consistent in trying new services and adding new features to our existing offerings. One of the newest additions is our loyalty program, which stands out compared to other programs available in the market. The program provides both incentives and gamification elements to engage users of all levels. Participants earn so-called in-coins simply by using Inpulse services, which can be in exchange for various rewards. This approach drives increased usage of our services like Inpulse Pay and Fresh, supporting the broader Inpulse ecosystem. Today, we are proud to have over 8 million users participating in the program already. The gamification element is very engaging and we are already seeing incremental volume as a result of this feature and the program is still in its basics. There is more to come very soon. Next page, please. Also last month in Poland, we had an exciting given in our operations. Despite being a market leader with best-in-class logistics, we still invest in improvements. In 2016, we opened a sorting hub in the center of Poland, expecting it to serve us for at least a decade. However, impulse growth has outpaced our expectations. To keep up with the growing demand, we decided to build a new logistics center in the same place, twice as large as the original one. In just 300 days since launch at the construction site, we were fully operational. This new hub can process right now 85,000 parcels per hour, delivering unparalleled speed and efficiency to support our expanding network. The logistics quality we've established in Poland serves as a benchmark across all nine of the European markets where we operate. I will now hand over to Michael for a short update on our international business. Thank you.

Thanks, Raphael. Good morning, everyone. Q3 24 has been another strong quarter for the international business and all the markets that operate within it. After the record high locker deployment in Q2, we deployed even more in Q3, over 2,200 machines outside of Poland, bringing the figure to over 7,700 machines added in the last 12 months. We've continued to take market share, disrupting the legacy incumbent players, attracting a younger demographic audience, and building on the number of new users to APMs in all markets. We've also solidified InPost and Mondial Relay as the leading locker solution in the UK and France. What we're most proud of is what you can see on the charts. The number of parcels delivered to APMs increased at a greater pace than our APM deployment figures, Our focus now is to continue this acceleration and investment in the network, which is important in order to ease the already high utilization of our lockers and continue to build future capacity for B2C. Now let's move on to Mondial Relay. There are three crucial points to highlight here. Firstly, we've deployed almost 3,000 APMs in Mondial Relay markets since the beginning of 2024. We now operate through a network of 8,200 machines in all Mondial relay countries, of which 6,300 are in France, where we're the clear leader in lockers. The number of parcels delivered to lockers has again increased at a much faster rate than our APM deployment. Deliveries to lockers already account for one third of all deliveries, a big step forward, doubling from 17% in the same period last year. We continue to see great improvement in the B2C and return segment, which has significantly outpaced total volume growth and was higher than in Q2 24. What you can also see in this slide is a high increase in our C2C volume, which was exceptionally strong, especially compared with earlier quarters. This is mainly because of a more visible seasonal shift with the back to school effect and weather changes in September from the previous year. However, it is our strategically important B2C segment that we're most focused on. The increase in B2C deliveries, higher APM volumes and overall volumes are all positively impacting our profitability, which Javier will discuss in more detail later. Now let's turn our attention to the UK. We have the largest APM network in the UK and the gap between us and the second player is widening with our pace of deployment. We deployed almost 2,000 machines since the beginning of the year, and we plan to have added more by the end of this year. We also accelerated the opening of our PUDO points at the end of Q3 in line with the volume demand as we look for covering the white spaces as we look for future locker locations, and we had twice as many PUDO points as at the end of 23. With such acceleration in developing the network, which already covers 65% of the population in the top three cities compared to 58% a year ago, and almost 40% of the entire UK population now, it is imperative to continue to accelerate capacity ahead of volume growth now, ease utilization, and prepare for the development of new services. As I've mentioned before, we're currently focusing on enhancing our B2C offering and driving greater adoption among merchants. We're proud to see the clients who have used our returns and locker-to-locker services now choose in-post at the checkout for a number of their B2C orders. As I've mentioned, We already have a number of key players such as Zara, Massimo Dudi and other Inditex brands, as well as Sheen and River Island, which went live in Q3. We've also launched a Shopify app in the last quarter to enable their retailer base to offer their customer parcel lockers as a delivery option at checkout. But I must stress this journey to winning B2C is a multi-step journey and building capacity is the first step. The existing solutions live now provide us a great platform to optimize the checkout flows with various integration partners on the market, test with retailers the UK consumer messaging, and adjust our network infrastructure to solve for the various injection points and cutoff times to provide a high quality of service for their customers. Let's move on to the next slide. As you're probably aware, we recently announced the acquisition of Menzies and we now have full control over the entire logistics process. First mile, middle mile and last mile to one of our out of home points across the UK. The only outsourced part at present is the last mile delivery for our locker to door service. As the chart shows, this is also the fastest growing service. To support this demand and enhance service quality, in October we started a partnership with Yodel for to-door deliveries from lockers, alongside the Royal Mail. As part of that partnership, we've made a strategic investment now into Yodel to secure long-term future to-door delivery options for in-post, while also allowing us now to offer in-post locker solutions directly through the Yodel merchant integrations. Thanks to that partnership, we now have a full offering for merchants in the UK, especially B2C clients, and are delighted to be partnering with Yodel now in this next phase of their journey. We believe this will provide additional opportunities for us and help gain more market share in the UK while keeping consumer satisfaction at a high level. On the next slide, this is a short summary of app users and their perception of our services. In France, we hold the number one position in the net promoter score. Our customer satisfaction, which we regularly monitor, remains very high. In the UK and other international markets where we operate under the InPost brand, I'm happy to share that we have high Trustpilot scores of 4.6 and 4.7, depending on the country. Our app user base is growing, with 1.4 million and 2.6 million people having downloaded the app in the UK and France, respectively. We'll keep working on adding new features and aligning it with the Polish app, especially since we see that our app users send and receive more parcels than non-app users, so a key form of our future growth. And last but not least, as Rafal shared in the Poland overview, we've been busy innovating in the international business also. Please take a moment to watch this short video produced by our partner, Adverb, showcasing how we are revolutionizing global logistics through automation and powered by AI by introducing cutting edge Zippy sorting robots to Mondial Relay's distribution facility in Southwest France. These robots are designed to handle Mondial Relay's high volume of parcels and streamline the sorting process. The parcel sorting system compromises stations where operators load parcels onto the robots. Each parcel undergoes scanning, and the robot employs sophisticated algorithms to accurately sort parcels to predefined destinations. This new solution is more efficient, ergonomic, and eco-friendly than traditional sorters. The fleet management software powered by AI enables real-time robot tracking automizing robot performance and efficiency, and turning human-robot collaboration into perfectly timed deliveries every single time, everywhere. This innovation solution not only boosts efficiency, but also enhances delivery accuracy, positioning Mondial Relay at the forefront of the logistics industry. Additionally, last quarter we opened our first-owned logistics hub in Italy, near Milan, situated in an area with a dense network of in-post lockers and puddle points. Lombardi ranks first among Italian regions where the impulse network is most widespread. We believe it is just the beginning of our road and demonstrates not just how we're thinking about last mile disruption, but disruption through the entire parcel value chain. I'll now hand over to Javier to talk through the financial highlights, and thank you.

Thank you, Michael, and good morning, everyone. Let's move to the summary of our third quarter financial performance on the next slide. I'm going to start with the group's P&L performance, focusing on Q3 results and the key dynamics behind them. While our primary focus is on Q3, you can also see year-to-date figures for a broader context. At the group level, as highlighted by Rafal and Michael, both parcel volume and revenue showed double-digit growth, outpacing the market. Revenue increased by 23% in both Poland and international markets, reflecting the very strong performance. Group-adjusted EBITDA rose by 33%, with international markets contributing significantly. This improvement boosted our adjusted EBITDA margin to 34%. As you can see in the table, in Q3, capex intensity increased with capex to revenue ratio reaching nearly 16%. This was primarily due to our strategic investments in the APM network, which counted for 67% of Q3 capex, along with further investments in our logistics infrastructure, such as the sorting hubs mentioned by Rafal and Michael. Group free cash flow for quarter three 2024 totaled 211.6 million polyslotting. Combined with adjusted EBITDA growth, this helped reduce our leverage ratio from 1.9 times, which is a marked improvement compared with year end, but also an improvement vis-a-vis the previous quarter. The solid financial position underscores our commitment to balancing growth with financial discipline, enabling us to deliver strong results across the board. On the next slide, let's discuss the financial highlights from our Polish business. Parcel volume in Poland grew by 21% with a strong performance across the board and the greatest gains coming from the fashion sector and from marketplaces. Volume growth drove a 23% increase in revenue, impacted by single-digit pricing, though slightly offset by product mix, and more volume from international marketplaces. Our adjusted EBITDA margin in Poland reached 46%, reflecting strong cost management in logistics and a reduction in other direct costs. While slightly lower year-on-year due to a high comparative base, we are maintaining high profitability this year in line or even slightly above full-year outlook. Moving on to Mondial Relay. Mondial Relay achieved an exceptional 17% increase in volume, significantly outpacing the broader market. This was fueled by a robust 24% year-on-year increase in the strategically important B2C segment, along with an exceptional 10% rise in the C2C segment. Revenue in local currency rose by 11% year on year, slightly below volume growth, which is attributed to product mix and higher volume from flagship B2C clients. Our adjusted EBITDA saw a substantial 75% increase, driven by robust volume growth, operational leverage, and well-controlled SDNA expenses. This now confirms the trend we saw already in the previous quarter. On the next slide, you'll see that in the last quarter, combined volume and revenue for Italy and the UK grew by 80 and 88% respectively. In the UK, revenue doubled, fueled by both volume growth and an optimized product mix, and supported by rapid network expansion and logistics enhancements. In Italy, revenue reached 63.7 million Polish zloty, marking a 46% increase compared with Q3 2023, driven by strong B2C and C2C growth. For the segment as a whole, adjusted EBITDA moved from a loss of 7.3 million Polish zloty in Q3 2023 to a positive result of 39.8 million Polish zloty in Q3 2024, achieving a double-digit margin of 12.5%. Profitability for the entire reporting segment is higher than in Q2 2024 due to the improvements in margins in each of the markets. On the next slide, you can see our usual bridge between adjusted EBITDA and net profit for the first nine months of 2024. Year-on-year adjusted EBITDA in Polish Lottie for the first nine months of 2024 is up by 33%, translating into a profit margin improvement of 260 basis points, from 30.4% to 33%. Net profit from continuing operations in absolute terms is up by 71% or by 320 basis points, from 8.0% to 11.2% of sales. At 29.7%, a 9-month increase in polyslotted group operating EBITDA is broadly in line with adjusted EBITDA growth. Group EBIT is up in the first 9 months of 2024 by 34.7% year-on-year, as, just as I said during the last call, the higher IFRS amortization behind our increasing APM and DEPO footprint was partially offset by the longer useful life of our APMs. Between EBIT and net profit, you can see the usual interest expenses connected with debt. and some improvement in effective tax rate due to lower losses in the UK and Italy compared to last year. The next slide again showcases the very healthy cash generative dynamics of the imposed business. For the first nine months of 2024, Poland generated 1 billion PLN in free cash flow, representing a free cash flow conversion of 47% equal to last year. Free cash flow investments in international markets amount to 423 million Polish lotti, resulting in a 23% group-adjusted EBITDA conversion, slightly lower than in the same period in 2023, mainly due to accelerated international APM network development and the increase in mondial relay lease payments. To close the financial highlights section, let me still say a word on net debt and leverage, as shown on the next slide. Compared to year-end 2023, gross debt at the end of Q3 increased to 7.2 billion Polish zloty from 6.6 billion Polish zloty, with changes mainly in IFRS 16 lease liabilities and other IFRS 16 items such as transportation, fleet and office leases. Net debt increased by 295.7 million Polish zloty, much lower than gross debt, on the back of higher cash generation. The slightly higher net debt combined with a 22% increase in last 12 months adjusted EBITDA resulted in a decrease of our leverage ratio from 2.2 times at the end of full year 2023 to 1.9 times at the end of last quarter. The recently announced acquisition of Menzies would change the net debt to EBITDA ratio slightly to not more than 2.1 times on a pro forma basis. Let me now close the financial highlights with the outlook, as you can see on the next slide. With only two months to go in the year, and based on the positive year-to-day momentum, we have adjusted some of the outlook line items. We slightly increased our expectation of the e-commerce market growth in the UK and in France, benefiting from the growth of international marketplaces. At the group level, we expect the revenue to be in line with volume growth on the back of a changing product mix. Next, we have increased our EBITDA margin outlook. This is due to, one, adjusted EBITDA in Poland growing more closely in line with revenue, two, Mondial Relay Margin improvement by 200 to 300 basis points, and three, the other international segment, UK and Italy, adjusted EBITDA margin at low double digits. As a result of the already mentioned acceleration in network development, we expect full-year CAPEX to end up between 1.4 and 1.5 billion Polish zloty. And finally, as for Q4 2024, we expect Q4 2024 volume growth of mid-teens in Poland compared to the same time last year and about 20% volume growth outside Poland. At the group level, we expect volume increase of high teens year on year. Thank you all, and now over to the operator for the Q&A session.

Thank you, sir. Ladies and gentlemen, if you wish to ask a question at this time, please signal by pressing star 1 on your telephone keypad. Please make sure the mute function on your phone is switched off to allow your signal to reach our equipment. If you wish to cancel your request, please press star 2. Again, it is star 1 to ask a question. Our first question comes from Otman Bridger from Bank of America. Please go ahead.

Good morning, Rafael, Michael, Javier and Gabi. Thanks for taking my questions. I've got three. First, how do you see cost inflation heading into 2025 and how should we think about price increases both in Poland and in international? And second, on Q4 trading in Poland. Can you give more color on how you expect Tudor to perform versus out of home? And in the Tudor segment, can you disaggregate the third quarter pricing from Mix and expectation into Q4? And then last question is on your partnership with Yodel. Can you give a bit more color on the financial investment into Yodel? And would you consider an equity investment in the future? And also, Yodel is known as being one of the lowest quality providers in the UK, as highlighted in a recent survey from Ofcom. Did you get any guarantees from Yodel on delivery quality? Thank you.

Yeah, so maybe I will start with pricing strategy and Tudor versus Algo Home PL. Good morning. So first of all, pricing strategy is not something that we disclose upfront as knowing that all our competitors are following our financial results and our strategy, we don't want to make their life easier, but the philosophy here is the same as always. The repricing is going to support the merchants in a way that we are very aware of the cost inflation, minimum wage increase, specifically very aggressively impacting in Poland, merchants and all the entrepreneurs. So we, as always, try to accommodate as much as possible of that cost increase by our increasing operating leverage. And that's why we invest into CapEx, into automation, opening the new hub, that all gives us ability to literally increase our efficiency per stop, per courier, per every single parcel. So the logic behind is going to be the same. And of course, the same logic is going to be applied elsewhere. All the other markets are following the same strategy. In terms of Tudor development versus out of home, As you notice in the presentation for the first time, we are not only number one player in the consumer surveys and out of home APM, but also we were ranked as the most reliable, the most successful and the most efficient player in door-to-door. So we want to continue that development because that translates into our market share gain. And when you look at our market share gain versus the market, you see clearly that it's also fueled by to-door. To-door is is slightly more expensive delivery meter than an IAPM. But if there is a huge volume coming from biggest players, of course, that difference is massively diminished. So in some cases, the price is very comparable to our APM pricing. So we see the positive inflow of that volume and also we expect it will continue in 2025. In terms of the cost inflation impact, maybe I'll hand over to Javier and then about Jodl to Michael.

Yeah, thank you. Look, cost inflation, something we keep on tracking, of course, very accurately, but it's difficult to project. We've seen cost inflation going down this year compared, of course, previous year, but we still expect cost inflation to be an element next year. Uh, more important than the rest of your probably, which I would guess it's going to be somewhere between. uh low to mid single digit uh percentages and as we look at our cost efficiencies as we look at pricing these are things that we take into consideration as Rafal said without disclosing exactly what we're going to do but I guess we all realize that the days with zero inflation are over and we have all now grown used back to think about inflation inflation pricing and cost management so it's just a reset button in the last couple of years that inflation is just part of normal business practices so i don't think there's any any specific worry about that on how we inflected in our costs in our in our plans for the year thank you let me comment on yodel uh good morning

I think the first context for obviously is a locker to door segment, which we have been partnering with the Royal Mail for nearly over a year is our fastest growing segment at the minute within the UK. And so nearly a third of our business. And therefore, it's important considering the backdrop. in the UK dynamics around ownership, that actually we secure a long-term solution for our to-door offer to really ensure we have the right component for our customers. I think Yodel presents that right opportunity in terms of the dynamics of the competitive environment. Two, we've worked with Yodel in the past prior to Royal Mail and actually what we've seen very effectively linked to quality is actually we know their quality and the quality in the past was very positive. And actually, since we've started the partnership in the last number of weeks, the quality is maintained from previous, if not actually improving against our current supply base. And that is really also linked to how we sort of structure our contracts related to service quality and in terms of demands and SLS that we put in place. So we're very pleased. I can't go into the comments of the deal structure, but we've obviously maintained optionality here for the future and really should keep our options open in what is a fairly dynamic market. But clearly our focus right now is integrating Menzies and now continuing to grow the business with sort of an increased addressable market with what Yodel provides us with direct access into B2C clients as well.

Thank you very much. Thank you. Thank you. Next question comes from Roman Reshetnev from Goldman Sachs. Go ahead.

Yes, hello. Thanks for taking my questions. I have three, if that's okay. The first one is, with your CapEx guidance upgrade for this year and following acquisition, which potentially unlocks the room for locker rollout acceleration in the UK, What would be your early thoughts for potential CapEx program next year, both in the UK, Italy, and on the overall group level? A second one, on the market volume growth in the UK and France, you have technically upgraded your growth outlook from negative to flat growth at the lower end of the range. But at the same time, I noticed that historical growth data for the previous two quarters was slightly white upwards as well, particularly for more of the algorithm relates. So is your growth outlook driven by somewhat stronger underlying trends you have observed so far, or is it mostly on the back of some technical changes in the historical data? And the last one, it's one that I'll relate, is C2C segment growth has turned around significantly in the first quarter. Are there any one-off factors, and what is your strategy on the segment development and potential growth revitalization going forward? Thank you.

roman it was not not always very easy to understand your question so let me try to repeat the question so number one is basically the guidance upgrade of what we do with capex 2025 then i understand it was b2c growth uh in mondial relay um and the link to the e-commerce market growth upgrade that we've taken um and how do we see that um and then the last one didn't really get that can you just uh repeat again

The last one was about C2C growth and the comparatives from the previous year and whether we see that continuing.

So, I can quickly give the update on the on the guidance and on the, uh, on the e-commerce market. Um, so on the capex side, as you understand, we again, not going to disclose our guidance for 2025 at this point in time. But as you, I think, understand from the zest of this presentation, you clearly see that we see a clear momentum of the business as also said. Our solution on lockers is clearly being adopted across many markets, and that's clearly also a solution for both merchants and for consumers alike, which means that we are clearly accelerating the expansion of the APM network. And therefore, you've seen already that this year we've kind of increased our guidance in terms of investment this year. So, expect that also for next year, we keep on accelerating our expansion. So, I think that's clearly the strategy of the company and it's working. So we shouldn't take it out in terms of the market growth. We indeed made a slight change into the market growth assumptions of. of mondial relay markets look this is a small adjustment uh as we always said we thought the market at the beginning of the year was uh was more positive we then basically adjusted that to be more flattish flattish to a slight decline the only reason why we've now slightly increased our expectation of the total market growth is because we've seen kind of international platforms performing uh significantly better so i would say the underlying market is not necessarily changed but as we see international platforms coming in we see there's some positive momentum and that's been the only reason why we basically upgraded or changed our vision of what the market today is doing and then on the c2c i think michael uh probably better pass it on to you sure absolutely

We did see very strong growth in terms of comparatives in the Q3 elements within C2C. That was above beyond expectations for that segment. I think two primary drivers, there was some elements from the previous year, both linked to seasonality, holiday scheduling, and actually weather related in terms of temperatures from the previous year, which actually does impact that segment on a historical basis when you actually look at the trends. So all those factors together really saw a spike in volume in that period, which is now normalized back to normal trends at this point in the time. So we've sort of cycled through that and that's what's been driving that.

Fair enough. Thank you very much.

Thank you. Thank you. We will now move to our next question from Marco Limide from Barclays. Please go ahead.

Hi. Good morning. Thanks for taking my question. So the first question, if I may, is on October rates or volume growth rates, sorry, across geographies. You clearly have provided the guidance for Q4, but just curious about how the quarter has started. Second question is on the partnership with Yodel. So if I got it right, Michael, you said that Yodel can actually now use the in-post locker option on the merchants. Yodel already works with it. So just curious how the whole thing works also in terms of IT integration. Have you provided them let's say, full visibility around the capacity of the local. So is there a proper integration in place for the partnership to work? And the third question is on Asian retailers. So how much, I mean, you've commented in the past that Asian retailers is only missing in Poland. Just curious about how big are they in France? And therefore, what percentage of your B to C dealers in France is on the plus 1 versus slower deliveries. Thank you.

I'll quickly take in the question on on October and trading and then I'll hand it over again to Michael for your and for the Asian retailers on the, um. On the outlook for Q4, what perhaps is being perceived for a bit of a cautious guidance, I just want to remind also everyone that last year was a very strong Q4. And if you look at the quarter by quarter evolution, you see that last year in Q3 in Poland, for instance, we grew by 13%, but in Q4 by 18%. so if you just take a two-year progression that you see that our guidance is pretty much in line with the current business progress over two years and so just to put a bit of caution on that now in terms of what we see so far we see a good strong start in october so we are confident seeing that the quarter has started well again november december uh it's important months and we'll have to see how that continues but at least compared to what we're guiding for we see a positive start in october

Michael, Jodl? Yeah, I'll come back. I think, Marco, yes. I think we started now with obviously us offering the Jodl service to Door in a replacement for the Royal Mail. And then two, we plan the reintegration work has started for Jodl to offer locker services to their merchant base, which will be in post lockers in that context. Very similar today to how they offer Collect Plus actually within the UK market. So there's available integrations. that we can provide, and that will actually then go live in Q1. So that integration work is now underway. But obviously with Peak really live in the middle of all the retailers making those checkout changes right now, we're on tech freeze. So that won't impact until Q1, which is only like six, seven weeks away from that context. Relative to two questions then in Mondale Relay, as I understand it. One, I think we see obviously a considerable growth in our B2C segment. Yes, the Asian retailers are a contributor to that growth. I'm not going to comment on the Pacific split of the Asian retailers within sort of our Mondial Relay mix. But what I would say is they're a contributor, but not the only contributor. I think it's balanced between a combination of European international merchants, to Asian retailers and then three local domestic French e-commerce in terms of that overall coverage. So that's sort of the sort of growth components to it. When you consider B2C and D plus one, when you actually look at how we measure that or evaluate that, You know, in terms of injection into hub for B2C, actually we're roughly around about 55 to 60% on average of parcels being delivered in a D plus one basis. So that's sort of the rough direction that we work on. But, you know, it's constantly improving and developing, but it's really measured as what we inject into hub.

Thank you. Thank you. Our next question comes from David Kirsten from Jefferies. Please go ahead.

Good morning, gentlemen. Thank you for the presentation. I also have three questions. Maybe just a follow-up to the peak season dynamics. Javier, you talked about the tough comparison with last year, but is the shape of the peak season this year different compared to last year, which would make it more difficult to gain share versus the overall market compared to previous quarters? Second question, Raffel, you highlighted the volumes growing much faster in Poland than the locker expansion leading to the two percentage points increase in utilization. I know you don't disclose the absolute level of utilization, but can you also give an indication on how utilization is developing in the networks in France and in the UK? Because I think that you probably have the same momentum with the very strong ramp up of the locker network and volumes outperforming that growth rate. And finally, maybe question for Javier. On the depreciation, you're basically saying that depreciation was flat despite the increase in the APM rollout due to the change in depreciation policy. Can you please remind us when was this actually implemented and for how long will you benefit from this change in accounting offsetting the depreciation charge? Thanks very much.

Maybe those are the first questions, if I may, and then I have your handing over to you. So in terms of the peak dynamics, one thing is very solid. On every market, we know we will beat. the market growth. And it's only a question, you know, how much will it be? We, as always, we try to be cautious here as the market dynamics is very, very volatile. But in every market, definitely we will beat our competitors, we'll beat the market simultaneously. In terms of the utilization, David, yes, you were right. I mean, continuously, the ramp up of the newly installed machines is accelerating and it's across the board. It's also, you know, in the UK and in... France moreover, UK is very remarkable because of course sometimes we have problem to access to locations to put a bigger machine so the size of the machine is different than for instance in Poland and in France but the ramp up curve is much more sharp means the utilization is increasing exponentially fast. And when we compare both UK, France and Italy to our historical ramp up from Poland, at the moment we have similar network in our home market, there is no comparison. I mean, in a meaning, you know, the utilization, the adoption, new users base is increasing much faster in those new markets than it was in Poland in the past. And we expect, by the way, it will continue to do so. So no changes here. Moreover, in the UK, because of this fast ramp up, we have limited capacity to onboard new clients. That's why we need to accelerate. And that's also why we want to deploy more machines in the UK and more PUDO points in the UK for 2025 to accommodate that growth perspective.

Yeah, sounds good. David, I'm going to just complement one thing also that Rafal said. As we've talked before, we keep on tracking efficiency very diligently and we also look at every cohort that we put in the market. So we keep on looking at the most recent cohorts versus all the ones to make sure that there's no problems. And that's something which we keep a high focus on and we see no reason for worrying there. So all good on that front. on the depreciation question that you asked on the policy so at the I think it was in quarter three last year there was a change in lifetime of the lockers of course as we've been expanding lockers over the last number of years we looked at the lifetime we clearly see that the lockers we have in place in terms of technology and robustness basically have a longer lifetime than what originally was expected so their lifetime was changed to 15-year lifetime depreciation that happened last year in quarter three so you would basically see that effect now waiting off As we get into Q4 to Q4 comparison, we would be on roughly the same dynamics Q4 and clearly in Q1 next year.

Okay, understood. That's great. Thank you very much. Thank you, David.

Thank you. Our next question comes from Henk Sloudboom from the IED. Please go ahead.

Good morning, gentlemen. Good morning, Gabi. Thanks for taking my questions. Also three from my side. For all three, basically. Rafał, the Polish government or the Polish parliament has announced, or there are voices in the Polish parliament that have announced steps or advocate steps towards the wild growth in the number of APMs. I assume that does not apply for APMs that are already installed. Could this change the competitive landscape in Poland? Because if, for example, DPD or DHL can't roll out APMs themselves, that maybe it could trigger them to combine forces or something like that. The second question is for Michael, I guess. Again, on Yodel. Michael, was the capital infusion you did or the loan you gave to Yodel, was that part of the operation that was announced in early August, so part of the 85 million pounds sterling capital infusion they got. And if so, I saw that Paypoint basically contributed 10 million pounds to that. They are the owners of the Collector Plus Pudos, which are mostly tobacconists and newsstands and that sort of thing. I see some similarity with the stores that are supplied by Menzies with newspapers and magazines. Is there a possible fit? I believe you said already that you can use to collect stores, but could this be a next step in the expansion program of InPost in the UK? And then finally on Menzies, part of the Menzies operation stayed out of the deal that was announced earlier this quarter. So you still have a stake in the storage facilities and the long whole fleet of Menzies. Do you think that that is going to be sold anywhere soon? Because I can imagine that the other shareholder wants to get rid of it sooner or later as well. Is there a drag-along, tag-along construction in place?

Rafal, you want to start on Poland?

Yeah, happy to tackle that, Hank. Good morning. So, first of all, I think there is no, not I think, I'm sure there is no decision on any kind of special regulations. There was a kind of topic in the press initiated by one of the individuals sending a kind of questions to the Ministry of the Development that maybe they should consider regulating that topic further. So there is no single law procedure right now going into that direction. But yes, you are right. If that goes that way, it will be much more difficult for the others to develop their network as ours is already well established. And that can translate potentially in a kind of even higher barrier to entry. um to to the polish market but irrespective of that you know when you look at the utilization of the the other machines versus ours specifically we we see that on the locations and premises where they developed their network literally on the same ground where where we already sit um there is no change uh irrespective of the pricing irrespective of uh of the marketing around uh the numbers, the numbers translate into very tangible outcome. It's not about deploying machines. It's all about, you know, creating the whole ecosystem we've created and looking at our proliferation of the loyalty program with more than 8 million active people participating in that within a month after launch. That gives you a clear flavor of the power of the brand we've created and also the loyalization of the consumer base to InPost as an end game. Passing to Michael.

Yeah. Thank you, Raffael. Good morning, Hank. A few questions there to unpick. I think one, clearly we structured our investment in Q3 with Yodel. I can't necessarily refer to their comments or press releases. Uh, but obviously, uh, we've done it alongside pay point and other, uh, partners. So, um, yeah, whether that contributes to that total amount, uh, I can't comment, but more that it was structured in Q3, uh, sort of a, before we closed that, that sort of enable us to do the. The partnership, um, when it comes to. This sort of PowerPoint relationship today, actually the, you know, PowerPoint are our partner for PUDOs in the UK. So I'll see there's a, there's also a close working relationship of PowerPoint. There has been for nearly over a year. And there's clearly opportunity when you look at the Menzies locations. Actually, a lot of those are actually PayPoint locations as well. So there's quite a strong overlap when you look at the elements all working together here. So when you look at the PayPoint, Yodel, Menzies locations, sort of overlap with us already. And then clearly there's a lot of synergies as we see when you think about last mile coverage, locker locations and PUDO partnerships. So we actually think when you bring these elements together right now in terms of our go-to-market solution, we see a really strong sort of way to all play together to sort of leverage the space. specifically when you then look at Menzies middle mile business or effectively Menzies distribution business. I can't specifically comment on sort of is it going to get sold. Obviously we are a minority shareholder in the entity now and uh probably from a major shareholder point of view probably best to have that uh direct conversation in terms of those future plans but certainly we're supportive of the business and its go forward basis and two part of the agreement is obviously to have a long-term third-party arms length deal for our middle-mile business to support our existing infrastructure so all those things are very much there but um clearly can't comment at this point on any sale process or potential sale process.

Just to perhaps add that I think mentioned already last, we already mentioned last time that for us, this is not strategic. And we still have also position on the board to oversee what's going on. So from a governance point of view, we keep, of course, having an eye on the business. But we also mentioned last time, it's not strategic for us. So we'll just have to see what the current majority owners will do with that business.

Okay, perfect. Thank you very much.

Thank you. Our next question comes from Alexia Dolgani from JP Morgan. Please go ahead.

Good morning. I have one question just on the international expansion. Obviously, Rafa, you make some positive comments that if we look at the network today in international and compare it to where Poland was at the same time, the take-up is much stronger in international. So my question is, what is really holding you back in a faster rollout, for example, in the UK or in France? And do you see further kind of M&A opportunities that can help you accelerate that market share kind of gains? Thanks.

Yeah. Hi, thank you. Thank you for that question. So definitely. What is holding us back? It was a kind of cautious approach in terms of the capex spending as we try to anchor the capex spending in recent years, taking into consideration a very shaky financial market conditions and the cautiousness of many of the investors. And I can tell you, even today, We have two camps. We have one camp saying to us, you need to reduce the capex and create more cash flow or even pay dividends. And we have the other camp saying you need to accelerate and double the capex spendings because the growth opportunity is clearly underlying there. So we want to be in a position to get a kind of happy medium. and yes we we are slowly accelerating the capex spendings um but let's bear in mind that deploying um let's say two times the the the number of machines uh year by year is almost impossible from the level we are already reaching out you know more than ten thousand in nine months three thousand a quarter uh the pipeline and the preparation of the new locations takes, unfortunately, on one hand, a lot of time, fortunately, because for any followers, the hassle is going to be even more profound. So in our case, yes, we want to accelerate, but we accelerate in a very uh well-planned way uh combining that with put up points and uh picking up different opportunities even like the opportunity that uh literally a minute ago michael explained you know uh teaming up with uh paypoint on on many more locations than it was done before that uh you know again you know menses acquisition new straight business massive underlying opportunity we already identified literally in recent few weeks uh so i mean it It's really like an accelerated approach and definitely we want to continue that acceleration everywhere where we see opportunities to gain quickly higher volume and efficiency and of course and consumer adoption, which is progressing very, very well. In terms of the M&As, I think nothing has changed in that context. We will take part in every single process that's on the market, looking at it and trying to choose in which we want to participate actively. from one perspective, this must be strategically well positioned versus our business and must add in short, meet and long term additional value to the company. If those three elements are there, we are more than happy to um to to move on with future acquisitions because i think we've already uh have proven that uh you know we we can do it we can make it and won't rely on irrespective of some negative comments at the beginning uh we continuously explained that this is not the sprints this is a marathon and now you see the first positive effects of the marathon but we are nowhere near where we want to be with montreal where we want to be with menzies and i'm telling you we will we'll deliver much more out of this but this takes time and this is the building the backbone building the logistics building the consumer base loyalization and the brand everything takes time but you know i think our competitors they already realized it has nothing to do with deploying machines

Can I just follow up very briefly? You've discussed in the past that you want to create a pan-European kind of parcel locker brand. Can you explain what you mean? Is it about dealing with kind of cross-border parcels or is it just more that it's a recognizable brand that kind of works independently in specific countries?

Yeah, so it's a very good question. And several times, I think I was very explicit in terms of where we see the main opportunity for future. And the main opportunity for future, of course, lies in cross-border. Currently, all the giants in logistics look at FedEx, UPS, DHL, or DPD. Most of their money they make on cross-border. Cross-border is stupidly expensive for the end user because there is the profit pool. There is the oligopoly of the key players not allowing other players, the domestic players to tap on this because without the cross-border connection you cannot win the profitable part of that cake. We want to break it. We want to change that. And as I promised, until your end, you will see the first, let's say, first step in that journey of creating fully-fledged cross-border platform where you may send parser from the locker or put a point in Lisbon to locker or put a point in Warsaw. and the end game will be definitely that we'll cover as well with partnerships those geographies in europe that we we don't have ambition to to have our own network at this point of time great thank you and we have a follow-up question from my name bricha from bank of america please go ahead thank you very much for taking my follow-ups just a couple please um

One on CapEx. From recent discussions I've had with some industry experts, they've been highlighting that the cost of APMs have been decreasing with more technology and also the cost of deployment as well. For example, when you don't connect the APM to the energy grid and you use a battery, then you reduce your deployment cost and also you can deploy it much faster. Can you explain if you see similar things and how you should think about, let's say, cost per CAPEX per APM or deployment of CAPEX per APM opportunity of savings within the next year or two or three? And I would imagine that you've already been benefiting from this over the past two or three years. And the second one is on the Yodel partnership and specifically, on the use of your APMs in the future. I think, Michael, you said Q1 earlier. Just to confirm, what branding will the consumer see? Will they see a Yodel branding, or will they see an in-post? Do they get an email from in-post or from Yodel? Thank you very much.

So maybe very quickly about the cost of the locker. Quarter by quarter, year by year, we reduced capex per machine using our state-of-the-art R&D facility and our own manufacturing facility as well, specifically for implementation of the new machines. We have developed our own battery machine as well. We started to deploy literally because of the reasons you mentioned in terms of reducing the OPEX costs associated with the deployment. uh and that's you know that will that trend will continue there are also third-party providers uh we are more than happy to speak to them um about you know certain elements of that network so this this becomes a kind of commodity already um and and we we will definitely continue to uh to focus on the cost reduction on that uh on that end but let's remember the reliability of that solution is super important. We have still machines, first version of our machines working since the beginning of our journey of the APM Lockers deployment 2009. There are machines, very cheap machines that the competitors deployed two, three years ago. They need to change now those machines for more reliable solutions. So that needs to be well balanced between, you know, the cost, but also the lifecycle of the solution. Michael?

Absolutely. Yeah, thank you. Just the branding and the communication will be in post. So that is quite an important element in terms of how we think about the presentation and the solution that will be integrated directly to the merchants. Because, you know, clearly that is a journey now we're beginning in the UK and it's important the consumer understands that it's a in-post locker solution and there's no confusion on that.

Thank you very much. Thank you. And we have a follow-up question from Hank Slodbom from the idea. Please go ahead.

Morning, and thanks for taking this follow-up. So, V.A., I've been hearing a lot about payment conditions by the Chinese platforms being extended over and over again. What are your experiences with the Chinese platforms?

At this point in time, I'll refer back also to Michael for the commercial, but so far from the receivables point of view, from payables point of view, at this point in time, we don't see any issues. We track our days outstanding, both for our payables, but our receivables. So far, we see no significant deterioration. If anything, we've had some bigger players more European players perhaps on some cash receivable tracking we need to do but so far commercially we've not seen any negative impact of Chinese players so we haven't seen that at this point in time okay thank you thank you and we have a follow-up question from Marco Limite from Barclays please go ahead hi thanks for the opportunity

Just wanted to ask one follow up question. So you, Michael, you were mentioning before that in the UK sometimes it's difficult to find places where to deploy large machines. Do you think that finding the right locations and the right size location is a bottleneck in the UK? Thank you.

I think I've said, Marco, I think there's definitely different dynamics in different markets. I think inner city locations in Western Europe are maybe different to what we've experienced in the past in our journey in Poland due to different components. It's not just space availability, it's public ownership of the land and regulation in different markets and cities. So we have adapted our solution. I've said before, we now have a multi multi attack plan when it comes to that one is indoor which we have started to develop more and more as an alternative solution two is actually size of location and how we think about the network linked to that size location i think a simple way to explain that would be today clearly we have density measures that we're building to but when size of the location uh it tends to be smaller than average then we increase the density footprint so you know that allows us to compensate Third, I've showed before on previous calls, we're testing locker shops. We're doing that in Paris and London today as an alternative method, which, you know, it's not like we're building a whole estate of shops. It's more where there's targeted elements and we think the white space requirement is there and we can't find the space. We will look for real estate and look at that alternative. And then obviously PUDU is an alternative as a fallback, which is very much similar to where Poland is today. PUDU still is part of the network in Poland, albeit it's a small percentage versus what we want to do with automation of the machines. So we've really adapted our philosophy as we've continued to expand across Western Europe. and clearly find different challenges per market. But it hasn't stopped the pace of deployment, as you can see. And really that in the last two quarters, as we really have focused now on building that capacity, you can see the acceleration. But the opportunity is not just in cities. the opportunity is equally as we've seen in the rural areas where actually space is not a challenge and actually that is more about the underserved population where legacy solutions in those parts of the rural areas actually have pretty weak logistic offerings in e-commerce solutions where actually e-commerce penetration is super high in rural areas because actually the high street or retailer base has closed or diminished over time and e-commerce is the main form of sort of shopping to some extent. So all these things are playing out, but clearly what continues to be important is base, first mover advantage, and really continuing that acceleration, which clearly we're doing.

Very clear, thanks. Thank you. And there are currently no further questions in the queue. Thank you.

So we have a few questions from the webcast. We have first question from Jean-Louis Dazin from RJL Limited. What are your ambitions for the Italian market and what is your competitive advantage there?

Yeah, maybe I can take that. You know, our ambitions, the Italian market are no different to the ambitions we have in all our markets. Really, we're building a we're building a strong first mover, leading APM network solution. And really, at the minute, our Italian journey is really just being about really both. We accelerated with an asset light strategy with PUDOs and we've now started to deploy APMs. Obviously, markets like France and the UK are ahead because that's been our priority. But over the last 12, 18 months, we've started that journey. I think what's super encouraging with the Italian market in terms of dynamics is what we've seen as we've started that journey in the last 18 months to two years. is actually out of home penetration is pretty much growing and even from external market studies has actually doubled. But what's to me most exciting about the Italian market overall is actually e-commerce penetration is still quite low. So when you take a relative benchmark versus most of Western Europe, as an example, it's one of the lowest. So really building those, getting in early, building those building blocks. And we've now started to see in the last sort of 12 months that acceleration of the local Italian e-commerce environment to consumer. We're putting ourselves in a very strong place. Effectively against the market where the historical incumbent is clearly one where they're not necessarily driving that disruption or dynamism. In fact, they're using third parties as a mechanism to try and develop it, which, as we've seen from other markets, is not a core winning strategy. So still very early. Obviously, other markets have taken higher priority, but ambitions are clearly to take a leading market position.

great our second question is john hyde from high dark limited what can you say about the threat and impact of dpd pickup and all in pashka pricing lower than you in poland through brokers happy to answer that question i i think you know i already um

uh top that topic a little bit uh i i you know i see no reason to uh to to change the narrative here because uh this is like an ongoing situation in recent uh two years and a half when they started deploying their machines It's not about, you know, the brokers selling this or that. It's about the end consumers choosing the solution they really like, prefer. And specifically when you look at, you know, at the adoption and our growth. And I can even refer, you know, to the published, I think early morning today, Bazelinker. numbers for October, like the commerce growth on the level of 14.5. I'm telling you again, in October, we we've been better than this. So again, and again, continuous statement, it's not about just deploying machines and offering more aggressive price to get the machines filled with the parcels. Nothing more to add.

Great. And the next question is from Hai Nguyen, Oceanside Family Investment. Could you please share your thoughts on deciding the rate of return for every investment decision in terms of payback period or international rate of return?

Yeah, I'll take that question. The challenge here to answer that question is I cannot go and give you an average. The types of investments we're looking into or we're doing range from locker by locker installation to potential significant M&A acquisitions. So I will not make an average of that. What we basically do is we look at every investment. If it's a locker, if it's new installations like in the UK, we know there's a very fast return on investment because of the high level efficiency. If we look at a project like an SAP implementation, which is a corporate project, and of course you talk about the multiple years. And if you talk about an acquisition, depending on the size that you talk about, you talk more about a couple of years or kind of perhaps five, six, seven years. um so i can't i can't really average the question what i can confirm is that there's a strong financial discipline in the company historically on looking at investments in a careful way to make sure that in the end they build first of all as rafa also said on mna they have to be of strategic importance so clear strategic focus Making sure that this is driving the ongoing, the future EBITDA and that we basically have a plan to pay them back as soon as possible. But in the end, they should overall build both top line and profitability over time. And there's a strong financial discipline to look at those. So I can't give you a specific number, but I can tell you that there's a strong financial discipline to make sure that the investments are strategic and in the end will contribute both to the top and bottom line of the company.

Right, we have two from Stefato Tofano from ABN AMRO. Please update on in-post pay development and how do you think about international EBITDA margin expansion going forward?

Peter will answer the first part of the question. So impulse pay is progressing, I would say, again, at pace. More than 6 million clients already onboarded. Hundreds of thousands making their continuous transactions within them. And the most important element, which is integration of the impulse pay payment gate um throughout the different channels among the merchants is accelerating uh again um massively so uh just just a reminder when we started uh to integrate first 250 merchants it took us three months then another 250 that took us two months now we are integrating uh monthly 250 to 300 merchants a month That means that the product is already proven in a sense that the merchants realize that we are driving their top line by much higher conversion in the basket. And now the loyalty program, which comes alongside with the Input Pay service is only strengthening that because part of the loyalty program is as well not only being onboarded, but also being very active in using InfoSpay as the preferred payment method. So, I would say, according to the plan, definitely we will expand that to every geography when our mobile app proliferation is on a certain level, minimum level, now fully focused on new services, new features that will make that value proposition even stronger.

Yeah, and I would say on the international margin, we've talked about this before. We've always stated that for international, depending on the markets, you're looking over time to get to the high 20s in terms of margin. Now, I think what's important to keep in mind is what we've seen in poland obviously is that when the fly would call the flywheel which is basically greater convenience customer experience that drives merchant adoption we deliver economies of scale and you can reinvest those in greater convenience what poland has clearly shown that if you get and when you get that flywheel running well that you have clear opportunities to go beyond 30 margin Now, so far, we've said international, we say high 20s, because for now, I think that's already an ambition that we come from where we are, where we need to go. But the North Star for all of us is to see how much of Poland we can replicate over time. And that might be in the next two or three years, but perhaps longer term, because we have proven that it works, the flywheel. so as we said short term uh michael has said rafale said the short-term focus is a window of opportunity to accelerate expansion because we know that's a key element in driving both consumer convenience merchant adoption our solution but it also unlocks economies of scale that's clearly short-term the purpose um and that will then benefit getting to the high 20s and once we're there

let's then see what else we can do and whether we can get close to the north start of poland so that's also the kind of explanation we've given in briefs in previous quarters i think great and the last question from the webcast is from john hyde at high dark limited how is your position in the iberian market today and what are you seeing in terms of potential speed for scaling up your presence here

Yeah, thank you. Very much. I'd probably frame our Iberian market is about 12 months behind where the UK market is today, is the way I think about it when I think of volume and offering. However, the infrastructure from a logistics backbone has actually developed from the legacy Mondial and has been adapted and we've invested into our sorting, sortation and capacity in particular in both Barcelona and in Madrid in the last 12 months to do that. Obviously the main coverage in the market from last mile distribution has been PUDO and actually from a distribution point overall with the combination now of lockers in the last 12 months in PUDO with well over 10,000 locations. So we've really got good coverage, good distribution, good infrastructure. And really now we've been investing both in team and capabilities. But the majority of the growth in that market has been international uh, market led and, and really now we're starting the journey as where the UK was just over 12 months ago to start that, that ramp up. So, um, market is, uh, uh, is actually really dynamic, uh, really great opportunity. E-commerce is developing well in particular in Spain and in Portugal. So very, very optimistic about the future potential and, uh, you know, how we can accelerate the, the business that are similar to Italy at a similar timeframe.

Great, there are no further questions on the webcast, so I'll hand back to Rafal for closing remarks.

Great, thank you. So, dear audience, once again, we demonstrated the strength and resilience of the APM business model of impulse, achieving really significant growth in both parcel volumes, but also in the revenue growth. uh and i think uh something was really important is that the strong performance and and the commitment to excellence in e-commerce logistics pays off the wda highlights operational efficiency effective cost management but also you know our ability to enhance profitability is uh is you know going according to our management plan what's very important We remain committed to expand our APM network at pace, really with trying to find new solutions to that accelerated opportunity of the growth. But our focus is on generating positive free cash flow simultaneously because that's financing our rapid expansion across Europe and also reinforces our strategic initiatives. What's very important, in Poland, we continue to exceed market growth expectations, maintaining strong margins. The competitive advantage in the region is very clear. And also, I strongly believe that you see that Mondiali has excelled with very impressive growth in parcel volumes. demonstrating the successful integration and the strength of of our b2c offering uh which which is you know uh starting from the beginning our key uh focus and although we continuously say it's it's a marathon not not a sprint also great performance and landing of the loyalty program which will help us further with clients loyalty to the brand translating into higher volume as well at the end The performance in the UK underscores our successful expansion strategy in this key market. I may really say that Holland is mature. Now the key market is UK. Further solidifying our presence in the logistics landscape, including new partnership with Jodl to strengthen it further. Moreover, we already identified a massive short to mid-term opportunity in the new straight business of Menzies, we definitely want to translate into tangible effects of the UK business. Now diving into it day by day. So my key takeaway is we have not said the last word in our UK expansion. And in conclusion, our strategic investments, robust performance, commitment to excellence position of the whole group as a leading force in e-commerce logistics and we are super excited about the future opportunities ahead so uh thank you very much for your continuous support and and also a trust in our um in our journey thank you guys have a good day