Postnl Nv

Good morning, ladies and gentlemen. Welcome to the PostNL Q1 2025 results. At this moment, all participants are in a listen-only mode. And after the presentation, there will be an opportunity to ask questions. Now, I would like to hand over the conference call to Miss Inga Laude, Manager, Investor Relations. Please go ahead, madam.

Thank you, operator, and a warm welcome to all of you in the call and here with us in The Hague. We have published our Q125 results earlier this morning and will explain the set of results to you in this analyst call. With me in the room are Pim Berendsen, our CEO, and Linde Jansen, our CFO. Linde will present the results to you. Afterwards, Tim and Linda will answer all your questions. Linda, over to you. Go ahead. Thank you, Inge, and good morning and welcome to you all. Nice to be here for the first time and happy to talk you through the first quarter results. Let's start with the key takeaways of our Q1 results. Our Q1 results developed as anticipated and landed below last year results. Our outlook for 2025 is unchanged. On the recent developments of the global trade and tariffs, it is too early to have a clear view on potential consequences. But I will come back to that later in the presentation. The main drivers for the Q1 performance were as follows. Revenue at parcels were up by 3.5%, with a volume growth of 2%. international customers. On the middle side, volumes declined by almost 7%, mainly due to ongoing substitution. Also in 2025, we expect to see a significant organic cost increase, 31 million in quarter one, which was mainly labor related in which on a positive note, which on a positive note has been fully offset by price increases. If we look on the right side at the segments from a more strategic point of view, then for parcels I want to emphasize that we are fully focused on the initiatives which we announced in February. The implementation is progressing according to plan, and the first positive signs from our targeted yield measures are visible. On the male side, we see a further significant step down in results, mainly explained by the ongoing volume decline. We have successfully started the transition of business mail towards standard delivery within two days. As you know, current postal regulations prevent us from further adjusting our business model. As long as adjustments to the universal service obligation are pending, measures such as stamp price increases are inevitable. Now that we expect that the outcome of the ACM study will be ready later in May, we are encouraging government to take next steps in a parliamentary debate later before the summer. Let's move on to our key metrics. Let's start with the financial KPIs. Revenue in the quarter amounted to 782 million, which is 2% higher than in the quarter last year. And we see normalized EBIT at minus 15 million, which, as I said, is in line with our expectation and mainly driven by the male segment, which I will elaborate in more detail later on. Free cash flow amounted to minus 33 million, and also that I will explain later on. And then a normalized comprehensive income of minus 10. We discuss the results in more detail as we move on to the performance of parcels and meal in the Netherlands in a bit. And also the non-financial highlights and some other ESG highlights for this first quarter. We are proud to mention that we received the Platinum Award from EcoVadis. We achieved a solid, often excellent score across all criteria. And what's particularly remarkable is that we scored 100 out of 100 points in the environmental category, a fantastic achievement for our company. Besides this, we also took our first roll cage filters in use this quarter, supporting our people in their daily physical heavy activities in the depots. In the next few months, more filters will be installed. We also saw an increase again in the amount of PostNL accounts. This is of strategic importance as these accounts provide us the possibility to reach consumers and obtain information from them. For example, when it comes to delivery preferences. The out-of-home strategy is gaining momentum as evidenced by a steady increase of customers adding out-of-home options in their checkout and more consumers adding APL delivery as preferred option in the PostNL app. Let's move on to the segments for a more detailed explanation of the developments. And I kindly remind you that as of the 1st of January this year, our real estate activities are reported in the segment parcels. The 2024 numbers have been restated to provide a like-for-like comparison. Let's start with parcels. Revenue for parcels amounted to 581 million, which is 20 million or 3.5% above last year, following volume growth, price increases and mixed effects. Good to know that market share remained more or less stable. Overall, our volume grew by 2%. Volumes from international customers continued its strong growth and were up 90% compared to last year. On the domestic side, the volumes were down by 2.4%. In addition, volumes this quarter were impacted by a different distribution of working day in the first week of the year and the timing of festive days compared to last year. The volume developments impact the composition of our portfolio, resulting in further client concentration, with increasing share of volumes from large players, domestic as well as international, but also platforms and marketplaces. With that in mind, it's encouraging to see that the total price mix impact was positive this quarter. The average price per parcel was up by 3 cents, supported by targeted yield measures and regular price increases. Furthermore, it is positive to note that our cross-border activities continue to trend. We have been seeing for several quarters now, with revenues at spring being up this quarter main most strongly in our intra-european activities a promising development as international growth is one of our strategic initiatives the cost reflected significant organic cost increases on the one hand mainly related to labor however we also see the impact from efficiency improvements from network optimization and rationalization of services For example, we stopped with parcel delivery on Sunday, and furthermore, our out-of-home delivery contributed to the savings. Let's zoom further in on parcels with the normalized EBIT bridge. Here you see the reconciliation of the EBIT from 5 million last year to 3 million this quarter. The volume growth strongly contributed to our results. though was fully offset by the less favorable product-customers mix referred to earlier. The organic cost increase amounted to 15 million, following wage increases according to PostNL and the sector collective labor agreements and indexation for delivery partners. As you can see in the bridge, the impact from our price increases was also 15 million. increases and pricing. The other costs were 9 million better, mainly as a result of operational efficiency measures and the implementation of the strategic initiatives as announced earlier this year. The other results are down due to various smaller items. Then the segment mail in the Netherlands. The revenue for mill amounted to €309 million, a significant decline compared to €318 million last year, but in line with our expectations. The volume decline of close to 7%, 6.9% to be precise. This quarter was mainly related to substitution, a structural trend which we are seeing for a while now. we also noted a further shift to non-24-hour mail. Furthermore, our revenue was supported by two stamp price increases, one in July 2024 and in January 2025. Looking at cost, labor costs were up following the CLH for PostNL, and mail deliveries and sick leave rates remained high in this tight labor market. These cost increases were mitigated by cost savings of 7 million from further adjustments in our current business model, such as the transition of business mail towards a standard service framework of delivery within two days. Altogether, this resulted in a normalized EBIT of minus 18 million euros. a significant step down of 10 million versus last year's quarter, proving that the current business model for mail is not sustainable. Then let's zoom a bit further towards mail with the normalized EBIT bridge. The elements of mail I just discussed are reflected here. The bridge shows the step down of 10 million euros from the reported 7% volume decline. And you see a negative mixed effect of 3 million, mainly driven by the further shift to 24-hour meal, which I mentioned before. The stamp prices I referred to added to 30 million of revenue, and the organic cost increases of 8 million were due to wage increases and other inflationary pressures. You then also see here reflected the cost savings of 7 million which were fully offset by additional labor costs related to sick leave and lower bilateral results. Then moving on to cash flow. The free cash flow for the quarter was minus 33 million compared to minus 7 million in the same quarter last year and in line with our expectations. The difference is mainly explained, of course, by the lower normalized EBIT results, but also by the negative working capital developments coming from expected phasing effects within the fourth quarter of last year. This brings us to the next slide, where you can find the balance sheet and the development of our adjusted net debt position. Our adjusted net debt position in quarter one was €509 million, which is an increase of €35 million compared to year-end 24, being mainly explained by the negative free cash flow and the addition in the WGA provision. We continue to manage our cash flow, balance sheet and net position carefully, following our aim to be properly financed. Then over to the split of normalized EBIT over the quarters. As mentioned during our full year results in February, in 2025 normalized EBIT has to be earned in Q4 even more than in 2024. The impact of pricing will be larger in Q4 than in the other quarters. And when looking at the results of Q1 2025, the results came in as expected, as I just mentioned. Overall, the working day distribution over the quarters in 2025 is slightly different than in 2024, which also impacts the quarterly split. For the remainder of the year, for parcels you should take into account that the announced yield measures are expected to come into effect as of the second quarter. And for mail in the Netherlands, please remember that in 2024 we had election in the second quarter. For this year, no elections are scheduled. In this quarterly split of EBIT, the impact from the structural cost savings for both parcels and mail in the Netherlands is included. In the graph on the right side of the slide, you can see the indicative phasing for the savings. Obviously, the phasing is related to timing of some of the underlying measures. For example, in the course of Q1, we adjusted the process of collecting This kind of changes in processes need some time to fully settle. And some of the savings are a bit tied to the absolute volumes, of course also impacting the distribution over the year. Then over to the outlook. Of course, we have to acknowledge that the recent developments around global tariffs resulted in more uncertainty and volatility. It is too early to have a clear view of the consequences for the e-commerce market, such as a potential rerouting of Asian volumes from the US to Europe or a slowdown in GDP growth. We keep monitoring recent developments closely and are prepared to swiftly adjust plans if necessary. And as said before, the pace of client concentration due to change in consumer behavior is difficult to predict. That being said, our outlook for 2025 is unchanged. We expect normalized EBIT to be in line with 2024 performance. Free cash flow is expected to be negative as, for example, CAPEX will be above the level of 2024, including around 50 million cash outflows related to the strategic initiative announced at the beginning of the year. On the right side, on the dividend element, I want to emphasize our intention to pay a dividend over 2025. We hold on to our aim to be properly financed, taking into account the anticipated improvement in performance going forward and the progress towards a future proof postal service. And lastly, good to add that the normalized comprehensive income, which is of course the basis for the amount of dividends to be paid, is expected to follow a pattern that is more or less in line with 2023. And lastly, before we close our presentation and open up for questions, as announced in February, we will host a capital markets update in September. We will then elaborate on how we see the e-commerce market going forward based on market dynamics that we have seen and will continue to see. And we will provide you further details on the strategic adjustments. Also, we will give an update on the future-proof postal service at that point in time. Based on all of that, we will provide the market with a medium-term financial guidance for PostNL. Together with Pim, I'm looking forward to meet you all then and have the discussion with you at that point in time. For now, I would like to conclude the presentation and hand back to you, Inge. Thank you, Linda, for your presentation. We now open up for Q&A. Let's start with the analysts here in the room, and after that, we will switch to the people online. So, who will take the first mark? Yeah, sure.

Yeah, just discussing the comprehensive income to follow the path I've seen in 2023. What does it exactly mean? Because I don't have the numbers in front of me. Does it mean that we have the same development through the year or so in 2023 or the same number as in 2023 or? or does it really? Not the same number, the same pattern if you look at the development from the deltas from normalised EBIT to normalised comprehensive income as the pattern of 2023. And in Q4DEC there was an appendix slide that kind of indicated that. So the balance between reversals tax positions follows more the flow of 2023 and not the specific developments in 2024.

You can see on slide 21 in the deck.

Yeah, I tried to look at that, didn't see the 23 in development. Otherwise we would just take the slide and comment a bit on it. On 47 of the Q4 deck, we see that Relatively speaking, in 2024, there was only limited income tax effects. All that follows a bit more the pattern of 23. And there was a positive normalized other comprehensive income element of 8 million in 2024 that we also do not expect at that level. Sorry, are we on slide? I'm going back to the Q4 deck because there we had a specific slide that showed both the 2023 as well as the 2024 reconciliation of normalized comprehensive income. That is which slide? 47. The last slide. So taxes just follow kind of the logic, of course, not the absolute demands, but relatively speaking, and that the gap there is a $16 million switch between other comprehensive income, 23 being minus 8, being positive 8 in 2024, what we do not expect in 2025. Right.

Okay, okay, okay.

We do not do that, actually.

Then on the partial volumes, at plus two in Q1, there was a negative working day impact in there. Can you share us a bit what the trend was, excluding all the working day elements in there, but also can you provide a bit more color of what the trend was from let's say through the quarter and into Q2, just to get a bit of feel for where we are in April, so to speak, because things have changed, particularly in April, not fully, but I can imagine that companies and consumers might have behaved differently. You already talked in the outlook about high volatility, so can you show us a bit what the trend is there?

Happy to take that one. To start with your question on the 2% volume growth and the impact of working days. Well, we can give some color on that, that approximately 2-3% impact is expected from the working days. So that would be on top of that if the working days would have been equal. On the question of what do we see for April? Well, for sure that is too soon to talk about.

I'm not sure if you want to... What we can say is kind of the development over the months of the quarters, no big changes between the months in terms of composition of volume. And if your last point, Mark, relates to do you already see in volume development terms effects of tariffs in, let's say, given when they were announced, we do not really see a material change there, not in relation to what Asian customers are currently trying to do. They are still seeking ways into the US. There's still a fair amount of uncertainty about how the regulation actually works in terms of the de minimis, et cetera. So no change visible there. We do not see a huge inflow or volume to Europe to compensate for a shortfall in the U.S. That's not what we're currently seeing, nor do we see a fundamental change of Dutch consumers and where they spend the money in comparison between March and April. So they're not getting more cautious, that's what you're basically saying. It follows the pattern of the first quarter so far. And just to be clear, we can only look at volume developments. It's the 6th of April of May, so in terms of Euros, I don't have a complete view yet. Yeah, and if you look to the price mix element, so it was a small positive in Q1, but of course most of it will come in Q4, as you already mentioned. but the Asian volumes are still growing 19%, so that negative mix element might still be a bit higher than maybe you anticipated at the beginning of the year when you gave that 55 to 60, if I'm correct, Inge, in the case of the positive price mix. So is it still feasible to get to that 55 to 60, given the mix trends we're currently seeing, and maybe it might even become bigger, the Asian flows, because of what's going on in the world.

Yeah, maybe to react on that, as also reconfirmed in our outlook, which remains as is, we don't see in that sense, we don't have a different view on that versus the 55 to 60 million you are referring to. It's good to note, of course, that we also announced the initiatives of targeted yield measures, which will come into play as of the second quarter, and that is also in line with how we anticipated in the outlook. So, in short, no change compared to earlier messages there.

Maybe to add, what you can see is potential changes between the separate elements, mix and price, and mix between domestic and cross-border. But the overall view is exactly as Linda says. The overall contribution of the components will be comparable. And again, we are not currently seeing additional Asia volume. already triggered by tariffs. That's not what we're seeing. Not to say that that cannot happen, but that's not what we're currently seeing.

I would like to elaborate maybe a bit more on the parcel trends. Because what struck me was this relatively low volume increase, but likely that has been due to the working day effect as you just described because I have expected it to be higher than your annual guidance and that's the first question because my sense is that you are a bit more cautious on the outlook as there are more uncertainties nowadays but are you still aiming for one to three percent volume growth over the year?

Yes I can confirm we still the outlook isn't changed and also that underlying assumption still holds.

Okay, and then what you also said is that the impact of yield measures expected to come in as from Q2, and I presume that we will see the negative impact on the volumes because you anticipated some market share loss. And on the other hand, on the financials and the impact of price increases, that should improve. But how should we see that? Is that a gradual trend over the quarters, or will there be already something sizable coming into Q2? How should I look at that trend?

Well, I think the reason why we've I mentioned Q2 indeed as one of the elements that bring our growth expectation below the overall market growth as a renegotiation of terms of some of the bigger clients. I don't want to be too specific. Some of these negotiations are still ongoing, which means that as of when they have been concluded, they will come into effect immediately. But then, of course, the impact of those renegotiated terms will be also a function of volume development over the quarters, where, of course, you will see impact in Q2, like in Q3, but partly volume dependent, which means that the fourth quarter will still, of course, still see the biggest and absolute terms impact, but not because of the fact that then there are still conversations going on. So you can already see the telltales. of that change by the end of Q2. And then it will mature based on volume division over the quarters of the year.

And that's also what you see in that graph with Q2. towards Q4.

And then the impact, because that was this quarter, impact of price increases was still 50 million, which is about in line with previous quarters. And then we should see that going up gradually over the quarters as well. Yes. And then a final question from my part about the cash flow, because you managed in Q4 to step up the free cash flow. to bring it in the positive territory over the year. And you anticipated phasing, and we saw that also in Q1 of this year. But if I would look at a bit more underlying trends, is it then fair to say that it will be on an annual basis slightly negative up to around break even? Is that a fair conclusion? Am I missing something?

Well, I think it's good to bring this back to our outlook, where we say what our proposed or expected free cash flow will be. And so this phasing effect was foreseen in that and also part of that.

No, but the thing is, that's clearly what you anticipate for the year. But I was just looking at the two combined. And then due to the phasing, probably this year's free cash flow is lower than might be if this strong Q4 wasn't there. And that's what I'm a bit looking if I skip out that element.

Yeah, I understand what you're trying to do. I think from that perspective, the only... then we would reverse it. Then, of course, your delta working capital of 2024 would look more negative than the minus 17 that we reported by, roughly speaking, the amount that you now see as delta. which still means that for the entire year you would get to, if you correct it, roughly speaking, comparable investments in working capital corrected for that phasing effect. So we don't see a fundamental deterioration of improvement of working capital underlying drivers. The only element that I always need to say as kind of a bit of a warning, there's not necessarily linear agreements with postal operators in terms of at what moment in time do you settle your terminal due position. So that could vary between the years a little bit depending on at which point those terminal dues are really due. But we do expect, forget the phasing now, let's say an investment in working capital in this year. to get to the overall free cash flow outlook that we also leave unchanged.

That's it. I have a few questions from our side. First of all, I'm struggling a little bit with the plus 19% international volumes and the minus, what was it, 2.4, I believe, by heart on the domestic side. I can imagine if I look at the CBS online spending figures, which were published last Friday, then I see positive growth, but it was especially in food, so that's not your core business. I understand that. So the market has barely grown. Where do you see, what was the main trigger for the international growth at the 19%? Was it still the Chinese platforms? And if so, then I was positively surprised about the improvement of the average value per item, which was three cents higher than it was last year. Perhaps you can shed some light on it. And connected to that, you already said you cancelled the Sunday delivery for parcels. Has that had an impact on the domestic volumes in the first quarter?

Maybe to start with your question on the international volume and the domestic volume, what you see is that clearly Dutch consumers, when spending their money on e-commerce, they do that more from international clients, international platforms versus the domestic players. And that is a trend which we have been seeing already for a while and also which is market dynamic, so not necessarily a PostNL specific. On your second question, maybe...

Yeah, certainly. I don't know and I don't have an absolute number, Henk, but surely because of the fact that we stopped Sunday and we still had those volumes fourth quarter, it did impact partially the domestic growth rates, although I don't think that's dead material in terms of volume. The reason why we stopped it is that, let's say, it was significantly loss-making and we didn't get any firm commitments from customers to increase or expectations to increase that volume on some days. That's why we've basically taken this out. But at the same time, that also had a negative impact on your average price per parcel because there the price points were obviously also higher. But again, I don't think those are material for the markers on volume and average price per parcel for this quarter.

So the difficulty you have, the dilemma of making choices.

If you meet somebody, it wasn't a dilemma because at the end of the day, the gap on value was so significant and the likelihood that we could get more volumes in so remote that to me, this is a good call to make and leave that to somebody else then.

Okay. So it's definitely value over volume. Yes. Okay. The other question I had is the international volumes, was that predominantly China?

The cross-border volumes, yes, that's predominantly China. Not only, but predominantly, yeah. That's still . Basically, it's a bit about the biggest Chinese webshops that you are And as you said, there's no front-loading going on right now in view of the... No, what we really see is that they are still not giving up that big market for them and find ways to get local-to-local done, maybe go through Latin America. There are still a fair amount of questions. So at this point of time, we don't really see them directing marketing campaigns to Europe yet. I think I would say that it cannot happen, but currently there are still... doing whatever they can to salvage as big as they can a part of that US market.

Final question from my side. During the presentation you said you were going to step up the investments in the European cross-border trade. Have you anything to report there yet?

Well, what we see is we see also there the positive signs from that strategic initiative, so we see good performance over there and also in line with what we planned for. So yes, that is in line and contributing as hoped.

Martin, how is that compared to the rest of the partial division?

Well, at this point in time, it's not a creative yet. What we also indicated that we do expect in-year a 5 to 10 million negative impact on our last EBIT because of the steps that we've taken. So in this quarter, I would say roughly 1 to 1.5 million on the parcel segment relates to kind of front-loading those decisions and already taking costs. for that expansion in both Belgium and spring Europe. But over time, as said, we do expect the same impact as we said on February. We're happy with the progress that we're making. Growth in Europe of spring is really, really great. So I think that gives us a good chance to see revenue growth coming from other areas than just kind of the domestic e-commerce based business. Did you see any positive impacts from the strikes that hit Beatpost in Q1? Because they were quite significant and they mentioned the tolerance went to competition. Yeah, yes, a little bit. Material, I don't really know. So if we talk about Belgium and then Belgium in total, so domestic flows from the Netherlands to Belgium, cross-border flows to Belgium, Then we saw growth beyond the market growth, but I don't think that it's been impacted that much by those strikes. It might be a bit, but not significantly more. I don't have a number. And just to confirm, the Asian web shops, the yield measures will kick in in Q2, so there were no price increases yet on the Asian shops, correct? Yes, correct. And then if I may... So the price points that you saw in... first quarter are realized on other clients. Yeah, and maybe then coming back to your full year presentation, there was this slide in there where you showed the development of the mill and L business, if you would not do anything or if there would be a change in D plus two. And if you then see the trajectory of the graph, including that deepest to approval, et cetera, and the measures taken in the longer term also, you see that in 25, 26, there's only a small deviation, let's say 10, 15 million, if I do a bit of the measurements on the graph. And then all of a sudden you see it bend off in 27 to a big plus in 28. What makes that graph all of a sudden comes from, let's say, a big minus, let's not put a number on it, to quite a big plus? Is that going to a D plus 3? Is that the savings? The savings from just getting approval from the ACM now seem to be rather small, because it's a small part of your volume going into D plus 2, because most of it is already done. Can you maybe explain a bit more? Before that famous graph, try to explain this, Mark, but let me... 29. Yeah, but I say look at 28, then the answer is partly there. So what will happen is, yes, we can take cost savings if we can go to day plus two. We already are taking those case-saving measures and are part of 2025 for the business meal, because already we have migrated 70% of business meals to day plus two at this point in time. We'll contribute roughly, I would say, for now, around... 7 million of cost savings in year 2025. That part you cannot migrate again. So what you can subsequently migrate in 25 to 26 is the remaining 30% of that part. And then it's depending on what moment in time can you migrate the USO part. So that already impacts your 25 to 26 phasing. The big change is if you can really go to day plus three, because then you can take out your off-peak days completely. That is the biggest contribution to cost savings. And that leads to the step up of cost savings from 40 to 45 million to 80 to 100 million on that graph. Yeah, so that's all top. So it's 40, 45 million and another 40, 45 and then 80 to 100. Yeah, and that is the big change. And you need then, if the conclusion is, do you need to go to D plus 3 in this regulatory framework to get to positive numbers again? The answer is yes. So if we are stuck at the D plus 2 surface level, will not get to positive numbers. You feel comfortable that the government will? It's a different thing. This is the plan that we've presented. Where are we in that process? We expect within the next couple of weeks a report out from ACM based on the research that they are asked to do. then we expect, of course, that the Ministry of Economic Affairs will make up their own mind that we still envisage a discussion in Parliament before summer recess. And by then, I guess we would have more clarity on the phasing elements of these elements, and whether or not D plus 2, D plus 3 is both in that draft postal law, yes or no. We believe it should be, and that's also why in the meantime, before we get to a change in postal law, we've put that financial contribution request on the table. Now for 25 and 26, but if the line stays a line below zero, I think you can guess what we'll do. Yeah, because the orange line does not include... Not in the compensation. No compensation included, nor in the orange line, nor in our outlook.

right thank you okay then let's go to the people in the poll operator would you please explain the procedure for questions via the lights thank you if you wish to ask a question you will need to press star 1 1 on your telephone and wait for your name to be announced to withdraw your question please press star 1 1 again we will take our first question And the question comes from the line of Michael de Klerk from KBC Securities. Please go ahead. Your line is open.

Yes, hi, thanks for taking my questions. The first one would be on the yield measures at parcel and you already talked about it a bit that you're currently in negotiation phase and I understand that you cannot disclose a lot on it, but can you just give some qualitative comments on how these higher compensations, how they have landed or how they are landing, how this is interpreted by your customers and if there is maybe a reaction from competitors as well to that. So that will be the first question. The second one would be, for me it's still a bit unclear on the parcel volume. I understand, of course, the 2-3% phasing and timing effect, but with the yield measure expected to accelerate in the second quarter volumes I assume would drop then. I'm still puzzling a bit how you would then get to this 1-3% or is there also a positive phasing effect from calendar days in the second quarter. That would be my second question. And then maybe lastly on the cross-border and the spring business, it's of course a lot of inbound and outbound into the Benelux, but if I'm not mistaken, In spring, you also have the non-Benelex to non-Benelex volumes. I was just wondering if there is any direct volumes between China and US, and if you could maybe quantify this, because this would then have a rather direct impact instead of the rerouting trends, which are now a bit more uncertain. Those would be my questions, please.

Yes, well let me start with answering your second question on the growth, the growth volume you are referring to. So indeed the overall growth is 2% and taking into account the effect of working days, you would then come around 4 to 5%, which is also in line with with the assumed total market growth. What we have mentioned in our outlook and also at the beginning of the year is that given the yield measures which we are taking and also what we talked about before, we expect there to be a step down in that growth because of the yield measures we are taking and therefore resulting in the 1% to 3% growth which we are referring to. And that gap is then the assumed market share loss, which we are anticipating because of these targeted yield measures, which we are taking. Maybe on the negotiation side, so on the developments there, maybe... Yeah, well, let's say... Progressing.

Difficult to be specific here. I, of course, appreciate the question. But let's say I'm positive about the progress. You will expect them to be slightly distracted by what happens in the U.S. because, of course, they are significantly impacted as a company because of all of that. So some of these conclusions are not or negotiations have not concluded because of that fact, not particularly because of the position we take, but just by the distraction that that gets to them. So positive about the progress. Addition to Linda's point maybe is that, to be clear, that also means that if we expect market share loss, it will be share loss driven by that international volume. So not on your domestic percentage points, but on your international points. Because the yield measurement discussions that we just had for this quarter focus predominantly on that flow. Maybe on the cross-border question then, yes, there's a bit of to U.S., not necessarily only China, but we do have trade lanes from the Netherlands or from spring origin countries to the U.S. That trade lane is not that big, and that's also why we said we do not expect the impact of trade wars as a consequence on those trade lines to be material enough to walk away from our full-year outlook.

Okay, that's very clear. Thank you for answering my questions.

Thank you. Thank you. Once again, if you wish to ask a question, please press star 1-1 on your telephone. We will take our next question. Your next question comes from the line of Marco Giuseppe Limit from Barcos. Please go ahead. Your line is open.

Hi. Good morning. Thanks for my question. So the first question is on recent press articles about one of your largest retailers, let's say, setting up efforts to, you know, setting up So yeah, just any comment on that would have been your latest discussion on that. Second question is on the state compensation. I mean, is there any timing you expect for final decision on the compensation for 25 and 26? And third question is just a follow-up on your outlook for market volume growth. International volume grew a lot, especially towards the second half of the year, last year. So if we have a slower international volume growth in the second half of this year because the comps become tougher, do you expect basically domestic volumes to accelerate or do you expect a very similar split in terms of growth as of Q1 for the rest of the year as well? Thank you.

Thank you for your questions, Marco. Well, first point is related to the news article that was in the Financial Times, Dutch Financial Times, that really relates to a part of Bol.com. The way we look at it is there's a very strong strategic partnership between PostNL and Bol.com that's there already for quite some years. and that is a very strong partnership that works both ways. We were aware of the fact that Ampere, which is the part that is referred to, is testing and piloting in some parts of the country home delivery. The size and scale of these elements, in our view, don't change the logic of the strategic partnership that we have with Bolk, so I don't expect any material impact because of that. On the second point, the state composition, is there a timing? The answer is yes and no. There's no formal required written deadline in legislation. At the same time, we've put forward a deadline in our request and basically asking for a resolution and decision on it prior to our half-year numbers, so roughly speaking, end of June, beginning of July. That's what we've set out. We believe that's a realistic and reasonable timeframe, and we do expect the Ministry of Economic Affairs to take their view, and we need to wait for that.

And then on your last question with regards to the impact of the international volumes and looking forward, well, also as Pim mentioned before, the impact of global trade and what will happen and the consequences thereof, it is too early at this point in time to say anything about that. At this point in time, we are comfortable with our outlook for 2025. And yeah, we are agile and we'll adjust where it's needed.

Can I add two quick ones? So the first one is what is your exposure to Bolt.com or what's the amount of your domestic volumes coming from that retailer, number one. And then also another question. Do you think that, you know, despite you have kept the Outlook for 25 and changed, now the Outlook is a bit more back-end loaded compared to your expectations in February? Thank you.

No, it's not more back-end loaded. It's as back-end loaded. Ball.com is our biggest customer, but as said, we really talk about fractions of their volume, really small, think about one, two, three percent of their total volume that potentially might be served through Ampere for home delivery. So it is our biggest client, but the size of the risk that they On scale, a lot of those volumes for self-distribution is very limited. And quite frankly, I also really don't see the logic why they would do that given the partnership that there is in place and also what it takes to be able to deliver parcels at scale in every household of the Netherlands.

Thank you. Thank you. We will take our next question. Your next question comes from the line of Stefano Tofano from ABN AMBRO Oder. Please go ahead. Your line is open.

Yes. Good morning, everybody. Apologies for the first question, because it's another one on bull.com, a little bit related to what my colleague Marco was referring to. I understand that we and you are not worried about now the volumes that bull.com might take on its software delivery, but aren't you a little bit worried on the trend? Because there are examples of other players which had a large client which started slowly, but then three, four years down the line, that few percent became a little bit bigger, and then they started to ask some yeah, lower prices. So basically making, implying that Wop.com's position will become a little bit bigger in the future. So aren't you a little bit worried on that? Because it seems to me you are a little bit too relaxed on this news, but maybe I'm understanding this. I'm overstating this completely. So, and the second question is you mentioned that it is encouraging to see evidence that consumers are increasingly finding the way to out-of-home options. Also mentioning the locker solutions. Can you maybe tell us a little bit on that and what you're seeing right now and the progress on this? And the last one is a more technical one. I mean, last year, CAPEX 24 was much lower than 23. And if I look at the Q1 CAPEX, I see 26 million. Last year, 24 million. This year, obviously, there's 2 million. But is this lower year-on-year CAPEX an indication of the rest of the quarters?

Thank you. All right, then go back to the first point. I don't think I'm too relaxed about it. I would say we're educated about what happens in the market. We know what type of models parties can apply. But at the same time, we also know what it takes to distribute a million parcels. That's not easy. So if you want to grow a parcel delivery yourself, it is asset heavy. As you know, you will need men, women, vans, sorting capacity. So this is not something that will turn to scale quickly. Are we following it? Yes, of course. Do we expect some clients to take those steps maybe to create leverage or put pressure on terms negotiation? Could be the case. But the question was, are you worried about development? Put in that news article, and then my answer remains the same. It's actually also not a bold.com spokesperson that said something there. So we follow this. I'm not relaxed about it. But at the same time, I do not expect a material impact of it.

Yeah, maybe on the APL, your question on your APL progress. Well, there we see that as part of our strategic initiatives, we see good progress there with a continued high NPS score of plus 46 for the automated parcel lockers. And we also see that already 70% of our users of the PostNL app are choosing for APL delivery as their preferred option. Also from the implementation side, or let's say placement of the APL automated parcel lockers, that is progressing according to plan and as such on track according to our initiative.

On the CAPEX guidance, we've given a bit of guidance in February about this, basically saying slightly higher than 2024, also driven by roughly 15 million of investments that do relate to the five strategic initiatives that we at that point in time introduced. So this remains the full-year CAPEX outlook.

Okay, thank you. Thank you.

Thank you. We will take our final question. And your final question comes from the line of Frank Klassen from DigRoof Petercam. Please go ahead, your line is open.

Yes, good morning all. I've got indeed one question left. You've indicated that you are agile and willing to adjust plans if things would deteriorate in the course of the year. Can you elaborate what you are referring to? Are you referring to more cost savings, accelerating cost savings? How flexible are you with that? So, yeah, what are, let's say, the game plan if things would deteriorate?

I think we said agile in both directions and not necessarily only in case of deterioration because there's also potential outcomes where there could be more volume coming our way depending on the choices. that Asian webshops make on how they look at Europe. So it's not necessarily only one direction. And it means that we'll look at the options that we have to scale network capacity or to increase the utilization in certain parts of the year. And also that applies downward. If we see volumes coming down versus expectations, what we always do Think about the composition. Do we leave all depots open for first and second sorting, yes or no? Can we take capacity out to adjust for volume losses if they occur? Those are the bigger elements there that we refer to.

Okay, yeah, that's helpful. Thank you.

Likewise, yield management, plan safe, more volume comes your way. What are you going to do price-wise to accommodate that above and beyond what already is committed? So there's also commercial elements to this agility.

I see. Thanks.

Thank you. This concludes the question and answer session. I will now hand back to Inge Laude for closing remarks.

Thank you all for participating in our analyst call for Q125, and we see you back somewhere in August, August 4.

Thanks. Thank you.

Thank you.

This concludes today's conference call. Thank you for participating. You may now disconnect.