Postnl Nv

Good morning ladies and gentlemen. Welcome to the post NL half year 2026 results call. 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 Inge Laudy, Manager Investor Relations. Please go ahead madam.

Thank you, operator, and welcome to you all. We have published our results over the first half of 26 this morning. With me in the room are Pim Berendsen, our CEO, and Linde Jansen, our CFO. They will guide you through a short presentation to explain the results and will then take your questions. Please go ahead, Pim.

Thank you Inge and good morning to all of you. Thanks for joining this half-year results update. I'll start with talking you through some key takeaways and then some strategy slides and then we will then take over to go in more depth towards the financial performance. So on slide five the highlights resilient performance in challenging markets revenue numbers of 1.6 billion closely and almost in line with last year slightly improved normalized EBIT significantly improved free cash flow and what is important strategically is that we see the volume to value strategy gaining traction and that for instance also can be seen in the average price per parcel that is up with five percent. We consistently see higher growth in European e-commerce activities and obviously declining volumes from Asian webshops, probably also influenced by the introduction of the custom duties as per July 1st. of this year. Crucial step has been the successful implementation of the shift of standard meal to standard meal delivery within two days. We obviously prepared for that change for the last six to nine months. A huge effort for all the people involved both in the meal segment as well in the e-commerce segment. and that implementation has gone very well indeed we have confirmed our 2026 outlook and basically there's two additions to the strategy or attention points that are noteworthy we have launched an initiative that will bring us 75 million of additional cost savings mainly in e-commerce as a answer to the most likely unfavorable market circumstances in the e-commerce domain and those savings are aimed to reduce the cost price per parcel which allows us a bit more room on the commercial side of things to optimize the volume to value strategy in the e-commerce segment and the second point is that we have completely redefined our out-of-home strategy to strengthen the long-term competitive position on the out-of-home domain as well. On the non-financial KPIs, good progress has been made on the share of emission-free last mile delivery. From 32% to 39%, we've maintained our average number one position in relevant markets in terms of NPS and an improvement of absenteeism that still needs to come down a bit more, but at least it's trending in the right direction. So all in all, resilient performance in challenging markets. If we then move to Slide six, seven, I should say, is just to summarize the key elements of the strategy before we dive into those segments. As you know, we've presented this strategy in September in our Capital Markets Day. At the very top, you find our purpose connected to deliver what drives us all forward. And that is basically what holds everything together. Just below our strategic intent, we grow our business, create sustainable value, lead through innovation and make impact that matters. And that is basically the lens through which we make our choices. Then one step down, we translate this into ambitions for our three business segments. For e-commerce, it's about shifting from volume to value. through a differentiated approach and smarter network utilization. For platforms, it's all about capturing international growth with asset-light models. And for mail, it's really transforming towards a future-proof mail service. We make those transitions by 10 strategic portfolio priorities through which we manage the transition that we're looking for and that leads then to four concrete objectives on financial KPIs, NPS, carbon efficiency and employee engagement. So that's basically the North Star that guides all our decisions. If we then go to e-commerce on slide eight, we clearly have been executing on the volume to value strategy in intensifying external challenged surroundings. Geopolitical uncertainty has impacted consumer spending, bringing a bit down confidence of consumers down that has also ended up with market growth below our earlier expectations. Furthermore, we see intensifying competition from new market entrants that quite often are tied or somehow related to the Asian platforms. And of course, there's a shift in market dynamics, followed by the introduction of the import duty and handling fees per July 1st and still a bit to come by November 1st. At the same time, in terms of execution on our strategy, we're happy with the progress we're making. Much more sharper customer segmentation, more differentiated propositions and better and more disciplined volume steering have led to better utilization of networks and margin improvements there. So those yield measures are gaining traction and the cost and saving momentum protects profitability even though We look at lower volumes than last year and also slightly lower than we anticipated in the beginning of the year, but we managed to compensate that by the yield measures we just discussed. Important from a competitive position is that we keep our high NPS scores as being the number one for both receiving and sending e-commerce clients and as said we have introduced a program that will lead to 75 million of additional cost savings for 27 and 28. So on slide 9 we follow up with clear progress Monetizing capacity by optimizing customer mix and product mix. Contract renewals have been secured that bring a better balance between volume and margin development. Important negotiations, predominantly also in relation to Asian webshops, have been concluded in the second quarter. And I think you can see in the half year results that kind of capacity management and more operational steering also on best day and network utilization have improved operational efficiency the expected cost savings for 26 are according to plan we aim to get 40 to 50 million halfway through the year 24 and of course we want to maintain to be distinctive where it matters and that's also why we offer smart delivery suggestions in checkout and focus on best day delivery as well. Then on 10 it's in more detail the kind of the protective measures that strengthen our competitive position going forward and that will be there to support the path towards our breakthrough 2028 ambitions in a market which is significantly challenging and competitive positions are intensifying. That's why we've launched the cost savings program and I think the prerequisites to be able to do so now we've worked on over the last year or so and it will allow us now to further simplify the e-commerce organization to even focus more in operational processes to take out costs a few examples maybe artificial intelligence technology allows us now even a better fill rate of roll cages that of course limits the transport capacity that you need better planning and collection also takes out routes those are examples of areas where we can take costs out next to procurement initiatives around big spend categories like IT will contribute to the 75 million of savings which will bring the total cost savings to 170 to 180 million for this period and of course in that market space where it is quite challenging being able to reduce the cost price per parcel is important and creates a bit more flexibility in that market to make the right choices in terms of volume versus value That's obviously helped by a reduction in the cost price per parcel and that's why we've launched this additional 75 million of cost savings initiatives. On the other hand, we have fundamentally revisited and redefined our out-of-home strategy. It is increasingly an important differentiator in the e-commerce space, and we really have changed it completely by taking a different view on the role of out-of-home and having a different proposition in terms of how the network setup should be, how UX, CX needs to be, and also will require a step up in the number of parcel lockers to 7500 by 2031. so it's really an integrated platform that seamlessly combines merchant checkout digital customer journeys and high density network to accelerate the out-of-home adoption against cost price points that are attractive and will push some of the volumes towards that out-of-home network more quickly than with the current proposition. I think What we've communicated also in the press release is that given the magnitude of messages we'll have a deep dive on this new strategy around October time to give a bit more insight as to what we're aiming for and how the proposition has been developed going forward. If we then move to platforms, as said, platforms is all about capturing the international growth through asset-light models. We invest, as you know, in 2026 in improving and expanding the workforce. That will allow us in different countries to attract more clients. We have been investing in the IT landscape. and the ease of use for asset light platforms is of course crucial and that gives us competitive edge as well. We've been expanding the network and predominantly the linehole network and we've seen double-digit growth of e-commerce volumes in mainland Europe. in the first half year and of course we strengthen our position in Asia beyond our position in China to further de-risk the business and unlock new markets there. That is what we're strategically aiming for. If you talk about progress in 2026 As I said, intensifying external challenges. Of course, we have seen a shift in market dynamics as Asian webshops redefine their commercial proposition and processes following the introduction of the import duty and we see them behaving quite differently. if you compare them that has already anticipated in anticipation of July 1st has impacted volume flows and has continued to do so quickly after July 1st and we're adjusting the propositions towards that of course we're they're investing like in other areas in the elements we just discussed to expand our e-commerce base in Europe and the performance includes those startup costs as well as startup costs in in fulfillment activities that we also guided in the beginning of the year will be a negative impact for 2026. Then let's move to Mil. Although, as I just said in the beginning, we're very positive about the implementation to the Dplus2 network, it should be clear for all that urgent political decision is still necessary, because the transition to Dplus2 is by far not enough to get to a sustainable affordable meal delivery in the Netherlands that is also economically viable and it would take significantly more than this step to get there and that's why we continue to push for the necessary changes in law to be able to move to a within three day delivery network later We're still continuing discussions and legal proceedings around net costs. As you know, the transition up to the point that we have a real full functioning D plus 3 delivery model are quite substantial and we believe it's unfair that the company needs to pay for those transitional costs because they really relate to the obligation that is put forth to us in terms of the universal service. So we have the 2025 and 2026 submissions already done and we're currently preparing the application for a net cost contribution over 2027 too. And without quick and decisive action in the political domain, it stays a very, very uncertain period for our employees and consumers that use mail and customers alike. So it's really crucial that as quickly as possible after recess, the discussions in parliament will continue to get to a decision that gets us to an economically viable universal service. On slide 14 it's the summary of the successful transition to D plus 3 delivery as of July 12th and the implications for the segment performance that we also guided for in the beginning of the year. It's really been a major transformation, both in terms of network redesign in the mail side, but of course also at the same moment in time, the letterbox parcels for a D plus one delivery have moved from mail to the e-commerce network. We've introduced a new tariff model to accommodate these changes for our delivery partners and so far we are happy with the implementation on both sides. If you talk about the cost savings that those are in the middle and in the beginning of the year we said of course there will be cost savings for half a year on the meal side there will be also additional costs in relation to the implementation but also more importantly additional costs related to the transfer of the letterbox parcels to the e-commerce network so the impact in year of this change will be around 12 million negative for mail but of course is crucial and a prerequisite to be able to move to a D plus 3 on the e-commerce side a full year we expect 50 to 60 million extra items 30 million basically around 30 million for half a year and also within the e-commerce segment it will be a negative EBIT impact for the first half of the year driven by transition costs as well and of course over time that will lead to a margin accretive business model as of 2027. On that note, I think it's now time to look in more detail on the financial performance in total and per segment. So, Linde, I hand over to you to take us through those elements.

Thanks, Pim. Yes, let's move to slide 16. Let me start with this slide showing an overview of the key reported figures per segment. For Q2, it shows volume and revenue, and for half year, we also show a normalized EBIT. Just a note in the remainder of the presentation, I will focus on the developments on the first half year. For total personnel, so for the group as a whole, we saw, as Pim just mentioned, stable revenues and a resilient normalized EBIT in challenging markets. But let's have a look at how that looks like per segment, starting with e-commerce on the next slide. Overall, starting with revenue, we see in e-commerce good progress on our targeted yield measures. This is demonstrated by 5% increase in the average price per parcel, despite the challenging external environment, which Pim also just referred to. The revenue amounted to 937 million, compared to 961 million last year. A decrease of 2.4% with volumes declining by 6.4%. If you only take the volume-related revenue, the decline was only minus 1.8%. Let's dive a bit deeper into the key drivers for this. Starting with domestic. Domestic volumes declined by 4.2% due to weaker market growth, weaker than expected, and a limited market share loss, which was in line with our expectations following our volume to value strategy. Good to see, of course, that the decline in the second quarter was less than in the first quarter. If you then look at our international volumes, those declined by 15%, mainly coming from our Asian webshops. This also reflects weaker market conditions, our volume-to-value strategy here as well, and the new low-cost entrants being mentioned earlier. And very important, we also see first impacts, especially of the large Asian players, to prepare for the introduction of the import duty on the 1st of July. The volume decline overall was partly offset by a positive price mix impact of 36 million. That follows our further progress on our strategic yield measures, so that sticky price increase. The 36 million includes 5 million from fuel surcharges. These kicked in in the second quarter, and we are able to pass through the higher fuel prices, though with a small time lag. The yield measures developed in line with plan and were supported by a very limited unfavorable shift in mix. As said, overall the average price per parcel increased by 5% compared to half-year 2025. In the last column you see the step down in the bucket other and that is predominantly explained by the sale of B.S. Nacht distribution in Q2 last year. Let's move on to the normalized EBIT bridge for e-commerce on slide 18. This shows the reconciliation from 15 million in half-year 2025 to 12 million in current half-year. As just explained on the revenue slide, the declining volumes driven by weaker market growth, the impact of our volume-to-value strategy, and first effects from the introduction of import-duting and handling fees. and the positive price mix effect that was predominantly driven by price increases and including the 5 million fuel charges just mentioned. Sorry. The organic cost increases amounted to 38 million, including 7 million related to higher fuel costs. So in the first half year, a 2 million negative gap On fuel exists, but as said before, the surcharges have a time lag, which is a common mechanism in the industry for pass-through of higher fuel prices. Overall, PostNL achieved 24 million in cost saving in the first half year. For example, through a leaner and more efficient operating model in first and middle mile and the shift to out-of-home delivery. These cost savings were partly offset by for example higher costs related to sustainability and equipment designed to reduce physical workload. And remember that we expect to overall achieve 40 to 50 million in cost savings in 2026 for e-commerce. Let's move on to platforms on slide 19 with the revenue bridge. And yes, as known, there is some overlap with the e-commerce story I just explained as part of the spring volumes are in feed in our e-commerce network. Overall revenue was up 1% to 379 million compared to 375 million last half year, with volumes down minus 7.1. Please note that at constant currencies the revenue increased by 2.7% instead of 1%. In line with our strategy, European e-commerce volumes continued to grow strongly by 28% in the first half of the year and were offset by declining low margin traditional meal items, which was predominantly visible in the second quarter due to phasing and the general declining trend in meal. Please note that we already transitioned to become an e-commerce player in the European market, with roughly 75% of revenue in Europe currently derived from e-commerce. Looking at volumes, the split is a bit different. Around 40% of volumes is e-commerce. But in short, so the dynamics here are growth in e-commerce and a declining traditional meal. Looking at the Asian volumes, the Asian volumes as mentioned earlier declined and reflect the weaker market conditions. And we see here also the impact from our volume to value strategy and the preparations that were initiated by the Asian webshops for the introduction of the import duty on non-EU parcels for the 1st of July. Looking at price mix, we see a very positive delta here. Prices were up in Europe approximately 4%, and obviously the mix effect is favorable, particularly in Europe, explained by the strong growth in e-commerce volumes versus the declining meal, and of course also the shift in mix between European and Asian volumes play a role. Looking at other revenue that showed a decline and includes my parcel other services as for example fulfillment and some intra-segment eliminations. Let's move to slide 20 showing the normalized EBIT bridge for platforms. Showing the reconciliation from 3 million in half year 2025 to minus 3 million this half year. and that the root cause therefore is mainly related to our strategy to invest in international expansion. The revenue drivers I just explained, so I won't repeat that, but let's look at the costs. The organic costs for platforms increased by 9 million and that is mainly related to increasing third party costs for international transport and distribution. PostNL continues to invest, as mentioned, in the expansion of its intra-European activities, MyParcel and other services. That means more marketing efforts, expansion of staff and investing in IT, as Pim also earlier on referred to. For our fulfillment activities, we have opened a center in Germany this year. So in the buckets, other results, you also see the impact of the startup cost thereof. Good to mention that the overall net FX impact on normalized EBIT was zero. And then moving to the last and third segment, mail. Starting with the revenue bridge on slide 21. Revenue rose by 0.5% to 623 million compared to 620 million last year. This is mainly explained by the combined impact from volume development and tariff increases. The mill volumes were down only 5.3% in the first half year. The main reason for this limited decline are the elections in the first quarter of 2026 of around 19 million items. If you adjust, for this election, male volume decline was 7.9%, evidencing the continuation of the underlying trend of structurally declining male volumes. The impact from volume decline was more than offset by a positive price-mix effect. Stamp prices were up 6.9% as of the 1st of January of this year and 8.3% as of mid-2025. In the bucket Other, you see an 8 million decline and that is, amongst others, related to international mail. Then moving to the bridge, the normalized EBIT bridge for mail on slide 2022.

The volume decline and price mix effect I just explained.

Looking then at the costs, the organic cost increases of 15 million are mainly due to wage increases and other inflationary pressures. And then you see the cost savings of 12 million, of which the majority is related to adjustments in sorting and delivery processes. And we also see that cost for IT, partly related to the transition to D plus 2, which we just completed, and transport costs increased. That about the segments. Let's now have a look at the free cash flow. I'm really pleased with the development that we report over the first half year of 2026. We see the free cash flow coming in at 17 million minus, which is significant improvement compared with last year. The strong improvement reflects our continued focus on proactive working capital management and also partly relates to prior year phasing effects. Thanks to our well executed cash and balance sheet management, we are on track to deliver full year free cash flow within our outlook range. Then let's wrap up at slide 2024 and look at our outlook. We confirm, as said by Pim, we confirm our outlook for the full year 2026 and which was shared with you on the 23rd of February. For normalized EBIT, our outlook is between 40 and 70 million and we expect that to translate into a free cash flow of somewhere between 0 and minus 30 million. The outlook is based on an assumed total revenue growth of between 5 and 7%, where it's obviously fair to assume that we will end up closer to the lower end of the range, taking the volume development in the first half of the year into account. As just explained, despite the volume decline, the bottom line result was resilient, where we expect further momentum in operational efficiency going forward. In 2026 we continue to invest in our strategic focus areas, with CAPEX expected to be around 125 million, while lease payments will be at the same level as in 2025. Expected organic cost increases remain high, around 140 million, mainly labor-related and other inflationary pressures. But price increases are expected to be more than sufficient to mitigate this. Our focus will continue to be on strong cost control and further efficiency improvements, building on our proven efforts to reduce cost. Please note that the outlook 2026 assumes limited impact from changes in treatment of the de minimis threshold in the EU and in the US or in related customs handling and clearance fee structures. The scope and timing could evolve during the year and could therefore impact performance. In the past half year, we have implemented a valid and working operational solutions for customs handling and clearance fees as of 1 July and later on also in November. Furthermore, the outlook excludes the risk that prolonged geopolitical uncertainty may increase inflationary pressure and impact consumer spending.

I will now hand back to Inge. Thank you Pim and Linde for explaining the results and I hand back to the operator to ask to explain the procedure for Q&A. Thank you.

Thank you. To ask a question you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question please press star 1 and 1 again. Our first question comes from the line of Frank Klaassen from De Groef Peterklaas. Please go ahead, your line is open.

Yes, good morning all. A question on the e-commerce volumes. If I recall well, you started the year with an assumption of 1 to 3% volume growth, yet we're now at minus 6.4 for the first half. So what is Fair to assume for the full year, what is currently reflected in your guidance on volume growth? That is my first question. And a bit related to that on the pricing, the average price per parcel went up 5%. Is it fair to assume that it will go up even further in the second half given the lack in the fuel price surcharges? Any comments on that would be helpful. Thank you.

Yes, thanks Frank for your questions. Regarding your first question on the 1-3% e-commerce volume growth, well, you are correct as the developments in market growth were lower than we anticipated at the beginning of the year. It is fair to assume that the volumes for full year will not meet the 1-3% mentioned earlier. At the same time, as you also see in our current performance, The drivers underlying, so price, mix, our operational efficiency are gaining traction and are showing also bottom line results and we expect further momentum thereof in the second half of the year. And then on your second question on the price per parcel, well, yes, of course, you can also, given our seasonal pattern, you can expect with pricing, with peak charges, et cetera, that trend will accelerate in the remainder of the year.

Okay, thank you. Thank you. Once again, to ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. And our next question comes from the line of Marco Limite from Barclays. Please go ahead, your line is open.

Hi, good morning. Thanks for taking my question. I've got a few. So, first question is on your statement that some important contracts have been concluded in Q2. What does that mean for the second half? I think you've just mentioned that pricing should accelerate in the second half, but should we also expect an improvement in volumes on a year-over-year basis versus the first half? I guess that would be the first question. My second question is on the platform business. So in Q2 we've seen a proper slowdown of volumes versus Q1. Now in the slides you mentioned there was already some impact from the de minimis in Q2. But in the guidance, you don't expect any impact in the second half. So just if you can clarify this point, what is the expectation for the volumes in the platform business and why we should expect any impact if, I mean, there are already some data out there showing some slowdown of flows from Asia to Europe. And the third question is on your mail business. Pim mentioned before that you're working on submitting your request for the cost of USO 427, but you're still, let's say, fighting for the 25 and 26. So at the same time, you received a fine for quality of service for a couple of years ago. So the backdrop sounds quite challenging in terms of negotiations. Any color you can give that, any progress you've made, any sort of confidence you have that this is going through. Thank you.

Okay, let's go one by one. Yes, I think as part of the volume to value strategy, and as you know, not all contracts end at the same date. There's been a lot of negotiations concluded with probably Asian webshops also into and throughout Q2. Those contracts have now been secured and we know against which conditions, which rates, which volume we expect to carry for them. And that will go a long way in continuing the strategy from volume to value. Of course, the overall volume that we get is still a function of how they commercially perform themselves. But those contracts work in volume brackets so if they are below a certain threshold then also the price points will move up even more than at the baseline volumes that we contracted them on. So I think important key contract renegotiations that reinforce our conviction that we're on the right path in terms of from volume to value strategy. I think the second question in relation, or the follow-up question in relation to it was, do you expect improvement of volumes on that international side in the second part of the year, or overall? Yes, overall we do expect an improvement from the minus 6.4% to a better number for a year, also based on the answer that Inge, Linde just gave on the question of Frank. I'll take question three and then I think Linde can comment on question two. You say challenging backdrop, yes, but at the same time we feel strongly that it cannot be our problem that we need to pay for the transition costs, that we need to pay for net costs that are out there as a function of an obligation that is put for us. So we make a distinction between kind of the ACM quality fines that are related to the quality standards in current postal law versus net costs and future required changes to the USO that make the mail business sustainable going forward and the first one is clearly a debate with ACM and we'll go to court because we think the fines are unacceptable acceptably high and also the basis for those files in our perspective aren't there. With government and chambers we continue to discuss the required changes to the postal law that will allow us to make changes to the obligation or subsequently need net cost compensation if the obligation is not changing in a way that we can deliver the mail business against an economically viable rate. That are the answers on 1 and 3. Maybe you can say something about in relation to the outlook statement.

So on your question with the de minimis volumes amongst others for platform and Asia, etc., Yes, so we say in our outlook that we assume limited impact. Obviously, that is still the case. So we, of course, face ourselves now, as also mentioned by Pim earlier, impacts thereof. However, these are the first weeks. Those parties are now also trying to organize themselves and make sure how their new logistics model works. We assume overall in the long term no structural impact for the longer term and therefore we hold on to our performance and in addition to that also good to note as you also see in our current performance that given our this time volume decline we are adapting well to that to scale down and adjust our costs accordingly.

Okay thank you very much and if I may just a quick follow-up on this. So you're saying that some of the international clients are adjusting the business model given the new Can you give just examples of what has been made so far? Are we seeing those clients building more warehouses or more inventories in Europe and what does that mean for you? Clear question, let me take it.

I think, and there you need to be very precise, I think all relevant platforms take different make different choices as how they handle this current market situation. There's platforms that basically say we will manage value on a basket size basis and we will on that basket swallow the vast majority of the three euro fee and then maybe slightly push a bit of the external cost up through the price points of the basket that's one option so basically a client that isn't really thinking about a new logistical process because they think they can offset This fee in the value of the basket in a split between what the consumer will then most likely pay more and what they will take as additional cost in their side. Others take a different view and want to move to higher valued product categories that can substantiate those fees better. and move away from the really really low and very cheap products where a three euro increase in cost is still material and you will probably see others that will continue down the road of those low valued goods But then through European warehousing solutions, so increasing the warehousing capacity in Europe, flying it in or cargoing it in bulk, so not as a 2C delivery parcel, but in bulk. to circumvent the angling fees and duties and then pick and pack from there and distribute it through various carriers towards the final consumer. So there's different parties taking different roads By the end of the day, it's all about where will the volume go and it will be shifting in comparative landscape between those Asian platforms. There will probably be new entrants taking the lower end of the value chain. and there will potentially also be competitive implications for the European webshops where some of the Asian players really intend to move up to higher valued products in which they will then subsequently compete with the current existing European platforms in those spaces. A lot is going on there and we of course follow this closely. It's important that we maintain a good share of wallet in the most important clients that are willing to pay for service. That is what we secured throughout the contracts that I've given you answer on in one of your earlier questions. So that's how the market evolves at this point in time.

Thank you very much.

Thank you. And our next question comes from the line of Henk Slotboom from The Idea. Please go ahead. Your line is open.

Good morning and thanks for taking my questions. First of all, a compliment for the degree of disclosure of numbers, which makes me very happy. But despite that, I have a couple of questions. First of all, Pim, you told a lot about the platform business and about the Chinese business. But last week, I listened in to the CTT conference calls. They said that Carcassia had suffered because a lot of volume was now flowing in to the Bananas countries instead of Madrid, for example, and to the Central and Eastern European countries. What am I missing in the case of spring? Because we see a quite clear dip in the Asian volumes at spring. Is that pure value over volume, or is it something else? And what is triggering the European volume so much? Does it have to do with the opening of the fulfillment center in Germany? I believe it's for one of the Spanish toding materials. The second question I have is on e-commerce and about domestic volumes in particular. We've been getting deliberately up some market share by means of the value over volume strategy. And if I look at the average value per parcel, if I look at the slide, I believe it is slide 16, the development of the EBIT, it's quite clearly visible that that improves your yields How far can you go in giving up volume? Because at the same time, we'll see parties like GoFundMe doing a lot of work for the Chinese. Track and Fly has come in handling volume for Amazon. We have Joy Express, a new name, on pair, has 85% nationwide coverage, at least that's what they claim. Traditional players stepping up imports has entered the market as well. How do you deal with that? Is the cost savings elements and reducing the cost per item is, of course, one part of the story, but what can you do to make the volumes grow again? And then the final question I have is on mail. In December there was a ruling by the CBB, the merger with SANS. I know it's a sensitive subject. basically got it right and basically was saying we're going to see how we deal with this situation right now. Have there been any developments on that front? Those were my questions.

Okay, thank you, Henk. Yeah, the first question had some, well, sub-questions. So correct me if I have not, let's say, answered them completely. I think there's a couple of elements to that I want to single out. I think Spring Europe's e-commerce volume is the double-digit number that Linde talked about. And that is a function of expanding the pan-European line halls from Italy to Spain, from Spain to Germany, by attracting local clients that fill those trade lines and bring us in a more competitive position. Not necessarily always, but there also the fulfillment proposition comes into play. and that's really not capital intensive fulfillment activities where we also manage warehouses and fulfillment activities for bigger clients that want to ship throughout Europe. So I think there the growth is as we would like it to be, is a function of the platform growth plan that we launched in September and as said is going according to plan. The overall spring volumes are depressed by the development in quarter by phasing on the European international meal volumes that don't contribute that much so in terms of revenue not that significant but in terms of volume that makes a very good 28% e-commerce volume growth diluted a bit. On the Asian side, I don't see more volume coming to Amsterdam or Liège. What we do see is that our custom clearance solution is working and has been working from the get-go. which is of course important because that clarifies towards consumers under which conditions they can still buy from other parties and were able to administer and also fulfill the custom duties. in the chain and I think there of course we already saw based on examples that we've had in Romania and Italy that goods in transit has been a big issue in other words how do we exactly know that a product that is bought just before July 1st doesn't get any duty if it accesses the country on July 1st or July 2nd. So that basically has led a lot of those parties to three, four weeks in advance, stop marketing campaigns, not push more products towards Europe. to avoid goods in transit being treated in a different way. And that has impacted Q2 numbers. We've of course seen the drops in volume. We also now see the Asian webshops adjusting their business model, adjusting their pricing strategies re-entering the marketing arena to do the marketing campaigns again and that's why we said that we don't expect a longer term structural impact that is going to be material in terms of EBIT contribution from those changes. That could in the meantime still lead to very volatile volume developments we quite often have share of wallet arrangements with those parties so although there's new entrants they sometimes forced by our volume to value strategy have kicked out other carriers and now our share is just a function basically on how successful they are to adjust their commercial models after the July 1st implementation. So I think that is the answer on the first set of questions. If you then go to the e-commerce domestic volume, yes, this is a delicate balance between volume, development, yield and market share. I think the market share loss is within the boundaries of what we find acceptable. Domestic volume development has obviously also impacted by lower consumer spending, so I think the flywheel of yield improvement could have worked even better with a bit more consumer spending, as we also anticipated in the beginning of the year. but to alleviate or to compensate or to de-risk on this dilemma or these commercial game plans it's obviously helpful to reduce your cost price per parcel and that's why we introduced the 75 additional costs Another point on comparative landscape is our redefined out-of-home strategy will also be significantly better equipped to compete with some of the other players you mentioned. That also strengthens our competitive position and over time will also strengthen the domestic volume development. So far not unsatisfied with the domestic performance but a close monitoring of market share development and yield and volume increases remains crucial and that's what we do on a daily basis and that's also why it's important to look at the answers that Linde gave that we have been able to adjust the network and create efficiencies in the network utilization so that yield isn't suffering that much with lower volume than anticipated. And on the third point, yes, this is sensitive. I don't think the Sepe Bay said that ACM got it right. They said something about the permit and on a 2018 basis. So it's up to ACM to do their research. Of course, we feel that there's no need at all to amend anything. We've adhered to the conditions of the permit. The permit was there at the day that we acquired SEND and was there when we integrated the business. But let's say I don't have clarity right now as to where ACM is in their research or in their investigation. So I cannot tell you more about it right now.

Thank you very much for your extended answers.

Thank you. We'll now move on to our next question. And our next question comes from the line of Mark Swartzenberg from ING. Please go ahead. Your line is open.

Yeah, good morning, everybody. One question left. Can you give a bit more color on the phasing and what's behind the additional 75 million of cost savings? How should we face it in the model? And what is really the driver of the 75 million?

Yes, thanks, Mark. Well, as mentioned, so it is mainly within e-commerce, but also in the related support functions, so HR, finance, IT. And well, we refer to the phasing for the total both years, so 2027 and 2028. and I would say that you can calculate with approximately 50-50 over the both years involved. Okay, that's clear.

Thank you very much.

Thank you. And our final question comes from the line of Marco Limite from Barclays. Please go ahead, your line is open.

Hi, thank you for taking my follow-up question. I've just got one, again, on the business model of the platform business, because you were mentioning before a non-capital intensive fulfillment activities. You were making the example of Italian volumes into Spain, Spain to Germany, and so on. So, can you just explain to us really what What is the activity here and how you are offering non-capital intensive fulfillment center activities, please? And is this the business model, doing more of that in the next year? Thank you.

It is really what it is. So if there are clients that say we're happy with the logistical solution, but can you also help me out with fulfillment activities? We, in conjunction with that client, think about the best way to do so. So quite often it's for instance a lease obligation the client takes and we just operate the location. Sometimes it's us taking the leasehold but back-to-back commitments from the client to compensate for that. but given the type of business we're in, given the type of clients the spring countries support, it's not highly optimized fulfillment activities, it's for the largest part traditional pick and pack with some efficiency improvements there and that's why it is less capital intensive than for other segments.

Got it.

And is the plan to, let's say, build up a proper fulfillment business, which is unrelated to the... Only in relation to our European growth business and only in relation to the type of customers that Spring serves. So that will not lead to big investments in fulfillment centers. So it's an organically developing model. Only to the extent that it helps us creating more density in the pan-European trade lanes so to make ESPRING even more competitive.

Okay, thank you. And given that I've got the opportunity also to maybe ask the last one. When we think about the new 75 million cost savings, Shall we think about those cost savings as an offset to maybe lower volume decline or a way to protect your margins or this is actually, you know, in your business plan offers a

It's really de-risking, created room to maneuver in slightly more competitive market circumstances. So don't add this just to the ambitions of 2028. It will de-risk the plan. If that comes with slightly better volume development, then performance will accelerate beyond the ambition. But let's get first to the ambition levels that we set for 2028 and this de-risks this for the combination of the factors that you said so it could help de-risking a slightly lower volume development it could help being more precise as to which price points on the volume-to-value strategy we want to entertain. It helps maintaining the market share at the level we think we need to maintain it for. And it actually then, as I said, de-risks the commercial elements of the e-commerce plan and gives us more confidence that we can get to the to the 2028 objectives.

Okay and when you say that we'll add up to 170 to 180 million you are adding those costs to the sort of

The 170 to 118 is the total number of cost savings over the period where this 75 has been now included.

The base you are adding this 75 million cost on is the Group Cost Savings, or is it specifically e-commerce?

It's mainly e-commerce because we do this to de-risk for the competitive environment in e-commerce. But as Linde said, it also involves some support functions that are also working on behalf of e-commerce. So it aims to impact the e-commerce cost base.

Okay, very clear. Thank you.

There are no further questions at this time, so I'll hand the call back to Inge for closing remarks.

Thank you all for joining today. If you have any questions, you know how to reach us. Thank you and speak to you in October.

This concludes today's conference call. Thank you for participating. You may now disconnect. Speakers, please stand by.