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.