Half Year 2026 PostNL NV Earnings Call

August 3, 2026

Pim Berendsen: of year results update. I'll start with talking you through some key takeaways, then some strategy slides, Linde will then take over to go in more depth towards the financial performance. On slide five, the highlights, resilient performance in challenging markets. Revenue of EUR 1.6 billion closely and almost in line with last year. Slightly improved normalized EBIT. Significantly improved free cash flow. What is important strategically is that we see the volume to value strategy gaining traction. That, for instance, also can be seen in the average price per parcel that is up with 5%. We consistently see higher growth in European e-commerce activities and obviously declining volumes from Asian web shops, predominantly also influenced by the introduction of the customs duties as per 1 July of this year.

Pim Berendsen: Of year results update. I'll start with talking you through some key takeaways, then some strategy slides, Linde will then take over to go in more depth towards the financial performance. On slide five, the highlights, resilient performance in challenging markets. Revenue of EUR 1.6 billion closely and almost in line with last year. Slightly improved normalized EBIT. Significantly improved free cash flow. What is important strategically is that we see the volume to value strategy gaining traction. That, for instance, also can be seen in the average price per parcel that is up with 5%. We consistently see higher growth in European e-commerce activities and obviously declining volumes from Asian web shops, predominantly also influenced by the introduction of the customs duties as per 1 July of this year.

Speaker #1: Off here. Results update: I'll start by talking you through some key takeaways and then some strategy slides, and Linde will then take over to go into more depth on the financial performance.

Speaker #1: So, on slide 5, the highlights: resilient performance in challenging markets; revenue numbers of €1.6 billion, almost in line with last year; slightly improved normalized EBIT; and significantly improved free cash flow.

Speaker #1: And what is important strategically is that we see the volume-to-value strategy gaining traction, and that, for instance, can also be seen in the average price per parcel, which is up by 5%.

Speaker #1: We consistently see higher growth in European e-commerce activities, and, obviously, declining volumes from Asian web shops, predominantly also influenced by the introduction of the custom duties as per July 1 of this year.

Speaker #1: A crucial step has been the successful implementation of the shift from standard meal to standard meal delivery within two days. We obviously prepared for that change over the last six to nine months.

Pim Berendsen: Crucial step has been the successful implementation of the shift to standard mail delivery within 2 days. We obviously prepared for that change for the last 6 to 9 months. A huge effort for all the people involved, both in the mail segment as well in the e-commerce segment, that implementation has gone very well indeed. We have confirmed our 2026 outlook, basically there's two additions to the strategy or attention points that are noteworthy. We have launched an initiative that will bring us EUR 75 million of additional cost savings, mainly in e-commerce, as an answer to the most likely unfavorable market circumstances in the e-commerce domain. 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.

Speaker #1: Huge effort from all the people involved, both in the Meal segment as well as in the E-commerce segment, and that implementation has gone very well indeed.

Speaker #1: We have confirmed our 2026 outlook, and basically there are 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 an answer to the slightly unfavorable market circumstances in the e-commerce domain.

Speaker #1: And those savings are aimed at reducing 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.

Speaker #1: And the second point is that we have completely redefined our out-of-home strategy to strengthen the long-term comparative position in the out-of-home domain as well.

Pim Berendsen: 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. All in all, resilient performance in challenging markets. If we move to slide six, seven I should say, it's 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.

Speaker #1: 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 on absenteeism that still needs to come down a bit more, but at least it’s trending in the right direction.

Speaker #1: So, all in all, resilient performance in challenging markets. If we then move to slide 6—7, I should say—just to summarize the key elements of the strategy before we dive into those segments.

Speaker #1: As you know, we've presented this strategy in September, and our Capital Markets Day had a very top view. You find our purpose, connected to deliver what drives us all forward, and that is basically what holds everything together.

Pim Berendsen: At the very top, you find our purpose connected to deliver what drives us all forward, 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. That is basically the lens through which we make our choices. 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. 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, that leads to four concrete objectives on financial KPIs, NPS, carbon efficiency, and employee engagement.

Speaker #1: 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.

Speaker #1: 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 different chain approach and smarter network utilization.

Speaker #1: For platforms, it's all about capturing international growth with asset-light models, and for Mail, it's really transforming toward a future-proof mail service. We make those transitions by ten 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.

Speaker #1: So that's basically the North Star that guides all our decisions. If we then go to e-commerce on slide 8, we clearly have been executing on the volume-to-value strategy.

Pim Berendsen: 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 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. Of course, there's a shift in market dynamics followed by the introduction of the import duty and handling fees per 1 July, and still a bit to come by 1 November. At the same time, in terms of execution on our strategy, we're happy with the progress we're making.

Speaker #1: In intensifying external challenged surroundings, geopolitical uncertainty has impacted consumer spending, bringing it a bit down. Confidence of consumers is down; that has also ended up with market growth below our earlier expectations.

Speaker #1: 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 following the introduction of the import duty and handling fees, effective July 1.

Speaker #1: And still a bit to come by November 1. At the same time, in terms of executing on our strategy, we're happy with the progress we're making.

Speaker #1: Much sharper customer segmentation, more differentiated propositions, and better and more disciplined volume steering have led to better utilization of networks and margin improvements there.

Pim Berendsen: 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. Those yield measures are gaining traction, and the cost-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've 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. I said, we have introduced a program that will lead to EUR 75 million of additional cost savings for 2027 and 2028. On slide nine, we follow up with clear progress.

Speaker #1: So those yield measures are gaining traction, and the cost and savings momentum protects profitability even though we look at lower volumes than last year, and also slightly lower than we anticipated at the beginning of the year. But we've managed to compensate for that by the yield measures we just discussed.

Speaker #1: Important from a competitive position is that we keep our high NPS scores, being number one for both receiving and sending e-commerce clients and asset.

Speaker #1: We have introduced a program that will lead to €75 million of additional cost savings for 2027 and 2028. So, on slide 9, we follow up with clear progress.

Speaker #1: Well, monetizing capacity by optimizing customer mix and product mix—contract renewals have been secured. That brings a better balance between volume and margin development.

Pim Berendsen: Well, 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 Q2, and I think you can see in the H1 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 2026 are according to plan. We aim to get EUR 40 to 50 million halfway through the year. We're at EUR 24 million. Of course, we want to maintain to be distinctive where it matters. That's also why we offer smart delivery suggestions in checkout and focus on best day delivery as well.

Speaker #1: Important negotiations, predominantly also in relation to Asian web shops, 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 peak days.

Speaker #1: And network utilization has 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.

Speaker #1: We're 24. And, of course, we want to maintain being distinctive where it matters. That's also why we offer smart delivery suggestions in checkout and focus on best day delivery as well.

Speaker #1: Then, on slide 10, it's in more detail—the kind of protective measures that strengthen our competitive position going forward. And those will be there to support the path towards our breakthrough 2028 ambitions.

Pim Berendsen: On slide 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. 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 on collection also takes out routes.

Speaker #1: In a market which is significantly challenging and where 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 on operational processes to take out cost.

Speaker #1: A few examples, maybe. Artificial intelligence technology now allows us an even better fill rate of roll cages, which of course limits the transport capacity that you need.

Speaker #1: Better planning on collection also takes out routes. Those are examples of areas where we can take cost out, next to procurement initiatives. Around big spend categories like IT, we'll contribute to the €75 million of savings.

Pim Berendsen: 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 EUR 75 million of savings, which will bring the total cost savings to EUR 170 to 180 million for this period. 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 is obviously helped by a reduction in the cost price per parcel, and that is why we have launched this additional EUR 75 million of cost savings initiatives. On the other end, we have fundamentally revisited and redefined our out-of-home strategy.

Speaker #1: And 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.

Speaker #1: 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.

Speaker #1: 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. 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 and CX need to be, and also, it will require a step-up in the number of parcel lockers to 7,500 by 2021.

Pim Berendsen: It is increasingly an important differentiator in the e-commerce space. 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 7,500 by 2031. It is 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.

Speaker #1: So it's really an integrated platform that seamlessly combines merchant checkout, digital customer journeys, and a high-density network to accelerate out-of-home adoption at cost price points that are attractive.

Speaker #1: And we'll 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.

Pim Berendsen: I think what we have communicated also in the press release is that, given the magnitude of messages, we will have a deep dive on this new strategy around October time to give a bit more insight as to what we are aiming for and how the proposition has been developed going forward. If we 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, the ease of use for asset-light platforms is of course crucial, and that gives us competitive edge as well. We have been expanding the network, predominantly the line-haul network, and we have seen double-digit growth of e-commerce volumes in mainland Europe in H1.

Speaker #1: 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 international growth through asset-light models.

Speaker #1: As you know, we are investing in 2026 in improving and expanding the workforce. That will allow us, in different countries, to attract more clients. We have also been investing in the IT landscape, and the ease of use for asset-light platforms is of course crucial.

Speaker #1: And that gives us a competitive edge as well. We've been expanding the network, predominantly the linehaul network, and we've seen double-digit growth in e-commerce volumes in mainland Europe in the first half of the year.

Speaker #1: And of course, we're strengthening 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.

Pim Berendsen: 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 are strategically aiming for. If you talk about progress in 2026, as 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. We see them behaving quite differently. If you compare them, that has already, in anticipation of 1 July, has impacted volume flows and has continued to do so quickly after 1 July. We are adjusting the propositions towards that. Of course, they are investing, like in other areas, in the elements we just discussed to expand our e-commerce base in Europe.

Speaker #1: If you talk about progress in 2026, as said, intensifying external challenges—of course, we have seen a shift in market dynamics as Asian web shops redefine their commercial proposition and processes following the introduction of the import duty.

Speaker #1: And we see them behaving quite differently. If you compare them, that has already—the anticipation of July 1st—has impacted volume flows. And it's continued to do so quickly after July 1st.

Speaker #1: And we're adjusting the propositions towards that. Of course, we're also investing, like in other areas, in the elements we just discussed to expand our e-commerce base in Europe.

Speaker #1: And the performance includes those startup costs, as well as startup costs in fulfillment activities, that we also guided at the beginning of the year will be a negative impact for 2026.

Pim Berendsen: The performance includes those start-up costs as well as start-up costs in fulfillment activities that we also guided in the beginning of the year will be a negative impact for 2026. Let's move to mail. Although, as I just said in the beginning, we're very positive about the implementation to the D+2 network. It should be clear for all that urgent political decision is still necessary because the transition to D+2 is by far not enough to get to a sustainable, affordable mail delivery in the Netherlands that is also economically viable. It will take significantly more than this step to get there. 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.

Speaker #1: Then let's move to Mill. Although, as I just said in the beginning, we're very positive about the implementation to the D+2 network.

Speaker #1: It should be clear for all that urgent political decision is still necessary, because the transition to D+2 is by far not enough to get to a sustainable, affordable mail delivery in the Netherlands.

Speaker #1: That is also economically viable. And it would take significantly more than this step to get there. 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.

Speaker #1: 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, fully functioning D+3 delivery model is quite substantial.

Pim Berendsen: As you know, the transition up to the point that we have a real full functioning D+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. We have the 2025 and 2026 submissions already done, and we're currently preparing the application for net cost contribution over 2027 too. Without quick and decisive action in the political domain, it stays a very, very uncertain period for our employees, our consumers that use mail, and customers alike. 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.

Speaker #1: 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.

Speaker #1: So we have the 2025 and 2026 submissions already done, and we're currently preparing the application for 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.

Speaker #1: That newsmail, 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.

Speaker #1: On slide 14, it's the summary of the successful transition to D+3 delivery as of July 12th, and the implications for the segment performance that we also guided for at the beginning of the year.

Pim Berendsen: On slide 14, it's the summary of the successful transition to D+3 delivery as of 12 July 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+1 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, those are in the middle. In the beginning of the year, we said, of course, there will be cost savings for H1.

Speaker #1: It's really been a major transformation both in terms of network redesign and 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.

Speaker #1: 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.

Speaker #1: If you talk about the cost savings, those are in the middle. And at the beginning of the year, we said, of course, there would be cost savings for half a year.

Speaker #1: On the mail side, there will also be 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.

Pim Berendsen: On the mail 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. The impact in year of this change will be around EUR -12 million for mail, but of course, it's crucial and a prerequisite to be able to move to a D+3 change later on.

Speaker #1: So, the impact in this year of this change will be around €12 million negative for Mail. But, of course, it's crucial and a prerequisite to be able to move to a D+3 change later on.

Speaker #1: On the e-commerce side, for the full year we expect 50 to 60 million extra items, basically around 30 million for half a year.

Pim Berendsen: On the e-commerce side, full year, we expect 50 million to 60 million extra items, basically around 30 million for H1. Also within the e-commerce segment, it will be a -EBIT impact for H1, driven by transition costs as well. Of course, over time, that will lead to a margin accretive business model as of 2027. On that note, I think it is now time to look in more detail on the financial performance in total and per segment. Linde, I hand over to you to take us through those elements.

Speaker #1: And also, within the e-commerce segment, there will be a negative EBIT impact for the first half of the year, driven by transition costs as well.

Speaker #1: 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 at the financial performance in total and per segment.

Speaker #1: So, Linde, I hand over to you to take us through those elements.

Speaker #2: 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.

Linde Jansen: 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 H1, we also show normalized EBIT. Just to note, in the remainder of the presentation, I will focus on the developments on the H1. For total PostNL, for the group as a whole, we saw, as Pim just mentioned, stable revenues and a resilient normalized EBIT in challenging markets. 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.

Speaker #2: And for the half year, we also show normalized EBIT. Just a note: in the remainder of the presentation, I will focus on the developments in the first half year.

Speaker #2: 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.

Speaker #2: But let's have a look at how that looks 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.

Speaker #2: This is demonstrated by a 5% increase in the average price per parcel, despite the challenging external environment, which Pim also just referred to. Revenue amounted to €937 million, compared to €961 million last year.

Linde Jansen: The revenue amounted to EUR 937 million, compared to EUR 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 -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 Q2 was less than in the Q1. 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.

Speaker #2: 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.

Speaker #2: Starting with Domestic. Domestic volumes declined by 4.2%, due to weaker market growth—slightly weaker than expected—and a limited market share loss, which was in line with our expectations following our volume-to-value strategy.

Speaker #2: 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 web shops.

Speaker #2: This also reflects weaker market conditions, and 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 from the large Asian players, preparing for the introduction of the import duty on the 1st of July.

Linde Jansen: Very important, we also see first impacts, especially of the large Asian players, to prepare for the introduction of the import duty on 1 July. The volume decline overall was partly offset by a positive price mix impact of EUR 36 million. That follows our further progress on our strategic yield measures, so that sticky price increase. The EUR 36 million includes EUR 5 million from fuel surcharges. These kicked in in the Q2, 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 H1 2025.

Speaker #2: 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.

Speaker #2: So that's the 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.

Speaker #2: 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.

Speaker #2: In the last column, you see the step down in the bucket 'Other,' and that is predominantly explained by the sale of DS not-for-distribution in Q2 last year.

Linde Jansen: In the last column, you see the step down in the bucket other, that is predominantly explained by the sale of PS Nachtdistributie in Q2 last year. Let's move on to the normalized EBIT bridge for e-commerce on slide 18. This shows the reconciliation from EUR 15 million in half year 2025 to EUR 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 duty enhancing fees. The positive price mix effect that was predominantly driven by price increases and including the EUR 5 million fuel charges just mentioned. Sorry. The organic cost increases amounted to EUR 38 million, including EUR 7 million related to higher fuel costs. In H1, a EUR -2 million gap on fuel exists.

Speaker #2: 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 the current half year.

Speaker #2: As just explained on the revenue slide, the declining volumes are driven by weaker market growth, the impact of our volume-to-value strategy, and the first effects from the introduction of import duty and handling fees.

Speaker #2: And the positive price/mix effect was predominantly driven by price increases and includes the €5 million fuel charges just mentioned. Sorry. The organic cost increases amounted to €38 million.

Speaker #2: Including €7 million related to higher fuel costs. So, in the first half of the 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 the pass-through of higher fuel prices.

Linde Jansen: 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 EUR 24 million in cost saving in H1. 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. Remember that we expect to overall achieve EUR 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. 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.

Speaker #2: Overall post NL 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.

Speaker #2: 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 achieve overall cost savings of €40 to €50 million in 2026.

Speaker #2: 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.

Speaker #2: As part of the spring volumes, our in-feed in our e-commerce network. Overall, revenue was up 1% to €379 million, compared to €375 million last half year.

Linde Jansen: Overall, revenue was up 1% to EUR 379 million, compared to EUR 375 million last half year, with volumes down -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 H1 and were offset by declining low-margin traditional mail items, which was predominantly visible in Q2 due to phasing and the general declining trend in mail. 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. In short, the demand dynamics here are growth in e-commerce and a decline in traditional mail.

Speaker #2: With volumes down minus 7.1%. Please note that at constant currencies, revenue increased by 2.7% instead of 1%. In line with our strategy, European e-commerce volumes continue to grow strongly.

Speaker #2: By 28% in the first half of the year, and were offset by declining low-margin traditional meal items. This was predominantly visible in the second quarter due to phasing and the general declining trend in meal.

Speaker #2: Please note that we have already transitioned to become an e-commerce player in the European market, with roughly 75% of revenue in Europe currently derived from e-commerce.

Speaker #2: Looking at volumes, the split is a bit different. Around 40% of volumes is e-commerce. But in short, the demand dynamics here are growth in e-commerce and a declining traditional mail.

Speaker #2: Looking at the Asian volumes, the Asian volumes, as mentioned earlier, declined and reflect a 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 web shops for the introduction of the import duty on non-EU parcels per the 1st of July.

Linde Jansen: Looking at the Asian volumes, as mentioned earlier, declined and reflect the weaker market conditions. 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 1 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 for volumes versus the declining mail, 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 MyParcel, other services as, for example, fulfillment and some intra-segment eliminations. Let's move to slide 20, showing the normalized EBIT bridge for platforms.

Speaker #2: 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 mail. And of course, also the shift in mix between European and Asian volumes plays a role.

Speaker #2: Looking at other revenue, that shows the decline and includes MyParcel, other services such as, for example, fulfillment, and some interest segment eliminations. Let's move to slide 20, showing the normalized EBIT bridge for Platforms.

Speaker #2: 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.

Linde Jansen: Showing the reconciliation from EUR 3 million in H1 2025 to EUR -3 million this H1. That the root cause therefore is mainly related to our strategy to invest in international expansion. The revenue drivers I just explained, so I will not repeat that, but let's look at the cost. The organic costs for platforms increased by EUR 9 million, and that is mainly related to increasing third-party costs for international transport and in 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. In the bucket other results, you also see the impact of the start-up cost thereof.

Speaker #2: The revenue drivers I just explained, so I won't repeat that, but let's look at the cost. The organic costs for platforms increased by €9 million, and that is mainly related to increasing third-party costs for international transport and distribution.

Speaker #2: 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 referred to earlier.

Speaker #2: For our fulfillment activities, we have opened a center in Germany this year. So, in the bucket 'Other result', you also see the impact of the startup cost thereof.

Speaker #2: 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 28.

Linde Jansen: Good to mention that the overall net FX impact on normalized EBIT was zero. Moving to the last and third segment, mail. Starting with the revenue bridge on slide 21, apologies. Revenue rose by 0.5% to EUR 623 million compared to EUR 620 million last year. This is mainly explained by the combined impact from volume development and tariff increases. The mail volumes were down only 5.3% in H1. The main reason for this limited decline are the elections in Q1 2026, of around 90 million items. If you adjust for this election mail, volume decline was 7.9%, evidencing the continuation of the underlying trend of structurally declining mail volumes. The impact from volume decline was more than offset by a positive price mix effect.

Speaker #2: Apologies. Revenue rose by half a percent to €623 million compared to €620 million last year. This is mainly explained by the combined impact from volume development and tariff increases.

Speaker #2: The meal volumes were down only 5.3% in the first half year. The main reason for this limited decline is the elections in the first quarter of 2026.

Speaker #2: Of around 19 million items. If you adjust for these for this election mail, volume decline was 7.9%, evidencing the continuation of the underlying trend of structurally declining mail volumes.

Speaker #2: The impact from the volume decline was more than offset by a positive price/mix effect. Stamp prices were up 6.9% as of January 1st this year, and 8.3% as of mid-2025.

Linde Jansen: Stamp prices were up 6.9% as of 1 January of this year and 8.3% as of mid-2025. In the bucket other, you see an EUR 8 million decline, that is, amongst others, related to international mail. Moving to the bridge, the normalized EBIT bridge for mail on slide 22. The volume decline and price mix effect I just explained. Looking then at the cost, the organic cost increases of EUR 50 million are mainly due to wage increases and other inflationary pressures. You see the cost savings of EUR 12 million, of which the majority is related to adjustments in sorting and delivery processes. We also see that cost for IT, partly related to the transition to D+2, which we just completed, and transport costs increased. That is about the segments. Let's now have a look at the free cash flow.

Speaker #2: 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 20, 2022.

Speaker #2: The volume decline and price mix effects I just explained. Looking then at the cost, the organic cost increases of €15 million are mainly due to wage increases and other inflationary pressures.

Speaker #2: 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 cost increased.

Speaker #2: That's 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 of 2026.

Linde Jansen: I am really pleased with the development that we report over H1 2026. We see the free cash flow coming in at EUR -70 million, 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. Let's wrap up at slide 24 and look at our outlook. We confirm, as said by Pim, we confirm our outlook for the full year 2026, and which we will share it with you on 23 February. For normalized EBIT, our outlook is between EUR 40 million and EUR 70 million, and we expect that to translate into a free cash flow of somewhere between EUR 0 and EUR -30 million.

Speaker #2: We see the free cash flow coming in at minus €17 million, which is a 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.

Speaker #2: 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.

Speaker #2: Then let's wrap up at slide 24 and look at our outlook. We confirm assets by Pim, we confirm our outlook for the full year 2026, which was shared with you on the 23rd of February.

Speaker #2: 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 zero and minus €30 million.

Speaker #2: 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.

Linde Jansen: The outlook is based on an assumed total revenue growth of between 5% and 7%, where it is obviously fair to assume that we will end up closer to the lower end of the range, taking the volume development in H1 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 EUR 125 million, while lease payments will be at the same level as in 2025. Expected organic cost increases remain high, around EUR 240 million, mainly labor-related and other inflationary pressures. Price increases are expected to be more than sufficient to mitigate this.

Speaker #2: As just explained, despite the volume decline, the bottom-line result was resilient. We expect further momentum in operational efficiency going forward. In 2026, we will 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.

Speaker #2: Expected organic cost increases remain high, around €140 million, mainly labor-related and due to other inflationary pressures. But price increases are expected to be more than sufficient to mitigate this.

Speaker #2: Our focus will continue to be on strong cost control and further efficiency improvements, building on our proven efforts to reduce costs. Please note that the outlook for 2026 assumes limited impact from changes in the treatment of the de minimis threshold in the EU and in the US, or in related customs handling and clearance fee structures.

Linde Jansen: 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.

Speaker #2: The scope and timing could evolve during the year and could therefore impact performance. In the past half year, we have implemented valid and working operational solutions for customs handling and clearance fees as of July 1, and later on also in November.

Speaker #2: 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.

Inge Laudy: Yeah. Thank you, Pim and Linde, for explaining the results. I hand back to the operator to ask to explain the procedure for Q&A. Thank you.

Speaker #2: 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.

Speaker #1: Thank you. To ask a question, you will need to press star, one, and one on your telephone and wait for your name to be announced.

Operator: Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Our first question comes from the line of Frank Claassen from Degroof Petercam. Please go ahead. Your line is open.

Speaker #1: To withdraw your question, please press star one and one again. Our first question comes from the line of Frank Larsen from Degroof. Please go ahead.

Speaker #1: Your line is open.

Speaker #3: 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.

Frank Claassen: 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 are now at -6.4% for H1. What is fair to assume for the full year? What is currently reflected in your guidance on volume growth? That is my first question. 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 H2, given the lack in the fuel surcharges? Any comments on that would be helpful. Thank you.

Speaker #3: So, what is—yeah, fair to assume for the full year—what is currently reflected in your guidance on volume growth? That is my first question.

Speaker #3: 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 lag in the fuel price surcharges?

Speaker #3: Any comments on that would be helpful. Thank you.

Speaker #2: Yes, thanks, Frank, for your questions. Regarding your first question, on the 1 to 3% e-commerce volume growth—well, you are correct, as the developments in market growth are lower than we anticipated at the beginning of the year.

Linde Jansen: Yes. Thanks, Frank, for your questions. Regarding your first question on the 1% to 3% e-commerce volume growth. Well, you are correct, as the developments in market growth are 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% to 3% mentioned earlier. At the same time, as you also see in our current performance, the drivers underlying price, mix, our operational efficiency, are gaining traction and are showing also bottom line results, and we expect further momentum thereof in H2. On your second question on the price per parcel. Well, yes, of course, 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.

Speaker #2: It is fair to assume that the volumes for the 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.

Speaker #2: 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 give an, our, seasonal pattern.

Speaker #2: You can expect, with pricing and peak charges, et cetera, that this trend will accelerate in the remainder of the year.

Speaker #3: Okay, thank you.

Frank Claassen: Okay. Thank you.

Speaker #1: Thank you. Once again, to ask a question, you will need to press star, one, and one on your telephone and wait for your name to be announced.

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

Speaker #1: To withdraw your question, please press star one and then one again. Our next question comes from the line of Marco Limite from Barclays. Please go ahead.

Speaker #1: Your line is open.

Speaker #4: 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.

Marco Limite: Hi. Good morning. Thanks for taking my question. I've got a few. First question is on your statement that some important contracts have been concluded in Q2. What does that mean for H2? I think you've just mentioned that pricing should further accelerate in H2. But should we also expect an improvement in volumes on a year-over-year basis versus H1? I guess that would be the first question. My second question is on the platform business. In Q2, we're seeing 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 H2.

Speaker #4: What does that mean for the second half? I think you've just mentioned that pricing should further accelerate in the second half. But should we also expect an improvement in volumes on a year-over-year basis versus the first half?

Speaker #4: I guess that will 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.

Speaker #4: 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.

Speaker #4: So, just to clarify this point, what is the expectation for the volumes in the platform business, and why should we expect any impact? I mean, there is already some data out there showing some slowdown of flows from Asia to Europe.

Marco Limite: 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? There are already some data out there showing some slowdown of flows from Asia to Europe. The third question is on your mail business. Pim mentioned before that you are working on submitting your request for the cost of USO for 2027, but you are still, let's say, fighting for the 2025 and 2026. At the same time you received a fine for quality of service for a couple of years ago. 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.

Speaker #4: 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.

Speaker #4: So at the same time, you received a fine for quality of service a couple of years ago. So the backdrop sounds quite challenging in terms of negotiations.

Speaker #4: Any color you can give on any progress you've made, any sort of confidence you have that this is going through? Thank you.

Speaker #2: 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.

Pim Berendsen: Okay. Let's go one by one. Yes, I think as part of the volume to value strategy, as you know, not all contracts end at the same date. There has been a lot of negotiations concluded with predominantly Asian web shops 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. That will go a long way in continuing the strategy from volume to value. Of course, overall volume that we get is still a function of how they commercially perform themselves. Those contracts work in volume brackets, 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.

Speaker #2: There have been a lot of negotiations concluded with predominantly 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.

Speaker #2: 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.

Speaker #2: 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.

Speaker #2: So I think important key contract renegotiations reinforce our conviction that we're on the right path in terms of the shift from volume to value strategy.

Pim Berendsen: 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 H2 or overall? Yes, overall, we do expect an improvement from the -6.4% to a better number full year. Also based on the answer that Inge Linde just gave on the question of Frank. I'll take question three, I think Linde can comment on question two. You say challenging backdrop. Yes.

Speaker #2: I think the second question, in relation to that, the follow-up question was: Do you expect improvement of volumes on the international side in the second part of the year?

Speaker #2: Overall, yes, overall we do expect an improvement from minus 6.4% to a better number for the full year. Also, based on the answer that Inge Laudy just gave on the question of Frank, I'll take question three, and then I think Linde Jansen can comment on question two.

Speaker #2: 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 cost, that we need to pay for net costs that are out there as a function of an obligation that is put on us.

Pim Berendsen: At the same time, we feel strongly that it cannot be our problem that we need to pay for the transition cost, that we need to pay for net costs that are out there as a function of an obligation that is put for us. 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. The first one is clearly a debate with ACM, and we will go to court because we think the fines are unacceptably high, and also the basis for those fines in our perspective aren't there.

Speaker #2: 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.

Speaker #2: To the USO, that make the mail business sustainable going forward. And the first one is clearly a debate with the ACM. And we'll go to court because we think the fines are unacceptably high.

Speaker #2: And also, the basis for those fines, in our perspective, isn't there. With government and chambers, we continue to discuss the required changes to the postal law.

Pim Berendsen: 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 one and three. Maybe you can say something about-

Speaker #2: 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.

Speaker #2: Those are the answers to one and three. Maybe you can say something about that in relation to the outlook statement.

Linde Jansen: The de minimis

Pim Berendsen: in relation to the outlook statement.

Speaker #1: Yeah, so on your question about the de minimis volumes for, amongst others, platform and Asia, et cetera—yes, so we say in our outlook that we assume limited impact.

Linde Jansen: Yes. On your question with the de minimis volumes amongst others for platform and Asia, et cetera. Yes, have we. We say in our outlook that we assume limited impact. Obviously, that is still the case. We of course face ourselves now, as also mentioned by Pim earlier, impact thereof. However, these are the first weeks. Those parties are now also, well, trying to organize themselves and make sure how their new logistics model work. Well, we assume in overall, in the long term, no structural impact for the longer term and therefore, we hold on to our performance. 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.

Speaker #1: Obviously, that is still the case. So, we of course find ourselves now, as also mentioned by Pim earlier, facing the impacts thereof. However, these are the first weeks—those parties are now also, well, trying to organize themselves and make sure how their new logistics model works.

Speaker #1: And, well, we assume overall in the long term no structural impact for the longer term. Therefore, we hold on to our performance. In addition to that, it's also good to note, as you can see in our current performance, that given our volume decline this time, we are adapting well to that by scaling down and adjusting our costs accordingly.

Speaker #4: 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 their business model, given the new regulation from the 1st of July.

Marco Limite: Okay. Thank you very much. If I may, just a quick follow-up on this. You're saying that some of the international clients are adjusting the business model given the new regulation from 1 July. 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? What does that mean for you? Are you still working for them? Yeah.

Speaker #4: Can you give just examples of what has been made so far? So, are we seeing those clients building more warehouses or more inventories in Europe?

Speaker #4: And what does that mean for you? So, are you still working for them? Yeah.

Pim Berendsen: Key question. Let me take it. I think, there you need to be very precise. I think all relevant platforms make different choices as how they handle this current market situation. 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 EUR 3 fee, and then maybe slightly push a bit of the external cost up through the price points of the basket." That's one option. 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 on their sides.

Speaker #2: Great question, let me take it. I think—and here, you need to be very precise—I think all relevant platforms make different choices in how they handle this current market situation.

Speaker #2: There are platforms that basically say, we will manage value on a basket size basis and, on that basket, swallow the vast majority of the €3 fee.

Speaker #2: 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 an additional cost on their side.

Speaker #2: 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 €3 increase in cost is still material.

Pim Berendsen: 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 EUR 3 increase in cost is still material. You will probably see others that will continue down the road of those low-valued goods, but then through European warehousing solutions. Increasing warehousing capacity in Europe, flying it in or cargoing it in bulk, not as a DTC delivery parcel, but in bulk to circumvent the handling fees and duties, and then pick and pack from there and distribute it through various carriers towards the final consumer. 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.

Speaker #2: And you will probably see others that will continue down the road of those low-value goods, but then through European warehousing solutions. So, increasing warehousing capacity in Europe, flying it in or cargoing it in bulk.

Speaker #2: So, not as a 2C delivery parcel, but in bulk—to circumvent the handling fees. Then use these, pick and pack from there, and distribute through various carriers towards the final consumer.

Speaker #2: So there are different parties taking different roads, but at the end of the day, yeah, it's all about where the volume will go, and it will be shifting in the comparative landscape between those Asian platforms.

Speaker #2: There will probably be new entrants taking the lower end of the value chain, and that will potentially also have comparative implications for the European web shops, where some of the Asian players are really intent on moving up to higher-valued products, in which they will then subsequently compete with the current existing European platforms in those spaces.

Pim Berendsen: There will probably be new entrants taking the lower end of the value chain, and there will potentially also be comparative implications for the European web shops, 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. 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 secure throughout the contracts that I've given you answer on in one of your earlier questions. That's how the market evolves at this point in time.

Speaker #2: So, a lot is going on there. And, yes, we of course follow this closely. It's important that we maintain a good share of wallet with the most important clients, those that are willing to pay for service.

Speaker #2: That is what we secured throughout the contracts that I've given you answers on in one of your earlier questions. So that's how the market evolves at this point in time.

Speaker #4: Thank you very much.

Marco Limite: Thank you very much.

Speaker #1: Thank you. And our next question comes from the line of Henk Slotboom from The Idea. Please go ahead, your line is open.

Operator: Thank you. Our next question comes from the line of Henk Slotboom from The IDEA!. Please go ahead. Your line is open.

Speaker #2: Good morning, and thanks for taking my questions. First of all, compliments on the degree of disclosure of numbers, which makes me very happy. But despite that, I have a couple of questions.

Henk Slotboom: Good morning, and thanks for taking my questions. First of all, compliment for the degree of disclosure of numbers, which makes me very happy. Despite that, I have a couple of questions. First of all, Pim, you talked a lot about the platform business and about the Chinese business. Last week, I listened in to the CTT conference calls. They said that had suffered because a lot of volume was now flowing in to the Benelux countries instead of Madrid, for example, into the central eastern European countries. What am I missing in the case of Spring? I see a quite clear dip in the Asian volumes at Spring. Is it pure value over volume or is it something else? What is triggering the European volume so much? Does it have to do with the opening of the fulfillment center in Germany?

Speaker #2: First of all, Pim, you talked a lot about the platform business and about the Chinese business. But last week, I listened in to the CTT conference calls.

Speaker #2: They said that Casesa had suffered because a lot of volume was now flowing into the Benelux countries, instead of migrating, for example, into the central and eastern European countries.

Speaker #2: 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?

Speaker #2: 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 coding retailers.

Henk Slotboom: I believe it's for one of the Spanish trading traders. The second question I have is on e-commerce and about domestic volumes in particular. You've been giving deliberately up some market share by means of the volume to value strategy. If I look at the average value per parcel, if I look at the slides, 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? At the same time, we see parties like Gofun that was doing a lot of work for the Chinese. Track & Trace has come in handling volumes for Amazon. We have JoyExpress, a new name. Compare has 85% nationwide coverage. At least that's what they claim. Got a traditional player stepping up in Post as has entered the market as well.

Speaker #2: The second question I have is on e-commerce, and about domestic volumes in particular. You've been deliberately picking up some market share by means of the value over volume strategy.

Speaker #2: And if I look at the average value per parcel, if I look at the site—I believe it is site 16—the development of the EBIT is quite clearly visible, that that improves your yield.

Speaker #2: But how far can you go in giving up volume? Because at the same time, we'll see parties like GoFund, who was doing a lot of work for the Chinese Dragonfly, has come in handling volume for Amazon.

Speaker #2: We have Joy Express, a new name on the pair, which has 85% nationwide coverage at least—that's what they claim. Traditional players are stepping up in process and have entered the market as well.

Speaker #2: How do you deal with that? The cost savings element—reducing the cost per item—is, of course, one part of the story. But what can you do to make the volumes grow again?

Henk Slotboom: How do you deal with that? Is the cost-savings element 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? The final question I have is on mail. In December, there was a ruling by the CBb on the merger with Sandd. I know it's a sensitive subject. ACM 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.

Speaker #2: And then the final question I have is on mail. In December, there was a ruling by the CBB on the merger with Sand. I know it's a sensitive subject.

Speaker #2: ACM basically got it right and was basically saying, we're going to see how we deal with this situation right now. Have there been any developments on that front?

Speaker #2: Those were my questions.

Speaker #4: Okay, thank you, Henk. Yeah, the first question had some sub-questions, so correct me if I've not, let's say, answered them completely. I think there are a couple of elements to that that I want to single out.

Pim Berendsen: Thank you, Henk. The first question had some sub-questions. Correct me if I've not, let's say, answered them completely. I think there's a couple of elements to that I want to single out. 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 hauls from Italy to Spain, from Spain to Germany, by attracting local clients that fill those trade lanes 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.

Speaker #4: I think Spring Europe's e-commerce volume is the double-digit number that Linda talked about. And that is a function of expanding the pan-European linehauls from Italy to Spain, from Spain to Germany, by attracting local clients that fill those trade lanes and bring us into a more competitive position.

Speaker #4: 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.

Speaker #4: That want to ship throughout Europe. So I think there the growth is, as we would like it to be, a function of the platform growth plan that we launched in September.

Pim Berendsen: 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 facing on the European International Mail volumes that don't contribute that much. 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.

Speaker #4: And as said, it's going according to plan. The overall Spring volumes are depressed by the development in quarter-by-facing on the European international mail volumes, that don't contribute that much.

Speaker #4: 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.

Speaker #4: On the Asian side, I don't see more volume coming to Amsterdam or Liège. What we do see is that our customs clearance solution is working.

Pim Berendsen: 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 we're able to administer, and also fulfill the customs duties in the chain. 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 1 July doesn't get any duty if it accesses the country on 1 July or 2 July?

Speaker #4: And has been working from the get-go, which is of course important because that clarifies to consumers under which conditions they can still buy from other parties and were able to administer and also fulfill the customs duties.

Speaker #4: In the chain, I think there, of course, we already saw based on examples that we've had in Romania and Italy, that goods in transit have 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?

Speaker #4: So that has basically led a lot of these parties to, three to four weeks in advance, stop marketing campaigns and not push more products towards Europe.

Pim Berendsen: That basically has led a lot of these 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. 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.

Speaker #4: To avoid goods in transit being treated in a different way, and that has impacted Q2 numbers. We have, of course, seen the drops in volume.

Speaker #4: We also now see the Asian webshops adjusting their business model, adjusting their pricing strategies, and re-entering the marketing arena to do marketing campaigns again.

Speaker #4: 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.

Speaker #4: 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 are new entrants, they are sometimes forced, by our volume-to-value strategy, to have kicked out other carriers.

Pim Berendsen: We quite often have share of wallet arrangements with those parties, although there are 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 1 July implementation. I think that is the answer on the first set of questions. If you 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 is obviously also impacted by lower consumer spending, 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.

Speaker #4: And now our share is just a function, basically, of how successful they are in adjusting their commercial models after the July 1st implementation. So I think that is the answer to the first set of questions.

Speaker #4: 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.

Speaker #4: Domestic volume development has obviously also been impacted by lower consumer spending. So I think the flywheel of yield improvement could have worked even better with a bit more consumer spending.

Speaker #4: 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.

Pim Berendsen: 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 competitive 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, yields, and volume increases remains crucial, and that's what we do on a daily basis.

Speaker #4: And that's why we introduced the 75 additional costs. And another point on the comparative landscape is our redefined out-of-home strategy. We'll also be significantly better equipped to compete with some of the other players you mentioned.

Speaker #4: 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 yields and volume increases, remains crucial.

Speaker #4: 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.

Pim Berendsen: 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. That yield isn't suffering that much with lower volume than anticipated. On the third point, yes, this is sensitive. I don't think the CBb said that ACM got it right. They said something about the permit and on a 2018 basis. 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 the day that we acquired Sandd and was there when we integrated the business. Let's say, I don't have clarity right now as to where ACM is in their research or in their investigation.

Speaker #4: So, that yield isn't suffering that much with lower volume than anticipated. Third point, yes, this is sensitive. I don't think the Safer Base said that ACM got it right.

Speaker #4: They said something about the permit and on a 2020-18 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.

Speaker #4: We've adhered to the conditions of the permit. The permit was there on the day we acquired sand and was there when we integrated the business.

Speaker #4: 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.

Pim Berendsen: I cannot tell you more about it right now.

Speaker #1: Okay.

Henk Slotboom: Okay. Thank you very much for your extended answers.

Speaker #3: Thank you very much for your extended answers.

Speaker #2: Thank you. We'll now move on to our next question. Our next question comes from the line of Marc Zwartsenburg from ING. Please go ahead.

Operator: Thank you. We'll now move on to our next question. Our next question comes from the line of Marc Zwartsenburg from ING. Please go ahead. Your line is open.

Speaker #2: Your line is open.

Speaker #5: Yeah, good morning, everybody. One question left. Can you give a bit more color on the phasing, and also on what is behind the additional €75 million of cost savings?

Marc Zwartsenburg: Good morning, everybody. One question left. Can you give a bit more color on the phasing and what is behind the additional EUR 75 million of cost savings? How should we face it in the model and what is really the driver of the EUR 75 million? That's it. Thanks.

Speaker #5: How should we phase it in the model? And yeah, what is really the driver of the €75 million? That's it. Thanks.

Speaker #6: Yes, thanks, Marc. Well, as mentioned, 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 across both years.

Linde Jansen: Yes. Thanks, Marc. Well, as mentioned, it is mainly within e-commerce, but also in the related support functions, HR, finance, IT. We refer to the phasing for the total both years, 2027 and 2028. I would say that you can calculate with approximately 50/50 over the separate both years involved.

Speaker #6: So, 2020, '27, and 2028. And I would say you can calculate with approximately 50/50 over the separate—over both years involved.

Speaker #5: Okay, that's clear. Thank you very much.

Marc Zwartsenburg: Okay. That's clear. Thank you very much.

Speaker #2: Thank you. And our final question comes from the line of Marco Limite from Barclays. Please go ahead, your line is open.

Operator: Thank you. Our final question comes from the line of Marco Limite from Barclays. Please go ahead. Your line is open.

Speaker #7: Hi, thank you for taking

Marco Limite: Hi. Thank you for taking my follow-up question. I could just go one, again, on the business model of the platform business. You were mentioning before a non-capital intensive fulfillment activities. You were making the example of Italian volumes into Spain to Germany, and so on. Can you just explain to us really what is the activity here and how you are offering non-capital intensive fulfillment center activities, please? Is this the business model doing more of that in the next years? Thank you.

Speaker #5: My follow-up question—I could just go on. Again, on the business model of the platform business, because you were mentioning before non-capital-intensive fulfillment activities.

Speaker #5: 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 is the activity here, and what I mean, how you are offering non-capital intensive fulfillment center activities, please?

Speaker #5: And is this the business model, doing more of that in the next years? Thank you.

Speaker #4: Yeah, 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?"

Pim Berendsen: Yeah, it is really what it is. If there's 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. 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 clients to compensate for that. Given the type of business we're in, given the type of clients that Spring support, it's not a highly automated fulfillment activities. It's for the largest part a traditional pick and pack with some efficiency improvements there, and that's why it is less capital intensive than for other segments.

Speaker #4: 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.

Speaker #4: Sometimes it's us taking the leasehold, but there are 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 automatized fulfillment activities.

Speaker #4: It's for the largest part traditional pick and pack with some efficiency improvements there, and that's why it is less capital intensive. And then for other segments...

Speaker #5: Got it. And is the plan to, let's say, build up a proper fulfillment business, which is unrelated to the—

Marco Limite: Got it. Is the plan to, let's say, build up a proper fulfillment business, which is unrelated to the-

Pim Berendsen: Only in relation to our European growth business and only in relation to the type of customers that Spring serve. That will not lead to big investments in fulfillment centers. 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 Spring even more competitive.

Speaker #4: Only in relation to our European growth business, and only in relation to the type of customers that Spring serve. So, that will not lead to big investments in fulfillment centers.

Speaker #4: So, it's an organically developing model—only to the extent that it helps us create more density in the pan-European trade lanes. So, to make Asendia even more competitive.

Speaker #5: Okay, thank you. And given that I've got the opportunity, I’ll maybe also ask her the last one. When we think about the new €75 million cost savings, should we think about those cost savings as an offset to maybe lower volume decline, or as a way to protect your margins, or is this actually in your business plan as a further upside to where you think you were?

Marco Limite: Okay, thank you. Given that I've got the opportunity also to maybe ask the last one. When we think about the new EUR 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 in your business plan offers further upside to where you think you were-

Pim Berendsen: As I said, it's really de-risking, created room to maneuver in slightly more competitive market circumstances. 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. 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. It could help de-risking a slightly lower volume development. It could help 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. It actually then, as said, de-risks the commercial elements of the e-commerce plan and gives us more confidence that we can get to the 2028 objectives.

Speaker #4: As said, it’s really de-risking and has created room to maneuver in slightly more competitive market circumstances. So, don’t add this just to the ambitions for 2028.

Speaker #4: It will de-risk the plan if that comes with slightly better volume development; then performance will accelerate beyond the ambition. But let's first get to the ambition levels that we set for 2028.

Speaker #4: And this de-risks this for the combination of the factors that you said. So, it could help de-risk a slightly lower volume development. It could help in being more precise as to which price points on the value, volume-to-value strategy we want to entertain.

Speaker #4: It helps maintain the market share at the level we think we need to maintain it. And it actually then, as said, de-risks the commercial elements of the e-commerce plan and gives us more confidence that we can get to the 2028 objectives.

Speaker #5: Okay. And when you say that we add up to under €70, 280 million, you are adding those costs to the sort of—

Marco Limite: Okay. When you say that it will add up to EUR 170 to 180 million, you are adding those costs to the-

Pim Berendsen: That EUR 170 to 180 is the total number of cost savings over the period, where this EUR 75 has been now included in.

Speaker #4: That was €170 to €180 million—that is the total number of cost savings over the period, where this €75 million has now been included.

Marco Limite: The base you are adding the EUR 75 million cost on is the group cost savings, or is specifically e-commerce, or?

Speaker #5: The base you are adding this €75 million cost on, is that the group cost savings or is it specifically e-commerce, or...?

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

Speaker #4: 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.

Speaker #4: So it aims to impact the e-commerce cost base.

Speaker #5: Okay. Very clear. Thank you.

Marco Limite: Okay. Very clear. Thank you.

Speaker #2: There are no further questions at this time, so I'll hand the call back to Inge for closing remarks.

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

Speaker #1: Yeah, 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.

Inge Laudy: Yeah. 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.

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

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