Bpost Aktie

Ladies and gentlemen, hello, and welcome to the Bnode Second Quarter 2026 Analyst Conference Call.

On today's call, we have Mr. Chris Peeters, CEO; and Mr. Philippe Dartienne, CFO. Please note, this call is being recorded. [Operator Instructions]

I will now hand over to your host, Mr. Chris Peeters, CEO, to begin today's conference. Please go ahead, sir.

Thank you. Good morning, ladies and gentlemen, and thank you for joining us today. As CEO of Bnode, I'm pleased to welcome you to our second quarter results presentation. Joining me today are Philippe, our CFO; as well as Alexandra and Antoine from Investor Relations.

The presentation materials were published on our website earlier this morning. We will first take you through the presentation, and we'll then be happy to answer your questions. As always, we kindly ask you to limit yourself to 2 questions each to ensure everyone has the opportunity to participate during the call. Philippe will first take you through our Q2 financial performance. I will then come back to provide an update on the progress of our key strategic and transformation initiatives during the first half of the year and conclude with our outlook for the remainder of 2026.

Philippe, over to you.

Thank you, Chris, and good morning, everyone. As you can see from the highlights on Page 3, group operating income for the second quarter amounted to EUR 1.046 billion, representing a year-on-year decrease of EUR 46 million or 4%. Most of this decline was driven by Bpost. In addition to the accelerating structural decline in Mail volumes, which reached almost 17% during the quarter, Parcel volume also contracted by around 9%, reflecting the impact of the 5-week strike that took place through April and which we first discussed with you in early May during our Q1 presentation.

At the same time, Paxon delivered solid top line growth of plus 6.5% in Europe, helping to offset both the impact of the previously announced customer churn at Radial U.S. and temporary revenue pressure at Staci Americas. At Landmark Global, revenue was slightly lower year-on-year, mainly reflecting the impact of the domestic strike on inbound flows from Asia to Belgium.

Turning to our adjusted EBIT of EUR 29.4 million, with respect to the EBIT strike impact, you can see that our estimate now stands at EUR 25.5 million compared with approximately EUR 15 million when we first communicated on the matter early May, shortly after the end of the strike. Since then, contractual penalties, compensation and other short-term effects have continued to increase the overall impact.

Excluding this strike impact, the year-on-year decline was limited to around EUR 3 million, which is better than we had anticipated. Indeed, despite the termination of the 679 activities and the accelerated decline in Mail volumes weighing on Bpost profitability, group's underlying performance remained relatively resilient. This resilience was supported by continued EBIT growth at Paxon despite ongoing top line pressure in the U.S. as well as by the positive contribution from the reorganization and operational measures implemented in Belgium.

While these factors were not sufficient to offset the exceptional risk impact, they demonstrate the continued effectiveness of our transformation initiatives and the underlying strength of the business. The strike impact nevertheless has a material effect on our full year outlook and take us below our initial guidance range. Chris will come back to this point in details in a few minutes.

Before turning to the performance of our business unit, let me highlight, as shown on Slide 4, that beyond the evolution of EBIT, our adjusted net profit benefited from a EUR 19 million improvement in financial results. This improvement was mainly driven by unfavorable noncash FX effect last year as well as higher net income from our treasury investment this year. These positive effects were partially offset by higher interest expense relating to the bonds issued in June '25.

With that, let me turn to the performance of our business unit. I'm now on Slide 5, covering Bpost segment. Revenue declined by EUR 43 million year-on-year to EUR 493 million. Domestic Mail revenues decreased by EUR 29 million or minus 10.4%. Mail and Press volume contracted by 16.8% during the quarter compared to only minus 11.3% last year and 14.3% in Q1 and in line with the mid-teens volume decline guidance we provided earlier this year.

The accelerated decline mainly reflects lower transactional Mail volumes following the introduction of the mandatory B2B invoicing (sic) [ e-invoicing ] at the beginning of the year as well as the termination of several advertising contracts. Overall, Mail volume decline had a negative revenue impact of around EUR 45 million, partially offset by a positive price and mix effect of EUR 16 million or 6.4%.

Parcel revenues decreased by EUR 10 million or minus 7.9% year-on-year, reflecting a volume decline of minus 9.2% compared to a growth of plus 9.3% (sic) [ 9.1% ] in Q1, alongside with a positive price/mix effect of 1.3%. As discussed during our earnings call in May, Parcel volume declined by around 27% in April as a direct result of the strike.

These figures does not include cross-border volume with destination Belgium, which are reported within the Landmark Global that I will comment in a few minutes. Following the end of the strike, we observed a gradual recovery in customer volume with activity improving week after week. By the end of the quarter, volumes were broadly back in line with last year. However, this means that we have not returned yet to the underlying growth trajectory we were experiencing before the strike and particularly in the first quarter.

Turning to price/mix. The positive effect during the quarter was driven by a favorable product and customer mix effect during the strike period as large customers did not inject their usual volume as well as a temporary fuel surcharge. These positive effects were partially offset by contractual penalties and commercial claims related to the service quality issue during the strike.

Finally, revenues from other activities, including retail, value-added services and personalized logistics declined by EUR 4 million year-on-year. This mainly reflects lower revenue following the termination of the 679 activities at the beginning of the year as well as lower revenue from fines solution, partially offset by higher revenue at DynaGroup.

Let's move to the P&L of Bpost on Page 6. Including intersegment revenue from inbound cross-border volume processed through the domestic network, total operating income declined by EUR 44 million or minus 7.1% (sic) [ 7.9% ] year-on-year. On the cost side, OpEx, including D&A decreased by EUR 21 million or minus 3.9%, mainly driven by 2 opposing effects.

First, we reduced our workforce by approximately 1,500 FTEs and interim staff, representing a decrease of around 6.5%. This reflects the benefits of the ongoing reorganization of our distribution rounds and retail operations. Second, those -- these savings were partially offset by higher salary cost per FTE, which increased by 2% year-on-year following the March '26 salary indexation.

This impact was slightly mitigated by unpaid absences during strikes. As a result, the adjusted EBIT declined by EUR 23 million year-on-year. This includes around EUR 24 million of strike impact, which, together with the termination of the 679 contract more than offset the continued productivity gains delivered throughout our ongoing reorganization initiative.

Turning to Paxon on Slide 7. As in previous quarters, the performance reflects 2 contrasting trends. At Paxon Europe, revenue slightly increased by 3% year-on-year. Across our European businesses and geographies, we delivered a growth of around 6.5% compared with 4% in Q1 '26, with several activities continuing to grow at high single-digit rates. This positive momentum was partially offset by the performance of Staci Americas, which is reported under Paxon Europe.

Following a contract termination announced in the fourth quarter, year-on-year revenues continued to decline significantly during the first quarter, further impacted by adverse FX effect of around EUR 1.5 million. At Paxon North America, revenues declined by EUR 9 million. At constant exchange rate, this corresponds to a minus 3% decrease, driven by 3 factors.

First, the expected revenue churn from customers -- from customer contract termination announced last year. Second, low single-digit negative same-store sales, although this is a slight improvement compared to the first quarter of '26. And third, these effects were partially offset by the contribution from recently signed customers, which generated around EUR 23 million of revenue during the quarter.

Let's move to the P&L of Paxon on Slide 8. Against this backdrop, total operating income remained nearly stable year-on-year, while operating expense, including D&A, slightly decreased. The development of our cost base reflects the contracting trends across Paxon geographies with continued growth in Europe on one end and lower activity level in the U.S. on the other end. Importantly, despite continued revenue pressure in the U.S., we have maintained a resilient cost structure.

Variable contribution margin remained solid, while additional fixed costs and headcount actions continued to support the profitability. As a result, adjusted EBIT increased by EUR 2 million to EUR 23 million in the quarter, driven by top line growth and productivity gains in Europe and cost measures and real estate optimization in North America, helping to mitigate the impact of the continued top line pressure.

Turning now to Landmark Global on Slide 9. At Landmark Global, underlying market trends remain unchanged. However, top line performance was flat year-on-year as domestic strike at Bpost negatively impacted Parcel volume from Asia into Belgium.

Volumes were lost to competition during April and remained under pressure in May, while operations progressively returned to normal. On a more positive note, June delivered a strong recovery and growth resumed towards end of the quarter. Other European destinations were not impacted by the strike and continue to develop broadly in line with previous quarter.

At Landmark North America, revenue was slightly up year-on-year at constant exchange rate. This reflects on one hand, modest volume growth in the context of a macroeconomical (sic) [ macroeconomic ] slowdown and on the other hand, an unfavorable mix effect driven by a higher proportion of U.S. domestic volumes and lower Canada to U.S. volumes. Overall, Landmark Global operating income decreased by 2% (sic) [ EUR 2.4 million ] or 1.6% year-on-year.

As shown on Slide 10, OpEx and D&A increased by 3%, primarily reflecting higher transportation costs linked to volume growth as well as higher Corporate and ICT charges. As a result, despite underlying growth across most of our commercial activities, adjusted EBIT decreased by EUR 6 million to just under EUR 17 million, reflecting a strike impact of around EUR 1.5 million, an unfavorable mix effect, both in Europe with higher share of commercial products versus postal volumes and in North America with higher proportion of U.S. domestic volume and lower U.S.-Canada cross-border flows and higher intersegment charges.

Moving on to Corporate segment on Slide 11. Adjusted EBIT was slightly lower at minus EUR 10 million, primarily reflecting higher marketing and communication and rebranding investment during the quarter. At the same time, we continue to exercise cost discipline, reducing our workforce by around 2%, while absorbing the annual salary indexation of approximately 2%.

Let me now turn to the cash flow slide on -- cash flow on Slide 12, sorry about that. Net cash outflow for the quarter amounted to EUR 90 million compared with an inflow of approximately EUR 480 million in the prior year period, which benefited from the bond issuance completed in June '25. Excluding this financing effect, free cash flow remained broadly stable year-on-year. The main drivers were the following: first, cash flow from operating activities before change in working capital amounting to EUR 107 million, representing a decrease of EUR 27 million year-on-year, mainly reflecting lower EBITDA.

Second, changes in working capital and provision resulted in an outflow of EUR 95 million. Compared with last year, this represents a positive year-on-year variance of EUR 29 million, primarily driven by the timing of terminal due settlement and movement in suppliers' balances.

Third, net cash outflow from investing activities amounted to EUR 30 million and remained broadly stable year-on-year. Investment continued to focus on parcel lockers and capacity expansion, the renewal of our domestic fleet and further development of our international e-commerce logistics activities.

Together, these elements largely explain the evolution of the free cash flow during the quarter. Finally, net cash outflow from financing activities totaled EUR 73 million. Excluding the proceeds from last year bond issuance, the higher outflow mainly reflects the annual coupon payment of EUR 26 million associated with the bond issued in June '25.

Chris, over to you.

Thank you, Philippe. I'm on Slide 13 with the strategy and transformation highlights. At Bpost, overall, the April strikes created significant operational disruption during the first half of the year. At the same time, execution of our transformation agenda continued with strong progress across the majority of our transformation initiatives translating into concrete results. Importantly, these results further validate the strategic direction we have set for the group. Despite the April strikes, the transformation towards a parcel-led operating model remains firmly on track.

Following successful pilots, we're now moving into the scaling phase. September marks an important milestone as we roll out later distribution start times and expand the new dynamic distribution model from 4 to 23 distribution offices. We are further strengthening our leadership position in out-of-home through Belgium's densest locker network. We're well on track to reach our accelerated year-end target of 3,500 lockers (sic) [ locations ] with only around 100 locations remaining.

At the same time, locker utilization continues to increase strongly, further reinforcing our multichannel proposition for both consumers and businesses. Our retail network transformation progresses further through the introduction of new products, services and partnerships. Over the past months, we successfully launched nationwide partnerships with DIGI, a telecom operator and the home security provider, Verisure, strengthening the relevance and value proposition of our retail network.

Nevertheless, progress has been somewhat slower than initially planned due to the ongoing discussions on the 8th Management Contract. And finally, our transport activities continue to gain momentum as a new growth platform. We are steadily expanding the pilot now serving more than 20 internal and external customers with over 150 volunteer drivers. This allows us to further validate and refine the operating model under real operating conditions while preparing for future scaling.

Turning now to Paxon and Landmark Global on Page 14. Across our international business, we continue to make progress against our strategic priorities, while each business faces a different set of challenges impacting the pace of progress. At Paxon, commercial development has progressed more slowly than initially anticipated and accelerating top line growth remains a key priority.

At the same time, our commercial pipeline continues to strengthen, particularly at Paxon Europe and disciplined cost management has helped protect profitability at Paxon North America. At Landmark Global, our business demonstrates strong resilience, maintaining volumes and defending our key trade lanes despite increasing trade barriers and the temporary disruption caused by the new EUR 3 EU import fee. We're not yet delivering the top line growth ambition embedded in our plans. Hence, protecting profitability remains our immediate priority.

To do so, we continue to implement structural cost measures, including workforce reduction and real estate optimization. In parallel, we further execute our mid-market penetration strategy, diversifying our customer portfolio and reducing our dependence on a limited number of large customers. At Paxon Europe, the commercial transformation is progressing more slowly than initially anticipated.

Nevertheless, the commercial action plan introduced by the new BU CEO early this year is beginning to generate encouraging momentum with increased commercial collaboration and cross-selling across the organization, yielding a sustained strengthening of the commercial pipeline. In parallel, we are leveraging proven Staci capabilities to accelerate the turnaround of selected legacy sites and customer contracts. And finally, at Landmark Global, we demonstrate a strong resilience despite increasing trade barriers and the temporary market disruption following the introduction of the new EUR 3 EU import fee.

Through targeted commercial actions, we successfully restored China-Belgium volumes following the April strike and largely mitigated the impact of the new EUR 3 EU import fee. We did so by increasing our volume share with leading Asian platforms and marketplaces, further strengthening our position in one of our most important cross-border trade lanes.

So as you can see, our Reshape2029 strategy continues to advance across all pillars. Let me now translate this operational progress into financial performance. Philippe has just walked you through our Q2 results. Taking a step back and looking at the first half as a whole, 3 key observations that stand out in terms of revenue development. First, a significant portion of the group's revenue decline of around EUR 100 million is attributable to our U.S.-based 3PL activity at Paxon.

Combined, Radial U.S. and Staci Americas saw revenue decline by around EUR 62 million year-on-year or minus 14%, including a negative foreign exchange impact of approximately minus 6%. This decline was only partly offset by the strong performance of our European 3PL businesses, which delivered growth of more than EUR 20 million or slightly above 5%.

Second, at Landmark Global, we continue to grow volumes despite a demanding market environment. Revenue growth was more modest due to product mix effects, but overall activity levels showed resilience. Third, at Bpost, the anticipated acceleration in mail volume decline to approximately minus 15% resulted in a revenue reduction of around EUR 50 million.

Under normal circumstances, part of this impact would have been offset by continued parcel growth. However, the 5-week April strike disrupted that trajectory. Despite a strong first quarter and a gradual recovery in volumes following the strike during which parcel volume fell by 27% in April, first half parcel revenue ended slightly below last year, resulting in an overall parcel revenue decline of around EUR 3 million.

Turning now to EBIT. At Bpost and adjusting for the February 2025 and April 2026 strike impacts, EBIT declined by EUR 15 million year-on-year while profitability continued to be affected by the structural decline in mail volumes and the termination of the high-margin 679 contract, a meaningful part of these headwinds was offset by the benefits delivered through our ongoing reorganization initiatives and efficiency measures.

At Landmark Global, EBIT declined by around EUR 10 million, excluding strike effects. This was despite resilient top line performance and was mainly driven by an unfavorable business mix evolution, both in Europe and in the U.S. The positive highlight comes from Paxon. Despite a revenue decline of approximately EUR 40 million or minus 5%, largely attributable to the U.S. activity, Paxon delivered EBIT growth of around EUR 6 million, together with a margin improvement.

While commercial momentum remains below our ambition, and there is still work to do, this performance demonstrates that the action implemented over recent quarters are moving the business in the right direction.

This overview of our first half performance brings me to the outlook update for 2026. I am on Slide 15. Based on our first half results and our current view of the business, we are today revising our full year '26 adjusted EBIT outlook to approximately EUR 140 million. You will recall that earlier this year, we communicated an initial EBIT guidance range of EUR 165 million to EUR 195 million with a midpoint of EUR 180 million.

So what has changed since then? The first element is the April strike impact, which we could not anticipate and is now estimated at approximately EUR 25 million. Mechanically, this brings the midpoint of our guidance range from EUR 180 million to EUR 155 million and implies a strike adjusted range of EUR 140 million to EUR 170 million. The second element mainly relates to Paxon. As I have just discussed, commercial development at Paxon is progressing more slowly than initially anticipated. While our first half performance at group level was broadly in line with our expectation, excluding the strike effects, a meaningful portion of our EBIT plan for the second half relied on new business ramp-ups and commercial initiatives that are now expected to materialize later than initially planned.

We estimate the resulting EBIT shortfall at approximately EUR 20 million to be mitigated by around EUR 5 million of additional corporate cost-saving initiatives, resulting in a net EBIT impact of around EUR 15 million. So if you think about the guidance revision, there is really 2 distinct steps. First, the mechanical adjustment reflecting the update strike impact, and second, the lower-than-expected contribution from commercial development at Paxon, consistent with the trends we have observed during the first half of the year. Put differently, our current expectation of around EUR 140 million corresponds broadly to the lower end of our initial guidance range adjusted for the EUR 25 million strike impact.

With this, we are now ready to take your questions. Again, 2 questions each, please, so that everyone gets the chance to be addressed during the session. Operator, please open the lines.

[Operator Instructions] The next question comes from Michiel Declercq from KBC Securities.

Yes. I have 2 on the Paxon business, please, one on Europe and one on the U.S. The first, on Europe, if we filter out, of course, the customer loss that you had in the U.S., your growth improved to 6.5%. But then if I look at the guidance, you mentioned that you expect some slower, yes, development of business activities in France. What do you mean with this exactly?

Is it new customer onboardings or new pillars? If you can elaborate a bit on that because it's a bit different than what we've seen in the second quarter? And then the second question is on Radial U.S. So during the Capital Markets Day, you were quite positive on these new customer onboardings, these smaller customers.

Now that seems to be trending a bit below your expectations, can you tell me a bit what the pushback or what the reasons are for this? Why is it more difficult than you originally expected? Or is it just a bit of a delay of a phasing that you just see that some contracts are being postponed into 2027? So if you just can comment a bit on those topics, please.

[ Philippe, you take yours ].

Yes. So on Europe, indeed -- so thank you for your question first. Indeed, your analysis is perfectly right. Despite a growth of 6.5% in Europe, we are seeing that in France, particularly, the development is not at the level that we're expecting. You know that we have a point-of-sale activity, which is not growing -- the sector in general is not growing very fast. But we are experiencing some delays in onboarding new customers on -- for new services. So it's not that it will not happen. It's I would say it's a delay in onboarding those customers.

On the U.S., so indeed, when we launched the Fast Track product, we had a very good traction in the initial part of that. If we now take back the analysis, a part of that was actually due to the fact that the tariffs inclined a number of retailers from outside of the U.S. that were importing directly towards consumers and a couple of fashion brands that started to do local fulfillment.

And we could benefit from that momentum that was there at that moment. And we estimated based on that, to some extent, let's say, overexaggerated the growth curve that we could expect going forward. That rebalanced in terms of tariff later on, which means actually that the pipeline was less filled with these kind of opportunities, and therefore, it's developing a bit slower than our expectation that we had at the moment that we made at the Capital Markets Day announcement.

Okay. If I can quickly follow up again on Europe. So you mentioned some delays on new customer onboardings. If you look at the growth of existing customers, the 6.5%, can you break this down a bit? I mean, what part is maybe Radial Europe fulfillment and which part is Staci? And based on your comments, I would expect this growth rate to come down again in the second half of the year. Is that correct?

So in fact, when we're speaking about operating in Europe, now we operate as one. All the activities we told you, we moved from an organization just post-acquisition where in every country, we had former Staci, former Radial, for Active Ants. Now since the beginning of the year, we're really operating those countries as one and all the sales force, all the warehouses are operated as one. So it's very difficult to make the split. And frankly, it would to our -- for us, it does not make much sense to continue looking what is -- what was for the Staci customers versus for the Radial customers.

We made that acquisition to reinforce our presence in Europe in all the geographies where we are present, and we added some, and it's exactly what is happening. Particularly to France, what is really -- in fact, there are 2 elements that are penalizing us. As I said, there, there were no former activities from Radial or Active Ants despite the fact that we want to bring that knowledge on e-commerce into France, which is a competence that Staci did not have. There, it's a bit more difficult to penetrate that market of e-com in France so far. While at the same time, the POSM, which is the core of the business of -- we're still having in France, which is really not a growing business. The business as a whole is at best stable. So there is limited growth coming from that kind of activity.

The next question comes from Frank Claassen from Degroof Petercam.

Yes. My first question is on the strike impact, the EUR 25 million negative. Is this it? Or is there any risk of a sort of delayed impact from maybe penalties or loss of market share? So could you elaborate on that? And my second question is on the parcel volume growth. We are back to flattish in May, June. What have you baked into your guidance? What do you assume for the second half? Do you expect to return to growth? And how much growth?

Okay. So on the EUR 25 million, more or less everything that we had to include is included by now. So if we look at the effects that we had was, of course, the direct strike impact during the period itself, then you had a strong decline on the number of clients, of which for most of them, we could regain their trust and they are in a normal operating mode again.

Some of them took a bit of time because we had 2 effects there. One effect was that some said, first, you have to fully clean up the backlog before we start to reinject with you, and that took some time. And some other ones had contracted with other players for a certain period of time, an agreement to do for them the last mile. And so it took before that contract ended before they came back. But at this point of time, we have fully recovered of that.

Second thing that you mentioned there in terms of penalties, most of the negotiations are in the final state, meaning that legal documents has to be finalized, but I think that the agreements are more or less finalized for most of those penalties and we don't expect new penalties to come in.

When it comes to Parcels growth for the second half, we expect in line with our initial guidance, a low single-digit growth.

Low single digit for the second half as of...

Yes.

So not for the full year, but for the second half, right?

No, no. For the second half.

Okay. Yes.

For the second half.

Yes. Okay. Yes, exactly.

The next question comes from Marc Zeck from Kepler Cheuvreux.

I'm afraid I just wanted to follow up on the question from my colleague on Paxon. To me, it's not yet quite clear if the slowdown or delays in commercial development is kind of structural? Or is it just kind of a delay in that the volume or the revenues will come later? For Paxon U.S., I've got to say from what you said, it seems more like a structural slowdown. So it's not really a delay, but that your initial expectations were just too optimistic.

And that's -- it's not really a delay, but really less revenues to be expect going forward? For Paxon Europe, you said that there's delays in onboarding new customers. And could you maybe elaborate a bit on what is causing these delays? Is it just kind of operational delays? Is it maybe due to, I don't know, France-specific issues? Or is this also some kind of a structural delay that will lead to lower revenues going forward? That's my first question. I recognize it's kind of a couple of sub-questions in there.

The second question would be on Landmark Global. Could you maybe give us a bit of feeling how H2 might develop for Landmark Global? I believe for H1, we are significantly below last year, even excluding strike impact. Will you catch up on this a bit on H2? Or should we more or less factor in the same delta for H2 on profits we saw in H1? That's my 2 questions.

Let me start with -- thank you for your question, Marc. Let me start with the second one on Landmark. In fact, when we issued the guidance, we issued a guidance of mid-single-digit growth with the impact of the strike and all the adverse impact that we have, as Chris mentioned, in the U.S. with the tariffs. We are more targeting a low single-digit percentage growth for the top line development.

This being said, I think it's important to highlight that in terms of profitability, we're still maintaining our guidance. We might be at the low end of the range, but still meeting the guidance, which is still a very healthy profitability at EBIT level. It should not be underestimated the resilience of the LGI business when we see all the adverse macroeconomic impact that we are facing. There is the one in the U.S. that started. It did not start yesterday. It started a bit at the end of last year as well.

But despite that, they have been able to develop new lanes to come directly to Canada and also developing some other new lanes, destination Europe. So indeed, it's a bit slower. But I would say, intrinsically, I think we could qualify what Landmark Global is -- as very resilient, being able to adjust to macroeconomical circumstance and adjust to customer needs. So I'm a bit more positive than what I'm hearing from your question mark on Landmark Global.

When it comes to Paxon, if I start with the U.S., it's a question -- it might be a question of terminology of words. When we speak about delay, yes, there is delay in onboarding new customers. But -- or is it a permanent loss? No, it's the fact that it takes more time to attract those midsized customers. When we launched that Fast Track product, it really rocketed in the first quarter. And now it's really plateauing. We have to recognize it what also -- what lead us also to revisit our service offering. Is it the right one?

We believe, yes, but it's more difficult to attract those customers. Also not to be underestimated, the same-store sales impact. In the past, we had a development of our best customers that were in the positive territories. Of course, it's come because you are serving them well and they stay with you, but you also benefit from the inherent growth of their business.

While since several quarters now, we see that the same-store sales is really in the negative territories. As I mentioned, it's slightly like to make -- to be very simple. We experienced a minus 5% in the first quarter. We experienced a minus 4% in the second one, okay? It's a small improvement, but is still in the negative territories, and that affect us in terms of top line quite significantly.

When it comes to France, I would say, I will repeat what I said to Frank. It's more like we are trying to bring new type of services on the French market where what takes more time than expected. Our presence there were barely mostly known for the POSM. We are bringing new customers.

When you bring a new type of service offering based on new competencies, it takes some time, a bit more time. You need to convince some existing customers also to give us those e-commerce type of businesses, but it doesn't come overnight. We are still very confident that we will prevail, but it's taking -- it's really a question of delay, I would say, on that one.

The next question comes from Henk Slotboom from The IDEA!.

I'm afraid it's on Paxon as well. Chris, it's more like a clarification question I have. In your final remarks on the outlook for the current year, for the second half year of Paxon, I got the impression that when you referred to delays in commercial -- in new contracts and that sort of things, relates -- does that relate to contracts that have already been signed and have not kicked in yet? Or is it reflecting the fact that you hope to sign on -- to onboard new clients somewhere in the course of the second half year? That was a little bit unclear. So perhaps you could clarify that.

The second question I have is you also referred to the fact that you've made a lot of progress in getting back volumes, especially from the Chinese platforms. That is, of course, helping Landmark and with a favorable position of Liege and Brussels as European hubs, I guess, that should offer a little bit of help. But is there a crossover in the direction of Paxon as well. The Chinese, some of them have advocated local warehousing, local fulfillment. Is that something you expect to be able to benefit from? Those were my questions.

Thank you, Henk. On the first one, in terms of delays, the way how we have brought it into our outlook is that we looked at the pipeline and the conversion rate, which is a fairly healthy conversion rate that we have seen over the last time. So it's not all signed contracts, but a applied conversion rate that we have on a very healthy portfolio in terms of different stages that we see within that pipeline. That's always the way how we've done it.

So there's a mix of some things might be signed, some things might be in negotiation. But on each of those different steps within our pipeline, we apply a conversion rate towards the final contract and of course, a risk mitigation because typically people announce more volume than they really do in practice later on. That's also an effect that we see. So we correct for these effects, but that's the way how it was built up. So it's a mix of the 2 on which we applied conversion rates on the different stages in the pipeline that we are developing.

If you look at the volume that we see happening. So there, I think that indeed, of course, we benefit from the fact that Liege Airport is a very important hub for the Chinese volumes coming in. The EUR 3 impact, as you have probably written in the -- seen in the press, was written in the press that there was a serious decline in the volumes coming in. We could benefit from that situation and by commercial action, capture a disproportionate share of the part that was still coming in.

And meanwhile, indeed, we are in conversation with a couple of people, but it's too early to make any announcement on that, that are looking for opportunities for closer to delivery market fulfillment opportunities. As you know, many of them have announced warehouses, some are actually opening warehouses almost as we speak. And so in that discussion, of course, Paxon is in the discussion of multiple parties over there as well.

Okay. Sorry, perhaps I can squeeze in a follow-up, Chris. When I look at earlier reports by, for example, PostNL and CTT, I sense an increased activity in the field of opening warehouses and fulfillment centers elsewhere as well. Do you see increased competition in that? You already referred to the Chinese that are coming. Is it something that is of any concern to you? Or is the power of the Active Ants and Radial's and that sort of things, is it so strong that you say, okay, well, we'll manage that, it won't affect us?

I would say overall market growth is good for Paxon Europe, depending, of course, on the different markets. We don't have the same strength of position in each of the markets. But typically, if the market grows, it's beneficial for us because it means that our conversion rates in our pipeline are better at that moment of time. So as long as you hear that there is more activity coming to the European market, it's typically a positive signal for the, let's say, the quality and the healthiness of our pipeline.

The next question comes from Marco Limite from Barclays.

I've got a couple. So the first one is on the de minimis. How do you assess the risk from new European regulation, especially in your Landmark business? You were mentioning that June was actually quite good. Do we think that there was sort of front-loading of volumes? And yes, how do you think that the Landmark business will adjust or react to the de minimis? Do we think the second half is going to be challenging? And then my second question is on the new management contract on retail activities. If you could please remind us when does that expire? What is the risk around this contract? How -- what is the revenue that needs to be renegotiated?

Yes. On the de minimis, so June was pre the EUR 3 import fee, the European import fee. And so it was a very strong month, which showed that we could rebound from the strike. So for us, that was more a sign that we could strongly rebound from the strike. What we see now, as I just already mentioned, and it was already in a number of publications. So there was a hefty reduction of the import volumes in the first weeks after the EUR 3 import. So you see that the Chinese platforms not have yet fully adapt to that reality, meaning that neither local fulfillment has been completely delivered to them, neither they could compensate by commercial actions, the impact of that EUR 3.

That being said, the position of Landmark Global was very strong during the month of July as far as we can see. So that means that we actually are quite optimistic that, relatively speaking, to that market that we actually are fairly competitive going forward, but it's not yet played out fully what the end game is of this EUR 3. So the EUR 3 rebounds after the 40%, we've typically seen that volumes gradually will come back, not fully, and some of that will go to local fulfillment. And so how that balances out is a little bit difficult to have a real view on that.

Second thing, of course, that we should not forget is there's a handling fee coming in later this year. And so that as well could have a second effect on that volume in that market. And that's an element, of course, that we will watch carefully and where also, our commercial teams are preparing well to ensure that we don't have negative effects on the side of Landmark. Can you go on the government contract?

So on the management contract, it will end at the end of this year. The management contract in the past, which is when I say in the past, the current one generates EUR 150 million of revenue. The government has expressed its willingness to reduce that amount by EUR 50 million. It's public information. They said for -- to reach the budget, they want to reduce it. And we are in negotiation with the government to see how we could implement that because for us, it's quite obvious that the reduction in the top line will not lead to a loss of EUR 50 million of EBIT.

We will not absorb that reduction of top line by maintaining the same services. So we are discussing with the government to see how under which modalities we want to reshape the portfolio of services to reflect the fact that the top line will move from EUR 150 million to EUR 100 million.

But on this, there is no risk that the wall of the EUR 150 million disappears. So you can confirm that we should be quite relaxed that we only get a EUR 50 million reduction, right? Yes, there's no further risk on it. It's more a negotiation on the service and cost base.

It's a statement in the government agreement. So that was also made public at the moment that this government started to operate. It's seldom that you see big changes towards a delicate government agreement because then you would question all the elements in a very large government agreement.

So it's indeed a very low risk that, that would change going forward. But it's not something -- as it is a political decision, it's not something that can be fully excluded. But it would be strange that something which is written in hard text in a government agreement that would drastically change during the course of that government.

And during the discussion that we have, we are speaking about how to implement this EUR 50 million reduction.

Yes.

It's not a question of could we go to zero. So...

Ladies and gentlemen, there are no further questions. So I will hand it back to Chris Peeters to conclude today's conference. Thank you.

So thank you, everybody, in the call for having taken the time to be with us and for your interesting questions. We look forward to staying in touch. And as a reminder, Philippe will present you our third quarter results on November 6. For those who have not been on holiday yet, I wish you a happy holidays. Thank you very much, and have a nice day.

Thanks for participating to the call. You may now disconnect.

Ladies and gentlemen, hello and welcome to the Bnode First Quarter 2026 Analyst Conference Call. On today's call, we have Mr. Philippe Dartienne, CFO. Please note this call is being recorded. [Operator Instructions]

I will now hand over to your host, Philippe Dartienne, CFO, to begin today's conference. Please go ahead, sir.

Thank you. Good morning, ladies and gentlemen. Welcome to all of you and thank you for joining us. I'm pleased to present you our first quarter result as CFO of Bnode. With me, I have Alexandra and Antoine from Investor Relations. We posted the materials to our website this morning and I will walk you through the presentation and will then take your question. As usual, 2 question each, which ensure everyone gets a chance to be addressed in the upcoming hour. I will start with our quarterly financial results, then provide an update on the progresses on our key strategic initiatives during the quarter before concluding with our financial outlook.

As you can see on the highlights on Page 3, our group operating income for the first quarter amounted to EUR 1.063 billion representing a year-on-year decrease of EUR 56 million or 5%. This performance reflects a combination of factors. First, as expected, we saw the impact of contract termination at Radial U.S., which were announced in the course of last year and already incorporated in our outlook we presented earlier this year. This termination resulted in a 11% year-on-year revenue decline or EUR 38 million and together with temporary top line pressure at Staci Americas largely offset by the 4% top line growth achieved at Paxon Europe.

Second, in Belgium in addition to the revenue decline following the termination of the 679 contract, domestic mail volumes declined by 14.3%. This was only partially offset by a parcel volume growth of 9.1%. In our cross-border activities, we also recorded higher inbound volume from Asia, which supports overall parcel flows. Overall, and as expected, the accelerated decline in mail volumes and the termination of the 679 activities weighed on the EBIT on the bpost segment despite the positive contribution from our ongoing reorganization measures.

That said, at Paxon despite a sharp contraction in top line, we were able to deliver EBIT growth reflecting a strong cost discipline in North America and solid operational execution in Europe. As a result, group adjusted EBIT reached EUR 33 million, down EUR 8 million compared to last year and broadly in line with our expectations. Before turning to the financial performance of our business units, let me highlight as shown on Slide 4, that beyond the evolution of EBIT, our adjusted net profit reflects a EUR 12 million improvement in financial results. This improvement was mainly driven by favorable noncash FX effects and higher net income from our treasury investment partially offset by higher interest expense related to the bonds issued in June last year.

Let me now move to detailed performance of the 3 segments. I am now on Slide 5 covering the bpost segment. Revenues for the segment declined by EUR 21 million to EUR 524 million year-on-year. Domestic mail revenue decreased by EUR 21 million or 7.2%. Mail and Press volumes contracted by 14.3% in the quarter compared with minus 7.5% last year and in line with mid-teens volume decline guidance we provided earlier this year. This accelerated decline mainly reflects lower transaction mail volumes following the introduction of mandatory B2B e-invoicing as of the beginning of the year as well as the termination of several advertising contracts.

Overall, the decline in mail volumes had a negative revenue impact of around EUR 40 million, which was partially offset by roughly half by positive price and mix effect of plus 7.1% or EUR 19 million. Parcels revenue increased by EUR 7 million or 5.8% year-on-year driven by volume growth of 9.1% partially offset by a negative price/mix effect of 3.3% during the quarter. On the volume side, the reported 9% growth corresponds to an underlying growth of around 5% after adjusting for the estimated volume loss linked to the strike in February last year when parcel volume declined by 12% in that month and over 2% in the full quarter.

As observed in recent quarters, growth continued to be driven by strong performance of marketplaces. This dynamic weighs on product and customer mix and explains negative price and mix evolution of minus 3.3% despite underlying price increases. Finally, revenues from other activities including retail value-added services and personnel logistics declined by EUR 7 million year-over-year. This mainly reflects our revenue following the termination of the 679 activities at the beginning of the year as well as lower revenue from Fines solution partially offset by higher revenue at DynaGroup.

Let's move to the P&L of bpost on Page 6. Including higher intersegment revenues from inbound cross-border volume processed through the domestic network, total operating income declined by 3.1% or EUR 17 million year-on-year. On the cost side, OpEx including D&A decreased by 1.2% or EUR 6 million mainly driven by 2 opposing effects. First, we recorded a reduction of approximately 1,260 lower FTEs and interim staff representing a decrease of more than 5% reflecting the benefits from the ongoing reorganization of our distribution rounds and retail offices.

And second, this was partially offset by higher salary costs per FTE, up 2% year-on-year following the March '25 and '26 salary indexations. Despite last year EBIT impact of around EUR 6 million for the 2-week strike, EBIT declined by EUR 11 million year-on-year. This evolution was mainly driven by the anticipated acceleration of the structural mail decline and the termination of the 679 contract, only partially mitigated by parcel growth and the benefit of our reorganization measures.

Moving on to Paxon on Slide 7. Broadly in line with the trend we observed in the fourth quarter, 2 main effects came into play during the quarter. At Paxon Europe, revenues remained broadly stable year-over-year. We recorded around 4% growth across European businesses and geographies with some activities still achieving high single-digit growth. This positive momentum was, however, offset by a negative performance at Staci Americas which is reported within Paxon Europe, following a contract termination in the fourth quarter. This resulted in a significant revenue decline during the quarter compounded by an adverse FX impact of EUR 5 million.

At Paxon North America, revenues declined by EUR 39 million. At constant exchange rate, this corresponds to an 11% decrease driven by 3 factors: revenue churn from contract termination announced last year together with mid-single-digit negative same-store sales evolution partially offset by the in-year revenue contribution of around EUR 27 million from new customers, of which 40% are Radial Fast Track clients. Let's move to the P&L of Paxon on Slide 8. Against this backdrop, total operating income declined by 9.3% or minus EUR 40 million year-on-year. Operating expenses, including D&A, decreased at a faster pace down 10.4% or EUR 44 million.

This cost reduction was primarily achieved in North America driven by lower variable OpEx in line with the revenue evolution at Radial U.S. while maintaining a solid variable contribution margin. These effects were further reinforced by fixed costs and headcount actions. As a result, adjusted EBIT increased by EUR 4 million to EUR 11 million in the quarter with growth recorded in both Europe and North America. In Europe, this reflects top line growth combined with productivity gains. In North America, EBIT growth was driven by cost containment measures, which more than offset the ongoing top line pressure.

Turning now to Landmark Global on Slide 9. At Landmark Europe, revenues increased by EUR 8 million or plus 10% year-over-year. Once again this quarter growth was driven by strong increase in volume from Asia across all major destinations, most notably Belgium supported by large Chinese e-commerce platform as well as the United States. In addition, other European lanes continue to grow as well. At Landmark North America, excluding unfavorable FX effect, revenue was slightly up year-over-year. This reflects on one hand, soft volume growth in the context of a macroeconomic slowdown and on the other hand, a negative mix effect with higher share of domestic volumes and lower Canada to U.S. volumes.

Overall, Landmark Global operating income increased by EUR 5 million or plus 3.4% year-on-year. As shown on Page 10, OpEx and D&A increased by 7.7%. This was primarily driven by high transportation cost linked to volume growth including increased inbound volume with Belgium as [indiscernible] destination. In addition, the quarter was impacted by unfavorable phasing cost effects both in transport and payroll, which we expect to reverse over the coming quarters. As a result, adjusted EBIT decreased to just under EUR 15 million. This decline mainly reflects the temporary cost phasing effect, which offset the underlying profitable growth in Europe and to a lesser extent, in North America.

Moving on to Corporate segment on Slide 11. The adjusted EBIT improvement is driven primarily by cost development. Strengthened cost management and a 1% FTE more than absorbed the 2% salary indexation resulting in an improved adjusted EBIT of EUR 3 million to minus EUR 9 million. Let's now move to the cash flow on Slide 12. The net cash inflow for the quarter amounted to EUR 110 million compared with EUR 91 million last year. This improvement mainly reflects favorable working capital movements and continued CapEx discipline.

Overall, the key drivers were as follows. Cash flow from operating activities before changes in working cap amounted to EUR 114 million representing a EUR 17 million decrease year-on-year mainly driven by lower EBITDA. Change in working capital and provision contributed to EUR 74 million. The EUR 29 million positive variance year-on-year mainly reflects 2 effects. First, the settlement of a client balance; and second, the payment of a cash advance in the context of the 679 activities transferred to BNP Paribas Fortis. While a small part of these activities are still partially subcontracted to bpost, we received a working capital injection in return.

It's important to note that this movement is expected to reverse over the course of the year. Net cash outflow from investing activities amounted to EUR 21 million, driven by CapEx for parcels. lockers and capacity expansion investment in our domestic fleet and international e-commerce logistics. This element largely explains the evolution of our free cash flow for the quarter. Finally, the net cash outflow from financing activities totaled EUR 57 million, broadly in line with last year and primarily reflecting payments related to lease liabilities.

Let me now briefly turn to our strategy and transformation update. I'm on Page 13. Two months ago we outlined our annual plan and key priorities for the year. Today, I will share a few updates and Chris will provide you a more comprehensive review when we present our half year results in August. Let me start with bpost with transformation efforts around 4 priorities area. First, the shift in our operating model. We are making progress on the key tracks of our future operating model notably through the rollout of dense and nondense distribution rounds as well as optimized correct model, which correspond to 2 complementary round types and a further centralization and automation of mail preparation.

These are designed to deliver operational efficiencies with FTE savings and space consolidation and optimization. As planned, this model was implemented during the first quarter in 5 distribution offices out of a national network of a bit less than 160 offices. We are progressing with the phased rollout over the coming quarters with a clear acceleration from Q3 onwards targeting around 50 distribution offices by year-end. In parallel, we continue to execute the reorganization of distribution offices and their delivery rounds together with the delivery of associated FTE savings.

On the full year plan, around 140 organization leading to approximately 1,150 lower FTEs. We delivered close to 40 reorganizations in the first quarter, fully in line with our planning. Importantly, the April strike has not impacted this transformation stream and execution remains on track. For perspective, we completed 138 reorganization last year, which are now clearly delivering results and contributed as observed in this quarter of a reduction of around 5% or approximately 1,260 FTEs within the bpost business unit.

Second, scaling out our out-of-home network. Building on the strong acceleration achieved last year where rollout already significantly increased, we continue to make solid progress on scaling out-of-home with the installation of 155 parcels, lockers or bbox, again fully in line with the annual plan and we also secured over 200 locations for future installations. As a reminder, our objective is to grow the APM network by 35% by year-end, which will bring us almost 1 year ahead of the ambition presented at the Capital Market Day. To date, we have a total of more than 2,700 lockers installed compared to around 1,250 at the end of '24 and around 2,550 at the end of '25.

As a result, during this first quarter we doubled the number of parcels delivered through the bbox network compared to last year. In parallel, bpost continued to improve customer convenience by scaling same-day locker delivery notably when home delivery is unsuccessful, which translate into higher NPS and improved profitability compared with next-day availability at post offices. Third, asset utilization optimization. We are actively exploring opportunities to improve the utilization of our assets and in particular our transport fleet, which is today primarily used during night hours.

As part of this effort, we launched a pilot transport of the future aimed at testing the creation of a stand-alone transport activity serving both internal and external customers. The pilot was initially designed around 20 trucks and 40 volunteer drivers, but interest has significantly exceeded expectation demonstrating strong engagement from the field and validating the relevance of the concept. The objective is to generate additional revenues, improve utilization of the fleet and drivers and progressively expand our service offering.

Finally, strengthening our B2B offering. As previously communicated, we recently launched an Innight delivery solution for our B2B customers initially based on the bbox, parcel, locker model. This quarter we have upgraded the offering by expanding it through 2 additional logistics subsidiaries within the Bnode Group turning it to a multi-model solution, including options such as car boot delivery and on-site deliveries. Overall, this initiative reflects our continued progress in reshaping the bpost operating model, improving capital and asset efficiency and reinforcing our value proposition to boost consumer and business customers.

Moving on to Paxon North America. At this stage, top line expansion in Paxon North America is progressing in a more challenging demand environment with same-store sales softer than initially anticipated while new customers contribution are progressively building up. In response and in order to remain on track to deliver our EBIT objective, we are implementing additional cost actions. These measures are not only designed to offset the near-term top line pressure, but also to further strengthen Paxon North America competitiveness in the market.

We have already made significant progress on variable cost where discipline remains very strong and where we continue to maintain a record high variable contribution margin. Building on this, the focus is now on fixed cost. The additional actions include optimizing our real estate footprint, reducing discretionary spending and rightsizing nonoperational fixed overhead to better align our organization with our volume. Following the actions already taken on both variable and fixed operation FTEs, we are now focusing on the nonoperational fixed cost base.

Let me now shift to Paxon Europe. The launch of our Forward plan marks the next steps in accelerating top line growth building on the now fully integrated and consolidated commercial platform that brings together Staci, Active Ants and Radial Europe led by Staci's commercial know-how. The plan is designed to amplify existing customers' momentum while expanding across products, geographies and customer relationship supported by more structured and disciplined sales execution.

In practice, this includes improved account coordination and closer executive level engagement ensuring we continue to deepen relationship with our core customers and capture the full value of those partnerships. At the same time, we are strengthening lead generation, leveraging our rebranding and continuing to invest in the development of our sales team to support incremental and sustainable growth.

Finally, I will conclude this section with Landmark Global where our focus in the first quarter remained twofold: expanding volume through new cross-border lanes while strengthening transport cost management. On the growth side, by leveraging agility and rapid opportunities capture in a challenging macroeconomic environment, we saw a strong acceleration of volumes towards the U.S. notably fueled by continued momentum on the China to U.S. lane. U.S. is, therefore, increasingly becoming a key destination alongside Belgium and Canada. And in Europe, we also see a solid pipeline of new lanes originating from Spain and the Netherlands.

This leads me to the outlook update for '26 on Slide 14. As a reminder, 2 months ago we introduced our '26 adjusted EBIT guidance in the range of EUR 165 million to EUR 195 million. Based on our first quarter performance, group results are broadly in line with our internal plan and our expectation at this stage of the year. Since then, however, we have been impacted by industrial action at bpost in April. As a result, while we are maintaining the adjusted EBIT guidance that we introduced 2 months ago, we are today more exposed to the lower end of the range. This reflects an estimated direct EBIT impact from the strike of around EUR 15 million.

Beyond this, fuel price development are currently not considered as a material risk for the group as we are largely insulated through a combination of pricing mechanism, contractual pass-throughs or internal cost hedging measures depending on the entity. That said, continued vigilance remains of course required as the current outlook does not reflect potential indirect and long-term commercial impact resulting from the April strike nor does it factor potential effects relating to the current geopolitical situation in Iran.

This could include industrial disruption linked to fuel shortages, higher energy cost as well as a broader impact on inflation, consumer confidence, disposable income and spending and therefore, on the top line development. Overall, while we remain within our community guidance range, the April strike put significant pressure on the guidance. And although this has been widely and intensively covered by Belgium media, for those less familiar with the situation beyond our own market, let me briefly summarize what happened and the impact identified to date.

In April, bpost experienced a 5-week nationwide strike in Belgium, which significantly disrupted our sorting and delivery operations. The impact was most pronounced in Wallonia and in the Brussels region. As a result, we accumulated a backlog of more than 16 million letters and 0.7 million parcels. In addition, we estimated a loss of approximately 3.2 million parcels volume mainly due to customers diverting shipments to competitors. The strike was triggered by employee opposition to certain elements of the ongoing transformation plan, in particular proposed adjustment to starting hours, which shifts up to 2 hours later in the morning.

These changes are aimed at enabling later parcel cut-off times and better aligning our operation with customer requirements in an increasingly competitive parcels market. From a financial perspective, our current assessment is that the direct EBIT impact of the strike is estimated around EUR 15 million expected to materialize in the Q2 result. This estimate excludes any potential future indirect impact and mainly reflects 3 direct elements: revenue losses in both Mail and Parcels including quality-related penalties, incremental costs linked to contingency measures and the cost associated with clearing the accumulated backlog.

Our operational and commercial teams are currently fully mobilized to clear the backlog as quickly as possible while actively working to rebuild customer confidence and address the reputational impact resulting from the strikes. As mentioned, while we consider this estimate to be robust for the direct impact, it does not capture potential longer-term and indirect impact. which is why we continue to closely monitor the situation.

With this, I'm now ready to take your questions. As usual, 2 questions each. Operator, please open the line.

[Operator Instructions] The next question comes from Michiel Declercq from KBC Securities.

I have 2, please. The first one is on the strikes in Belgium. I appreciate the direct impact of EUR 15 million. But is there a bit more color that you can give on those quality penalties and these contingent measures? How we should look at that when these costs will be booked? Will that also be Q2 or I think it will also be a bit later in the year for the quality penalties? That's 1 angle of course. Secondly, you also have the commercial impact. You had strikes last year.

The lasting impact remains a bit more limited I would assume looking at the volumes in the remainder of 2025. But now second year on a row and a bit of a bigger strike, let's just say. What has been your feedback here from customers? You say that you estimate to have lost 3.2 million parcels to competitors this quarter, which I assume is 3% to 4%. Will they be coming back or how have your discussions with these customers been? So that would be my first question.

And then secondly, we have seen in the news that Amazon is also opening its supply chain logistics network. I'm just wondering if you look a bit at the Amazon offering today in the U.S., how does this overlap with your existing activities at Radial and Landmark and how you are looking at this given that the same-store sales at Radial are already down mid-single digits in the recent quarters. So any comment on that would be useful.

Okay. Thank you, Michiel, for your question. So strike direct impact, they will mostly be booked in the second quarter. The top line impact is in the month of April. Pure technically there were 2 days of strike in the month of March, but it's really immaterial. Most of it is in the month of April so the loss of revenue will materialize definitely in the second quarter. The contingency cost that we had to support was some storage cost. I'm sure you have read in the newspaper that we had some of our customers ask us to store the parcels in a location because their own warehouse were totally full.

So there are some costs associated with that. Sometimes we have redirected some parcels to some of our subsidiaries to deliver the parcels. These are extra cost that we have supported. And there will be also a bit of the cost linked with the decrease of the backlog where we are injecting roughly 200 temporary workers on top of the usual one to decrease the backlog as soon as possible. So this is a bit what it entails in terms of direct cost and contingency costs. When it comes to the commercial aspect of it, I will be as transparent as I used to be.

Our customers were not delighted to say the least, especially in the context that you rightly mentioned. We already had a strike last week like last year once again and customers have indeed diverted their volumes. Now it's really up to us to demonstrate that from an ongoing basis, we are capable of coming back to a high level quality service as we used to do when we are not on strike. And I think it will be a discussion customer by customer and a decision customer by customer at the speed at which they will reinject volume into the network. They are already reinjecting volume into the network, no discussion, but some customers have not returned back.

And as I said, it will be a more one-on-one discussion with each of them. So the commercial impact will be seen on one hand in the second quarter by the speed at which the customer come back and at which level and potentially more longer effect as some customers have definitely opted for a dual-carrier strategy while some of them were only mono-carrier with us prior to this strike. So it's up to us and it's really the willingness of the management and the people on the ground to deliver as much qualitative service as possible and as soon as possible. As we speak right now, we could say that we are back in full operation. There is no strikers anymore since roughly a week so we are in full operational mode.

Your question on Amazon, yes, but it's not the first time that a major player is developing this kind of activities. It will be 1 more competitor than we had in the past. We had some big retailer chain not so long ago who decided to do the same. So fundamentally, I don't think it will have a direct impact on us. Indeed, you pointed out the same-store sales evolution, the negative one. Indeed, it was in the first quarter more than what we had anticipated. And you will be reminded that same-store sales evolution has been negative for multiple quarters in a row. We told that Q3, Q4 last year we had reached the bottom, but it seems that it's not the case and we had, as you mentioned it, a mid-single-digit decrease again in the first quarter of '25. I hope this answers your question.

If I can ask a small follow-up on the strikes. I know commercial impact you won't see or have visibility on that in the short term or maybe a bit of course. But on the indirect costs for the storage and the quality penalties, is it fair to assume that we will get a number on that during the second quarter results?

It's already partially included. Frankly, in the impact, the biggest part is relating to the lost volume and the related EBIT and not so much about those contingency costs because those measures that have been put in place are rather limited if you look at the total operation cost.

The next question comes from Frank Claassen from Degroof Petercam.

My first question is on Paxon on the financial performance. If I look at Q1, minus 9% on top line and 2.8% on EBIT margin yet if I recall well, one of the building blocks of your full year guidance was Paxon to reach low to mid-single-digit growth for the full year with a 6% to 8% EBIT margin. So I'm struggling to see how we can get there in the rest of the years because that's quite a gap. So could you elaborate how you think you can bridge this gap? That's my first question. And then secondly, on the automatic wage inflation in Belgium, you just made a step of 2%. When do you expect to see the next step and what is, let's say, baked into your current guidance on that one?

Let me start with the second one and I will come back with the first one. So indeed, we learned late afternoon yesterday that there will be an additional 2% step increase. We had anticipated to have 1 in 2026. We had anticipated that to happen a bit later in the year. We had 1 month we have -- this step-up comes 1 month ahead of what we had in our forecast. Coming to Paxon, your point is absolutely right and we will not be able to catch up. We will not be able to catch up. Different reason to that one if you allow me to elaborate a bit.

If we look at Radial U.S. or Paxon U.S., if you want; as I said, we are facing same-store sales which are significantly higher than anticipated. It depends if it's a negative, it goes up. Antoine will try to correct me, but I repeat to make sure that the message is clear. There is a decrease and the decrease is bigger than what we anticipated and it's across the board on all customers. The second point is that we were anticipating a pickup of the contribution of new customers especially in the second half of the year. We don't see it coming to the expected level. So we will be worse than one anticipated. This being said, there is a top line discussion.

And there is a second one when it comes to EBIT contribution and cash contribution and there we believe that with all the measures that have already been taken and the ones that are in the pipe as we speak, we could be able to offset that negative evolution in terms of top line. What kind of measures are we talking about? Some of them we already mentioned them and now we are implementing them, Optimization of real estate footprint including sublease of underutilized facilities, divesting some noncore assets, reduction of discretionary spending travel and entertainment and also rightsizing fixed cost and headcount aligned to lower volume.

Again there is nothing new on that one except the fixed cost one, as I said, that was not the primary focus over the last quarters, now it has become. So all in all, I do believe that those measures will be able to offset largely the decline or lower the development -- the top line development at a lower than anticipated -- the lower top line development. That was for Radial. Staci Americas, indeed we are low in the top line evolution. We lost a major customer at the end of 2025, which is materializing in the Q1 result. So 2 elements on that one and I don't want to oppose them, but I want to make the comparison.

As much as I said that at Radial, we see a lower revenue contribution from the pipeline development, it's not the case in Staci Americas. The pipeline of Staci Americas is very strong and we believe that it will be able to offset part of the losses of the volume related to the departure of 1 customer combined with fixed cost measures to protect the top line evolution to a lesser extent than Radial, but it will contribute as well. So to summarize, we have to recognize that, yes, we are a bit behind.

This being said, element that I really want to point out is that all over the place within the Paxon world, the profitability is and remain very high. Variable contribution at Radial, you might tell me, Philippe, you tell us that. Since I will be close to 4 years in bpost, I'm telling you that every quarter, but it's reality and it's still there. So this is an achievement. And also despite a lower top line development, when you look at the Paxon Europe environment, we see still significant or very strong gross margin in the existing business, which is very reassuring. It's very, very robust.

And we also see thanks to the fact that in Europe, the 3 former brands are now being operated together so Staci, Active Ants and Radial. We see a pickup on the performance in Central Europe mainly by operating all these 3 brands on the same territory altogether. So it's a bit of mixed bag, but there is still very good and reassuring positive element.

The next question comes from Henk Slotboom from the IDEA!.

I've got 1 clarification question and 1 other question. The clarification question relates to what you just talked about, the impact on margins and the mitigation impact on margins. We are talking about margins in the U.S. and not about the absolute EBIT I assume.

On one, it's yes and no, Henk. So we maintained the margin. But if we compare to the guidance that we had that expected a development of the top line, since there will be less top line, it will be additional EBIT contribution to offset that one. So it's a bit yes to both in fact.

Okay. That's clear. Then on Landmark and that's basically 2 questions folded into 1. The higher transportation costs, Philippe. I thought that the organization was structured in a way that there are back-to-back agreements. So you know on forehand roughly what you're going to pay, what you have to ask your clients based on your estimated costs. The transportation cost impact, didn't you use a fuel surcharge for example or something like it? You're an asset-light player in that field or is this reflecting the disadvantage of an asset-light model that when capacity is scarce, we saw a lot of disruption in sea transport, in air freight and that sort of things that you end up paying a higher cost price anyhow no matter what to get the stuff from for example China to Europe. That's the first question.

And connected to it, is it fair to assume that Landmark had a bit of tailwind in Europe because the French have introduced the EUR 2 levy per product line already in January whereas the rest of the EU is doing that as of 1st July. So I've been hearing a lot of stories about Chinese taking their goods to Schipol Airport, Amsterdam and Liege in Brussels instead to avoid this hassle of the EUR 2 and to avoid the EUR 2 as a whole. Perhaps you can highlight that.

Sure. I will start with the second one. Indeed, you are well informed. We see in Liege, I was just right before this call with our guy in charge of the inbound volume in Belgium, we see an increase of activity in Liege. But what we are seeing is that the planes are coming, that they are offloaded, but the containers are directly loaded to trucks to go either to France, go to the Netherlands or to Germany. So we might have a small ripple effect in our last mile activities in Belgium because we only do that in Belgium. But I would not say that it's significant, but it's a fact.

This being said, it's also something we are contemplating since we are the operator. We are the incumbent in Belgium, can our activity and the transport one could play a role into capturing part of those volumes. But most of them, as you rightly pointed out, are not directed to the Belgium market. They are mostly directed to the non-Belgium market. So that's for the EUR 2 taxes. When it comes to Landmark and transport cost, I would like to broaden a bit the debate and also emphasize the fact that Landmark is managing the transport for all the group for Bnode.

Of course transport for Belgium last mile is limited because we do the last mile activities. But for all the fulfillment activities within the Paxon world, it's managed through Landmark and the one who are benefiting -- everyone is benefiting from the good condition that we could get. So it's important to notice that that activity is not only limited to Landmark business unit. Now your question about transportation cost and the fact that they are evolving upwards due to different elements, it's really a pass-through for us and we do not see an EBIT impact from that.

The next question comes from Marc Zeck from Kepler Cheuvreux.

Really on, let's say, consumer sentiment or the impact of higher energy prices on the consumer. Could you elaborate a bit what you currently see both for the U.S. and Europe in your business? You talk about, let's say, lower same-store sales in the U.S. for Radial. Do you feel like this is related to the energy price increases and therefore drain on consumer finances and therefore mostly concentrated in March and looking forward maybe in April or have you seen lower same-store sales for the entirety of Q1 that obviously includes then January and February as well?

And what you can see in your European business not only Paxon, but maybe also Landmark Global and the parcel business in Belgium. How did March compare to January and February? Was there any impact from higher fuel prices on the consumer and what do you see currently for April? That would be the first question. Second question, if you could elaborate a bit on why you don't see a material impact from Amazon in the U.S. I guess from what we can get from Amazon's press release, it's at least to me not entirely clear where they are actually really competing.

Do you feel like they are opening up really contract logistics proper 3PL services in the U.S. or it's more like warehousing with not too much direct management of inventory there. So I could guess that if it's just warehousing, there wouldn't probably be much of an impact. But if they do proper 3PL contract logistics as well, I can imagine that maybe that is a bit higher. So it would be great to hear your thoughts on what you believe Amazon is actually doing in the future.

Okay. It's going to become an habit. I will start with the second and we'll continue with the first one. So I'm not in the shoes of Amazon. So I recommend you to direct your question to them on that one because I don't want to speculate on what they are doing. What I'm telling you is that we do not see impact from that at least so far. They have always operated their warehouse sometimes themselves, sometimes outsourcing to contract logistic players. They have been active in transport. They are permanently starting testing or going with new activities around the 3PL. That's true. But so far, we don't see any impact from that and again I cannot speak for Amazon.

When it comes to the consumer sentiment, I don't have the figures for the U.S., but I think the same-store sales is a good proxy for measuring what is happening there. As I said, 7 quarters in a row, then the same-store sales is going down and it even accelerated in the first quarter of this year. I don't know what the next -- the further part of the year will bring us. As I said, we already thought that at the end of Q3, Q4 we had reached the bottom. We have been proven wrong on that one. So it's difficult to speculate on that.

When it comes to Europe, I have the consumer sentiment numbers in front of me. And if we ended up the last quarter of last year something which is, I would say, breakeven; slightly positive in November, very slightly positive in December. The beginning of the year was -- Jan and Feb were more positive, but we saw a total flip of that consumer confidence in the month of March and even more so in the month of April. So again in terms of trend, it's difficult to speculate. But currently, we see a downwards trend.

The next question comes from Marco Limite from Barclays.

I've got couple of follow-ups on your strikes in Belgium. So first question will be I mean what sort of confidence have you got in terms of the strikes to be totally over or do you see a risk of the strikes coming back? And to what sense negotiations and discussions are sort of stopping you to go through your transformational change, operational changes you wanted to make. So what is, let's say, also the negative impact from implementing your operational changes slower than what you had thought maybe at the start of the year?

And the second question is on your volume growth in April. I appreciate you quantifying the hard numbers. But if you could give us a bit of color of what has been the volume growth or the volume decline in April for parcel volumes in Belgium? And have you seen, let's say, the growth rate picking up in May post end of strikes?

Again I will start with the second one. Thank you for your questions, Marco. Volumes decline that we have seen in the month of April is around 25% and it's still too early to comment on what is happening in May. When it comes to the strike and the risk associated with them so I just want to remind that several elements. So there is in the mind and I don't want to speak for them. But based on what my colleagues are telling me while discussing with our social partners is that there is a clear understanding of the need to change the business model. They clearly understand the fact that the mail is no longer bringing growth. It's declining at high pace and it will not come back.

They totally acknowledge it as well as that the change in the demand from the customer, they totally acknowledge it. What is very difficult for them from a human standpoint for all the affiliates and all our colleagues. If we look back 3 to 4 years back when we still had the press concession, we had colleagues who were waking up at 3 or 4 in the morning coming back at the office to be able to have delivered all the press and the magazine prior to 7:30 in the morning. Those volumes are gone because the press concession ended up and we are no more except in Wallonia still for until the end of this year. We are no more distributing those volumes.

So that was already a first shock for them, which is impacting their life because we have that concept which is very usual in the mail business, which is when your job is finished, you can go. So those guys have since years not to say decades used to have a life organized about you start early, but you also finish early and if you want to have some activities after your hours or potentially if you decide to go for a second job, you had plenty of time to do it because most of these people, especially the one distributing the press; around 11, 12 in the day, they were done and they could do revert to other activities either professional or leisure or going and pick up the kids at school.

Then there has been a second element to that one is with declining mail volumes, the number of people that we need in our distribution network is decreasing. I mentioned the fact that last year we have been able to reorganize the offices. It has always been done over the last 15 years the reduction, the adjustment of the FTEs in the distribution network, but it accelerated I think over the last 2 years. Last year we reduced the headcount by more than 1,000 employees. We will continue doing the same in 2026 and people understand that. It's a mechanical consequence of the evolution of the business, but it's not easy to take it on board.

Also, the way we reorganize the offices with the combination of some routes, we have some dense and non-dense routes. We also want to extract more efficiency on that part. So it's an additional pressure on these people who sometimes in some offices when we adjust the headcount, it could lead to reduction of 15% to 16% of headcount in 1 particular distribution office. So it's tough on people, we have to recognize that. But there is a very clear understanding and no discussion on the need for change and the society is changing.

Again the fact that we want for some of our colleagues to delay the start of their day to be able to deliver the parcels -- to accept parcels, the cutoff time in the sorting center a bit later. Again it's a disruption into their private life. We have to recognize it. I do believe that it will take maybe a bit of time, but people will adjust to that one. I think I would be more worried if there would be a strong opposition on the need for change than, I would say, the short-term impact of the direct impact on their private life if I could say so.

So can we guarantee that strikes are over? No. Also, what I see is that our colleagues have at heart the willingness to serve the customer in a qualitative way and I don't think it has changed during the course of the strike. That gives a bit of time for people to swallow, digest, adjust and I'm very confident for the future.

Can I sneak another question, please? So you have kept today the guidance despite a EUR 15 million EBIT negative from the strikes plus wage increased 1 month before, let's say, your business plan, which from memory I think is about low single-digit million higher OpEx per month. So rough numbers, you now have got EUR 20 million EBIT headwinds compared to your original guidance, but you're still holding on the old guidance. Does this mean that beyond -- I mean you think you are sort of tracking or you were tracking at the upper end of the guidance and therefore minus this EUR 20 million, now you are at the low end of the guidance or how do you justify you keeping the guidance?

Thank you for your question. Indeed, we maintain the guidance; but as we said, we are more exposed to the low end of it. I think during the presentation and with the question of your colleagues, I had the opportunity to emphasize on the reaction on the cost side that we are putting in place everywhere. Good example again in Belgium, the reorganization has not stopped in the first quarter. They have not even stopped during the strike meaning that all this positive evolution in the cost development mean being more efficient. We are still planning and confident that we could execute them.

For all the other entities especially on Paxon, those guys are really committed to compensate the temporary shortfall or the slower development of the top line by cost measures and we have levers. It's not just a task that we put in an excel spreadsheet. We have detailed plans at various entity level, which lead us to believe that it could materialize. And hence, we have concluded that at this stage based on the direct impact, we still maintain our guidance though guiding more to the low end of it.

Ladies and gentlemen, there are no further questions. So I will hand it back to Philippe to conclude today's conference. Thank you.

We would like to thank you, everybody, in the call for having taken the time to be with us and for your very pertinent questions. As a reminder, bpost NV will hold its AGM next Wednesday and our second quarter results will be released on August 7. In the meantime, we look forward to staying in touch. And thank you very much and have a great day.

Thanks for participating to the call. You may now disconnect.

Ladies and gentlemen, hello, and welcome to the Bnode Fourth Quarter 2025 Analyst Conference Call. On today's call, we have Mr. Chris Peeters, CEO; and Mr. Philippe Dartienne, CFO. Please note, this call is being recorded. [Operator Instructions]

I will now hand over to your host, Mr. Chris Peeters, CEO, to begin today's conference. Please go ahead, sir.

Thank you, and good morning, ladies and gentlemen. Welcome to all of you, and thank you for joining us. Today, I will be presenting our fourth quarter and full year 2025 results as CEO of Bnode. With me, I have Philippe Dartienne, our CFO; as well as Antoine Lebecq from Investor Relations.

We posted the materials on our website this morning. We will walk you through the presentation, and we'll then take your questions. As always, two questions each, would ensure everyone gets the chance to be addressed in the upcoming hour.

Let's get to the highlights of the full year results, and Philippe will then walk you through our fourth quarter '25 results.

On Page 3, you can see that Bnode, as we are now called, and I will come back to this in a few minutes, delivered results at the upper end of the EUR 150 million to EUR 180 million EBIT, guidance range that we set at the same time last year and progressively derisked quarter-after-quarter.

Despite pressure on top line development, we delivered an EBIT of EUR 179.7 million, while at the same time, remaining fully committed to the transformation of our business. At bpost as anticipated, top line decreased by around EUR 90 million. Mail and Press revenues declined by approximately EUR 100 million, reflecting both the accelerating structural volume erosion and the base effect as 2024 still included 6 months of the Press concession.

On the Parcel side, revenue increased slightly by around EUR 10 million as our volume growth was limited to 2%, notably impacted by the strikes actions we faced during the year. In response to these challenges, we progressed on important cost measures, particularly through operational reorganizations and a reduction of around 4% in FTEs. The full impact of these actions were mainly visible in the last 2 quarters of the year.

EBIT came in at EUR 67 million, down 50% year-on-year. The decline was primarily concentrated in the first half, reflecting the scope impact of the Press concession, while performance roughly stabilized in the second half of the year.

At Paxon, top line growth was primarily driven by the continued expansion of our European activities and even more significantly by the consolidation of Staci. This positive momentum was, however, largely offset by a 21% revenue decline at North America. As announced last year, Radial faced the departure of several major clients. Since then, we have been actively addressing this through a progressive reshaping of the customer portfolio towards the midsized segment.

At the same time, we maintained a strong focus on productivity with Radial, once again, delivering substantial cost savings. Supported by the contribution from Staci, EBIT increased slightly by EUR 7 million year-on-year, reaching just under EUR 59 million.

At Landmark Global, our U.S. business was as expected, impacted by tariff measures. Nevertheless, top line posted slight growth overall. This was supported by sustained activity in Canada and most importantly strong momentum in Asian volumes across all key destinations, including, of course, Belgium, which is particularly accretive from an EBIT standpoint. Combined with continued productivity gains, notably true or Transport Center of Excellence, this enabled us to increase EBIT to EUR 85 million.

Let me make one final remark on our financial highlights. As you can see, on a reported basis, the group recorded a net loss of EUR 39 million, in line with the dividend policy reaffirmed at our Capital Markets Day in June. And with no change to that framework, the Board of Directors will recommend to the general meeting in May, not to distribute a dividend this year. This reported net loss is primarily explained by one-off costs recognized at Radial North America, Philippe will elaborate on this in a moment.

But before handing over, I would like to briefly reflect on our key strategic priorities in 2025 and how they continue to shape our transformation journey. In 2025, our transformation gathered significant momentum across Bnode, delivering tangible results and reaffirming the strength of our strategic direction.

We restructured and strengthened the Bnode Executive Committee with a new CEO for Paxon North America and Paxon Europe as well as the people's management committee, including Group CEO and four members of the Group Executive Committee to accelerate strategy execution and better address emerging challenges.

We simplified the group brand architecture, moving from 31 brands to a clear 4-brand structure, bringing consistency and focus fully aligned with the group strategic repositioning.

At bpost, we made the operating model shift accelerated the transformation of our Belgian operating model across multiple tracks, including bulk rounds, now fully operational in all sorting centers, centralized preparation of Mail rounds and the reorganization of 138 distribution offices to adapt the cost base to new volumes, among others, due to lower Press volumes.

We also developed Out-of-Home at scale, expanded the locker network at record pace, reaching 2,500 bbox installations driving a 50% growth in locker volume in 2025. We also successfully launched Night Bbox Delivery, enabling time-critical deliveries before 7:00 a.m. with early phase pilots underway in the omnichannel segment.

At the retail network, we strengthened the strategic relevance and commercial contribution of our retail network by expanding multiple partnerships in among others, telco, utilities and banking, while reinforcing our societal inclusion role.

For Paxon, we continue to transition to mid-market client portfolio driven by the successful launch of Fast Track offering rapid and seamless integration with existing systems with 22 Fast Track clients onboarded, representing EUR 38 million of in-year revenue.

We also successfully integrated Staci into our new Paxon organization. We established an integrated country structure across Staci, Radial Europe and Active Ants, paving the way for accelerated commercial development and we exceeded the initial cost synergies target with the 2026 target already secured.

And for Landmark Global, we achieved strong progress in leveraging group-wide capabilities, notably through the introduction of a Transport Center of Excellence, realizing EUR 50 million of group-wide savings in 2025. Staci transport synergies, Last Mile group contracts, et cetera, are included in this.

And in terms of market resilience, we demonstrated the ability to navigate an increasingly complex trade environment including rapidly involving trade tariffs, while maintaining operational stability and commercial momentum.

I will now hand over to Philippe for the quarterly results, and I will then take the floor to share with you our strategic priorities for 2026 and the financial outlook.

Thank you, Chris, and good morning to all. As you can see on the highlights on Page 5, our group operating income for the fourth quarter came at EUR 1.242 billion, a decrease of EUR 93 million or 7% year-on-year.

This performance reflects a combination of factors. As expected, we saw the impact of contract terminations at Radial U.S., which we already flagged earlier this year. This termination materialized through the quarter and drove a 20% revenue decline year-on-year on EUR 82 million, largely offsetting the 4% top line growth at Paxon Europe.

In parallel, the 9.2% decline -- 9.2% decline in domestic Mail volume, excluding Press which was only partially compensated by close to 3% Parcel growth volume in Belgium. Note that Parcel volumes were impacted by several national strikes in October and November.

In terms of cross-border activities, we also recorded higher Asian inbound volumes, which supported overall Parcel growth. Overall, while our top line remained under pressure, we continue to adapt our cost base effectively, sorry. As a result, group adjusted EBIT reached EUR 83 million, broadly in line with last year. This outcome reflects the positive effect of our reorganization measures and improve peak efficiency at bpost as well as margin actions at Paxon U.S.

Before turning to the financial performance of our business units, let me highlight, as shown on Slide 6, that our group reported EBIT stands at EUR 10 million. Beyond the usual PPA adjustment, this mainly reflects the EUR 55 million one-off charges related to the real estate portfolio rationalization and technology stack simplification at Radial U.S., in line with maximize the core initiative presented to you at the Capital Market Day in June.

Let's move now to the details of our three segments. I'm on Page 7. With the bpost segment previously Last Mile. We see that the revenue declined by EUR 70 million to EUR 574 million. Domestic Mail recorded around EUR 17 million decline in revenue, of which EUR 11 million stemmed from transactional and advertising mails and EUR 5 million from Press.

Excluding Press, Mail volumes contracted by 9.2% in the quarter compared to 8.1% same quarter last year. The decline in Mail volumes had a negative revenue impact of around EUR 21 million and was partially offset only by half, through positive price and mix effect of plus 4.2% or roughly EUR 10 million. As a result, the Domestic Mail revenue were down 4.9% or EUR 11 million year-over-year.

Note that on a full year basis, this Mail volume declined by 9.8% at the upper end of our guidance and was mitigated by a price/mix impact of plus 4.3%.

Our Parcels revenue increased by EUR 3 million or plus 1.7% year-over-year, driven by volume growth of close to 3% and a slightly negative price/mix effect of 1.2% in the quarter. On the volume side, the reported 9.2% actually correspond to an average daily growth of plus 1.3% and include a shortfall of just under 1% due to national strike that took place in Belgium in October and November.

Over the past months, and particularly during the peak, growth was mainly supported by strong performance of marketplaces, which also contribute to our negative price/mix impact of about 1.2%.

For the full year, our average daily volume grew by 2.4% despite the negative impact of the fourth quarter strike and more importantly, the bpost strike in February during which a significant share of volume shifted temporarily to competitors. These disruptions resulted in our overall volume shortfall of a bit more than 1% for the year. Excluding this impact, our volume would have landed at the low end of our annual volume guidance.

Revenue from our other activities, including Retail, Value Added Services and Personalize Logistics decreased by 3% year-over-year, notably with lower revenue from fine solutions partially offset by higher revenues at DynaGroup.

Let's move to the P&L of bpost on Page 8. Including the higher intersegment revenue from inbound cross-border volumes handled in the domestic network, our total operating income was down by 2.3% or EUR 14 million.

On the cost side, OpEx and D&A decreased by 2.7% or EUR 16 million, mainly driven by two effects: lower staffing with FTEs and interims down 5%, reflecting improved peak efficiency and lower volumes. The benefit from the ongoing reorganization of our distribution rounds and retail offices implemented over the previous quarters and which ultimately concluded in line with annual plan target despite delays accumulated until June due to strikes.

And on the other hand, higher salary cost per FTE up plus 2% following March '25 salary indexation. In contrast with the first half of the year, when EBIT had contracted sharply by almost EUR 64 million year-on-year, mainly due to the end of the Press concession in June '24, we see now that despite the structural Mail decline, Parcel growth and the benefits of our organization are helping to mitigate EBIT erosion. EBIT decline was limited to EUR 3 million in the second half of the year and even showed a slight improvement in this fourth quarter.

I would like to highlight that our peak efficiency improved not only versus last year, but for the first time ever also versus the full year run rate.

Moving on to Paxon, previously, 3PL, on Page 9. In terms of Paxon revenues, two effects came into play. First one, at Paxon Europe, revenue remained broadly stable year-over-year, while we recorded around 4% growth this quarter across European businesses and geographies, with some activities even achieving high single-digit growth. We also felt the negative impact at Staci Americas, which is reported on the Paxon Europe, where a contract termination led to a significant revenue decline during the quarter.

At Paxon North America, revenues decreased by EUR 82 million. At constant exchange rate, this represents a 20% decline, driven by revenue churn from contract termination announced in '24 and '25. Mid-single-digit negative same-store sale and partially offset by the in-year contribution of a bit less than EUR 30 million from new customers of which 60% relating to Radial, Fast-Track clients. As expected, despite seeing positive and encouraging seniors on that front, we continue to feel the impact of the churn announced in '24 and '25.

We remain focused on executing our plans and we are confident that the ongoing stretch to core actions presented at the Capital Markets Day, expanding into, as Chris said it, new industries, client size and channel and strengthening our portfolio will deliver the intended benefits.

Let's move to the P&L of Paxon on Slide 10. With this total operating income decreased by 14.4% or EUR 82 million, while operating expense and D&A decreased by 13.2% or EUR 69 million. The reduction was primarily in North America, driven by lower variable OpEx in line with revenue evolution at Radial U.S. and sustained variable contribution margin. As a result, adjusted EBIT decreased by EUR 13 million to EUR 33 million in the quarter. This was mainly due to the outgoing top line pressure at Radial U.S. and to some extent, at Staci Americas to temporary productivity issues and an IT incident.

Note that Radial U.S. reached another record high margin during the peak season. And on a full year basis, Radial U.S. continued focus on productivity improvement delivered a 2% increase in variable contribution margin, equivalent to our cumulative benefits of EUR 16 million.

Looking at our reported EBIT of minus EUR 35 million, this reflects the EUR 55 million one-off charge related to the real estate portfolio rationalization and the technology stack simplification, at Radial U.S. I've mentioned earlier in the call, this is being totally in line with "Maximize the Core" initiative presented at our Capital Markets Day in June.

Moving on to Landmark Global, previously Cross-Border, on Page 11. Landmark Europe revenues increased by EUR 4 million or 4% year-over-year. This growth was driven by a solid volume increase from China across all major destinations, notably Belgium fueled by large Chinese platforms and U.S. Other European lanes continue to grow well with the exception of U.K. where adverse market conditions remain.

At Landmark North America, we continue to face volume headwinds, while the broader tariff environment is weighing on existing business and delaying new opportunities. However, this was offset by strong domestic volume growth in Canada and a strong peak period resulting at North America level in a high single-digit percentage growth in revenue, equivalent to 0.5% increase or EUR 0.4 million increase in euro, when including the negative FX impact development. Overall, our Landmark Global operating income increased by roughly EUR 7 million or 3.9%.

As shown on Page 12, OpEx and D&A increased at the same time by 3.1%, mainly reflecting higher transportation costs, driven by volume growth partially offset by lower rates on the new transport contracts. This links back to the Transport Center of Excellence that we presented at the Capital Markets Day. And from which we are now seeing tangible benefits across our various business units.

Adjusted EBIT increased slightly to just under EUR 26 million. And the productivity gains across the board resulted in margin improvement compared to last year.

Moving on to the Corporate segment on Page 13. Adjusted EBIT continued to improve as cost control measures on third-party and expand services as well as facility management initiatives helped offset higher payroll costs driven by additional FTEs in the March '25 salary indexation. This quarter also benefited from a one-off favorable impact from operational taxes. And as a result, our adjusted EBIT improved by EUR 7 million to minus EUR 2 million.

Let's now move to the cash flow on Slide 14. The net cash inflow from the quarter amounted to EUR 35 million compared with EUR 118 million last year, mainly reflecting the variation in working capital and higher coupons on the bonds. Overall, the main items to highlight are the following: cash flow from operating activities before changing working capital stood at EUR 149 million, a decrease of EUR 11 million versus last year, mainly driven by lower EBITDA and lower corporate tax payment.

Change in working capital and provisions amounted to EUR 57 million, the negative EUR 39 million variance year-on-year reflect the termination of the Press concession in June last year as well as some lower suppliers balances.

The net cash outflow from investing activities totaled EUR 61 million, driven by CapEx for parcels, lockers and capacity expansion, our domestic fleet and international e-commerce logistics. Note that on a full year basis, CapEx amounted to EUR 147 million, below our initial guidance of EUR 180 million, reflecting disciplined spending behavior. This constitutes the main variation in our free cash flow and the net cash outflow from financing activities amounted to EUR 110 million, mainly reflecting higher lease liabilities payment and higher bond coupons linked to the EUR 1 billion bond issuance in November 2024.

Chris, this brings us now to the strategic priorities of '26 and our financial outlook.

Thank you, Philippe. As we move in 2026, the focus shifts from piloting to scaling. Accelerating what works, executing with discipline and embedding successes structurally. For bpost, that means that the operating model will further shift to accelerate the transition towards a 24/7 logistics company. This includes the structural embedding of efficiencies and flexibilization levers. For example, the dual density rounds or the delayed curve that we will do.

At the Out-of-Home, we will further scale, expand the network coverage of 3,400 Bboxes installed and doubling the parcels delivered via lockers. We will continue to pilot and scale promising B2B services in omnichannels and for technicians. And also, we will negotiate an agreement for the Retail network with the Belgian state and entering into force as of January 2027.

For Paxon in North America, we will leverage and scale the proven Fast Track solution to deepen our presence in the mid-market segment. And for Europe, we will capitalize on the integrated country structure to accelerate up and cross-selling, improving asset utilization and driving commercial growth.

For Landmark Global, we will drive the full utilization of the Transport Center of Excellence, ensuring group-wide efficiencies and boosting profitable growth in a scale-driven market. And for the market, we will leverage our ability to navigate trade complexity to better support clients in managing cross-border complexity and evolving tariff dynamics. These strategic priorities lead me to our outlook for 2026.

I'm on Page 16 now. We are engaged in a profound transformation of our group and the strategic shift we have initiated is a multi-year journey. 2026 will be another important step in that transition. At a high level, the continued acceleration of our international logistics activity is expected to be the main driver of EBIT growth at group level.

At the same time, in our historical Belgian operation, we will remain focused on mitigating the structural mail decline, while further advancing our operational shift toward a more parcel-centric model. Overall, at group level, we are targeting an adjusted EBIT in the range of EUR 165 million to EUR 195 million for 2026.

For Paxon, we expect total operating income to grow in the low to mid-single-digit range in 2026. While in Europe, we anticipate mid- to high single-digit growth, supported by continued commercial momentum and further leveraging of our integrated logistics capabilities. In North America, the ongoing portfolio shift towards the midsize segment, notably through our Fast Track initiatives should offset the impact of customer share. On profitability, we expect an EBIT margin increase from 3.5% in 2025 to between 6% and 8% in 2026. This uplift will be driven by the combined strength of our new regional setup, realization of cost synergies and continued real estate optimization.

Then we turn to Landmark Global, where we are targeting a mid-single-digit top line growth for 2026. In Eurasia, momentum remained strong in our commercial activities, particularly driven by Asian volumes, while Postal volumes are expected to remain resilient.

In North America, growth should be more moderate. Market overcapacity continues to intensify competition and the uncertainty surrounding tariff measures is creating limited visibility and implied pressures on flows to and from the U.S. across most lanes.

In terms of profitability, the evolving business mix with a lower contribution from Postal and a higher share of commercial volumes is likely to weigh on margins leading to an expected EBIT margin in the range of 10% to 12%.

Finally, regarding bpost, we anticipate a low single-digit decline in revenue in 2026. This mainly reflects three factors: first, Mail volumes are expected to decline in the mid-teens range, while this will be partly mitigated by a favorable price/mix effect of around 5%, 6%, structural volume erosion remained significant.

As you observed in 2025, decline already accelerated, reaching around 10% at the upper end of our 8% to 10% guidance range. In 2026, we will also face the full impact of mandatory B2B e-invoicing in Belgium as well as the loss of certain advertising contracts.

Second, on the Parcel side, volumes should grow in the mid- to high single-digit range, primarily driven by large customers. As a result, despite the usual price adjustments, the overall price/mix is expected to remain broadly stable. In addition, as discussed during our Capital Markets Day, we will see the full year revenue impact from the loss of the 679 banking contract which was retendered and transferred to BNP Paribas Fortis as of January 1.

From a profitability perspective, this marks another year of revenue contraction, which will inevitably put pressure on margins. That said, we remain fully focused on aligning our cost base notably true, intensified distribution around reorganizations and further productivity gains. Altogether, this should translate into an EBIT margin of around 1% in 2026.

We are now ready to take your questions. Again, two questions each, please, so that everyone gets the chance to be addressed during the session. Operator, please open the lines.

[Operator Instructions] The next question comes from Michiel Declercq from KBC Securities.

I had some questions on the 3PL or the Paxon business. First on profitability, a bit lower than what you guided for, for the start of the year. I was just wondering, can you give a bit more color on the temporary productivity issues and the IT incident at Staci in the Americas? And maybe quantify this and maybe also looking at the margins of Staci, are we still in the 10% to 12% range there? That would be a bit my first question.

Then secondly, would also be on the 3PL Europe, you guide for mid- to high single-digit growth in 2026. Looking at the fourth quarter, it was flat, you had, of course, a customer loss and some headwinds at Staci Americas. But I would expect this also to somewhat continue in 2027. So I'm just wondering where will this step up from a flat growth in the EU in Q4 to mid- to high single digits in '26 come from? Can you -- do you see some reassuring trends there? Or just a bit more color on that, please?

Do you take the first?

Yes. I'll take the first one. Thank you, Michiel, for the question. Very, very, very interesting question indeed. When it comes to Paxon profitability as a whole, we are impacted by -- mostly impacted by the loss of customers that we faced at -- from Radial, as we mentioned it. Despite the fact that they have been able to maintain the variable contribution margin, even a slight improvement year-over-year. Nevertheless, in absolute value, indeed, it weighed on the EBIT generation.

When it comes to Paxon Europe, so the -- what I would say is that we have a profitability at the level of Paxon Europe so mostly from -- resulting from the acquisition of Staci. We always guided in the range of 10% to 12%. And in '25, we nearly reached the bottom end of the range.

Why do I say nearly very close to, which is mainly explained by the fact that we had an IT incident in the U.S. that weighted on the profitability.

And on the second question, so if you look at the Staci growth, you see indeed that there was a bit of a slowdown due to a combination of economic circumstances, mainly in France and the U.K. last year and also probably a focus, which was on the integration and the setup of the new structure.

Now we have a team fully dedicated to developing the top line. And what we see there is that we have, especially around cross-sell and up-sell on these clients. And when we talk about cross-sell, it's both geographical, but also in other product ranges. And up-sell where we see that we expand our services within the same service line with those same clients, we see that we have an attractive pipeline on which we feel comfortable that, that growth is a feasible figure.

Okay. Clear. Maybe a quick follow-up, if I may. If I then plug in the guidance for the growth in the EU also for Paxon business, is it then fair to assume that growth in the U.S. or in North America, Radial North America will be flat? And if so, can you maybe give a bit more color on the phasing there?

Yes. Indeed, growth in the U.S. will be flat. It's the effect of the historic client losses that we see to have a full impact. And obviously, if you see, although we see a ramp-up at the Fast Track side. These are substantially smaller clients, meaning that you need a lot of more onboarding to compensate for the loss of a large client. And so that effect of clients that were shared -- was already announced for the non-renewal of contracts that we will have the impact from gets compensated by new mid-market clients, but the one is balancing out the other.

If you allow me to add one element, Chris, also what we are seeing in terms of evolution of same-store sales, so on existing customers, we are still believing that we will be in negative territories in '26 compared to '25.

Which is again an effect of that historic portfolio of, let's say, older brands that are more in decline than the overall market.

The next question comes from Frank Claassen from Degroof Petercam.

Two questions, please. First of all, on the transfer of the 679 banking contract, could you help us how much revenue would that roughly be? That's my first question.

And then second, on the corporate cost line, you indicate that it will go up some -- or will have the negative EUR 35 million delta in '26. That's quite a step-up. Could you elaborate what kind of investments or costs you're going to make on that corporate cost line?

So on 679 -- thanks for the question, Frank. We'll -- we don't use to disclose individual contracts, neither the profitability. So we will not do it for the 679. But this being said, you know that the contribution of this contract was solid, very solid. So it's weighing on the profitability.

When it comes to corporate, it's -- in fact, we are adding some resources very limited compared to the '25 situation. And those resources are geared towards supporting the transformation initiative. They are hosted at the level of corporate, but they benefit to the integrity of the group. So they are, in fact, also the natural evolution of the cost base, which -- because those corporate costs are mostly people-related costs. And we expect also to have, as we mentioned for BeNe Last Mile, we also expect to have a one step of inflation of 2% and that helps explaining the evolution of the corporate cost.

The next question comes from Henk Slotboom from the IDEA!

Chris, Antoine and Philippe. A few questions about the bpost division. I'm a bit surprised about the Parcel growth you indicate for the current year. Last year, it was 2.9%. There was a 0.7% negative impact of the strikes you experienced. Now you're aiming for mid- to high single-digit growth. I assume you must have had a good start of the year. But at the same time, there are some things happening in the Middle East which could spur inflation again and weigh on consumer confidence. How do you look at that, Chris?

So on the Parcel growth, I think the fact that you see in the terms of growth of last year, main mainly the effect of a little bit lower growth fix has to do with the strike impact of which we have two major events, one in the early part of the year with a quite significant impact. As you know, we had a couple of days of non-operation and a blocking of our sorting center that had quite an important impact in number of parcels.

And while we could mitigate last minute to a large extent, the national strike against the government in the end period. Some of our clients took at that moment of time, whether it was late at already the batches to have some of those volumes deviated. And so there, you see two elements where you have some volume leakage as a result of the strike.

That being said, if we look at the start of the year, well, as always, at the start of the year is a -- is not the most relevant period. But if we see in terms of client development and contract conversion, we are on a positive flow. And so we expect, in that perspective, a good year.

If we look at the impact of what we see in Middle East. I think, there's very little, let's say, direct flow from us from that side with some Postal flows, but they're quite limited. 12 countries are blocked in terms of Postal flow, but that's a financially a very minor impact on our total volume.

We don't see today a reduction on the Chinese flows. Obviously, I agree with you. If there is an impact on consumer behavior likely you will see some impact on the overall spend. Still, what we've seen in the last times when that was happening was that there was a further shift towards the products which are available within the e-commerce space. And so that is something where we don't expect that there will be a massive impact on the year.

Then on the Mail volume, Chris, we have a shock-wise decrease this year, partly because of the loss of some advertising clients and the introduction of e-invoicing in Belgium, especially the latter impact. Do you think that this will mitigate the decrease in Mail volumes as of 2027 when this has been absorbed?

I don't understand the question, to be honest. Can you repeat the question?

Well, if this year was the introduction of e-invoicing, if I'm correct, in Belgium. So that means that you have a shock-wise decrease in volumes, paper invoices being replaced by electronic invoices. Normally, I assume that will lead to a lower contraction of transaction Mail volumes in the year thereafter, because there's less left.

Yes. I mean, I can understand what you say. But overall, we don't count on that. I think that you've clearly seen that our strategy is now to move as fast as possible towards a parcel-centric operator, and so we want to become a logistical company. You see that, that Mail decline also if we look at comparable countries that were ahead of the curve have mostly had the Nordic countries are ahead of the curve. The Baltic states are also ahead of the curve in that perspective.

You see that, that decline continues to be fairly steep also in the end phase of Mail. If you look at the Denmark case still until the last year, you saw a continued steep decline in the Mail business. We see the same happening in the other Nordic countries, which actually are already at a further progressed decline in Mail that we are. And so in our plans, we don't count on that difference anymore. We actually have -- are preparing ourselves for a continued accelerated decline in Mail. And obviously, what we will do as a consequence of that, start to prepare ourselves for the usual discussion, which will be -- we will have a new user as of the 1st of January '28. And so that preparation of discussion is happening now to ensure that our operating model can follow the reality of the volumes that we have to treat.

[Operator Instructions] Ladies and gentlemen, there are no further questions. So I will hand it back to Chris to conclude today's conference. Thank you.

We would like to thank everybody in the call for having taken the time to be with us and for your interesting questions. Please note that we will release our annual report 2025 on April 2nd. We look forward to staying in touch and Philippe will present you our first quarter results on May 6. Thank you very much and have a great day.

Thanks for participating to the call. You may now disconnect.

Ladies and gentlemen, hello, and welcome to the bpost Group Third Quarter 2025 Analyst Conference Call. On today's call, we have Mr. Philippe Dartienne, CFO. Please note, this call is being recorded.

I will now hand over to your host, Mr. Philippe Dartienne, CFO, to begin today's conference. Please go ahead, sir.

Thank you very much. Good morning, ladies and gentlemen. Welcome to all of you, and thank you for joining us. I'm pleased to present to you our third quarter results as CFO for the bpost Group. Chris, our CEO, could not make it today, and I have with me Antoine Lebecq from Investor Relations.

We posted the materials on our website this morning. We will walk you through the presentation, and then we'll take your questions. As always, 2 questions each will ensure everyone gets a chance to be addressed in the upcoming hour. I'll start with the quarterly financials, then move on our financial outlook and provide an update on our key transformation initiative for 2025.

As you can see on the highlights on Page 3, our group operating income for the third quarter amount to EUR 1.030 billion, remaining broadly stable year-on-year and almost at constant scope as Staci has already contributed for 2 months in the same period last year. As usual, the summer quarters show some seasonal softness, but beyond this, we saw a mix of different factors.

At Radial U.S., we continue to see the expected impact for the 2024 contract termination, but even more this time, the materialization effect of those announced earlier this year. As a reminder, these are the same ones that led us to take an impairment at the beginning of the year. Altogether, those elements more than offset the extra month of Staci contribution in the quarter.

At the same time, we continue to see good volume growth in Asian cross-border activities. While in Belgium, the domestic mail volumes declined, this was partially compensated by a decent volume growth in Parcels. Our group adjusted EBIT came at minus EUR 3 million, representing a year-on-year decrease of EUR 16.3 million, mainly driven by Radial U.S., where despite sustained margin action, the revenue shortfall due to the anticipated churn and seasonal softness did not allow full absorption of fixed costs in the quarter. More broadly, at bpost Group level, the results we are presenting today are in line with our expectations, and we reconfirm our EBIT outlook at around EUR 180 million for the year 2025.

On Slide 4, you will note that the EUR 14 million decline in net profit mirrors the EBIT evolution as in the same period last year, the acquisition of -- the acquisition debt was already on balance sheet and the financial results remain broadly stable.

Let's move now to the details of our 3 segments. I'm on Page 5 with BeNe Last Mile segment. We see that the revenue declined by EUR 9 million, amounting to EUR 512 million. Domestic Mail recorded around EUR 16 million decline in revenue, of which EUR 10 million stemmed from transactional and advertising mail and EUR 6 million from press.

Excluding press, mail volume contracted by 9.4% in the quarter compared to only 6.7% last year, which had benefited from the election uplift in September 2024. The decline in mail volume had a negative revenue impact of around EUR 20 million, of which was partially compensated by half through a positive price and mix effect of EUR 4.7 million or roughly EUR 10 million. As a result, domestic mail revenue were down by 4.6% or minus 10% year-over-year.

On Parcels, revenue increased by EUR 4 million or 3.2% year-on-year, reflecting a volume growth of 2.8% and a slightly positive price/mix effect of 0.5% in this quarter. On the volume side, the reported 2.8% actually corresponds to an average growth of 4.4% per working day. Over the past months, this momentum has been mainly supported by the outperformance of marketplace, notably boosted by sales events and continued strength in the apparel segment.

Let's move to the P&L of Last Mile on Page 6. Including some higher intersegment revenues from inbound cross-border volumes handled in the domestic network, our total operating income was slightly down by 1.4% or minus EUR 8 million. At the same time, on the cost side, our OpEx, including D&A, remained broadly stable and mainly reflects 2 effects: lower FTEs resulting from lower volume and efficiency gain, notably from the reorganization of our distribution rounds and retail offices, which are progressing in line with plan, and on the other hand, higher salary cost per FTE around up to 2% year-over-year following the March '25 salary indexation.

In contrast with the first half of the year, when EBIT had contracted sharply by almost EUR 64 million year-on-year, mainly due to the end of the press concession in June '24, we see that despite structural mail decline, parcel growth and initial projects of -- sorry, and initial effects of our reorganization are helping to attenuate EBIT erosion.

Moving on to 3PL on Page 7. 3PL revenues were broadly stable overall as 2 offsetting events affecting -- came into play. First, effect. 3PL Europe, where revenue increased by EUR 62 million, we benefited from 1 additional month of Staci revenue in the quarter, along with continued commercial expansion of Radial and Active Ants in Europe. That said, sales from existing customers or the famous same-store sale remained soft and even negative in certain geographies during the quarter.

As a side note, since we are 1 year after the acquisition of Staci, there will be no further consolidation impact going forward. As we are now advancing in the integration of Staci, Radial Europe and Active Ants, we are really starting to operate as one single business unit as explained at our Capital Market Day in June. Our P&L is being increasingly managed together, this means that from now on, we will only report on 3PL Europe as one single business and gradually phase out stand-alone reporting from individual entities.

Second effect, in 3PL North America, revenue decreased by EUR 58 million. At constant exchange rate, this corresponds to a decrease of 24%, mainly driven by revenue churn from contract announced in 2024 and even more so from those announced early '25, partially offset by in-year contribution of new customers, around 60% of which are Radial Fast Track customers as we presented to you at our Capital Market Day.

While we are seeing positive and encouraging signs on that front, and I'll come back to that on a moment, we are still feeling the impact as expected of the churn. We continue to execute our sales development plan, and we are confident that these efforts will pay off, but it needs a bit of patience.

Let's move on to the P&L of 3PL on Slide 8. With this, the total operating income slightly increased by 1.1%, while our operating expense and D&A increased by 4.8%, primarily driven by in Europe, Staci consolidation impact and one-off reorganization costs, including site closures and relocation of customers to further accelerate 3PL Europe integration and cost structure optimization. In North America, lower variable OpEx in line with the revenue development at Radial U.S., and sustained variable contribution margin close to record high level.

The EBIT evolution at Radial U.S. is certainly one of the key highlights of this quarter performance and also the main reason for the gap versus market expectation. Despite 1 additional month of Staci contribution, the minus EUR 30 million EBIT decline in 3PL from plus EUR 1.7 million last year, indeed clearly reflects the situation at Radial U.S. After 3 consecutive years of contraction, revenues are now about 45% below their peak level in Q3 2022.

In this quarter, the combined effect of churn and seasonal softness limited our ability to fully absorb fixed costs despite strong VCM discipline and tight cost control. Ironically, we are now at a point where revenue have reached their lowest level ever, and yet our VCM margin stands at all-time high. Looking ahead, the solution lies in top line recovery, and on that front, we are executing our plan and making good progress.

Moving on to cross-border on Page 9. Cross-border Europe revenue increased by EUR 11 million or plus 14% year-over-year. This growth was driven by strong volume increase from Asia across all major destinations, notably Belgium, fueled by large Chinese platform and U.S. Across-border North America, Landmark Global continues to face the broader tariff environment that is weighing on existing business and delaying new opportunities. However, this was offset by strong domestic volume in Canada, resulting in an overall plus 1.4% revenue increase for North America, including a 6% negative FX impact. Overall, our cross-border operating income increased by roughly $12 million or 8.7%.

As shown on Page 10, our OpEx and D&A increased at the same time by 9.6%, mainly reflecting higher transportation costs linked to the volume growth I just mentioned. EBIT slightly increased to above EUR 17 million with a margin of 11.5%, reflecting a slight dilution from commercial products.

Moving on to Corporate segment on Page 11. Adjusted EBIT improved by EUR 1 million to minus EUR 9 million as cost containment measures across spend categories helped offset higher payroll driven by more FTEs and March '25 salary indexation.

Then we move to the cash flow on Slide 12. The net cash outflow for the quarter amounts to minus EUR 16 million, representing an improvement of EUR 275 million year-on-year, mainly reflecting the acquisition of Staci last year, which was partially funded in cash for a bit less than EUR 300 million. Besides that, the remaining items to flag are the following:

Cash flow from operating activities before change in working cap stood at EUR 71 million and decreased by EUR 7 million year-over-year, mainly reflecting higher corporate tax payment. Change in working capital and provision amounted to EUR 17 million. The plus EUR 16 million variance is primarily explained by the settlement of some terminal dues and some client balances. The net cash outflow from investing activities totaled EUR 28 million, driven by our CapEx for international e-commerce logistics, parcel lockers and capacity expansion. Also, our domestic fleet was considered into this EUR 28 million.

This item constitute the main variation in our free cash flow. The net cash outflow for financing activities amounted to minus EUR 776 million and mainly consisted of lease liabilities outflows, while we had on top of the acquisition debt last year. This brings us now to the outlook and our strategic priorities of 2025.

Outlook 2025. We presented our group EBIT outlook of the range EUR 150 million to EUR 180 million back in February, and during the Q2 results in August, we indicated that we were targeting the upper end of the range. With a year-to-date EBIT of EUR 97 million, the results we're presenting today are broadly in line with our plan, now allowing us to confirm our full-year outlook at around EUR 180 million.

This implies achieving an EBIT of around EUR 80 million to EUR 85 million in Q4 compared with EUR 80 million in the same quarter last year -- sorry, compared to EUR 84 million last year, which we are cautiously optimistic about. Based on current assumption and expectation, we believe this is achievable, particularly thanks to our preparation and readiness for an efficient peak execution across the group.

In North America, we validated client volume capacity plan. We have secured to hiring over 4,100 seasonal workers to ensure full site coverage and put peak incentive plans in place. In BeNe Last Mile, beyond the usual measures, we have implemented additional productivity initiatives, including tracking performance at each distribution offices and site and setting up a national tool to further optimize interim and reinforcement of the planning. Of course, we remain vigilant amid challenging market conditions, notably as volume development and the phasing out of end of year peak volumes in Belgium and internationally remain uncertain and partially beyond our control.

To wrap up on our outlook, we are also updating our CapEx guidance with a downward revision from EUR 180 million to EUR 140 million. This reflects our disciplined approach to spending in Belgium and in the U.S. and a strategic phasing towards 2026. Overall, we remain focused on prioritization and value creation, ensuring that every euro invested is where it has the highest impact in the group.

Finally, as we usually do, I take a few minutes to walk you through the progress we've made on our transformation plan over the last months as part of our Reshape2029 journey we presented to you at the Capital Market Day. When it comes to the update on the strategic initiative, bpost continues to accelerate its transformation, shifting firmly towards becoming an international logistics and parcel operator.

Let me walk you through the tangible progress we've made across our segment. I'll start with BeNe Last Mile. Following 2 successful pilot phases, we launched our 9 delivery service on October 15. As new B2B service consisting in a 9-time delivery solution targeted at technician and field workers that helps eliminate detours from central depots and save up to 1.5 hours per day for these technician and field workers.

In practice, parcels are collected by bpots until 6:00 p.m. on working days, sorted overnight and then delivered before 7:00 a.m. to selected parcel lockers of our network across Flanders, Brussels and Wallonia. The service is exclusively available for B2B shipment, internal deliveries or business-to-business exchanges requiring high level of reliability.

Meanwhile, still in Belgium, our bbox network of parcel lockers continue to expand strongly. We have now around 2,000 active units with 800 more contracted, most of them located in prime location and high-traffic venues like supermarkets. As announced recently with Lidl, we target to have 240 lockers by the end of this year, which represents nearly 10% of the targeted APM capacity.

We currently install up to 12 new lockers per day, and by the end of this year, we intend to have 2,500 lockers installed in Belgium. On our future operating model, one of the pillar is bulk rounds, consisting in dedicated parcels round in bulk, serving pickup and drop-off points, including lockers. Here as well, after a successful pilot phase, this model is now fully operational across all sorting centers, servicing 26 distribution offices and handling over 12,000 parcels a day. Before end 2025, we will extend to 29 offices with a capacity close to 21,000 parcels a day. This bulk model is set to become a cornerstone of our 2026 peak strategy capable of managing nearly half of the out-of-home volumes.

Let's shift to 3PL Europe. We are entering into a new chapter in leadership with Rainer Kiefer taking over as CFO of 3PL Europe and Staci Americas as of January 2026, succeeding Thomas Mortier, who announced earlier this year its intention to step down at the end of the year and will move into a part-time advisory role starting January 2026.

Rainer brings extensive experience from DSV and DB Schenker with a strong track record in transformation and scaling across Europe. This appointment reflects our ambition to accelerate the transformation of the 3PL business, strengthen our European footprint and drive value creation across the full spectrum of contract logistics, fulfillment and omnichannel solutions. With Thomas supporting this transition and Rainer taking a help, we are confident that the business is well positioned to execute the next phase of our growth strategy.

In parallel, the integration of Staci remains firmly on track. As cost synergies start to materialize in the second half of the year, we expect to overdeliver on our 2025 synergy targets. The 2026 targets are already secured, fully in line with what we presented to you at the Capital Market Day. In 3PL U.S., our Radial Fast Track rollout is ahead of our plan. 16 customers are already live and 2 more are set to launch in the fourth quarter 2025, each contributing an average ACV between EUR 4 million and EUR 5 million. The in-year revenue from Fast Track is already exceeding internal targets, providing strong momentum in U.S. and validating the scalable potential of the model.

As Chris mentioned it last time, there's still a lot of work ahead of us, and the first results are not always immediately visible in the P&L. This is notably the case this quarter in the U.S. That said, we are confident that we are on the right track and focused on doing the right things to deliver sustainable results.

We are now ready to take your questions. Again, questions each will allow every one of you to be addressed in the upcoming hour. Operator, please open the line for questions.

[Operator Instructions] The next question comes from Frank Claassen from Degroof Petercam.

My 2 questions. First of all, on Radial, minus 25% organically in Q3. Could you split the minus 25% between, let's say, the negative same-store sales and the impact of the churn? Is this, let's say, and what can we expect going forward? Is this the bottom? Or do you expect an improving trend in the coming quarters? That's my first question.

My second question on Staci. I understand that you don't break down the EBIT anymore or give the separate EBIT. Could you elaborate on how the profitability is developing? Is it according to plan? I recall that you had a sort of guidance or, let's say, target of 10% to 12% EBIT for Staci. Is that still valid? Could you elaborate on that?

Okay. Thank you for your 2 questions. Let's start with Radial. Indeed, we observed a severe decrease in the current quarter, which is mostly explained by the churn. Again, the churn coming that was announced in 2024 that has a full-year impact in 2025 and some churn that were announced at the beginning of the year, and then they're only materializing now.

I have one very specific example in mind where the customer said, we're going to stop 1 of the 2 warehouses in the first -- sorry, in the third quarter, so meaning now. This is part of the explanation and this is the bulk of it. Same-store sales evolution is not positive, but nowhere near what we observed in the recent quarters. If you recall, we had a terrible sequence of -- if it's in 2024, minus 4 at the beginning of the year, we peaked, wrong word, but it's a high amount, even it's a negative one, around 9% in the fourth quarter 2024.

The beginning of the year was also in negative territories, lower than the minus 9%. Now we are slightly negative, but it's not what it mainly explains the different impact on the EBIT. Simply why? Because the basis at which it applies is also by far lower. This being said, very important to notice that the variable contribution margin has been extremely high, again, sustained quarters-after-quarters, which is a positive sign. That's for Radial.

Sorry, and there was a subset in your question about what is the trend. The trend for us is twofold. We have launched in the first quarter of this year, our new product offering or service offering, which is Radial Fast Track that aims at offering solutions which are more flexible, standardized, easy to onboard type of solution, also very asset-light in terms of CapEx and automation, and it's picking up. It's picking up. We have signed 16 customers. We will onboard another 2 between now and the end of the year.

Also, important to note is that we will be onboarding customers nearly close to the peak, which is -- which shows how flexible this solution is to onboard new customers. Historically, it was taking roughly 12 months to onboard new customers at Radial because of the high level of customization in the processes and also in the IT systems. In terms of trends, we are optimistic about the product that we have launched because we see it's picking up. There is traction on the market.

On the other hand, we need to be realistic. When we are losing customers average size between EUR 50 million and EUR 70 million, while the ACV of the Fast Track typical customers is around 5. You can do the math as well as me. It takes time to be able to compensate this churn. We are also not aware of any new customers who have announced their departure in the near future. That's for Radial.

For Staci, it's going according to plan. Yes, it's going according to plan. The EBIT margin is a bit on the low end of the range this quarter, which is mostly explained by the fact that, as I said it, and again, we already announced that there is no news in that one that we want to operate on a geographical platform as one entity, one go-to-market. We have several territories, like Belgium, the Netherlands, U.K., Germany, Italy, where we're really operating as one. The local managers there, they look at their portfolio of customers, what is their needs, what is the solution, the operational solution available to serve those customers and also the footprint.

Some movement has been already initiated to relocate customers where they better fit with the requirement of the customer and also optimizing the footprint. It's also the case in the U.S. where one warehouse has been shut down and customers have been transferred to a new site.

In Germany, the former site of Staci Germany in Boston has been shut down and customers has been transferred to a former Radial site in Halle. In the Netherlands, in the Active Ants portfolio, we have decided to close 1 of the 2 warehousing in Nieuwegein and those customers have been transferred to Roosendaal. This cost -- these transfers demonstrate that we really want to operate at a local level as one, but it has, unfortunately, on the short term, some cost. There is cost attached to shutting down warehouses and to move customers. It's all for the better. It's to serve the customer in the best possible way and the most efficient way on those territories.

[Operator Instructions] The next question comes from Henk Slotboom from The Idea.

One question from my side. We've been hearing a lot about levies on Chinese goods. The French want to do it unilaterally. The Dutch have already said, they might follow the French maybe already as soon as the 1st of January of next year. Now personally, I don't think that EUR 2 per parcel will stop the avalanche of parcels to Europe. It will simply be relocated. What does the situation look like in Belgium? I don't know, if they have similar ideas to do things unilaterally. Well, could it be the case that you benefit from it if stuff is not flown at Schiphol Amsterdam Airport, but at Liège or Brussels instead provided, of course, there are no drugs over there.

Thank you for your question, Henk. Indeed, the situation in Belgium is that the government is thinking of putting EUR 2 per parcel levy. Now it leads to a lot of questions. There is also who's going to collect this EUR 2, which is a very practical problem, and there is no answer to that. Of course, we are not -- we are there to carry the parcels. We are not there to collect this kind of surcharge or taxes levies, whatever you name it. There will definitely be a question of implementation.

Interestingly enough, we had a discussion yesterday with one of our Board members who is coming from the Nordic, who faced a bit the same situation, and it took more than 12 months to find a technical solution to implement it. It's still an intent at this stage. There is no implementation date decided. Indeed, it will be difficult to implement.

Your comment about, of course, if other countries are deciding for the levies, let's say, in the Netherlands, France, Germany, it could lead to additional volumes in Belgium, but anyway, it would only be a temporary solution. At this stage, it's a very good question, but it's a big question mark when it comes to the implementation date and also the practicalities behind it.

Can I ask an add-on to that, Philippe?

Sure.

If I look at, for example, Austria Post or Polish Post and that sort of things, they've been entering alliances with, for example, Temu and Shein, who want to move part of their logistics and then I'm talking about warehousing and that sort of things to Europe. You have a fantastic network of fulfillment centers with Radial Europe, with Active Ants, with Staci. Is anything there being discussed with the large Chinese platforms?

Again, a very good question from Henk, as usual. There are movements indeed, we see the Chinese are coming closer to Europe. They are also thinking of implementing themselves in Turkey, which is also close to Europe. Indeed, it's a movement that we see in the market, but I will not comment any further at this stage.

The next question comes from Marco Limite from Barclays.

I've got 2 follow-up questions. One is on Radial U.S. Do we have to think about Q4 as the last quarter of year-over-year decline in revenues, and therefore, we should expect growth from next year? It’s the first question.

Second question, on Staci Europe, I mean, if I look at the Q3 numbers, it feels like that most of the decline year-over-year is coming from Radial U.S. At the same time, you've got 1 month more of Radial Europe in the base now. We basically have got 3PL Europe being flat despite growth and despite an additional month. On top of that, you are also talking about synergies being ahead. Just the math doesn't work for me why year-over-year, things are flat despite tailwinds from synergies and an additional month. If you can clarify.

Good. I'll start with Radial. No, in 2026, there still might be some decline in top line because there will be the full-year impact of the customer churn that we observed in 2025. Of course, the one announced in '24 will be over in '25, but there are some of them that will have an impact in 2026. This being said, what is really important for us to look at is the profitability and the cash generation profile and the quality of the portfolio.

I really want to remind what we said at the Capital Market Day, not only we want to go for the mid-market, not to have big customers dependent on 2 big customers are requiring huge investment in terms of customization of system, high automation. We want to move out of that one, and they will be gradually phased out. We want to reinforce ourselves our presence in other type of customers. ACV of Radial Fast Track is in the range of 5 million, so totally different, but also and equally important in my eyes is also the portfolio itself in terms of the number of verticals where we want to operate in.

In the past, it was focused on only 2. We really want to broaden that one, and we see first signs of result -- positive result going into that direction. Again, as I said, and again, I'm also repeating what we said at the time of the Capital Market Day, it's a long journey. It's not a 1- or 2-quarter journey. It's a long journey to move from big anchor customer focused or very capital intensive and focused on 2 verticals to something which is more nimble and flexible going forward.

Again, the math plays against us when it comes in terms of timing. There will be a delay between the moment we could see growth again to be totally honest, transparent, but also totally aligned with what our forecasts are. There is nothing -- no news on that one. There is no change of strategy. There is no acceleration or degradation of the situation. It's happening as we had planned to do it.

Can I just follow up on this one? Is there a risk that more or other large customers are going to, let's say, leave Radial U.S. in the future because you are moving type of strategy and type of service?

The risk is always there, Marco. This being said, interestingly enough, very interestingly, in our Radial Fast Track customers, we have 16 of them that we have new ones, but there is also 2 of them that were former old solution type of customers moved to Radial Fast Track. This also demonstrates that we have now with this solution, capabilities to address their demand.

Europe or 3PL Europe?

Yes, I didn't forget. Don't worry. On Staci, the math add up, but there were maybe -- we need to remind all the elements of the equations. First one and is the vast majority, it's all about the costs relating to the optimization of the operations in different geographies in the U.S., in the Netherlands, in Germany, that explains the chunk of the fact that indeed, when you do the math, you don't see a growth when you come to Staci. There is also, but to a lesser extent, some softness in certain territories, and I'm mostly thinking about France, where the same-store sales has been negative in the quarter.

On the other hand, as a positive note, in France, we are not seeing the departure of any customers.

The next question comes from Marc Zwartsenburg from ING.

I also have a bit of a follow-up on Radial U,S., because I think you mentioned you will also see a significant decline still in Q4, and that fits also with the story with the mentioning of the churn of the larger accounts. I think originally, there was a sort of a guidance of minus 10% to 20% a bit on the full-year top line, which would indicate still, say, mid-single-digit double digit, let's say, 15% maximum year-on-year decline if you plug in, say, minus 20%. Is that still an applicable guidance that we're looking at still a double-digit decline of around 15% for Q4? Just to get a bit of more feel on the movement of Radial because it's quite big numbers we're talking. That's my first question.

You want me to take it immediately. It's more in the range of 15% to 20%.

Q4, we're talking about?

Yes.

Then on the parcel volumes, so the working day adjusted number is plus 4.4%. That's a slight improvement from Q2, but how do you -- was that stable through the quarter? How are you looking to the big season? Do you already have a bit of an indication on the big events for Q4, what you expect there? Because I think also here, the guidance was more like a mid-single-digit to high single-digit growth. It looks now more like on the low end of the mid-single digits. What are your thoughts there? What kind of trends do you see?

In fact, there is one very important element. It's not that it's totally new this year, but we see -- and typically in Belgium, we see more-and-more before the peak was very -- excuse me, very focused on 1 or 2 days. By the way, in Belgium, we have the peak, but with also Christmas and Sinterklaas. In fact, it's the month end of November and the month of December, which are, in fact, higher months. Unlike what we see in the U.S., when you see the peak, it's a couple of days. It's more spread all over that period, combined with the fact that we see more-and-more our customers, the one selling directly to the customers or through platform, offering throughout the year, promotion, discount and this kind of stuff. It's very difficult to predict how it will look like. But for sure, we see it's become that higher activity is spread over more days or weeks than it was in the past.

Do you see September, October trending higher than the 4.4%?

In that range.

It's rather stable. That's currently the trend.

Yes.

Then lastly, I know you're not disclosing it, but could you give a bit of an indication of the EBIT contribution of Staci, because it's still important to model that properly also through the quarters because we saw quite a miss on the consensus on particularly the 3PL division and whether that's Staci or whether that's Radial U.S. or whether that's the extra cost, it would be helpful to have a bit more granularity. Can you help us there?

I can help you in repeating what I told you is that the big chunk of the fact that it doesn't grow is linked to this optimization, cost optimization, operational optimization, which is the majority of the variance and the rest coming from same sourcing. You could count on.

Staci have no growth on the revenue side and a bit of impact from the fine-tuning of the optimization of the warehouses. Is that how we should see it?

Yes.

How long will that take that optimization of the warehouses till when should we pencil that in that the margins may be a bit more at the low end?

I would say -- in fact, the more the people will start working together and depending on the customer need, it might lead to additional ones. This one were the obvious one. I would say, in the next 2 quarters, I'm not expecting any site closures or major site closures now, but It's an ongoing process.

For 2 quarters -- yes, exactly. We will see a little bit of double running costs in the meantime. Then after that, we should see the efficiencies coming through.

I hope it will come faster, but it's not to be excluded that we might decide here or there to restructure on another warehouse. There is one that was already planned in the U.S. By the way, it was a journey, nearly 3 years journey at the time of the acquisition of Amware by Staci, they looked at the portfolio, and we were totally aware of that because it was an element that was shared with us at the time of the acquisition. They knew that they had a plan to restructure 3 warehouses. They have done 1 in '24. There is a second one in '25, and there will be the third one in '26.

Then thinking about '26, we should see a higher EBIT than what we probably will see in 2025. Is that?

Yes.

The path towards your long-term outlook to see a higher EBITDA?

Don't drag me into a budget discussion and a guidance for '26. We will come to you on that one when we publish the Q4, but I give you some element. I have the impression of painting an impressionist painting with dots of colors, some quantities. I'm doing some quantities on the U.S., but don't drag me where I don't want to be dragged.

It's the time of the year budget.

The next question comes from Marc Zeck from Kepler Cheuvreux.

Two, if I may. First one on -- again, Radial U.S. Could you give us a bit of more color or feeling about, let's say, the top 5 customers at Radial U.S., how much of sales is that broadly speaking? For these customers, is there kind of a contract renegotiation period upcoming end of '25 or early in '26? Or is these contracts mostly locked in for a longer period of time? That would be my first question.

Second question also on, let's say, the broader U.S. business. I believe we've seen quite a bit of pull forward buying into the U.S. imports for the first 9 months of the year were pretty good, I believe, into the U.S., but we see container imports or container arrivals at U.S. ports dropping quite sharply now in Q4. Is your business in the U.S. mostly related to ocean freight? Should we expect a bit of a negative business development on same-store sales as well for Radial U.S.? Or are you kind of air freight exposed from a product category where we still see quite good numbers, I would say, in the overall market? That's my 2 questions.

Okay. Let me start with the second one. It's a bit of both. Of course, all your comments are valid. We are exposed to air freight and ocean freight. I give you a very practical example. In one of the customers that we have onboarded with Radial Fast Track is a fashion brand coming from Australia, who wanted to be implemented in the U.S. They wanted to have fulfillment there. We are hearing from customers, some other customers that they want to be in the U.S. rather than systematically air freighting stuff.

By the way, it's no different than what we are seeing with the Chinese platform now. Let's refer to the comment or the question earlier on the Chinese who want to be implemented -- to implement themselves in Europe to avoid tariffs is the same that we are seeing in U.S. We have a very practical example, as I said, of one who really has decided to come physically in the U.S., and there, we have definitely a role to play and a good service offering.

When it comes to Radial, I also want to -- do we have big renewal in the pipe for the coming quarters? The answer is no. We already have renewed some of them in the course of 2025. There, I want to reiterate something which is extremely, extremely important. In the past, what we saw at Radial, especially with the big customers, the situation was the following.

They were asking for a lot of customization, a lot of automation that typically are passed on to the customer over a period of 6 to 8 years, while we were having contracts of roughly 4 years. At the same time, we had also our warehouses locked for a period of 7 to 8 years. In many instances, what we saw is the customer left or didn't renew the contract, and we were there even if there was some provision in the contract with unamortized portion of own developments and the liability linked with these warehouses.

Since the last 18 months, all renewal or all new contracts signed are [indiscernible] with the lease of the warehouses. It's also important to look at what could be the impact of the customers. In fact, the Radial situation we are in right now is absolutely not the same as the one we saw years ago.

Ladies and gentlemen, there are no further questions. I will hand it back to Philippe to conclude today's conference. Thank you.

Thank you very much, guys, for your intense question session. Antoine is always there to do the follow-up with you in the coming days and weeks. Let's stay in touch. Next time, we'll see, we'll be able to demonstrate that we have executed the peak in a qualitative and efficient way. Thank you very much. Have a good day.

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