CTT - Correios De Portugal, S.A. Aktie

Hello, and welcome to CTT's First Quarter 2026 Results Conference Call. This event is hosted by Mr. Guy Pacheco, CEO of CTT; and by Mr. João Bento, CCO of CTT. Please note that this conference is being recorded. [Operator Instructions] I'll now turn the call over to Mr. Guy Pacheco, CEO.

Good morning to you all, and thank you for attending our first Q conference call.

I would invite you to start our presentation on Slide #4, where we show a quarter of resilient growth with 4.3% growth with our growth areas performing well, Parcels and Banco CTT showing growth acceleration. Although as anticipated, our profitability was impacted by a number of contractual impacts, namely the Middle East crisis and new regulation introduction in Parcels, concentrated peak volumes that spilled over to the first quarter and the storms that affected the center of Portugal due to the Hurricane Christine.

And with that, our EBIT declined 35.3% year-on-year on a comparable basis. These events were contained in April and April is showing strong signs of improvement with SEP volumes acceleration accelerating. E-commerce Solutions recurring EBIT also improving sequentially and the public debt placements showing signs of strong recovery and should improve further with the revision of the limits that the government announced last week.

On Page 5, we can see the e-commerce Solutions volumes, where we continue to see strong volume evolution with another quarter of acceleration on growth. We posted a very strong 14.3% in the first quarter. And April shows strong signs of improvement with almost 30% growth on April. This growth is supported mainly on non-Asian customers with strong volume acceleration. And with this, we continue to see a very strong Iberian structural opportunity that remains unchanged since the last quarters.

On Page 6, we can see E-commerce Solutions revenues growth that remained very solid. SEP revenues increased 14.4% on the back of strong volume growth that we saw. E-commerce Solutions revenues consolidated growing on a pro forma basis, 10.2% -- the non-SEP revenues, namely on CASA were impacted by discontinuing of low gross margin business like handling and the impact of the introduction of the new G4 regulation in March.

Our margin had the impact of these specific events. And as such, we had a challenging margin in the first quarter. Regulation, peak volumes and Middle East crisis introduced volatility in the volumes throughout the quarter as shown in the inter-month detail that we shared on the previous slide, and that posed a number of capacity management issues that affected the margin in the first quarter. All those issues were resolved and as such, profitability in April is showing strong signs of sequentially improving and normalizing. With that, I would pass you over to João to take us through the public debt numbers.

Thank you very much, Guy. Good morning, everybody. As we did in the last call -- last results call, we start this another section with our growth and diversification areas. As you can see in this slide on the left side, we show the performance of public debt placements.

This first quarter performance was impacted by two main factors. So the lower footfall in our stores due to the several storms that affected Portugal during the quarter that led to several stores being closed for a long number of days and also a demanding of this quarter versus the quarter of last year when we compare because the quarter of last year was still benefiting from the cap increase that you see in the quarter -- the last quarter of '24 and also the improved remuneration commissions.

The good news is that we already saw a sequential improvement in April. And in addition, the upgrade limits at the end of April already translating into a strong growth in the first days of May. We can highlight that the first days of May, we see 2x of -- sorry, public debt placements in a daily basis. And even in our app, we see a best day ever like a record in our app in public placement. On the left-hand side, we see our diversified services we are doing. So the health plans and insurance. Here, we highlight the health plans that even with the lower footfall in stores, we see the customer base continue to increase. Both health plans and insurance products are evolving very positively and helping us to build the customer portfolio with recurring revenue and great predictability for CDP.

On Page 8, we see the revenues decline from EUR 128.7 million in this quarter versus EUR 132.2 million in the last quarter. This performance reflects two main factors. So the decline in Mail that is a well-known trend that we are managing with improving in pricing and with managing churn with the big customers. But more important than the reduction in revenues from the savings certificates that I explained before, but it is not a trend. This is a specific impact that we already sold or is already sold and we are seeing already a positive trend.

In the other hand, positive in this chart, you can see Business Solutions and Payments, another important pillar in our diversification strategy continue to grow. This area continues to support the overall performance of this business unit. In terms of profitability, recurring EBIT in -- well Services was impacted by lower revenues from the saving placements. Recurring EBIT stood at EUR 4.2 million in this first quarter versus EUR 7.9 million in the last quarter, represent a decline on 46.6%. And the EBIT margin was 3.3% on the first quarter versus 3.0% on first quarter of Nevertheless, we maintain a positive outlook on this than others because continued growth of business solutions, and we see -- and we already see this recovering on savings placements in April and the first days in May. And with this, I pass to Guy.

Thank you, João. On Page 9, we can see Banco CTT operations. The Banco continues to accelerate sequentially its volumes growth, showing early signs of success of the new strategy that we have been implementing with volumes growing almost 14%, especially on the loan book with growth of almost 16% and off-balance sheet savings that continue to overperform with 23.2% growth.

Banco was one of the -- or the bank that grew most within the retail bank in Portugal for the ones that post results. So very, very strong performance here. Current accounts continue to grow 3.5%, reaching almost 712,000 customers. On banking revenues, we continue to see net interest margin improvement that now stands at 2.2% and the banking revenues driven by net interest income and commissions reaching almost 9%. In terms of recurring EBIT, a flattish performance or a marginal improvement as we continue to invest in reinforcing our commercial and digital capabilities to refuel or to reignite the bank growth going forward.

On Page 11, we can see the beginning of our financial review with our key financial indicators. Please bear in mind that these are not pro forma, so include the impact of the acquisition of Casella, and we see 14.1% growth on revenues. Our operating costs, as mentioned, with the additional costs due to capacity management and impacts of weather growing 17.7%. -- recurring EBIT reaching EUR 15.3 million with a decline of 24%. And our net profit was EUR 4.5 million with 17.6% decline. Our free cash flow was heavily impacted by seasonality, and that is due to the repayments of the capacity installed to face peak and the additional -- the CapEx that normally is back-end loaded. And as such, we saw this reversal that we expect as previously commented to reverse during the year.

On Page 12, we see the revenue growth continues to be pulled by a solid performance of e-commerce solutions, where we see SEP with very strong performance and overall growing 10% or EUR 15.1 million. On Mail, we saw the decline of financial service placements that accounts for EUR 3 million of this decline. The remainder is the net effect of good performance on Business Solutions and still decline on volumes of Mail. Banco CTT driven growth of EUR 3 million, driven by volumes that drove net interest income and commissions and overall growing 4.3% on a pro forma basis on the first quarter. Our e-commerce will continue to be the catalyst or the core catalyst of our revenues and accounting more or almost half of our revenues in the first quarter.

On Page 13, we can see the evolution of our costs that, as mentioned, were mainly driven by temporary e-commerce capacity challenges. E-commerce solutions grew 19.8% with high volatility due to supply chain disruptions and peak season 2025 spillover to January due to an abnormally concentrated peak around Christmas required a significant additional effort to maintain quality. And as such, we continue to prioritize quality for our customers because we think that is what protects value in the long term. And this have contained impact on the first quarter.

Mail Services declining EUR 0.8 million, showing lower activity in Mail and Financial Services with some cost impact resulting from the storms in Portugal and the bank a EUR 2.9 million increase due to the investment on growth and commercial expansion. Our core cost of risk now stands at 1% with a slight increase from 0.9% last year. Overall, our revenues grew 7.5%.

In Slide 14, we can see our recurring EBIT bridge, where we see a first quarter showing compression in our margins due to these later events where we see early signs of recovery with a strong April in terms of operations. Our EBIT is declining 35% on a comparable basis due to these impacts, namely on in Commerce Solutions, where the capacity management issues and regulations impacted the performance with EUR 4.7 million decline. And in Mail Services, the impact of lower public debt placements also affecting performance with EUR 3.7 million of decline. The bank showing a flattish performance in line with guidance and with the phase of investment that we are now undergoing.

The recurring EBIT performance is set to improve in the rest of the year. The second quarter started strongly with parcel volumes also posting strong performance and recovering on profitability. On Mail & Services, we see Financial Services benefiting from not only higher interest rates, but especially from the increase on limits. The government increased limit is on the current series from EUR 100,000 per person individual limit to EUR 250,000. And we -- as we mentioned, we see early signs of elasticity due to those changes. And the net interest margin in the bank will have tailwind from interest rates, but the investment will continue as guided.

In Page 15, we see cash flow and the net debt. Our leverage ratio due to the working capital performance now sits at 2.2x still below the self-imposed limit of 2.5x. We expect working capital normalization throughout the rest of the year that will help deleveraging that coupled with the proceeds from the JV with DHL that we expected to close this month, we see leverage immediately below 1.7 and with the reversal to improve further throughout the year. And with this, I would move to my final remarks.

We continue to believe firmly in the future growth of this company, continue to building upon our strategic foundations. We have been building this commercial franchise, strong commercial franchise throughout Iberia, and that continues very strong, especially in the dynamics of revenues, where we continue to see resilient growth in e-commerce solutions. The first quarter was affected by anticipated headwinds with limited impact throughout the quarter, and we see April trading showing strong signs of recovery.

For the rest of the year, we see normalization underway with this recovery on margins of e-commerce and continuous strong volumes. Mail Service is stabilizing on the back of recovery and better performance of financial services with the revisions of savings certificates. And Banco CTT will continue this path of accelerating growth with no change in our strategic stance in terms of investment.

With this, we are reiterating guidance, notwithstanding a volatile environment in regulation and increasing execution risk, but we remain committed to achieve our full year guidance that I remind it's a growing guidance. We delivered -- deliveries to be driven by e-commerce execution throughout the rest of the year and tailwinds on financial services. We expect, as mentioned, our leverage trajectory to improve after DHL closing in May.

We started very strongly in our second quarter. We see the second semester also with strong fundamentals, but subject to the new regulations. We are preparing according to our scenarios, but we'll need to adjust according to reality, but we remain very committed to achieve our full year guidance. And with this, I would be ready to take your questions.

[Operator Instructions] We are now available to take your questions. Our first question comes from Joao Safara.

Welcome. So I mean I have 2 questions. I think they are related. The first one is just if you could help us understand or try to identify the several impacts you mentioned. You mentioned peak season spillover, volatility, volatility weather. So I don't know if there is a way to sort of give us an idea of exactly what are the impact -- what is the contribution of each of this impact? And also, the question here is also because it seems that -- and we've seen that as well in -- it's true with different perimeter, but we've seen that as well in the first quarter of '25 that there was because of quality, some deteriorations of margins.

So Here, basically, what I wanted to understand is a bit if this is something that we should expect going forward in the first quarter in the sense that, okay, I understand weather. So definitely, that is a one-off, but maybe the other impacts might happen on a recurrent basis. So a bit -- this is my question. And so I don't know if you can help me understand this a little bit better. Then just on the performance of Cacesa, I mean, is it fair to assume that Cacesa did relatively worse than the rest of the business? And the reason why I'm saying this is because we've seen we've seen some volume growth in the quarter, which was quite strong, 14% that should have triggered some operating leverage. And then, I mean -- or maybe it was just that the base for Cacesa's margin in the first quarter of '25 was too high. I don't know, if there's something there that you could also help me understand a little bit better. And that's it.

Thank you, Joao, for your question. I will start with the first one. So you are right when you see -- when you say that there is some seasonality effects on the first quarter, and it's easy to explain why that is -- the market is still very exposed to Asian volumes. And on the first quarter, we have February typically with the Chinese New Year. And normally, we have very low volumes around those weeks because production in China stops and as such, that implies -- that impacts the supply chain, and that is the reason why the first quarter normally has lower margins because it's difficult to just for 1 week or 2 adjust capacity to then resume with significant volumes uplift in March. And as such, normally, we have lower margins in the first quarter. That trend this year was aggravated further by specific impact. That was the peak and the war. And that's why, because we had in every month, so in January, February and March, a high volatility from 1 to 3x the volume week-on-week.

And that poses tremendous challenges in terms of managing capacity because when it's low, you are under capacity and having margin loss because of that. And when it grows, you need to put extra labor and hire people at higher costs in order to face that extra growth. On average, growth was resilient, as you saw, but with this volatility impacted. And that volatility was driven in January because of the spillover of the peak. February normally is slow because of Chinese New Year and no news there. But when we were expecting a strong recovery after the New Year in China, as every year happens, we have the Middle Eastern war crisis that impacted all the flows that come through the Middle East, and that took some time to recovery. Luckily, the supply chains were agile enough recovering, but we have a huge amount of volumes coming on the end of March that once again impacted margins.

So good news is the business remains strong. We had this volatility that impacted margins temporarily. As I mentioned, we continue to protect quality of our customers in order to keep loyalty of them, and that's what we see in the long term, generating more value. But unfortunately, we had these impacts on the quarter margin. In terms of the storms, they were more contained on the Mail Services impact, not on the Parcel division.

Cacesa, in terms of margin, in terms of top line, we discontinued some legacy business they had from their past in Iberia. Remember that Cacesa used to be an Iberia division, and they had some handling services that were noncore and low margin that we discontinued throughout last year. But in March, the Spain Customs Authority was the first in Europe to introduce a new EU regulation that is G4, and that posed a number of problems in the Madrid airports, not only for us, but to every customs broker in the market with the inability to clear volumes that by -- due to mainly constraints on the customs authority side in IT that was unable to respond to the clearance requests. And that had impact on margin in revenues and in margin because we had more costs of storage in the airport side of -- due to that. Since then, things are improving as normality with tax authority resumed, and we are seeing things going back to normality.

Our next question comes from Filipe Leite at CaixaBank.

[Technical Difficulty] I have 4 questions, if I may. First one is regarding DHL, the joint venture with DHL because you -- as you mentioned, it's expected to be closed this month. Just to confirm what will be the net proceeds, the final net proceeds for CTP? And also if we can already assume that DHL will not take any stake in Cacesa. Second question on e-commerce solution because you mentioned profitability improvement in April, and he was just explaining that. But in terms of numbers, can we assume that the EBIT margin in April still already close to the almost 10% reported in second quarter of last year or the sequential improvement, as you mentioned in the presentation, means that probably in second quarter, we will still have an EBITDA margin for this division below the close to 10% reported last year.

Third question also on e-commerce and it's actually a clarification because you mentioned new regulation affecting parcel volumes. But just to confirm that this new regulation will be implemented only in June or July, right? So my question is just to understand how this regulation that will be implemented only before summer already impacted the volumes in the first quarter. And last, a clarification on Banco CTT and on recent news that apparently, you hire a financial adviser to evaluate your options on the bank. Just to confirm how is the process and if there is any official process open to divest part or the entire stake that you have in the bank.

So Filipe, thank you for your question. Starting on the JV. So it will be closing on the next weeks. We still cannot confirm the final number, although we are not expecting material differences from the number we announced. We announced a number that is a non-GAAP basis, and we'll have a cash adjustment according to the accounts of April. We are still finalizing that number. So it's still -- but we are not expecting a material adjustment due to that. Regarding the margin, we see a sequential improvement. The last quarter margin was close to 10%. We see conversions to that number. Still early days to commit to a specific number, but we see signs of normalization.

In terms of the bank, I won't comment news, but I can say that we didn't hire any adviser at this point. So nothing else to comment on that. On regulation, you are right to ask that clarification. So from 1st of July onwards, we'll have the de minimis removal, but that is encompassed in the -- what EU calls the European Union tax reform, where there are several changes. Those changes are not material in terms of taxation or any kind of levy charge to the goods like it will be from 1st of July onwards. But there are changes in the amount of information exchange between the platform, the e-commerce platform and tax authority. And that is increasing materially because one of the aims of European Union is also to increase transparency in what arrives and enters the European space.

And as such, the number of information collected increased materially, and that's what driven the chokes on the IT systems from custom side because the number of information increased by almost 100x per parcel. And those throughput issues posed temporarily issues on Cacesa business in Spain. That is, as you know, the big chunk of Cacesa numbers and profitability.

Just if I may, a follow-up on DHL.

On Cacesa, right, I forgot to mention that. Cacesa will not be on the perimeter.

We continue to take questions. [Operator Instructions] As we don't have any other questions at this point, I will turn now the call back to our CEO, Pepe Sek, for additional and closing remarks.

Thank you for attending. We have a new management team in place. We are very excited to take on this new challenge. We see encouraging signs of recovery and an encouraging start of this quarter with our April numbers, and we remain very committed to deliver our commitments to the market. Thank you all, and see you next time.

[Audio Gap] Because 2025 marks the end of our strategic cycle. We have announced ambitions -- financial ambitions for 2025 back in our Capital Markets Day in 2022 because it's also the end of the term of the present Board of Directors and my own ownership of this company, we decided to include this Slide #4 with a number of remarkable points in our journey. But moving to Slide #5 and starting with the business of the day. We closed 2025 by -- with a very steady growth, both on revenue and EBIT, a cycle that comes back from the early days when this management team joined CTT, but more than that -- more than a significant growth along this cycle on revenues and EBIT, a very significant transformation.

And we see a reasonably stable mail revenue profile throughout these years while the company was growing at around 11% on revenues. And on EBIT, a very radical shift in the sources of value creation since the company was a mere mail company with an early bank that had been born a few years before back in 2018. And now we are mostly an e-commerce logistics player, whereby the main contribution for revenues and for EBIT comes from that. Moving to Slide #6. We highlight the achievements of this -- the end of the strategic cycle. Just to recall the ambitions, the targets that were set back in '22, we should close 2025 with revenues ranging from EUR 1,100 million to EUR 12,500 million or 7% to 10% annual growth.

We have indeed exceeded that target by posting EUR 1.288 billion for the year as a consequence of CTT having been the fastest-growing commerce logistics play in Iberia throughout the cycle. Then our second ambition was related with margin, whereas the target here was to reach an EBIT in 2025, recurring EBIT between EUR 100 million and EUR 120 million, again, with a very significant, almost doubling the ambition on revenues, growing between 14% and 19%. We ended up 2025 closer to the right-hand side of this range with EUR 115 million, which was exactly the value we have guided the market for. And a third objective, very important, regarding profitability of the bank, where again, we have -- by having posted a return on tangible equity of 13.2%, we have exceeded the announced range that was, as you might recall, between 11% and 13%.

All this in a combination that we classify as optimal between shareholder remuneration and the capacity of growth that exactly within this cycle, we combined significant investment on CapEx for organic growth, capacity expansion, investment on IT expertise, but also on nonorganic growth. While closing the overview about the cycle, I would invite you to moving to Slide #8 for a deeper analysis of the year. So 2025 exhibited a resilient organic growth with revenues up 8% and recurring EBIT 16%, part from organic, part nonorganic, as you know. That's why in the bridges that we show in the slide, we have decided to include what would have been the pro forma numbers if we had acquired Cacesa in the beginning of the year.

So in a like-for-like organic growth, this represents an 8.4% growth on revenues, but indeed, the real growth of 16.3%. And moving to EBIT, these numbers amplify significantly, more than doubling or almost doubling in revenues. 16.2% of additional EBIT and 35.3% if we consider the actual growth on EBIT. The profile of growth is, of course, mostly on -- in terms of revenues. The highest portion of growth was obviously on e-commerce solutions, but also on EBIT this year, we have posted a very interesting growth on the margin of Mail & Services. With e-commerce solutions, competitiveness and growth profile enhanced, of course, by the fact that we have included Cacesa, which indeed makes CTT one of a kind in Iberia for e-commerce logistics. I will come back to this point later in the presentation.

Moving to Slide #9, deep diving on the analysis of e-commerce solutions. We have resumed in the quarter double-digit growth in e-commerce volumes. As you might see, we started the year at 15% growth quarter-on-quarter. I'm sorry, year-on-year for the quarter, then it slowed down. And as guided, growth in volumes grew again in the fourth quarter, 11.3%, hence, the double-digit growth. And this, in a way, is a consequence of an Iberian e-commerce outlook that remains quite competitive. And therefore, we have produced this growth on revenue associated with the growth on volumes.

Moving to Slide #10, a slightly deeper analysis on both revenues and recurring EBIT for Parcels. We have posted an 11% growth on the year for Parcels organically, but then including the inorganic effect of Cacesa, a 38% growth, numbers that are much more impressive when we're moving to the right, see the contribution of Cacesa with implying a significant growth on the generated EBITDA of almost 60%. Again, this is a consequence of CTT being a one of a kind. And in fact, with Cacesa, we may state that we create more value per object handled. And therefore, so as a summary, we have shown significant growing EBIT -- recurring EBIT while investing in expansion, capacity and quality. So a very good year for E-commerce Solutions, but also a very good year for Mail & Services. And for that, I will hand over to Joao Sousa to guide us through the next slides.

Thank you very much, Joao. As you can see on Slide 11, as previously mentioned, CTT operates across 3 segments: E-commerce Solutions, Mail & Services and Bank. On this section, Mail & Services, we like to highlight the increasing relevance of services in this segment. As you can see, financial services -- on financial services and retail, public debt placements increased approximately 147% normalization developments compared with the previous years. I would like also to highlight that in 2025, we marked the consolidation of the app for digital that around 10% of the operations are already conducted in the app. And maybe just also to give you the number on the first quarter of this year, it's already more than 12%. So that's a good number.

And the customer base on the app are double in 2025. So this means that we are bringing new customers to [indiscernible] by the app, new generation, lower ticket, but more frequency and more recurrent on this. As you know, also on retail and financial services, we are very concerned to developing, selling services on this network to have a recurring in revenues. And as you can see on the right side of the slide, health plan customer base increased more than 23,000 users on this year, a very good number. But also, I can tell you that we have a strong growth in insurance distribution, particularly driven by the health insurance that the product that we launched in the last quarter of 2025. On the next slide, coming for Mail, as you can see, we see volumes decline 8.6% when we look for '25 compared with the last year, reflecting ongoing structural trends.

However, mostly of this decline was offset by the price increase spread item. And -- but importantly, as you can see also in the right side of the slide, Service segment showed a strong growth, enabling the overall business area to grow year-on-year. As you know, on this area, we are developing business solutions and payments, also financial services. And the idea is putting this business area growing that in a way, compensate the decline of mail. And this year, we already saw that with this increasing 1.5% compared with 2024. On Slide 13, even with this decline of Mail, we are still working on profitability which continue to restructuring the central structure and also operations in all the areas we have. And with this, we see EBIT reaching EUR 32.8 million in '25, this is growing -- sorry, 46.3% against last year. And that means an EBIT margin improving to 6.3% comparing with 4.4% in 2024. These results demonstrate a clear operational discipline that this company showed in the last years. And with this, I pass to Guy Pacheco.

Thank you, Joao, and good morning. I will start in Page 14 with Banco CTT's operational highlights, where we see a very strong growth once again in business volumes growing 12% year-on-year in the quarter with a special highlight to the off-balance savings that grew 26.1%. That also drove banking revenues that grew 23%. In the quarter, our net interest margin stood at 2%, a slight decrease year-on-year. In terms of profitability, a small decline of 4.3% as we continue to invest preparing the next growth phase of the bank.

Also, the bank delivered all the commitments it had promised for 2025, where you can see all those green tick marks. We delivered the targets for business volumes, current accounts, return on tangible equity that stood at 13.2% and also in profit before tax. 2026, as said in our Capital Markets Day, it will be a year of focusing and accelerating the business of the bank. I'll move on to the financial review, starting in Page 16. These numbers include the inorganic effect of Cacesa. And as such, we see a strong progress in all the metrics. I would highlight the net profit for the full year, where we grew 11.4% and a strong cash flow generation at the consolidated level, be it on the quarter with growth of 19.4%, but also in the full year with 13.2% growth.

Now moving on to our revenue bridge, where we continue to see e-commerce as a core catalyst of our performance. In the full year, it already accounted for almost 49% of our revenue. So this very marked shift of the profiles of our revenues. In the quarter, contributing with additional almost EUR 20 million, plus a growth of 11.3%, driven by volume growth in the Mail and Services, as Joao shared, a flattish performance with Business Solutions and Services offset by Mail decline and the Bank growing 23% in Banking product.

In the Slide 18, we can see our operational costs that grew 16.4%, mostly coming out of our E-commerce Solutions division with 11.6%, slightly above our activity as we saw unit cost increase due to the investments on capacity to face the peak season. In Mails & Services with a decline of 1.2%, where we continue to implement efficiency and restructuring measures that are bearing results. The bank increasing EUR 8.1 million in the quarter or 31.7%. This is a factor of not only increase of cost of risk that now stands at 0.9%, but also in the investments in staff -- commercial staffing and IT in order to secure the next phase of growth.

In Page 19, we can see our EBIT performance in the quarter with a very resilient growth of almost 11%. Our margin stood at 10.9%, and that was driven by Mail and Services and e-commerce. E-commerce growing 3.9% with margin compression with a focus on quality during the peak season. The Mail & Services division growing 36%, driven by the performance of services and mail efficiency measures and a flattish performance on the bank, where we continue to reinvest resources in future growth. And with that, I'll move on to free cash flow performance.

In Page 20, we see our consolidated free cash flow that stood in the year in EUR 83.6 million. And our net financial debt now stands at EUR 7.9 million at the year-end. Page 21, where we see the same numbers, but excluding the consolidation of the bank, where we see our leverage ratio finishing the year at 1.9 following a very strong cash flow generation in the fourth quarter. This is below the 2x as we guided the market. The free cash flow for the year, excluding the bank, stood at EUR 46.9 million, and that's as we see the leverage growing from 1.6 to 1.9. That is a very modest increase if we take in consideration that we invested EUR 90 million in the acquisition of Cacesa and still concluded EUR 14 million of the remainder of the buyback announced back in 2024. And that shows the strong generation of cash of the company and solidity of our balance sheet. And with that, I'll hand over to Joao Bento for his final remarks.

Thank you, Guy. If you move to Slide 23, it's a new slide that we decided to include because as I'm going to explain, we are somehow guiding for a weaker first quarter result even with the eventual decline year-on-year for the quarter. But the overall message that I want to stress is that we are posting a final year growth guidance despite the first quarter being marked by significant external events. And I don't want to guide you through all the details, but basically 3 classes of events. The first one, the obvious Middle East geopolitics that became aggravated by the recent war with Iran, where we are seeing supply chain disruption with impact on volumes and, of course, impact on costs.

On costs, mostly driven by fuel cost impact that for line hauls and last mile costs for us are extremely important. But on volumes, we have -- well, less bad news. We have a short-term effect because we see prenoticed volumes remaining high, meaning that people keep buying. Our e-commerce -- large e-commerce clients out of Europe keep pre-noticing significant volumes. But then these objects don't reach Iberia. They are somehow through slower routes, land routes, sea routes, some of them stuck in intermediate airports. So this disruption in logistics are returning.

The good news is that this is not lost business. This is just delayed business. So with a short-term impact, that is the less serious of the aspects that I've seen. And a final note on this volume aspect, which is we see a very strong growth observed in non-agent clients. This is not a replacement. This is in our view. This is not, of course, because of the geopolitics. This is because we are becoming a more reliable and better perceived operating in Iberia and some of these clients are growing significantly. For example, with Zalando now posting 5x more objects than they guided us when we started relation with them recently.

The second line of concern is regarded with past events during this quarter. We had this hurricane Kristin in Portugal and in Southern Spain, unfortunately, very well known for all of us. We had 2 significant negative effects with this. One, significantly lower walk-ins in our retail stores and this lower volume, of course, implies lower business and significant operational disruption, abnormally high operating costs to maintain operations and quality of service. And this was not only in Portugal, which is probably better perceived by some of our analysts, but was also significantly -- very significant in Southern Spain. With weather stabilization, we expect this to return to normal, although we are now -- we have now been receiving warnings of hopefully much smaller storm reaching the Portuguese coast.

And the final line is, in fact, related with the end of the year and some spillover to January. That then will have an impact on first quarter. We had a very concentrated peak season in 2025, which has 2 effects -- had 2 effects. One, the ramp-up was, I would say, less efficient than ideally because we were reading capacity and volumes were -- came a bit delayed. The volumes that were processed were very good. We've seen that before in the presentation. But then because of the concentration, we had, as always, the more volatile and the less smooth is the evolution of volumes, both upwards and downwards, we have to deploy significant effort to maintain quality. And unfortunately, especially in all the Mediterranean areas, Southern Spain from Malaga and the Luzia region, Valencia up to Barcelona, we had significant costs to be able to keep quality.

Just to give you an idea, in Malaga, our -- the demand for our services multiplied 2.5, 2.5x because the market basically failed and CTT being the most reliable operating company over there. And so this had very significant impacts on costs. And this effect spilled over to January because it took us almost to the end of January to be able to process all this backlog that in a way represented volumes being processed without -- and the due cost without the corresponding revenues.

Finally, because last mile capacity is being adjusted and it is adjusted already, and we are seeing already favorable impact on unitary costs, namely on handling. This is an effect that -- well, it's here, it's registered, but fortunately, is resolved. And with this, I would invite you to move to Slide #24, where again, we are issuing a growth guidance, notwithstanding a high volatility context. And now with less detail, the first aspect is that the number is, in fact, at least EUR 125 million. The introduction of new customs, moving to expectations and risks that somehow framed the reason why we have posted this guidance.

The introduction of new customs regulations will create future growth opportunities for Cacesa, both possibly on B2B, but certainly because where we see the market evolving and the national authorities in Europe evolving to and moving to this will represent for sure, as predicted and many times shared with you additional services and more expensive services for the customers. So good news for Cacesa. But in the short term, we are expecting some penalization on customs in the short term. And I think that we could probably resort to what happened back in 2021 when the VAT de minimis ended well, the customer experience was very, very -- well, very much the same.

People kept buying with the same ease, although paying VAT, but just because there was a change, we saw short-term volatility that then resumed. And this is how we are looking at volumes regarding the introduction of these new custom regulations. We expect high single-digit to double-digit growth in CEP in a scenario of limited impact of the new customer regulations that will, and let me repeat that, get a favorable kick in for additional services for Cacesa. Then unfortunately, now very common and very present geopolitical situation, and the disruption of logistics chain that I referred to. And this leads to high volatility in volumes and higher fuel prices. And here, the assumption is that this conflict will not be too prolonged. So this is not going to be a new Ukraine war. And so that's why we have decided to be so explicit in the assumptions that are guiding this guidance.

And finally, to conclude, recurring EBIT of at least EUR 125 million represents at least 8% growth anchored on efficiency measures on Mail & Services and central structure in line with what we're doing recently. And here, we are also guiding for restructuring charges associated with this that will then have obviously a positive implication in efficiency. Then recurring EBIT, excluding the bank to grow 11%. We don't give you -- we don't guide a number for the bank. But if you look at the right-hand side of the 2026 column in the left-hand side of the chart, well, basically, the gray area is more or less the same size, which is totally in line with what we have said in the Capital Markets Day, and Guy already noticed very clearly, the bank is now on a ramp-up phase for higher growth.

And so this is very much in line. The positive thing here is that the growth that we are posting on EBIT is, in fact, the growth that comes from CEP volumes growth and again, with a not very prolonged fuel price hikes. Therefore, the bank will have a flat recurring EBIT while preparing for high growth. And with this, I would invite you to move to the final page. Again, we are delivering future growth by building upon our very strong strategic foundations that were clearly well shared with the market back in November. So looking at first, 2025, a strong financial and operational performance for the year. Revenues and recurring EBIT growing 16% and 35%, thus meeting or exceeding our Capital Markets Day targets for '25.

This growth has been driven mainly by E-commerce solutions, and we'd like to stress more and more that we want to be an E-commerce logistics player. So this is not only very good news, but also aligned with what we see being our future. Now the largest business line. And in the quarter, for the first time in our history, E-commerce Solutions represented more than half of our total revenues. And with this, we set the growth outlook for 2026 while navigating regulatory and geopolitical developments with confidence. I believe the company is better prepared than ever to face a year that for reasons that are related with the external context will be, well, possibly very challenging.

Moving to the second bucket of -- regarding the cycle. Well, everything -- all the targets were successfully achieved, successful execution then, which builds confidence for the 2026-'28 execution. And in my view, we have posted ambitious targets, not less ambitious than we had before. And the fact that we have proven and we have executed according to the ambition that was posted back in 2022 gives us and should give the market confidence that we're going to deliver again. We are strengthening our logistics footprint through the integration of Cacesa through the joint venture with DHL that, by the way, was approved yesterday, just announced to the market, as you have seen, new automation investments, new engineering expertise, expansion of our lockers network with Iberia and a much, much more robust retail cross-selling with significant contributions for Mail & Services.

Then the never-ending efficiency measures and resection of Mail & Services and Corporate Center stabilized margins in 2025 despite falling volumes. And again, I would like to stress something that both Joao and Guy mentioned that we see and we see this -- we saw this very, very clearly that the revenues generated by business solutions, by services in general at large and of course, retail services as well. So services at large compensated -- more than compensated the revenues lost by Mail that were somehow favored, of course, by the price increase, but not -- that was not sufficiently. And finally, we believe that our portfolio is poised to take full benefit from the EU upcoming regulatory landscape, thanks to Cacesa. And this is not because we are more than anyone involved in the customs area of the value chain is also because Cacesa is in a very large number of European countries.

And so we have a very privileged viewpoint, both because we talk with all the relevant Chinese players, all of them and also because we talk with a very diversified number of national authorities, most of them in Europe, of course. But although the regulations are European, we are seeing a very differentiated interpretations of the law, and that's why we believe we're going to be better positioned than anyone to navigate this regulatory change. And finally, a word on the financials. Cash generation supports financial resilience and attractive shareholder remuneration, and it is a significant advantage for the upcoming cycle because when I say that we are better prepared than ever, it's not because of -- not only because of technology, operations efficiency, knowledge, it's also because we have a very solid balance sheet, and we are prepared for the future better than ever before.

So our -- the strong free cash flow generation reduced our leverage to 1.9x as guided. Now with DHL, this will improve significantly with the completion of the joint venture. And we have also once more complied with our announced dividend policy and are posting a dividend per share of EUR 0.19 and of course, are completing the share buyback that was announced recently. And with this, I believe we are ready for Q&A, and I'll pass the well management of the meeting to [indiscernible].

Thank you, Joao. As Joao said, we are now available to take questions. [Operator Instructions] Our first question comes from Joao Safara.

A few questions from my side. So first one on the guidance. Just wanted to have some clarification here. So let's assume that we are on the low end of the guidance, meaning EUR 125 million of recurring EBIT. Is it fair to assume that there is, I mean, barely any impact from the DHL synergies if we were to go to the low end? Just to understand a bit -- I know there are several moving pieces this year and uncertainty, but at least on the DHL side, how do you see the synergies playing this year?

And then also linked to this on the timing of the deal. I mean just wanted to understand what is your degree of confidence that May '26 for the completion of the deal will not derail. I mean, just want to have your view there. And then last question, just on the -- I mean, there were some news report on Bloomberg last week. You probably saw that saying that, I mean, you were -- you invited advisers to pitch for potential sale of the Banking business. We know you are focused on growing the Bank, but would there -- are there still options being considered in terms of someone joining the Banco CTT or what would be your role in this process of growing the Bank? Will be a minority role or still a controlling role? I don't know. Just if you could a bit elaborate on that, that would be great. And that's it.

Thank you, Joao. So your assumption regarding the guidance is right. And indeed, I think I may confess that this guidance was designed and approved yesterday in the Board of Directors prior to us receiving the news that the deal would have been approved yesterday. And so yes, that is a good assumption. Regarding -- and then maybe Guy can complement my answer with the details about how we see the synergies deploying for the year. But let me move to the other 2 questions.

So we are very confident that now because there are, of course, a number of preconditions that now the most relevant one was this one, that this one didn't depend exclusively on us, only on our collaboration. But what we have to do now is it gives us great confidence that this deal should be closed, I would say, in early May. And so yes, we feel quite confident on that. And then Guy will also take this for the issue of the unfolding of the synergies. Finally, on the Bank, I would -- if you allow me, correct your statement, Bloomberg does not say that we have hired consultants to discuss the selling of the Bank. We would have denied such a statement.

They say that advisers were contacted for -- if I'm not wrong, discuss options for the Bank. I don't know. I don't care actually. What I may say is that we are very happy with the development of the bank. But I must also add that we keep receiving manifestations of interest. And of course, we look at them very seriously. And that's it. We don't want to add anything more. But the statement that has been used several times that we would like to -- we see ourselves in the long term mostly as an e-commerce logistics player, and that we'd like to have a lower importance of the bank in our portfolio stands. Having said so, we are first rational agents and react to demonstrations of interest that I must say are probably today more frequent than before. With this, I will ask you to complement the other questions, please.

Yes. On the guidance clarification, back when we announced the transaction of the JV and sequentially to Cacesa, we said that the synergies of Cacesa will be faster to materialize than DHL. And we guided the materialization of the synergies between 1 and 1.5 years after the completion of transaction. This year, the only impact that we are assuming is the consolidation of DHL Portugal that will occur after May -- to remind that we guided the value of the EBIT of the Portuguese operation on a full year basis of EUR 2 million -- around EUR 2 million.

I would take the opportunity also to clarify what we are seeing on the guidance. So we chose to post a conservative guidance because of 2 functions. First, this year is a transition year for the bank and one of the growth engines of the company will be stalled for 1 year. We see the bank growth resuming after this year in '27, '28, having significant growth after this repositioning of the growth engine of the bank. Our remaining growth engine that is parcels as this year, a lot of sources of volatility, one from regulation that is de minimis and the other from the geopolitical context. Just reminding that most of the sources of E-commerce originate on Asia and most of the flows from Asia to Europe come through the Middle East. And with this disruption, we are seeing what we understand as temporary disruption on these value chains that we cannot estimate how long they will take.

But we continue to see, as long as mentioned, resilient demand from our customers because the pre-notice continue to be very strong. But the transit times from Asia to Europe are expanding immensely because of the lack of flights during -- in the Middle East. In terms of de minimis, this is a year of some volatility. We see in medium term, de minimis as positive, if any, positive impact on our business because we see higher value chain of logistics in Europe as this regulation will force Chinese platforms to invest in Europe, and that will entail opportunities for CTT as we have assets with true Cacesa throughout Europe, and that will mean more opportunities to grow in the short term because of all the news flow that will entail and short-term impact on pricing. We see some volatility on customer demand that as we saw in 2021 with the VAT de minimis will be temporary and as such, but nevertheless, impacting 2026. And with this volatility, that's why we chose to have a conservative guidance at this point.

Thank you, Joao. Our next question comes from Joaquin Garcia-Quiros.

Most of it was on the guidance, which was already been discussed. But another one on the DHL deal. Is Cacesa going to -- sorry, is DHL going to acquire the 25% of Cacesa? Or what can we expect there?

Thank you, Joaquin. What I believe was announced before is that DHL is interested in participating in Cacesa. If that materialize, it will be in a percentage similar to the joint ventures, so 25%. We have decided because we didn't want one deal to affect the other and namely the approval by the European authorities. We have decided to keep this apart. So we keep developing Cacesa by ourselves and discussing with DHL if, when and in which terms they will join. But yes, that interest remains active.

And may I ask another question? Can you quantify the impact from the hurricane of the recurring EBIT to know a bit on a like-for-like going forward, what can we expect for 2027 onwards?

At this point, it's difficult to estimate. We saw obviously impact on volumes that are retail linked as debt placements in financial services, B2C Mail and also on the Bank side, and some costs because of the disruption in [ 19 ] buildings that we had throughout Portugal.

And also more than 100,000 companies around these areas was closed for this week. So no -- and it's an area for small, but E-commerce companies that was closed during this time also.

Our next question comes from Filipe Leite.

First of all, I would like to congratulate Joao Bento for this incredible journey at CTT. Regarding my questions, I have 4, if I may. First one is actually a follow-up on your guidance or full year guidance and your expectation of a decline in the organic EBIT for this quarter, first quarter of this year. Just to understand because we don't have the contribution of Cacesa during last year. So for us, it's difficult to calculate the organic growth. My question is, should we expect or what kind of organic growth should we expect for second, third and fourth quarter to reach your full year guidance? Or if you prefer, what is the organic growth assumed by us in your EUR 125 million recurring EBIT guidance for this year?

Second question on working capital. And if you can elaborate on the strong performance of fourth quarter and if we should expect some reversion of this working capital inflow in the upcoming quarters? Second, on DHL, just to confirm that the initial expected EUR 69 million net cash impact is still confirmed despite the delays in the approval of the deal? And last one on Business Solutions and Payments because the revenues of this specific line dropped for the first time in fourth quarter in the past 2 years. Can you explain this evolution? And how should we expect this business line to evolve in the future?

Maybe I will start and...

Let me just start by thanking your congratulations, Filipe.

So the EUR 69 million, just -- so no difference on the announcement only to clarify what was announced. This was assuming a cash neutral transaction. So there is to be expected some adjustments by net debt evolution during the period. Then on working capital, Filipe, we are working with an estimate of neutral working capital evolution. But as you know, there is some seasonality. So normally, we are -- we have more working capital investment in the first quarters of the year that normally we recovered throughout the second half, and that is what we are expecting. On the organic growth, we are assuming some organic growth. You should assume that Cacesa will contribute more or less EUR 4 million in the first 4 months of the last year.

In Business Solutions is something structural. As you can imagine in Business Solutions, it's something one-offs because you -- as you know, in Business Solutions, sometimes you have just one-off products that you are selling. It's just that nothing that we are concerning about that.

Our next question comes from [indiscernible].

I've got 3, 2 are connected. So it's basically 2.5 question. Let me put it in those phrases. First of all, you mentioned a shift from Asian volumes to, call it, domestic or European volumes. With the Chinese so much focused on tariffs, am I right to assume that the margins -- that this will have a positive effect on your margins? So the mix is changing towards domestic that the margins are there higher? Connected to it, on the China-Europe lane, let me put it in those phrases that's the area where Cacesa is active as well. We see more and more competition on that front. We see PostNL announcing new initiatives with Spring. Bpost is pretty active there. Austrian Post has recently done an acquisition in Central Europe, which is active in that field. But on top of that, we see companies like GD Express, like [indiscernible], Chinese competitors coming in.

Is this an area where we should expect margin pressure or tariff pressure as well going forward? And then the final question is, obviously, the -- what's happening in the Middle East is beyond your control. And I understand what you say about procurement and distribution lines and whatever there is higher fuel costs. But there's also something like inflation, and we're beginning to see, especially in the chemical sector, the first price increases, and they are pretty hefty. [indiscernible] announced some price increases by 30%. There's a knock-on effect on detergents, on shampoos and that sort of things. And before you know it, the consumers are getting cautious again. We've seen something like that before. I haven't followed CTT long enough to judge what happened during the start of the Ukraine war. But perhaps you can shed some light on it, what your expectations are in terms of consumer sentiment on the Iberian peninsula. Those are my questions.

Thank you, [Hank]. Let me start with the geopolitics and the implications. We have a good observation point in E-commerce in general. I think it's very early days for us to evaluate what's going to be the influence, but we can only draw expectations from, well, I would say, history. And typically, high inflation produces -- and somehow retraction on consumer behavior. That's why we -- one of our assumptions is that the war is not going to be very prolonged. Regarding the impact on pricing and the competition of Chinese players, I will ask Guy to help you.

Yes. Let's see. On the -- so the 2.5 questions are trying to separate them. On customs, let's say, we see some competition, of course, because namely the customers are very price sensitive. But we work at the European level, so not in specific airports, as you mentioned with the examples that you said. And as such, that enable us to continue to grow and to capture the volumes that swing between the local attractiveness of each customs authority. More than that, we see with de minimis the type of clearance evolving for more complex clearance in terms of process, and that will entail, in our view, upside risks in pricing and in margins as the direct-to-consumer things will be diminishing.

Poland was, in fact, in the first quarter, so Eastern European in first quarter are the fastest-growing geographies in terms of customs clearance. And this has to do with all the dynamics around handling fees and others throughout Europe. In terms of local last mile Chinese operations, that will entail some more competition. We think that we have a differentiating offer. So we don't provide the same service as these guys do, although still not much present in the markets we operate. They are mainly focused still in France and Italy. That will -- may entail a new -- more price competition, but we always said since our Capital Markets Day that we see in the next cycle more competition on price because not only more last milers, but also less abundant growth.

But we see our best-in-class margin as a key advantage going forward as we can lean in on that margin if we need to keep being competitive and keep growing market share. As we stress, we aim to be leaders in Iberia, and we are on the clear path to do that. Moreover, now with the completion of the JV where our offering will be largely extended and that complete offering will enable us to win in Iberia. If needs be, we can always resort to having a competitive offering with the kind of services these guys provide that are actually very different from our...

Yes. If you allow me, the feedback, it's more qualitative than quantitative. That's the feedback I have from the customers. So the feedback I have from the customers is we had conversations in the last weeks that we call postmortem of the peak season. So it's typical with these big clients from the Chinese and the quality that we are bringing to our services, that's enough to compete, but we have space always to retain these volumes like Guy was saying.

On inflation, let's see, we're still early days to see how prevalent will be inflation. Obviously, that gives us more pricing power within our customers, we have been in e-commerce resilient during inflation cycles, where we see more risks is on the labor side of Mail. Of course, it's difficult to translate labor inflation because normally, it's very difficult to delay the inflation impacts on labor. And obviously, on Mail, we cannot -- we don't have enough pricing power to translate fully to price on the competitive side of the Mail, the level of inflation, although Mail is less and less meaningful in our profitability, but normally, are those areas impacted by inflation.

Quick follow-up, if I may. In relation to fuel prices, is there a fuel surcharge provision included in the contracts you have with the big E-commerce firms?

We have fuel surcharge in most -- almost 60% of our revenues, not in all contracts, but we have a significant hedging in terms of revenues.

[Operator Instructions] Our next question comes from Mathias Paladino.

I have only one question. I'd like to come back to public debt placements. So they recovered strongly in 2025, mainly because of certificates still offer an attractive spread over deposit rate. But if the current geopolitical context pushes [LIBOR] above the certificate gap, I think that spread will be -- will disappear in some ways. So how meaningful is that risk? And how do you have any sense on whether the treasury will adjust the terms of the current series?

Thank you. We actually see [LIBOR] going up as an upside pressure on the -- also positive impact on public debt placements. As you might recall, the remuneration of that product is completely [LIBOR] linked with a cap. So as long as we keep being below the cap, normally, this product is more interesting than the bank competing offerings on deposits. And as such, normally, this pushes placements up. We are working with placements for this year between EUR 4.5 billion and EUR 5 billion. That is slightly below the last year numbers, but above the average on the last years in terms of placement.

Our last question will come from Antonio Seladas.

First of all, thank you, Joao, for the last 5 or 6 years, and I wish you all the best. So my question is just a clarification on your first quarter guidance. So you basically mentioned that organically, it will come down. But does it mean that if I compare last year figures with first quarter figures that we are going to release in 1 or 2 months, it should increase. So organically, it will come down because all the arguments that you mentioned. Nevertheless, in absolute terms, it should increase. So can you confirm, please?

Antonio, we -- what we had to say on that topic, it's what is written on the slide. So we won't clarify or give any additional detail.

So organically, without Cacesa this year, it should come down. Is that it is what we say. Nevertheless, Cacesa should have EUR 1 million, EUR 2 million, EUR 3 million on the quarter. Is that right?

Antonio, this is Nuno. We have given you the numbers of Cacesa in the last year. So you have that impact, more or less around EUR 4 million for the 4 months that we have not consolidated in the last year. And the message that we can give you at this point is that organically, the recurring EBIT will come down, but we are not providing any comments beyond that at this point.

Thank you, Antonio. Thank you all. As there are no further questions at this time, I'll hand the call back over to Mr. Joao Bento for any additional or closing remarks.

So I thought I should have a bit of a more extended final remark. When I woke up this morning, I counted them and this is my 28th results presentation, webcast and the seventh yearly results one. So Antonio is 7 years now. A good part of this journey was made hands-on hands with our analysts, of course. Some are already here when I came in, some others started covering mid mile. Some others returned to us possibly because they were happier.

We've had a desertion of someone that preferred to cover smaller peers, instead of us that are now much smaller than us. And to all of you, we feel thankful. I'm sure my colleagues are with me for helping us while guiding the market and your clients and somehow also disciplining us and helping us delivering more and more. So thank you for that. And the last slide that we are seeing here summarizes my main feeling now that I'm about to hand over to Guy and to Joao. I think that we've delivered. I feel happy for that and thank you for that as well.

Thank you, Joao. On behalf of CTT, I would like to thank you all for your participation. This earnings call is now concluded. Thank you very much.

Thank you. Thank you very much for being here today. This is a great opportunity to present -- to update you on CTT's transformation journey. And it has been a long way since we last met in a Capital Markets Day in June 2022. And now we want to update you on the journey we've done so far, and we want to present you the new way, the new path that we are going through. We will have a full morning. This will include an initial part of a presentation on strategy and e-commerce solutions by Mr. João Bento, our CEO. Then we will have a coffee break. And then we will have presentations on the mail services by our CCO, Mr. Joao Sousa; on the bank by the bank's CEO, Mr. Francisco Barbeira and on the financial ambition to 2028 by our CFO, Mr. Guy Pacheco, and then we will have time for Q&A. I have to go through a slide, so just we understand we are all in the same page which is the disclaimer and forward-looking statements. I don't expect you to read, but you have it printed. So if you do want to do so, please do. And I will pass on the floor to Mr. João Bento. João Bento, please, the floor is yours.

Thank you. Good morning, everyone. So you'll have to bear with me up to coffee break. As Nuno said, this is the outline for the morning. And we will start with this short view on the group vision and strategy. We are 2 days away of celebrating 505 years of age. We seem to be the oldest company in Portugal. So we carry a long history on our shoulders, and we've been acting with a, well, more recently stated purpose of delivering the future by connecting people and businesses in a sustainable way.

We have indeed gone through a huge number of transformations, but in recent times, one that we hope will lead us to become the Iberian leader on e-commerce logistics with the bank. And what we are here today for is basically to, well, look at the results regarding our commitments 3 years ago and more important than that, to put strategic ideas and lines and commitments for the future.

So starting with what we then and what guided us in recent years, business by business. On e-commerce, -- sorry, on parcels, it was basically a scale-up of the business with -- we have achieved, well, formidable position in Iberia. We have expanded our leadership in Portugal and acquired a significant presence in Spain. And we were indeed the fastest-growing player, not only in Iberia, but actually in Europe amongst the parcel delivery companies.

In Mail, well, the game was one of leveraging the -- well, then new USO contract by using the levers we have now finally of price, but also quality and density while we protect the sustainability and profit of this business line. On the bank, well, it was a play of -- it was the bank breakthrough after breakeven and speeding up growth. The bank has built an impressive base of more than 800 clients, doubled deposits since '21, increased significantly credit and achieved profit before taxes over EUR 35 million. So it was actually -- well, the first significant life for the bank. Today, we're going to see how it's going to speed up.

We have also executed the first meaningful partnership in terms of capital in the bank with Generali. So it was a very important period for the bank. We have meanwhile, of course, been very concentrated on efficiency, on operations and on cost control to the point that we have been able to improve our EBIT margins from 7.1% to 7.28% in the period. And we did it all with I think I may call it a significant disciplined capital allocation by paying meaningful dividends, having 3 buyback programs through which we have acquired roughly 12% of the company. It was also the period where more recently, we have acquired Casesa and announced the -- and actually agreed the partnership with DHL.

So it's been a very busy period, and we did it all while remaining true to some of our core pillars. One, obviously, being the environment. We drove decarbonization significantly. We have actually reduced carbon emissions per parcel, almost 50% in this period with major investments on electrification of the fleet, on solar production and self-consumption, amongst many other initiatives. We did it with a people-first mindset, to strong heritage of proximity. We have actually created employment. We have invested in social impact programs with some meaning up to the point that we have multiplied by more than 20 the number of volunteering hours of our people.

And obviously, not only because we are listed but because we attribute a significant meaning to the way we govern ourselves with all the good governance rules that are required and supposed and expected by a listed company. And we have actually created a dedicated sustainability committee. We have created a new code of ethics and started practicing on that. And actually, we went even further than it is now required in terms of sustainability reporting. So a very significant and impactful period, a journey of strong transformation, as Nuno said before.

In the sense that we came to a set of businesses with significant growth. Indeed, we have we have growth in revenues of more than 8% per year and an EBIT of more than 5% per year, but with an impressive transformation in the sense that this in red is the contribution of the mail business, which remained more or less stable while we grew significantly. But in terms of margin, this is -- this was almost a mail-only company, and now it's a bit of an exaggeration, but just to illustrate how strong the transformation were.

We believe that we have produced what is now an e-commerce logistics player. And well, obviously, with the Bank. But we are now announcing a simpler and new way of not only reporting, but indeed organizing ourselves in 3 business areas. The Bank remains as it is, although it's going to grow much more, E-commerce Solutions and Mail & Services. This is a simpler structure that we believe has been expected and required by the market and also because we believe that we've been able to give a strategic sense to each of the 3 business areas.

Of course, we have grown significantly in E-commerce Solutions and in the Bank. And for Mail, it's a matter of ensuring profitability, and we have a significant number of initiatives of Mail & Services, of which Joao Sousa will guide you along that, in fact, promises that we're going to be able to create an Iberian market leader in this -- each of these 3 different areas.

And this is how our portfolio is organized. If we plot horizontally higher feed to our core business or lower feed, and if we plot vertically the growth nature of each business, this is not us. This is how our business lines are plotted. And this provides a relaxing consideration about the nature of our business portfolio. With the Bank, actually, our retail bank is much higher because it's a fast growing one. The bank and payments and real estate a bit further away from core.

On the opposite extreme, we have last-mile logistics, customs clearance, not only core but also fast growing. And then, of course, mail and others that are somehow with a significant fit with what we do, but obviously, mail with -- well, no growth at all. And this is why we believe the portfolio is now very well balanced.

We have obsessively pursued excellence in innovation throughout this period. And we did that by respecting not only our vision and mission, but also our values. And this has been thoroughly acknowledged by the market and by society in general with prizes on from innovation to technology, capital markets, sustainability, you name it. This is just a few examples of that kind of recognition. And we have developed scale in this obsessive idea of becoming the Iberian leader. And scale means, for example, that we are now with a D+1 offer in the whole of Iberia with 77 operating centers across Iberia, of which 20 are automated. We are now able to process 150,000 parcels per hour. We have delivered last year almost 150 million parcels. Well, it's going to improve significantly this year. And in our peak day, we have delivered more than 1 million parcels. Well, as we speak today, we have probably in the street in Iberia today around 700 parcels as we speak.

And this scale is also present in our network, not only the Pudo network that we call we name now CTT Collect with more than 20,000 PUDOs, of which 1,100 are lockers. This number is going to improve significantly, as you're going to see later, but also the -- well, CTT retail network where most of our B2C services around mail are developed. And we did this with the explosion of the usage of digital channels with now 3.5 million users -- active users in full respect to the environment, and this is probably our flagship because we are achieving this year 50% of electrification in our own fleet, of course, with all our people engaged and reinforcing a consistently trusted brand with Net Promoter Scores always consistently above 50.

Well, a couple of words on main operating achievements or things that we have done. We became, of course, a meaningful actor in parcels in Spain. We have expanded revenues significantly in both countries. Also market share, we will see these numbers in detail. We have sustained a solid EBIT margin in Iberia, and we have delivered consistently strong NPS, as you've seen. On Mail, we stabilized revenues, in particular, with the new price formula, revenues are almost automatically balanced. We have accelerated our digital offer, like, for example, with this E-letter product. We have boosted multiplied by more than 3x our business solutions revenue, which is a main replacer of main replacer of Mail higher revenues. And we have leveraged with Financial Services to generate incremental EBIT contributions to the group. The Bank reached, as I said, a very impressive number of accounts. This is the fastest-growing history in Portuguese banking of building a customer base, increased significantly profitability, achieved a return on tangible equity in line with what we had promised in the previous market -- Capital Markets Day and thus increased deposits and of balance to a number higher than EUR 5 billion. And with this, of course, by engaging our people, we have reviewed and invested significantly on progression and the employer brand. We have also expanded significantly training, and we have been distinguished with top employer in this segment several times and also with well-being awards, which is probably a good sign. We have meanwhile been certified a family-friendly company as well.

And on ESG, I've referred already to the results on the fleet. We have invested in social community impact programs, a significant amount of funds, and we set the ESG-linked incentives to actually the whole of our leaders in the company. But while we did things, we achieved operational relevance, but we also, of course, have significant financial results.

This is the evolution of revenues. Here, the trailing 9, 12 months, we are now above the upper limits of our commitment back in 2022. And likewise, in EBIT a significant improvement. We are now in the last 12 months up to the third quarter on EUR 105 million. Well, we've mentioned this in our recent results presentation with a strong quarter that already started, and a very strong October, it should be quite feasible to, well, achieve the guidance and meet all the targets that we have committed to back in 2022.

And we have, of course, continuously remunerated our shareholders, not only with an increasing dividend but also with a significant activity in these three buybacks that, as I said before, accounted for the acquisition of just over 12% of our own stock. We have delivered ambitious targets that have granted market recognition. And this is probably, well, the strongest way to somehow evaluate what we did in the sense that we have multiplied by more than 3x the equity of this company in the period of this management, of this Board, of this term actually, which is obviously, well, a source of satisfaction.

So this is what we did now. Let's talk about [Audio Gap] why we are here. So we are now building up of a market leader. And I will guide you through measures that are associated with growth and measures that are associated with efficiency and therefore, profitability. On E-commerce Solutions, it continues to be a scale-up game. We are aiming at Iberian leadership in e-commerce logistics. We want to evolve our operating model, which is now almost fully integrated in Iberia. I don't need to remember -- sorry, to remind the audience that well, we came to actually two different almost independent companies that are now well very much integrated.

So there is still a play of further integration. By combining vast first mile -- sorry, last mile offer with other positions in the value chain that is, in fact, the main factor that distinguishes CTT from our competitors. Then on Mail, stabilized Mail but nurtured business solutions and strengthen retail, B2B and B2C as significant contributors for this new business area of Mail & Services that we see very positively, leveraging, of course, price, reducing costs and efficiencies and basically to capitalize on the sales force and the relations we have with, let's say, virtually all the Portuguese companies, so more in Portugal and, of course, of this unique retail network.

And finally, the Bank as you're going to see, is a play of speeding up where we are with additional investment, but Francisco will give us very thoroughly on that to strengthen a distinctive business model, of no frills retail bank, boosting the digital channel to become on par with a very significant retail network that the bank has, which is CTT.

And then with using these main business enablers, technology and in-house engineering, this is -- we're going to have some emphasis because this is, again, unique. Some of you have visited some of the facilities yesterday. Focusing on attracting and preserving talent and, of course, embedding sustainability in our decisions because we want to be here for the next 505 years with a significant role.

With a slight more detail but yet at the general level, on E-commerce Solutions, which is our main growth engine for the future. So we aim at Iberian leadership. This is probably the fifth time I mentioned this. So this is probably a belief of commitment, propelling our business model and amplifying our, well, the present e-commerce tailwinds. We want to broaden our -- the present value chain because this is actually unique. And this is one of the reasons why we've been growing faster than our competitors. But more than that, why we've been able to show EBIT margins like almost no one.

Capturing cross-border volumes, which is the portion of e-commerce that grows more as you're going to see, and Cacesa is very important for that purpose and not only in Iberia and again, leveraging on the joint venture with DHL for intra-Europe and in fact, global clients given their global presence and strong brand.

Evolving our tech-intense model, deepening specialization and productivity and quality and some of the things that also we are now able to do is, in a way, very much related with our somehow recent but strong technology internal capabilities and expanding on out-of-home delivery because this is not only a societal trend, but we see that also as a factor that will bring not only convenience to the customers, of our customers, but also reducing last-mile costs and even reducing carbon emissions. I will go myself in deeper description of what we are doing along these lines.

Moving to Mail & Services. So the key word is stabilizing mail and unlocking value with Mail & Services, leveraging the current contract through the pricing updates, efficiency and preparing for the upcoming negotiation. It is our strong belief -- well, I would say it is my personal absolute certainty that the existing funding model for the USO is no longer viable after '28 because volumes are coming so down that price would have to become, I would say, unproportionately high and so there is a need, and we've been working on that steadily so that we find new ways of funding the universal service. So this is one of the things that respects -- needs to be done and started to be done along the next strategic period.

Engaging customers with omnichannel experience, basically by improving our digital channels and intelligence, and we have now a full-fledged digital channel working with a significant number of customers. As I've mentioned, continuing to unlock value and engage with partners for business solutions and payments. Although we are pretty dependent on payments in business solutions, it's mostly a play of our own expertise and companies, but also a play of partnership, which is very much present in what we like to do, and that's why we've been able to grow and keep growing fast and use the established retail network to grow services that need to be aligned with our footprint. So we don't want to do -- to have a bazaar of services. We have to -- want to keep a focused set of services. But for all of those services that require a physical presence, we are very well positioned, like no one.

And moving fastly over the bank, maintaining growth in domestic mass market, of course, with the no-frills retail banking for this 3 years period, excelling savings by fully capturing the synergies with the CTT network leveraging, of course, the already very successful partnership with Generali and hence, the significant results on off-balance placements. Fight for our fair share in terms of credit, both for consumer credit and mortgage, reinforcing leadership in auto loans. The bank is now top 3 in the market and offering an outstanding service and proximity, integrating in person with digital channels and with a growing footprint as I'm sure Francisco will detail.

And we'll take -- I'll take some of your time for debating a bit on technology. First, with mostly IT-related things, we are now only -- unifying operations in Iberia. And this is very much a game of unifying IT systems on the offer operating procedures, but mostly IT. This is probably the most relevant IT project that we are undertaking as we speak, so that we have a single Iberian ICT platform for parcels.

Then regarding customers to provide centralized tools so that all our customers relate with us through very clear and easy and useful channels. B2C super app for general public, B2B portal for companies and of course, in the case of the Bank because of regulatory concerns and business concerns, the bank has its own app.

And on processes, of course, keeping advancing automation and autonomous solutions, we will also illustrate with some of the things that we are doing, boosting productivity. And here, I would refer the Helena chatbot and process automation with and without AI, and there's plenty to show along these lines. And we have a very, very well filled agenda on this front.

On more the engineering side of technology, which is less known from the general public, but not less important for us, we are also working significantly on first mile further developing proprietary technology that we have. This is driving scale and efficiency. On -- this is just an example. I'll go in more detail after that on optimizing sorters, some of them very old sorters that we are now revamping at a very low cost and significantly improving efficiency.

Also on our own methodology for facilities layout. And on last mile, I would refer, I would refer probably, well, our price winner field force app that improved significantly our success in deliveries in deliveries and probably above all, all the journey that we have done from 0 to full independence on lockers. We now produce our own lockers and this provides for significant agility in well, offering new services and offering convenience and additional productivity to our offer.

On people, well, managed workforce with care. So care here is, well, carefully chosen word. Of course, developing talent and building a future-ready workforce, we need to bring people with us, otherwise, we won't be able to keep the pace of transformation and growth. We are now engaging more -- we have engaged more than 1,000 people on leadership training. Also shop clerks training, we have basically covered already 80% of our retail network and digital AI capabilities, we have already covered 900 people. So a significant effort in terms of training and empowering our own people and proactively attracting and retaining top talent.

We have more than doubled, for example, the number of candidates to our trainees program. This is a good sign. And of course, we need to refresh our own workforce, but it's also a good sign that we are now more attractive company. We have all our operations people already with performance compensation, something that is simple and powerful, but given the strong unionized nature of our workforce, this has been a great journey and merit progression applied for 1/4 of our people.

And we need to strengthen employee well-being by addressing pain points. And we are doing things that are very useful, for example, providing financial literacy support to our, well, mostly low skilled people, mortgage aid, of course, awarded by our bank and funded by CTT to our employees and also the bank employees and improving the employee experience through the new MyCTT portal.

On sustainability, of course, we remain committed for purposes that are meaningful and that, in fact, will determine our ability to be here in the future. So I've referred already the decarbonization of the fleet. Now we are committing with a new target, which is to have 100% of our fleet electrified -- owned fleet electrified by 2030. We have just recently received approval by the Science-based Target Initiative of our own reduction, short-term reduction targets, and we are also committing to incorporate 100% of recycled materials in our SEP products and 100% of green energy.

Actually, we are already practicing 100% of green energy today. And by promoting participation and investment in social impact programs, we have this idea of using volunteering as the main source of exercising our own contributions to the community around us. And we are also committing with targets of 6,000 hours of employee volunteering by 2028. 100% -- sorry, 10% of our employees engaged in this kind of practices and also to support vulnerable communities with some of the things that we do, like, for example, using idle time in the contact center to support institutions or to offer mail services to institutions that need to deliver mail, that kind of stuff, which is done at the marginal cost, of course.

So we have proven execution, and we believe that we are ready for the future. We have consistently delivered on our targets, and I apologize for insisting on this, but we felt some doubts when you came here 3 years ago, to setting very daring targets. We have built strong foundations for the future, and we believe we are ready for future growth. And growth is as [indiscernible] yesterday mentioned at dinner one of our, well, I would say probably our main attitudes.

And with this, I will leave you the short film, and we'll be back for the next session.

[Presentation]

So I hope you could rest a little bit of taking me. But we now -- I will now guide you through what we are doing -- what we have done and what we are doing in a slight more detail on E-commerce Solutions. So our recent journey has been very significant in terms of growth as well. We grew 24% year-on-year on revenues, 48% year-on-year on EBIT. And this is why in part -- well, not only grew, but also improved significantly our EBIT margins. And basically, we came from a 5% when we were here 3 years ago to an 8% EBIT margin. And if we would plot this is '24, if we plot Cacesa, and this is how it's going to be in the end of this year, this would be 9%. 9% is simply best-in-class. And there's only one peer, which is a particular one that only delivers out-of-home that is able to show. No one else similar to us is even close to this EBIT margin.

So we are very happy what we did, but this is just, as you see it, the beginning of a new journey. And there are a number of factors. I would highlight growth and efficiency and across the presentation, I will try to enhance where we see contributions from growth and contributions for efficiency. And very often, they are both connected.

One first reason that is associated with growth is that we grew significantly above the market. And we grew significantly above the market for several reasons. Well, one, it's obviously that we were very small in Spain and Spain is a very large market. Let me remind you that Iberia is the fourth largest parcels market in Europe, only behind -- equal to Italy, only behind Germany -- France, Germany and U.K. And -- but one of the reasons is that global marketplaces in this period grew significantly more than everyone else. 10% -- more than 10% to -- compared to less than 5%. We're talking about, of course, large marketplaces, global marketplaces. And this is why by the end of last year in Iberia, this was somehow the split 1/3, 2/3 of the market. And because we are very exposed to this, that's one of the reasons why we grew so much.

So one success factor is growth and the way we grew and why and how we grew. And this is why we came from a 23% parcel component of this type of clients to 2/3. This is something that we pursued actively because these are the growing outperformers and we are more exposed to them. And this is good for us. Then there is the issue of scale because, of course, we needed to have solid foundations to be able to grow. I mean, there's no point in having customers if we are not able to deliver. Actually, with the ever-increasing sophisticated customers, either we deliver correctly or they simply disappear. And this is our footprint in Iberia with -- well, I'm a bit of a color blind, but this seems to be green or maybe blue for operating centers without the sorter, red for operating centers with the sorter.

And then all the pink points of presence for collection or delivery so basically PUDOs and with that kind of footprint, but also with increasing profitability, as we've said, this is the same arrival point, but now with the trajectory, and again, we have improved 3 percentage points, with Cacesa, this will represent 4 percentage points in 3 years, which is explained -- or explains why we have improved productivity, 18.6% in the period. We have reduced unit costs 8.4% in the period, and we have improved significantly our quality in general.

Growth carries density, and this unlocks scale efficiency. So there is a virtual cycle here that I'd like to illustrate. If you look at the evolution in Portugal and in Spain in this period, on B2C market share, well, we have increased an already impressive market share in Portugal of 40% to 45%. And in Spain, we almost doubled our market share. Spain is obviously, well, the Spanish market is more than 10x larger than the Portuguese one.

On productivity, we moved from 5.68 sorters per inhabitant in dense areas to 6.37 and an even higher improvement in Spain in terms of productivity. And if you look at the cost ratio, that is the cost of delivering a parcel in the dense area versus the average, in Portugal, we have slightly improved, which is which is related with -- well, the very high density that we already had. And in Spain, with, again, a very significant improvement on this cost ratio. So this is one of the reasons why efficiency helps to deliver those numbers. And as I said, there is a virtual cycle because scale drives density, obviously, density drives competitiveness and the more competitive we have -- we are, the more clients we have. So therefore, there is this virtual cycle of scale, density competitiveness.

We afford a distinctive value proposition to customers because we give them greater convenience given the -- well, extreme evolution of points of presence, 7x more now than 3 years ago in terms of PUDOs. We have improved, as we've seen, quality of service together with a significant improvement in the Iberian market share with density also both in Portugal and Spain, measured in terms of number of deliveries per square kilometer improving in both countries. And we are in Spain now only half the way where we were in Portugal, so a huge room for improvement and because we have a wider presence in the value chain from customs clearance to storage, fulfillment, delivery, handling of returns, PUDOs and you name it.

And so here, we have actually contributions from both growth and efficiency. So this is again a bit more detail and some repetition how we came here. Now let's look at the important stuff, which is how do we scale to leadership in our markets. Here, I will try to bring trends and then explain how we plan to react and take advantage of these trends. First 3 trends. One is that Iberian e-commerce is accelerating B2C, and this is good because e-commerce is moving up. B2C, as you're going to see, is moving up. The other one is that international marketplaces are gaining ground. As we've seen, these large marketplaces are growing faster than the general public and general competitors.

And then out-of-home delivery is in itself also as a societal tendency going to improve. People, and we see that very, very consistently. Every time we open a locker or a PUDO and with lockers, this is even more obvious. while, adoption never goes back, never goes back. So this is also a very important trend. Our value proposition is based on, again, growth and efficiency levers. So one is growing Iberian e-commerce logistics capacity. So we need to bring up capacity so that we cope with demand, expanding our offer as well because the more services we offer, the more we are able to grab to capture clients and then deepening our relations with Tier 1 customers. I'm insisting on this because this is, in a way, the major -- or one of the major explanations for our success, and we foresee that's going to be like that for quite some time.

Then leveraging on end-to-end coverage, increasing client loyalty because the more services we provide, well, the better the clients feel with us. And to be honest, we have some clients in the room, the more difficult it is for them to leave. And we like that because we like -- we see clients as partners. And this is, of course, significantly improved with the incorporation of Cacesa.

Then there is the capturing of international flows, not only intra-European flows, but global flows given, of course, the powerful brand that DHL brings to our universe. And finally, I referred to this, expanding and activating out-of-home network because this increases reach, increases convenience and therefore, customer adoption.

So this is on growth. On efficiency, Well, in a nutshell, we are talking about network efficiency, cost discipline, Iberian consolidation and capture of synergies, in particular with these 2 recent plays. There is further room for e-commerce growth, given the situation where we are. These numbers are improving, but we are still -- here, we see a number of countries, and we are plotting the percentage of e-commerce -- sorry, the percentage of retail that is done through e-commerce. And here, this is the European Union average in 2024. Spain is slightly trailing the average, Portugal considerably trailing the average. So there is still room for improvement, a bit and a lot, but the European average is increasing itself. So good news from this and indeed tailwinds in the sense that more and more people will adopt retail e-commerce as their retail -- main retail habits or significant retail habits.

And we have here modeled how in Portugal and in Spain, this trend should evolve by comparing ourselves with somehow similar cultures. And again, we have good news in that sense. So people will buy more, and therefore, there will be, I would say, a steady increase in terms of e-commerce adoption. Then B2C is expected to outgrow traditional B2B. And this is again good news. If you look at INREV, B2C, in Magnda B2B, the evolution that we are foreseeing is very interesting.

Spain, on the left, Spain has grown B2C at a higher pace than B2B, 8% to 6%, but it's now doubling the growth pace for the future -- for the recent future. And in Portugal, the numbers are even more impressive also because the situation is a bit different. B2B actually, as we speak last year and today, it's still -- sorry, last year was still slightly lower than B2B, and it's going to be like this year, but it's going to evolve. From 9% to 4%, we're going to have more than twice the growth of B2C. And because we are exposed mainly to B2C, this is again good news. So we are favored by this trend. Indeed, if we plot market segmentation horizontally and the differentiation vertically, we are in a very sweet spot. And it's only that peer of us that delivers only out-of-home that is so well positioned to capture this trend of B2C growing more than B2B. So again, good news in this sense.

Then there's another trend, which is cross-border flows. Cross-border flows are growing much more globally than domestic flows. And this is here, we are representing the percentage of global cross-border flows in e-commerce. So 19%, 1/5 of global cross-border comes from Asia to Europe. Actually, a similar number from Asia to the U.S., at least pre-Mr. Trump's tariffs. It is almost irrelevant the flows between the America and Europe. And this is, again, very good news. Why? Because if you look at these tendencies, again, domestic flows that grew less than cross-border in the previous period, this is now more than doubling the difference between cross-border growth versus domestic growth.

Here, we have the contribution of DHL that will allow us or help us to capture these flows from intra-Europe and actually global clients, not only to Iberia, but also from Iberia. And of course, we have a significant help from Cacesa because all these out-of-Europe flows need to be cleared and being the market leader in Iberia, this is, of course, very good news for us.

Then strong synergies across e-commerce verticals. And I'll show twice the representations of the value chain on e-commerce. Here, value chain on e-commerce and here, different segments in terms of flows. And where are we? CTT is already on fulfillment last mile and returns in our markets and even out of our markets for some of our clients. Then with the acquisition of Cacesa, we improved something that we already have, which is progress in the value chain more towards warehousing and clearance. And with the partnership with DHL, we are going to expand to intra-Europe and in fact, global clients and also in terms of the value chain to long hauls because the presence of DHL in that part of the spectrum.

So we are not only occupying a higher portion of the value chain. We are also covering a higher portion of the flows, which is obviously, again, good news. Cacesa is strengthening our position in the cross-border part because, again, looking at -- well, a different simple representation, starting from customs clearance to last mile, what typically happens is that customers do have an export provider for clearing, then a logistics provider or several for the other parts. We can do that, and we are doing that with Cacesa in some places. So Cacesa is our clearing partner and then we deliver or someone delivers for Cacesa. But the good news is that we can do that in an integrated way. And this is indeed unique. And by the way, Cacesa is doing this portion. Although the integrated part is only in Iberia, this portion, well, in a very large part of Europe and already in Turkey with some sizable operation starting in India and in Morocco.

So again, a good contribution for Casesa for this particular trend of cross-border growing. This provides for higher customer engagement, as I mentioned, it provides for additional operational efficiency, especially even here, but especially when we do integrated, imagine a sorting center when only a few tiny portion of the parcels are going to be cleared and all the others are immediately being sorted and sent away. So this is a huge improvement vis-a-vis 2 separate operations. And well, the great benefit here is our clients because we give them better service levels. And of course, we share the operating efficiency.

And there is also a strategic sense on being in that part of the spectrum is that we anticipate market movements because anyone coming from out of Europe to Europe, the first thing it needs to find is a clearing partner. So we are in a privileged viewpoint to see who's coming and which new opportunities we do have. Also because Cacesa is clearing parcels in all these geographies, and we also see that this provides an opportunity for us to probably go to some of those geographies and do the rest of -- and occupy the rest of the value chain.

And a word on the DHL partnership. This is an extraction of DHL e-commerce -- sorry, Capital Markets Day, just to say that their e-commerce division, which is our partner in Iberia, is aiming at growing above the market. So we are partnering with a partner that is in itself also ambitious. And of course, we take advantage of the global presence in terms of leveraging inbound and outbound flows, the brand recognition. We hope to access global clients that are now -- will now be able to be convinced by the strength of the brand and this issue of specialization because just to remind the audience, in Portugal, we are acquiring DHL e-commerce. So we will deliver B2C and B2B actually through this new arm of us. But in Iberia, we're going to deliver B2C they being a minority partner and they will deliver B2B as being a minority partner. And this specialization is also very promising.

Moving to another trend, which is the fact that, well, I mentioned earlier, Tier 1 players are the most relevant and global marketplaces are gaining ground vis-a-vis the rest of the market. Just an illustration, back in 2019, this was the split between Tier 1 players, Chinese marketplaces and other players. And the evolution, of course, is that these 2 portions of the spectrum are becoming ever more relevant and the fact that we are exposed to them is also very important. In fact, 91% of the market is going to be here in 2028 in a very few number of clients, very sophisticated clients that we like a lot, but it's very important to be with them.

Approaching ideas for each segment. So for global marketplaces, we want to consolidate our presence, efficiency and quality, quality being of utmost importance for these partners. We have tracked a fully controlled operational model. The idea of consolidating Portugal and Spain for this purpose is very important. Extended value chain presence also for those, of course, that do require other services within the value chain, out-of-home delivery and returns, which is part of our offer, and all of them require this.

For Iberian champions, the DHL will enable a one-stop shop for B2B and B2C, which we didn't have, frankly now. We had it in Portugal. We have it now for the whole of Iberia. It will add scale and competitiveness, and it will actually allow us to again leverage our presence in a very large out-of-home network that I will detail later. Make it simple is the idea for SMEs using alternative channels, mostly digital channels, prepaid solutions. This was a very, very impactful measure in Portugal and to promote point-to-point shipping, which is also interesting given the out-of-home network, and it will also probably improve our presence in C2C, which is not very relevant. today. And finally, to attract volume, blend the best-in-class B2C operation with DHL commercial reach for global clients and leverage on a single offer, as I've mentioned before. So value chain presence, full-fledged offer, out-of-home network and digital channel. This is basically what we need to do to keep growing for each of the various segments.

Zoom in on out-of-home delivery. It's obvious that if we plot closeness or the inverse of distance to customer satisfaction, well, the closer PUDO is, the more the client is -- the more satisfaction it raises. And if we look at what is the evolution of density to against preferences, we see that we are in a reasonably sweet spot, both in Portugal and in Spain, but we need to invest along this line. This is, of course, the other only -- out-of-home only peer. And this is what we plan to do, to invest more to somehow follow the evolution of this trend and also because we know that we will, in a way, influence this trend. The more lockers and PUDOs we have, the more this preference will develop. And we've seen this in Portugal very, very well. So that's why we are so committed to this target that you're going to see later, but you already know of 10,000 lockers in Iberia.

So this is good for merchants. It's good for municipalities. It's good for couriers. It's good for consumers. Well, with a few green stamps because it's, in general, also good for the environment. So this is yes or yes, a way to go. This strategy, in our case, is a combination of lockers and PUDOs, as you know, lockers being mostly in public places that delivering a 24/7 presence, and this is very, very important. PUDOs more on CT places and local stores. Again, of course, with an attended operation. It's not available 24/7 and the advantages are well known. I don't need to take you here, just a few names of the 10 highest users of our networks today.

We also want to increase leadership in this area. And so finally, the target. Here, we see the total number of PUDOs in Iberia evolving from 38,000 to 53,000, in Portugal 21%, 79%. So Spain growing more than Portugal, also because Portugal is already pretty filled with our own presence. And this is where we hope to be. We are -- we did deliver 3% last year. We want to be in 2028 at between 10% and 15% and then move to 15%, 20%, following and also helping the market adoption to evolve. And this is by expanding our present 20,000 points of presence to almost 30,000 in 2028, given being the locker expansion, obviously being the more relevant component. And you'll see that when you look at capital expenditure, and Guy will also address that. So a very important point here. This drives, for obvious reasons, significant operating efficiencies to deliver with 100% network is 40% -- as a cost, which is 40% the cost of, well, non-PUDO network. So this is also a very significant source of improvement.

So cost efficiency, planning and volume peak management because it very, very core peak, the usage of a locker or a PUDO network sometimes helps to exhaust parcels if that is allowed by the customer and quality of services. Well, with this tiny presence that we have, we know that we have -- with the number of PUDOs that we have today, we saved in 2024 sufficient funds to a full year of Lisbon to Madrid line hauls. So just to give you -- and this is a very small presence that we have in Iberia. So this is a very strong source of further efficiency.

A focused road map on operations, so network capacity efficiency, integration and synergies. Just to mention that we need to keep expanding our network, increasing productivity and consolidating our Iberian approach. And finally, [Audio Gap] we need to do on the network expansion side.

Well, a deeper word on what we are doing on in-house innovation and on engineering. We have this sort of hybrid solution, whereby we install, modify, upgrade our sorters with our own technology. This drove and it will keep driving 48% cost reduction and the 65 first-mile process productivity. The fact that we control our own sorters and the software that manages our sorters is ours, gives us a huge hedge on managing productivity of sorting and first mile. Then upgrading sorters, 42% FTE reduction, 48% of parcels handling.

Tray vision. We have improved the efficiency of our main sorter in around Lisbon in Merle by 10% just out of vision technology that makes inspection of the trays and manages the fact that the sorter could be dirty or occupied. So 10% increase on a large sorter is a huge investment just by a tiny contribution in terms of vision.

Then we have developed a proprietary digital weighting system because the market offers were too expensive and not strictly usable for us. We have developed also technologies on containerization, moving to last-mile routes, dispersal points. So this is technology that is basically related with the organization of the way we deliver. A field force app that has improved 3 percentage points on effectiveness of delivery, pit-stop technology that is also proprietary and of course, the highest impact. We came from 0 to full flexibility in lockers in these 4 years.

We do have -- we control electronics, software, metal parts. We have a virtual factory that fabricates them. We have lockers for all purposes, and we are increasing significantly self-service in our retail store also through that.

On internal technology, more on the digital side, I would refer to the Helena chatbot. It was, in fact, the first chatbot to be publicly made available publicly in Portugal. This deflects today 35% of our contact center inquiries. So a significant improvement in efficiency, increased by 40 points NPS and then by incorporating agentic AI, we are also driving additional economy by deflecting contacts that otherwise need to be handled by, well, real people.

On the field force app that I've mentioned, a single Iberian platform. And as a whole, the first pilot of a new system for the whole of Iberia is already working as we speak so far with the normal difficulties and successes of a very complex project that is going on.

And finally, on omnichannel, we want all our journeys being it by companies or by retail customers to be full omnichannel. They can start digitally and then physically, they can start physically and then digitally, they can start on a self-service and end -- close on the balcony. So everything should be -- this is the aim, and this is why we need, of course, to excel on IT technology and also the corresponding hardware.

Then investing to build the foundations for scale. There is this issue that the markets will keep growing. We will deliver a bit more than 150,000 -- sorry, 150 million parcels this year. But by '28, this number will increase to, we hope, more than 200 million. So of course, building capacity. This requires not only funds and the ability to deliver, it requires also probably new concepts for network evolution. This is Iberia. Madrid is the very center, not only politically, but in all senses in Spain. It's also the very center of Iberia. Most of our cross-border flows arrive through Madrid. And so we have now 3 very large hubs in Madrid that will most likely will evolve to a mega hub in Madrid with Barcelona, Porto and Lisbon also being very strong complementary hubs.

So we need to invest on the design of the network and significant investments here. And this is why Guy will also refer to this with more detail. This is why we are keeping roughly the recurring CapEx stable at 2% of revenues. But for a short period, we're going to have a hike for this -- both the investment in the locker network and the master hubs to allow for capacity. This will nevertheless not exceed the roughly 4% of revenues. So a robust training model, a clear path to attack the next cycle.

We have a strategic positioning on the fastest-growing portion of the market, which is e-commerce and B2C and the key players of this market. And that's because we have positioned ourselves to be there. We have the most compelling offer along the e-commerce value chain, enhanced by the DHL joint venture and the acquisition of Cacesa. We have a specialized operating model backed by technology, autonomy and higher technology intensity in our operations and integration. And we have differentiation, scale and efficiency as the main levers to consolidate our best-in-class margins. That's why we believe we deserve to aim the Iberian leader on e-commerce. And this is where we are today with our partner. This is where we hope to be in 3 to 5 years. Thank you.

Thank you. Thank you very much. As we are CTT and we like to deliver on time, we are on time. And so as such, we have time for a full coffee break. The coffee break will be towards my left, towards your right. And I look forward to seeing you here at 11:40 -- sorry, at 10:40. Thank you very much.

[Break]

Good morning, everyone. My name is Joao ão Sousa. I'm the Chief Commercial Officer of CTT, and I'm going to present you today the strategic for Mail & Services for the next 3 years until 2028. As you know, the decline in mail is -- in mail volumes is a structural global reality, but at CTT, we are actively transforming this challenging to a source of efficiency, innovation and the long-term sustainability. Why? Because the trend is that mail volumes continue to fall globally, a struggle trend driven by digitalization and a new way of how people, companies and institutions communicate. And this is a permanent shift, reshaping how people are communicating.

But at CTT, we are not waiting for a change. We are leading it. So we don't see this is like a problem. And our focus is clear in efficiency and growth. In efficiency, we -- and I'm going to speak a little bit about this during my session, we are modernizing our operations and improving our workforce efficiency. We are advancing the digitalization omnichannel experience and also working on everything, and like João Bento said, involving the USO terms. But most important, we are using mail as a platform to growth, like we already have done for the Bank. We already have done this for Express & Parcels because we have this relationship with all these customers, B2B and B2C.

So in that way, we see mail as an opportunity to grow in B2B, growing in share of wallet and market share inside of B2B customers and in B2C selling financial services for these customers. Inside of these new areas like João Bento says, we have 3 strong business lines: Mail, our historical mail operation and complementing by these adjacencies that allow us to look for this business area like a business to growth, Financial Services and Retail and Business Solutions.

Beginning on Mail, our focus here is maintaining the service relevance while improving the unit costs and the unit economics. How are we going to do this? Volumes are declining by over 40% across the world, the last decade. Portugal mirrored this strength. And why? Because digitalization is in process, is our main competitor for Mail, shifting the consumer behavior and also rising costs of physical mail. And this is going to happen in the coming years. So we know what's going to happen. So that's why it's so important to offset these decline of mail with efficiency and business adjacencies. And now we're going to do this. So as you know, we have this current price mechanism that allow us to mitigate the impact of the decline of volumes in Mail, but nevertheless, we need to continue to work in operational efficiency. Because if you see, this is the reduction of the regulated mail, so an available trend. But we have these convenient prices that allow us to mitigate the decline of volume.

So around 60% of the mail volumes are using this price form that allows that the decline on revenues is less than the declines of mail but is keeping tightening cost control is crucial to maintain this area sustainable at the same time that we are going to focus in growth like I'm going to talk to you after.

And how we are doing this? Leading. So the focus here, we're very happy on CTT that we are leading the way, we look for the efficiency in mail. Leading distribution innovation, if you see here, since 2019 we are evolving the distribution model that allow us to decrease the number of routes. We began with this all of crazy names or good names that our operations invented with our marketing team. And now we have this new model that is unique, and all the other operators are trying to understand how we are doing this, that we call fast and slow distribution model. And what it is this fast and slow distribution model?

In fact, it's a dual speed network that is -- uses 2 networks, 1, D+1 for priority products, mail or express and parcels and a slow network for D+3 for not priority products, okay? And this has allowed us to distribute the number of routes, number of kilometers and also don't need so much people to distribute. We have also like, João Bento, talked about it, use technology to improve our performance. And Raul talked about that last night in the dinner. We are becoming more than a Mail company or Express & Parcels company, also a technology company. And we are using that technology to be more efficient in our operations. I bring here just 2 examples, just for you to understand. This is what we call track florence orange bar codes, but at the end of the day, can use some samples what the mailman are doing in this app. And that way I can control efficiency and quality of our operations.

We have these postman cards with this capacity increase through an ergonomically design card. I would just like to highlight this is doing with recycled materials and look it produced in Portugal with 1/3 of the cost of the typical normal suppliers. So very happy to have done this in Portugal and at the same time, bring more efficiency to our operations. And we have this postman digital brain at the end of the day, what it is. We are incorporating to a digital system, the knowledge of the postal network. So typical, the knowledge of the routes was in the postal men and we are bringing this to an app. And with all of this information, we have decentralized and can be planning much better our -- the way we deliver mail.

We're also going to have this retirement and natural exits that allow us to do a workforce resign avoiding forced exits. So this is at the same way we are decreasing the number of routes. We are optimization operations, we are bringing efficiency. We don't need so much people and have this retirement and natural exits allow us to have less people without forcing exits. We look for this natural attrition a decrease of 8% to 12% by 2030. So this is also important.

Of course, always coordinating this with the demand we have with mail and the capacity we needed and also promoted initiatives that facilitate integrated and mobility people inside of the company. But at the end, we still need to work on and being improving all these efficiency, like I told you a year before. Working on new operation models like we see. We already are trying always and Raul is challenging us how we can do better, how we can be more efficient. Looking out the way we can do with less people with operational force efficiency via natural churn, retirement, transferring people inside of the company. And of course, looking for our corporate functions, we have inside of CTT, try to understand how we can resizing this capacity and this corporate function.

This is about mail. Now also very important, and João Bento already speak about this, we have a strict USO that wasn't -- have not been reduced in sync with a sharp decline in volumes. What I mean? We still have -- most of the European operators still operate with 5 to 6 delivery -- 5 to 6 delivery days per week despite the volumes are dropping. And this means that these standards are outdated and financial and sustainable for mail operators. But as you can see, some countries already are taking measures to help the mail operators to maintain these public services. That's why it's so important and it is paramount to involve the new USO contract in 3 key dimensions.

Of course, maintain the scope of quality and SLAs, but simplified products, aligned with the -- how important is mail for the community. The financial model, this self-funded model is not more sustainable for the future. So we need to work and try to understand how we can -- try to understand how we can funding these public services for the future and also the geographical coverage, as you can see from the presentation of João Bento. I'm going to show you also with self-care solutions, we can have this geographical coverage and don't have a route or a person to deliver in mail or package inside of the house.

So this is about mail. This is how we're going to work on efficiency and bring efficiency for this business. I would like also to highlight, this is a decline, but we know what to do with this decline, but we are using the platform of mail to growth. This bring -- because CTT is a loved brand in Portugal. We have a very good relationship with B2B and B2C customers, and this is what we are doing right now. Business Solutions is now a structural growth driver, accounts around 50% of the Mail & Services revenues and growing more than 90% per year.

So it's already established, okay? And we want to capitalize these market share we have with B2B customers to introduce more business solutions and growing market share inside of these customers. And now we're going to do this. Following these key trends.

First, balancing these digital payments growth. So payments are bringing more digital. But at the same time, we still understand that this -- we have some segments that want physical payments. So we have the best solutions. We already have digital payments. At the same time, we still have this huge network that allows us to have physical payments like nobody inside of Portugal. This is one of the trends we are seeing for B2B. The second one is cost control and reduction. Most of the corporate leaders around the world is trying to understand how to avoid costs, how to cut costs with innovation, with digitalization or service outsourcing, and we have these solutions for the customers, and I'm going to show you.

And the last one, how to use technology to accelerate efficiency inside of the company, mainly with AI. This is the 3 key trends we see for the next 3 years for B2B and the concerning of the companies. And this is the way we are positioned to deepen customer relationships. We already have this commercial and service digital platform already inside of our portfolio that enable us to help the SMEs to go digital. We have this digital wallet inside of this -- just for you to understand, 52% of the Portugal students right now is using a digital wallet of CTT. This is sometimes when you look for CTT and we look for mail and we look for e-commerce, we don't understand these small service that we are implementing and growing inside of CTT.

We have the solution of payments. Just for you to understand, in a normal daily basis, we have more than 100,000 daily users that using our physical network to pay invoices, to pay taxes and so on. We have this mall and document management. This is a solution, maybe all the solutions we have in Business Solutions, but still very important because you have -- if you go for municipalities and big companies, they still have a problem with documents, how to digitalize, how to archive these and we have this solution for the companies.

And at the end, we have these business process services that will allow CTT to deliver an end-to-end BPO solutions and contact centers to our customers or prospects. And why we believe that we can have success? Because on B2B, what is very important is the relationship and the contact you have with the customer. And just for you to understand today, CTT have a share or have a contact or have a relationship with more than 90% of utilities in Portugal, more than 80% of the municipalities, more than 60% of bank and insurance and more than 45% of the public services and institutions.

So the path is over there. We have the solutions. And after this presentation comes a tough job is selling more and growth. That's why we are aiming for a double-digit growth on this area, but not with the same importance of investments. On payments, we're going to have an investment level of growth with the strategic rationality that payments is very complementary with the Express & Parcels business. So we went to investment in a way that we see growth in this area.

On business process services, the idea is here to invest in a double down investment and leveraging the business opportunities that we already have with the relationship with the customers that I talked before. On customer service and digital platforms, it's doubled down, reinforced the digital service role is very important. Portugal is still having a way for the companies to go digital and CTT can be the right partner to do this job. And Mail & Document management, investment level is maintained as it is, but pursuing the digitalization opportunities. And in that way, we see a growth per year at 7% to 10% until 2028 on this business area of growth.

Now I speak about B2B and growth. Let's go for Financial Services and Retail. They are the area that we want to maximize the assets we have inside of CTT. What is the assets we have on CTT? 15 million walk-ins per year in our retail network. This is something unique. Who is managing in a daily basis retail, understands the importance of have 15 million persons enter in a store, on a third-party store in a week -- per year.

We have what we call the biggest retail network and we want to have also the best retail network. More than 500 CTT stores, more than 1,800 [indiscernible] that is third parties for logistics and more than 4,700 agents Payshop. Payshop is our brand for payments. At the same time, we already have this digital network with self-service with [indiscernible] and workers like João was mentioned and also our digital app, and I'm going to bring you the numbers of also digital, just for you to understand.

We are so ambitious that we call internally this app as super app so it's -- and we think with this physical and digital network and using each channel to offer service that best suits the type of customers in the segment, that we are able to grow on this B2B. Because right now, we are on CTT and [indiscernible] selling postal and parcel services and also third parties like for Banco CTT, for GCP and Generali, and we can go for an omnichannel experience, growth in this area of postal and partial service for so SMEs.

But at the same time, growing these current partnerships we have with the bank, with Generali, GCP and also new -- start new partnerships because most of the utilities in Portugal, when look for this huge retail network, understand that can partner with us and use this retail to work with us. But this means that we're going to serve and sell everything inside our stores, no. We have done a huge segmentation. So we have -- on the logistics part, we're going to sell, focus on our CTT stores for SMEs. So -- and for B2C insurance and public debt. We're going to sell Mail and Express & Parcels on CTT portions also, but more simplified offer, more simple, not so complex like we have in our CTT stores.

And these Payshop agents don't sell logistics. And the additional offering, we're going to sell financial services on stores. We're going to do work for CTT and payments, but no more confusion, don't going to have either retail services, other services that we're going to do with in third parties. So in that way, the B2C customer or the SME understands when he wants solutions for in SMEs in logistics or financial service that needs time or payments that needs time, consulting sales going to a CTT store, simple offer, logistics or additional offering going to our third parties that we have.

And for that, we need to do something, doing 3 different things: A new shop concept that allow us to have more consulting sales that people have time to sit on the CTT store so that our salesmen can have time to sell our services. Using our lockers to complement stores which have self-service capabilities, so no-brain solutions, the customer can go for self-service, doesn't need to go for a store and also use our digital channels for omnichannel experience.

And now I'm going to show what we are doing on these new concept stores. So in these new concept stores, we have enhanced the client to be autonomy and self-service when they don't need any consulting. We have these self-services working 24/7. This preparation deck or is this quick service counter that can do all the services that they don't need to be in the queue and waiting for a long time. We're going to have spaces to consulting sales for SMEs and so or individuals that take more time like we have for Bank CTT and we are doing this with the bank, waiting areas, consulting services, selling financial services or insurance need this.

And of course, with technology when more time enable us for a new customer journey. And you are -- and the numbers we have and the outlook is very positive for the new stores and in that way, that's why we're going for the top 10 to 15 high-potential stores will be annually remodeled. So you're going to see this in our CTT stores in the country. At the same time that we already have this in our app, in our site. We still maintain our investment in digital so to bring this omnichannel experience to our customers.

We have something that is very powered for us. João Bento already talked about it. That's why we can have these self-services and self areas. This is CTT-owned technology. Some of you already saw this yesterday. So this enables us to be very flexible and design the solutions the way we want for our customers, for our stores and for our partners. That's why we have these lockers that receiving and sending and very important for returns. Returns, it's very important in e-commerce. And right now, 70% of the potential CTT stores already have at least 1 locker.

We have these vending machines that allow customers to purchase prepaid envelopes and boxes and so on. Just for you to understand the success of this, around 29% of the sales on these vending machines is doing after closing hours. So this brings more convenience to our customer, more flexibility. At the same time that we take people from the stores that want just simple products and allows our sales person to spend more time with the customer. We have this PO digital box so the typical -- the oldest thing that we have in our stores with also the technology of the locker.

We have the stamp machine, also one more time. The customer wants just one stamp or more than one, they can do this with self-services and we're going to have label printers also to do this in self services. And I would like to highlight this very beautiful outdoor version we have. We change what we call [indiscernible] in Portugal for this one. So you see this in Portugal, in Lisbon and Porto, a self-care machine around the city. At the same time, even these ones include 2 red panels that allow us to communicate to the customers with CTT advertising.

And this capacity it's very important to bring this new concept to our stores. At the same time, we are investing since 3 years in this, what we call super app that bring convenience to our customers and seamless digital access to consumers. So they can begin doing things in the app and finishing the store or beginning the store and finishing in the app or can do all the purchases, all the services inside of the app. Just so you understand, right now, we have more than 3 million registered consumers in the app, a powerful number for Portugal.

Growing year-on-year a daily basis, users, 20%. And why we call it this super app because inside of this app, you can have logistics services, parcel tracking, online parcel service, via CTT, that solution we have for SMEs and companies in Portugal and also understand what is the Locky and all the relationship with the Locky. We have payments inside of this app. So call -- so, they can do payment tools, tolls and consulting, and we are developing this digitalization of the Payshop journey also inside of the app. Just for you to understand, more than 50% right now of the payments of digital tolls is doing -- of the toll, sorry, is doing by digital.

And we have the success of financial services that is selling the public debt on side of the CTT. Right now, everybody can do a subscription inside of CTT, and we are already in development and just waiting to put this in the market, the capacity to also opening already in account of -- for digital. And just for you to understand, September was a record. So every month, we see more people using the app. And with this, we bring new subscribers and new type of subscribers for [indiscernible].

So in a nutshell, with this digital expansion, new services to grow in this area in top of a stable context of public debt that we see flat, but growing 3x the new financial service, insurance, health plans, third parties and most of these have an importance for us because it's recurring revenues. That's something that you typically don't have in this kind of business. We see for the coming 3 years, a growth of 7% to 10% on this business area.

In resume, we believe that in Mail & Services, we have a clear plan for the next cycle. In Mail, stabilized mail profitability through price mechanism and operational efficiency, like I speak before and using Mail to grow in our B2B customers, grow share of wallet, maximize and monetize the relationship we have with these B2B customers and grow also in financial services through new offers and mix evolution with the channel. That's it. Thank you very much.

[Presentation]

Hello, good morning to you all. It's really an honor for me to be here for the first time presenting to you Banco CTT and it's also an excitement for me to be presenting you the new growth cycle that we see ahead of us. But before talking about the future, and our growth ambition, as I was mentioning to you, I think it's really important for -- first of all, to understand what we are as a bank. And why can we look to the future with this new ambition, as I mentioned to you.

So we started the bank in 2016. We are almost celebrating our tenth anniversary next March. And we started developing a very innovative retail banking approach. And I will underline the 3 basic pillars of this innovative approach, as I mentioned to you. The first of all is, of course, the brand. Who can start a business with such a strong brand as CTT? We have that opportunity. So when we launched the bank 10 years ago, we already had a very strong and successful brand with us.

Banco CTT is, as you all know, one of the best recognized brands in Portugal and every individual and family associates the brand also with some core important values for a bank. The brand is associated with trust, proximity, also very associated, as João Bento show us because of the relations with the public that with focus, so with the savings and so this was really a privilege to start a bank with such a strong brand and such strong values. And even if you remember, we started in a very post-crisis content where the incumbent banks were facing a very negative perception from the customers. And we started in that moment in time with a very strong brand.

The second pillar that I would like to mention to you is, of course, the branch network. Again, here, we have the privilege to start not only with a digital solution like the neobanks, but also with a nationwide presence with a very low CapEx. And we have this privilege because we started in CTT premises. We started in premises, which are located in the very prime, high traffic locations, in places where everyone knows where CTT are. So the general public assemblies and individuals again, know exactly where CTT is located in that city. And this was very important for us and for our growth, as I will show to you.

And we do this with a very low CapEx. We estimate with less than 5x less CapEx vis-a-vis the incumbents to start a new branch for serving customers, and also with a solution with very low and flexible OpEx. Because if you look to the incumbent banks, you can see that probably they will have around 7 -- 6, 7, 8 employees in their branch, is on average. And probably if we don't have the capacity to have 4 employees there, because the business is not there, they will probably have to close. But in Banco CTT, we have today branches with 5, 4, 3, 2, 1 employees, and we can adjust our capacity to the moment where we are, not only to the market that we are serving, but also to our growth cycle.

So this was really a very important thing for us, and it's still a very important asset that we have. So we can serve the customers in a digital way of serving, in an omnichannel way of serving with a very interesting and very nationwide presence in branches with proximity and with a very low cost to serve when compare it to everyone else. The second thing that I would like to underline is our value proposition. So we started the bank, we decide of a simple value proposition.

We are very focused. We are only serving individuals and families and we have a simple value proposition with reduced adoption barriers so that everyone can open an account with Banco CTT and with a very strong value for money. And also with an attacker mentality so that we can grow fast as I would show you -- we'll be able to do in the past 10 years.

And so this was, as I was mentioning to you, a very innovative retail banking model. And let's see what happens in these last 10 years. So today, we can probably say that this -- the market have confirmed this new innovative approach model. We have more than 800,000 customers that believe in us, and that trust us every day to help them satisfy their financial needs. And this is a huge asset after 10 years. It's a big customer base, as I mentioned before. We have more than 700,000 customers with the banking account and also in 2019, we acquired 321 Crédito, which is the top 3 brands in auto loans in Portugal, and we have more than 100,000 customers with auto credit with us.

And this is not only a very important customer base in terms of size, 800,000 customers, but it's also a very important customer base in terms of quality. We are looking to essentially customers that live in Lisbon and Porto more than 65% of them with an average age around 48, very aligned with average age of the Portuguese population with strong digital adoption. We have a good Net Promoter Score. So the customers love the service that they are receiving from Banco CTT. And we have already a noteworthy engagement level.

We estimate that around 50% of our customers are using the bank as their primary bank. And this is a very interesting number for a bank with only 10 years. I can tell you that, of course, if you look to the incumbents, you will see a higher engagement rate. The incumbents are probably around 70% of engagement rate. And what this tells to us is that we still have a lot to go in terms of the engagement of our customers, which, of course, represents a growth opportunity. But I can also tell you that this number is way higher than any neobank can achieve even after 10 years.

So I think that this both represents a validation of the market for our approach -- our physical approach and also represents a good opportunity for growth. I can also tell you that we are the fastest-growing bank in Portugal. If we see the last 3 years, we can see that we are growing 12x above the market in terms of volumes -- business volumes -- on balance business volumes. And this is huge, and this represents, again, an opportunity. We are in the momentum. We continue to be the fastest growing at the end of 10 years.

This is easy to be in the first 1 or 2 years. But after almost 10 years, we are still the fastest-growing bank in Portugal. And this is very important for us and for prospecting our future. And we also fully deliver our previous Capital Markets Day aspiration, which is also, of course, essential and really very important. So in terms of business volumes, we are above guidance in all of the objectives that we presented to you in the last Capital Markets Day. And also in results, we have profit before taxes expected to stay within the range despite of the lower interest rate scenario that you all know that we lived in.

So we have a very interesting story. We are -- the market has validated our model. We are growing fast. We have delivered what we promised you that we will deliver. And so I think that we can, in short, conclude that we are leaving a great momentum. So the innovative business model is leveraging the distinctive assets that are not available to neobanks. So we are in a very nice place. The outstanding market acceptance show us that we are in the right path. And we still are looking to positive macroeconomic context for the next years.

And so this is the time, of course, for us to double down on our growth ambition, supported, of course, with investments in some key enablers to support not only this new growth ambition cycle that we are going to be in the next 3 years, but also to support future growth cycles with a very scalable way of doing things. So this is really important for us. This next 3 years will be very important. And what is this new business cycle and how can we represent it in a very simple way. So we will be looking for 3 growth themes and for 2 business enablers, and I will be talking to you about all of these 5 areas of interest.

The 3 growth themes are, of course, grow customer base, grow even more than we have grown in growth in the last 2 or 3 years and of course, work in that engagement level that I've already mentioned to you. We will also want to excel in savings. We started with savings, again, capitalizing the brand awareness of CTT in savings, but we want to go faster on that and capitalize on savings and on investments, and I will tell you how. And we want to fight for our fair-share in credit. We are not so good yet in credit. And of course, if you want to be the primary bank of your customers, you need to have the entire offer, and you need to be very good, not only in terms of offer, but only -- but also in terms of commercial attitude in all the aspects of the offer that an individual or a family needs to fulfill their financial needs.

And we will, of course, invest in our hybrid distribution model. We will -- we are going to increase the investments in our hybrid distribution model and in our digital transformation. And I will address each one of these 5 items for you. So in terms of growth themes, we will -- we want to keep growing in terms of number of customers. This is very important. We have already shown to you that we can do this, 800,000 customers in less than 10 years, it's really impressive. And we want to go faster -- even faster. And to do that, we will improve our current account portfolio.

We will underline our freemium approach to the marketing, reducing the barriers for new customers. We will be launching tailor-made offers for specific segments. For instance, in the beginning of next year, we'll be launching a specific offer for self-employee customers. And we will keep simplifying the commissions so that we have a clear message to the market that if you want to work with us, you will not pay commissions with your current account portfolio. And so we will, of course, have a positive discrimination for those customers, who want to work with the bank as their primary bank.

And we'll also improve our service and capillarity. I will talk a little bit about that later, but we will improve our service standards with a more omnichannel approach that we have today -- than that we have today. And we will increase our capillarity with presence in underserved regions, again, with our low CapEx, low OpEx model that I mentioned to you. And with that, we aim to be -- to have more than 1 million customers at the end of 2028. In the deposit and savings, we will complete our off-balance offer. We are very good and very strong in on-balance offer. We have to complete our off-balance offer.

We will strengthen our partnership with Generali, which is going amazing. The first months of work, we are way above our own objectives in selling off-balance products with Generali, and we will launch new products during next year to complete the off-balance offer. And we'll also launch during the first semester of next year, our investment funds platform for -- our platform for investment funds and selected capital market products. And this will complete the offer so that we can be as good as investments as we are already in savings.

We also want to boost our cross-selling with CTT, as João was mentioning, and we will leverage the CTT ecosystem, again, very aligned with what João also mentioned before. And we'll maintain an attacker attitude on term deposits, mainly looking for new money and being much more aggressive for acquiring new money. So we'll maintain our attacker attitude in term deposits. So we need to complete the offer and excel in savings and investments.

If we look to the credit, and I already mentioned to you that we need to -- we have very good opportunities in credit. In mortgage, we have the product. We have a very good product, but we need to improve our time to decision and our time to cash. This is really essential to increment our market share in mortgage. And we will also reinforce the relationships with intermediaries, going even deeper at the point of interconnect bank systems with CRM systems of the main mortgage intermediaries.

We will also invest in consumer finance. We will revamp our actual personal loans partnership with a much more commercial attitude towards the consumer finance products. And we will launch our own balance credit card. The offer that we have right now is with partnership, and we don't think that's the offer that we need to have. So we will launch our own on-balance credit card, and we'll have it hopefully at the end of next year. So this is very important for us to go deeper in the credit.

For auto loans, as you know, we are already #3, but we want more. Right now, we have this very important share -- market share, but we are very focused on the small and medium car dealers, car vendors and we want to go also be very good in the large intermediaries. And this, of course, needs a different approach, a different approach on pricing, a different approach on offer, a different approach on process. And that's what we are going to invest in the next months so that we can go deeper and increase our share in auto loans and our ambition in auto loans.

And we will also develop new strategies -- new commercial strategies, not only with more than 100,000 customers that we have right now, and we want to work better that relationship that we have, mainly if we think about revolving at the end of the contracts, but also we need to work better the cross-selling between 321 Crédito and between Banco CTT. We want that the customers from Banco CTT have easy access to the offers of 321 Crédito, and we want that to customers for 321 Crédito to open their banking account in Banco CTT. So we will go deeper on this cross-selling agenda.

And with this, we expect to have annual growth above 15%. The same I didn't mention it. I hope that you have seen that in the previous slide -- the same in the previous slide. So we hope to have an annual growth above 15%. For the enablers. So we will be investing in our hybrid distribution model. I've already told you that. So we need to revamp digital channels. We have good digital channels, but they are mainly focused on service, and we need to focus those digital channels also in sales, not only sales in the self-service way so that the customer can fully buy the products and have a customer journey to fully buy the product in digital channel, but also in this omnichannel approach, like João Bento was mentioning.

The customer need to have the ability to start their customer journey in the branch and in the app. The employees in the branch need to have the opportunity to call the customer, sell a product and the customer doesn't need to come to the store to sign the contract. They will sign and finish the sales or the buying process in the app. So we need to invest a lot in the digital channel so that it will be much more focused in sales and much more focused in marketing with marketing automation campaigns and marketing automation capabilities.

And we need also to strengthen our branch network, keeping this low and variable cost base that I already mentioned to you, and that is an asset that we have and nobody else have, and we have to capitalize on that. We will reinforce in-store specialized stuff. We will double the number of employees that are fully -- totally dedicated to the Banco CTT service, and we will expand the branch capillarity for underserved regions, but still with a very high significant market value, and we'll do that again because we can, because we have this opportunity for being in CTT Group.

We will also invest in digital transformation. It's really important -- it will be very important for the next year. We are right now changing our core system. We will have -- this change will take place during next year. This is a really very important moment not only because of technical issues -- of course, we are migrating it to cloud and so on. So this is also important in terms of technology issues and to be very able in terms of technology. But this is also very important for scalability so that these new core systems can support the bank ambition for growth and also for flexibility.

We need to have flexibility and time to market to launch all of these new products and all of these new customer journeys in a time-to-market manner. So we will also be investing a lot in AI and process automation. We will transform the bank during these next 3 years in a data-driven company, clearly, AI-first bank. So this is our ambition. And of course, we have lots of things to do, as you can imagine, to put in place the systems, to support the new products, the new digital channels, the new customer journeys that I've mentioned to you so that we can have a complete simple offer, but complete so that we can engage the customers more and more and increase that 50% that I mentioned to you before.

So in a nutshell, we have a strong ambition with the growth focus for the following years. And these are the key numbers that I can present to you. So in 2018, we expect to be way above 1 million customers with the bank. The business volumes, we will -- in 2024, as you know, we are looking to a EUR 7 billion business volume, and we want to be in the EUR 12 billion, EUR 14 billion in 2028. We will be between EUR 12 billion and EUR 14 billion in business volumes in 2028. We will be delivering a profit before taxes around EUR 40 million to EUR 50 million. Of course, because of the investment that we will need to do in the next months, we will be stable until 2026. So we'll see the increase in profit before taxes in 2027 and 2028.

And we will be delivering a return on tangible equity -- a normalized return on tangible equity around the numbers that we are delivering today, so 12% to 13%. Of course, with a different structure in our capital base, we will evolve from a 21% core equity Tier 1 capital base to a core equity Tier base above 17%. And this is important to address that this is a self-funded plan with 100% of the earnings reinvested in the bank. And this is, of course, also very important to mention and for the group.

And with this, we will materialize our core vision. We have just recently entered the group of the midsized banks in Portugal -- of the 5 midsized banks in Portugal. We have recently entered this group, and we want to go higher in this group. We want to be the first in this group. So during the next 3 years, we will be a fastest-growing franchise on track to become a significant midsized player, and this is our vision, and we will capture every day a bigger market share for realizing this -- for fulfilling this upgraded core vision.

So just to synthesize what we can expect for the next 3 years besides -- with all these ambitions and projects that I mentioned to you. So we'll be much more relevant in the market. We will have more than 1 million customers, and we will increase that level of engagement that I mentioned to you. We'll be growing in a strong way during the next 3 years. We'll be reaching EUR 12 billion to EUR 14 billion in business volumes with a growth -- annual growth above 15%, and we will keep our returns with the benchmark of return on tangible equity around 12% to 13%, delivering higher bottom line results by 2028.

So this is the ambition for the next 3 years. As I mentioned to you before, we are very excited to showing to you this ambition. Me and the executive team that are all here with me are very committed to it, to deliver this vision. And we are also available for any questions that you have at the end of this session. So thank you very much.

Good morning to you all. I will guide you through the financial ambition. And I will start with our journey. Our journey over the last strategic cycle has been remarkable as we transform CTT from a postal Portuguese operator into an Iberia integrated logistic player. And we did that while we grew our business significantly. We grew 10% per year over the last strategic cycle, making parcels our biggest business unit that when we combine with the bank, the other growing area that we have. It almost accounts for 60% of our revenue, so diversifying away from the legacy business.

And that is even more meaningful when we discuss EBIT that also grew 15% in the period and reached more than 17% of parcels and bank combined as the growing areas of the overall profitability. And we did that combining fast growth with best-in-class margins and that allowed us to grow our EBIT faster than our peers and outperforming most of them and we -- during the period from '22 to '24. While we did that, we also increased our recurring dividend. We complemented that policy with 3 share buybacks programs that allowed us to buy more than 12% of our share capital, and we kept investing in our business.

We stepped up investment in our business, and we managed our balance sheet in a very balanced way that enabled us to keep leverage even furthering down the increase of growth with the acquisition of Cacesa that we recently made. And we did that with a very disciplined capital allocation strategy. We were being able to redeploy capital in an accretive manner. We -- as an example, we had inflows like the real estate that we did in an EBIT multiple above 14x that we deployed, be it in Cacesa or NewSpring for the much lower than our trading multiple and with an acquisitive play.

And most important, we delivered our targets. We delivered all the financial targets that we promised to you 3 years ago. We delivered revenues. We are well in line to be on the top end of the guidance range. We were the fastest-growing Iberian player in the market. We met our recurring EBIT guidance. We are also meeting all the targets on the bank, namely the return on tangible equity, and we think we optimally combine shareholder remuneration with the investment in our capacity.

And what about the next cycle that we are starting today? We will seek to continue to allocate capital in a strategic fashion, and that means that we'll continue to invest in our scale, investing in growing capacity and broadening our suite of services. That means that we'll densify PUDOs as João takes you through. We'll scale fulfillment, and we will continue to differentiate in last mile. And that will be always driven by quality. We aim to be best-in-class quality as we think. It's paramount for our customers and for our growth. And that combined with verticalization, and scale will continue to lead to industry-leading margins that ultimately support our cash flow that we see robust coming in the next years that will also support our remuneration policy.

And what about targets? When we start with 2024 with this new structure of reporting, we include the Cacesa in order to make it comparable in terms of growth and we aim to grow high single digit in the next 3 years on the back of above-market growth, both in parcels and in the bank. We'll be acquiring share in our -- both of our growing businesses, and we'll enter the interval of EUR 1.6 billion to EUR 1.7 billion in 2028. In terms of EBIT, also the same base starting in 2024. We aim to be mid-teens, so growing between 13% and 17%. Also on the back of parcels and bank, we aim to achieve leadership in Iberian market in the next 3 to 5 years. And also the bank aims to be a significant midsized bank in the Portuguese market.

Our targets assume a stable macroeconomic context. As we see in all the official forecasts, we see GDP stabilizing around 2% in Iberia, the same for inflation rate and interest rates will stabilize just above 2%. And we are also assuming the conclusion of the DHL JV that we now foresee for the beginning of the next year. To support this growth, we'll step up our investment. We'll be increasing our investment to EUR 50 million to EUR 55 million in the next cycle, keeping it within the same CapEx intensity range.

And we want to replicate the kind of returns that we had on the past cycle in growth CapEx. We'll be investing in increasing our capacity. As João shown, we want to further increase Iberian integration. There is opportunities to reap out synergies for having a more integrated network, and that will be done especially through Madrid. And that, coupled with the technology, will further increase our ability to reduce costs and scale. And we'll continue to expand the locker network, especially in Spain. We have a very dense network in Portugal, but still a lot of room to cover -- or ground to cover in Spain. And we want to capture that opportunity because it's a new trend that will be fast coming to the Iberian market, and we want to take advantage of that.

We see paybacks between 2 and 3 years, so a fairly interesting investment. And we also will continue to invest in our digital platforms, be it on parcels, be it on the mail, be it on the bank. We need to continue to digitize and have smoother and seamless customer journeys in order to continue to provide good quality standards. The bank, as Francisco shown, will reignite its growth, and that will entail also a CapEx envelope that we estimate between EUR 15 million and EUR 18 million. That will be all self-funded by the bank.

And more important, we see this also a step-up of CapEx on the next 3 years when we phase out of these big investments on that and on the local network, will slightly come down to a CapEx intensity below 3%. The bank will still invest to reaccelerate its growth. We see a big opportunity to grab market share, market share in the credit, market share of customers, and that will enable the bank to become a leading midsized bank. And that will also drive value, as we see strong correlation between price to book valuation and business volumes.

And because the opportunity is there, we want to take benefit of that, that ultimately will generate value for our shareholders. When we look to our portfolio, we'll be keen to invest in our core, as we continue to be vigilant for opportunities to simplify our portfolio in the less core areas. And looking down to the logistics value chain, we want to reinforce our positioning in e-commerce value chain. We are highly present in last mile returns and after Cacesa's acquisition also in customs. We are looking to reinforce our positioning in fulfillment. We believe fulfillment continues to drive market share in e-commerce.

And also, it's a key element to have -- for cross-border e-commerce, as we see changes in the way the volumes will arrive to Iberia and also reverse logistics because it's highly synergetic, high-margin incremental margin that we want to also bet. And we'll keep prioritizing key verticals as we did in pharma. There are other key verticals developing in e-commerce that we want to remain vigilant. On the traditional core, it's an area that we are keen, but we don't see that much opportunity in Iberia and the other areas, either we are already highly present or it's not our focus.

We have a strong balance sheet that we want to manage to keep our optionality. We are setting up a leverage ceiling that is 2.5x net debt to EBITDA, that excludes the bank. We are now stand at 2.4x EBITDA in the 9 months. This is something that we see rapidly deleveraging under the current perimeter and even faster if we conclude the JV with DHL. We aim to operate within these new levels, and we use the optionality or the leverage capacity for any relevant inorganic opportunity that may arise.

So a disciplined capital allocation. First, we'll invest in the growth of our organic business, EUR 150 million to EUR 165 million of CapEx. We aim to have an interesting and growing shareholder remuneration policy. We are setting up a dividend policy with a payout between 35% and 50%, the same that we had in the last period that we also want to complement with opportunistic share buybacks, if leverage and the market conditions allow us to and keep the optionality of our strong balance sheet for any opportunity of an M&A.

So to conclude, we are certainly ready for higher returns. We are setting up ambitious targets throughout our all business units. We are investing to reinforce our core in all the markets we operate in, and we aim to continue to have a very disciplined capital allocation. So on the back of a strong execution track record over the last cycle, we are ready to grow, to deliver value to our shareholders and to continue to seize new opportunities for value creation that may arise on the next cycle. Thank you.

[Presentation]

Here I'm again for a few minutes to conclude and then remain available for Q&A. So we came up a long way, a very long way indeed. And we believe that we've announced a new journey starting now. We will intensify our Iberia integration as the cornerstone for value creation. We will build on unique partnerships for growth opportunities, and we have demonstrated how significant this can be in this recent strategic cycle. We will deepen tech intensity, fostering the innovation and efficiency.

And again, we believe that there is a huge role for technology to improve our efficiency ratios and quality ones. We will nurture closeness to our customers as a very important factor for success, since we have segmented our preferences and we know which markets will grow, we need to feed those relations because these relations are -- have a partnership nature. They live on trust. We need to develop talent, backed by a culture of merit and well-being because nothing can be done without engaged people and workforce.

We want to take responsibility in making a positive impact to our communities, the environment, people, locations, communities in general. And of course, we need to do that and want to do that in a balanced investment between growth and robust shareholder remuneration, as we very rightly illustrated. So we remain more than ever committed to deliver, which is our motto, with a target of EUR 1,600 million to EUR 1,700 million of revenues or a growth between 7% and 9% annually.

We are also committing to a growth of between 13% and 17% annually on recurring EBIT. And well, to sum it up, we believe that we will either be there or deliver significant steps to become the Iberian leader in e-commerce logistics. Thank you. We remain now available for questions.

Thank you very much. We will now have a Q&A session. And we have investors and analysts that are in virtual mode from elsewhere in Europe and all over the world. So -- and we have the investors and analysts here. We will take questions first from the room. And then we will see whether we will have enrollment for questions from outside of the room.

So would like to enroll for questions. We have a first question from João Safara. João, please state your company affiliation even though we all know it.

Is it working? Yes. Good. So it's João Safara from Banco Santander. Is there a question restriction, 2, 3? Let's do it -- let's do 3 then.

Try as much as you can.

I'll restrict it to 3. My first question on the -- I mean, on the -- basically on the CapEx plan, which I understand it's a little bit more intensive in this period than probably I was expecting. And also, a big part of it is also being driven by the bank. So I noticed there has been, let's say, doubling down your bet on Banco CTT. And so as far as I understood, the bank will self-finance this investment, which will probably mean that during this period, '26 to '28, we shouldn't expect any dividends coming out of the bank. So that would be my first question. How do you think is your -- let's say, your dividend flow from bank to CTT?

And then on market share, so you have the ambition to be the #1 in Iberia. Just if you could give us some figures there because we usually talk about your market share and you've presented your market share in Spain and in Portugal. I guess the overall market share today should be close to, I don't know, 15% to 17%, maybe I'm wrong. I mean -- and I would like you to address that. And thinking where you want to be in 2028, which would mean having a higher market share than say, wood. What that would mean? So this basically just going back to the slide you showed on the peers and the market share, what should we expect for Iberia in terms of market share for you to be the leader?

And then the third question on what you mentioned on the Universal Service Obligation. What has to change for the new Universal Service Obligation or the -- or no Universal Service Obligation? Just what has to change in terms of the funding model for it to become viable by -- starting in 2028?

Nuno, how does this work?

Let's answer one analyst by one analyst.

Thank you, João. I'll start with the last one. So the implied consequence of my comments are associated with the fact that mail is declining, and we have a funding mechanism, which is solely associated with users. I'd like to use a short joke of a colleague of mine, which is the CEO of An Post, the Irish postal company that says, "Well, my operating costs on Mail are roughly EUR 400 million. With your mechanism today, I will have a single letter to deliver and this time will cost EUR 400 million." And so that joke illustrates where we are aiming. We cannot keep increasing the mail price at close to 10% per year.

And so we think it's time for this public service to have a similar contribution to -- well, it would be symbolically similar because all the public service in Portugal, being it health, safety, security, pensions, education, all are fully funded by the state budget and the taxpayer. There's no single cent from the taxpayer today allocated to the public service. And this is almost unique in Europe. And so what explicitly we've been arguing and defending even publicly and in public events such as this one is that in the next cycle, we will require -- I mean, the Universal Service to be awarded in similar service levels, which, as Joao Sousa mentioned, will themselves have also to be relaxed for obvious reasons like everyone else is relaxing. But even so, it will require contributions from the state budget.

On the CapEx, your assumption or your interpretation of what you said, and I believe Francisco was explicit on that sense is that our cash contribution as a shareholder, and we are aligned with Generali in that sense, is that we don't require dividends to be paid in the sense that we are very confident of the growth journey that has been redesigned for this cycle. And therefore, we believe that the best way to allocate the ability that the bank has to generate cash is to reinvest on its growth agenda. So yes, we won't require dividends in this cycle.

On the market share question, we right now on Iberia have around 12% consolidated, okay? We are forecasting to be #1 jointly with DHL in 3 to 5 years. And the idea -- I can share also that SEUR or DPD is around 18% right now. We are committing to be #1. We are not committing with a specific market share, but the numbers are this 12%, our current position, 18% DPD, and we commit to be #1.

Next question, please. Yes, yes please Ildar.

Sorry, I had other questions, but I just wanted to follow up -- and this is [ Ildar Davletshin from Oda ] Wealth Management. You just said that 18% is your current market share in Iberia or -- sorry, could you repeat because...

No, 12% our current market...

Is it with DHL or without?

Right now, we have 12%, and we want to have the leaders jointly with DHL. We have today, the biggest player in the market as 18%.

But you would -- but your market leadership would be including the DHL business? And what is the share of DHL now?

It's around 3% to 4%.

All right. And if I may, then the other -- the main question on the targets for EBIT that you provided. So just to clarify, the -- what you said about USO and your plan to maybe request some state funding during the next 3 years, do your targets assume any government support or not?

And if possible, could you break down maybe the margins or the EBIT within the segments of the E&P and Mail in the next 3 years or at least how the trajectory -- we can see the bank is growing, I guess, 15%, but how to other segments do you think could grow relative to the consolidated number you've provided?

Well, I can start by saying that we don't disclose -- we never did and we won't be disclosing targets for each segment, if I understood your question correctly. And as for the market share, I believe the question was already answered.

Yes. But nevertheless, I think it results from the presentation. I think the bank is very clear at its own target. We are committing with strong growth in parcels and some margin incrementality. And we also detailed a number of targets, be it for Business Solutions and Financial Services. And we also provide the guidance for Mail. So there is a lot of numbers to reason around how the breakdown will be in 2028.

Okay. Next question, please.

I am Joaquin from JB Capital. Just 2 quick questions. One, if I'm correct, the Financial Service, there should be a revision next year. Have you started the conversations with the government? And how are they going? Do you feel any threat of competition here? And then on Banco CTT, is the divestment still on the table in the next coming years? Or is this now more for the future?

Thank you, Joaquin. I will start, and I will ask Guy to then to complement. So the contract for the distribution is, in fact, a combination of 2 contracts as we stand, one for services that we provide, opening an account, deploying cash and KYC services. And then there is the -- so this is pure service contract and there is the placement contract. We are now in a very advanced stage of negotiating the new contract.

And in fact, it has been negotiated and in terms that are, we believe, very interesting and also compatible with a higher degree of servicing that this activity today requires, and we have tested that recently because of regulatory concerns. And so just to say that there will be a significant increment on the services part. And on the placements, we are also -- although we are slightly changing the structure, we have also -- well, we struck a deal that is very much in line with our expectation. So very good news on that sense.

These contracts then need to be approved by the Court of Accounts, and we are in that process. So I mean, the main message to the market is that things have been more than starting contracts with government. Everything happens actually with public debt agency and the negotiation phase is already ended and we are closing contracts. We have also interesting news in the state budget proposal because the targets that are -- that have been announced are very much in line with recent placements.

As Joao Sousa mentioned, we are now in a much better position because we hear also competition regarding our digital channel because we are increasing the percentage of placements. And this is, we believe, with a new class of investors, typically younger and more digital. So we're talking about more frequent and smaller placements. And we don't see any impact whatsoever of the competition. There's only one bank that applied for a license, and they are just placing marginal portions.

Given the bank, so I believe that we have demonstrated quite a few ideas. One is that we feel comfortable with the bank in our portfolio. But of course, it is well in this plot that both myself and Guy brought your attention is further away from our core, but it is also very obvious. It was, in my view, in Joao's presentation and Francisco's presentation that the leverage that the bank makes and the value it brings to our retail platform, which is -- and we like to make it even more a platform for deploying services that require physical presence is interesting.

So we are very comfortable with this idea of building market leaders to quote one of our Board members. The bank wishes to be a market leader in its own natural environment but well -- but it is far away from the core. And of course, we will be very attentive to challenges or opportunities that will emerge. But if I may be a bit more direct, we won't seek actively to sell it. We are, at this stage, very much focused to develop it, to make it grow faster. And of course, we will take seriously any ideas that come to do -- that we have any portfolio movement. I don't know if you want to complement.

Next question comes from Filipe Leite...

Guy was about to complement.

No, so just underlining the slides I showed, but we -- in the end, we think by taking this opportunity of growing the bank, we'll be ultimately increasing the value of the bank that opens up all the other opportunities that Joan mentioned.

Filipe Leite from CaixaBank BPI. On my side, I have 2. First one is on your strategy on Express & Parcels. And if it's possible to see you in the future expanding your activity, namely the last mile activity to other countries outside Iberia. Probably in countries where Cacesa is already operating? And second one is on CapEx. And if you can give us some details or breakdown of what will be deployed in each of the key areas. So what will be deployed in lockers, sorting capacity, digitalization and so on.

Thank you, Filipe. I will take the first one and Guy certainly better than me on the second one. So you have -- you came to an argument that I use myself. I will take the first one and certainly better than me the second one. So you have -- you came to an argument that I use myself. Cacesa is now in a number of -- it has been and is actually expanding its presence in a number of geographies, geographies where global marketplaces are getting more and more relevant as we see in Iberia, for example. And therefore, that provides us for, well, places and geographies where we feel more comfortable because somehow we are in those markets, and we have access to market intelligence, and we feel more comfortable.

We are in a better condition to assess risks and opportunities. And so the fact that we incorporate Cacesa in our portfolio places us in a better position. The main idea we need to be clear about is that within the present strategic framework and numbers, we are not foreseeing opening any geography. Having said so, we are responsible actors in this market. We have global clients that are clients of Cacesa in some of these geographies. Global clients that are our clients and partners in Iberia, and we are challenged and we look at the opportunities.

So well, one day -- I mean the good news is that, as I believe I mentioned, Spain and Iberia is large enough for us to grow significantly and to commit to the numbers that we have committed with. But -- I mean, if good opportunities arise, we will consider them, and we have been actively looking at opportunities because sometimes they just, well, show up.

On CapEx, so we'll be deploying 5,000 lockers. Most of them in Spain. We aim to be close to 7,000 lockers in 2028, 2,000 in Portugal, 5,000 in Spain. And so that is one of the key areas of investment. The other is the network. I think it's important to clarify that right now, we have 2 parcel networks that cooperate, you can say -- that they mainly cooperate between each other. And we need to recenter them as an integrated network starting from Madrid because it's what it makes sense in terms of logistics.

It's steps that we've been doing during the last few years, but it's time to recenter it in Madrid, and that entails probably a big investment in Madrid. That is the rest of the pickup of the investment, okay? We will be discussing around north of EUR 20 million on that area over the three years. We have shared early numbers and that it's what is sliced in that 3 years. So it's the growth or the step-up of the CapEx is basically lockers and this recenter of the -- in the Iberian network, in Madrid. But that will, in the future, unlock a number of synergies, be it on Cacesa, okay, because it opens up the opportunity to co-locate Cacesa in our own facilities, that is something that is not today and opens up the opportunities to save in space, line-hauls and increased quality overall market -- Iberia market, be it Spain and Portugal.

Next question comes from Sophia. Sophia just before you ask your question, I would remind the virtual attendees that if you want to enroll, please raise your number in the Zoom conference call.

So on the -- going back a little bit on the universal service. I would like to -- since you are increasing your footprint in lockers and proximity, I was wondering if the new shape of funding could actually increase the quality service that you provide, given that you are investing in proximity via lockers. Does it mean that the model could actually incorporate a different kind of service level coverage using this proximity and self-service that you are investing in?

And the other one is a little bit related with the fact that you're actually investing a lot in technology that assumes increased self-service and you have a natural attrition in personnel. That means that probably walk-ins or personnel will be reduced. My question is, is there any plan for reducing physical presence because the intensity of service of walk-ins will be reduced? If you can elaborate a little bit on that.

Thank you, Sophia. So conceptually, the fact that we've been building and we have already and we'll certainly increase our self-service ability or ability to provide self-services. Conceptually, I was about to say is, well, allows us to figure out new ways of presence, one that -- well, it was vaguely illustrated in a good portion of our top stores. We have destroyed the windows and embedded, well, kind of lockers that didn't exist in the market that work well there so that this store became available 24/7.

And there's no reason for us not to use that cheap alternative to store to, well, intensify our presence if it makes sense. If -- because you have associated your question with USO, I need to be careful because what is natural in the next cycle for the USO is that service levels should be reduced. I'll give you a very, I would say, strong example, which is next-day delivery. Next-day delivery for a letter is not present in the Universal Service of most European countries. It has never been present in Spain.

Let me remind the audience that public service exists to comply with the market failure. I mean there's no market failure in having a letter anywhere in Portugal next day at a decent price. So that is an example whereby service levels in the next cycle should probably decrease. On the other hand, it's also cheaper and easier to have basic services. Joao also illustrated some of the machines that we already have and they have been deployed. So in a way, it will be a matter of -- for the USO alone of what the policymaker wants for the public service.

We are ready, and we believe we have the responsibility to influence that particular public policy, given our experience and exposure and the ability to benchmark, but it's, in fact, a decision for the policymakers. I don't think that regardless of the color of government in those days. There won't be, I would say, some reduction or easing of service levels. On the technology investment, self-service and plan for reducing physical presence, again -- I mean, we are very happy, and it's, in fact, one of the trademarks of this management to stop a significant reputation erosion that resulted from the fact that we were closing stores.

We have now a balanced concession contract that is compatible with the level of density that we have. If again, if the policymaker wants to intervene on that, there will be -- well, the right moment to do that will be in the next concession contract. Well, my view is that, as I said many times before, and that debate has not been reopened, we won't be -- we will not be the public service provider, if the conditions are not economically viable.

Fortunately, today, we have a new postal law. The postal law calls for the need of aiming and protecting the sustainability of the service itself and therefore, of the provider. So I believe that it's a matter of negotiation, but there is -- I believe there is strong political content in what needs to be done to public service that is changing because, well, life and society have changed. So we don't plan to reduce our physical presence unless that is the choice.

This doesn't mean that we don't optimize as we always do. Well, we've recently replaced 2 stores in the center of Lisbon by a much better store and waiting times were reduced. Quality and NPS were improved. So of course, we will always be aiming at improving our service levels and quality.

Next question from António Seladas.

Thank you for the presentation. So I have 3, in terms of specific items, could you provide some color for the next few years...

Antonio, put it closer to the mouth.

Okay. In terms of specific items, if you can provide some color for the next 3 years, namely on Mail. You mentioned about workforce reduction. So I think that you should have some idea about the figures. Second question is on Parcels. On the presentation, you mentioned about -- my understanding -- I understood that volume should continue to grow at 15% or higher. Nevertheless, over the last 2 quarters, it was not easy to reach the 15% growth. So it's not too ambitious target. I know that you are going to -- we are going to create a joint venture with DHL. So it could help, nevertheless, seems too ambitious.

And if you can clarify the question about market shares -- current market shares, DHL, CTT and your main competitors. And last one on bank, I understood that loans and risk-weighted assets are going to grow about 15% or higher, probably NII at around 15%, fees around 15%. So you can provide some color on cost and cost of credit risk, if it is going to increase or it is about 70 basis points.

Let's see, we -- on restructuring, what we tried to depict is two-folded. So first, we need to continue to improve our distribution models in order to be reducing routes. Reducing routes will enable reducing people. And we have some tailwinds because the natural attrition of the people and the tenure of our distribution people will help on that effort. We showed a number of 12% reduction of people within that period, okay? That will, in a way, soften the dimension of the effort that we need to make in order to restructure, okay? Nevertheless, we continue to see some opportunities to -- or the need to continue to complement that with restructuring. We are forecasting 100 to 150 people paid exits in the next 3 years. That is around 70,000 per people -- per person, sorry.

In terms of market share, so we are discussing Iberian numbers once again. So it's not -- neither Portugal or Spain. We currently have 12% market share. Our DHL has between 3% and 4% and our main competitor is 18%. We are aiming to be the largest one in 3 or 4 -- between 3 and 5 years. without committing with a firm number for that leadership. In terms of the bank, maybe Pedro, it's cost of risk. Help me, Antonio, cost of risk, right?

Can we have a microphone?

Over there, same gentleman.

Basically, for the bank, I understood that risk-weighted assets and asset loans are going to grow about 15% or even higher. So costs are going to evolve cost, operational costs and the cost of risk.

So correct, Antonio. So we have a 15% plus growth on the credit, so RWAs. We do expect revenues to grow, most likely not at 15%. We're in tacking mode. So the margins will be slightly lower.

On the cost of risk, there's a guidance there. We are growing credit without enhancing our overall risk appetite. So our cost of risk guidance remains the same between 70 and 90 bps. And on the cost side, we will have a take-up of costs, especially in '26 and slightly roll over to 2027. So we'll be especially -- in 2028, cost growth will be slightly lower or we expect to be lower than the revenue growth.

On the issue of excessive ambition, or too ambitious, I believe, was your framing, Antonio. So just a reminder, we've been growing more than the market, actually more than anyone else. We have these trends that are all of them very positive. So overexposure to B2C, which will grow more than B2B, overexposure or higher exposure to large global players, which will grow more than everyone else.

And the fact that we have a stronger presence, wider presence in the value chain. So that's why we feel confident that -- and because there is also a prediction that the market will grow at around 8%. So it should be -- we see quite feasible to achieve the ambition that has been translated to our own numbers. So in a nutshell, we feel confident with our assumptions and forecast.

Our next question will come from [indiscernible], who is attending virtually if the technical team can put him on speaker.

[indiscernible] I've got two questions basically. Well, first of all, thank you for the presentation. Impressive presentation. I've seen a lot of presentations for -- from your peers, but this is definitely one of the ones I like most. Enough compliments, so a critical question as well.

First of all, with regard to slide -- I believe it was Slide 43 that you signals that the Tier 1 clients and the Chinese marketplaces are growing to around 90% of the market by 2028. Now there's a big discussion going on at an EU level about all the cheap imports of Chinese articles, unsafe, too cheap, unfair competition and that sort of things.

There are proposals to basically introduce a levy of EUR 2 per parcel. But there are also countries that say we should tackle this by means of using the digital directive of the EU, basically punishing Chinese sellers for selling unsafe products because that would basically allow you to charge -- to put a fine on them of x percent of their sales.

How are you looking at it? Is that a potential challenge for your growth model going forward? And the second thing, and that's closely related to it, when you talk about a focus on large clients or large clients taking a bigger share of the market, then mostly that is bad news for margins. How are you dealing with that?

Two very good questions. All questions are very good. But -- so coming to the challenge. First of all, I believe the sentence that has been word expression is global marketplaces. Not all of them are Chinese. We have some of them very global and present in this very room. And so that exposure is to global marketplaces.

Coming to the Chinese marketplaces, well, of course, we are taking it very seriously. But there are basically to simplify and well, and make it possibly a short answer to a complex issue, there are 2 possible consequences. One is elasticity because if there is EUR 2 or whatever will be the final amount imposed on every parcel. There will be an impact on price and therefore, some price elasticity. And the other one would be additional complexity like the one that we are now seeing for parcels entering the U.S.

Coming to the first one, we think that there is sufficient efficiency in these marketplaces for elasticity in our view, not to be significant. And of course, we see also other global marketplaces sourcing a lot in China. And therefore, there will be a more level playing field and eventually less pressure from peers for actions on that. But the answer is we don't think that, that kind of price increase because of the impact of an additional tax is meaningful. So we don't -- we are not very concerned with that.

On the other hand, if there is additional complexity, that is, in a way, very good news for Cacesa because the more complex it is, the more services it will be required. We also have probably different impacts because there will be more bulk clearance and more sourcing from Europe and then it becomes, well, a neutral issue.

As for the competition with large clients, competition with large clients, yes, you have a point, of course, large clients have a higher negotiated power. That's why we like to nurture our relation with them. And I've mentioned more than once in my presentation that we believe that our relation is a long-term relation, a partnership relation. Our large clients do have as much operating information of our own performance as we do so they can assess what we do, how we do, our service levels, our quality.

And so we need basically to keep satisfying them in delivering quality at the level that is very rare, often unique in Iberia, both in Portugal and in Spain. So it's -- well, it's part of the game, higher relation implies higher responsibility, but we take that very -- I wouldn't say, in a relaxed way. We take that very seriously, but also very naturally, so to say.

Any more questions from the room? António and Joao have a follow-up question, perhaps Joao first and then Eric as well. So let's -- Eric, please go ahead.

Yes. I have a question on the lockers versus PUDO. If you can speak a little bit about the unit economics and also the NPS. My thesis is that the NPS and the unit economics are much better for the Lockers at scale. So if that's the case, I'm wondering how you sort of think about it on a higher level. It's also largely a cultural thing, the preferred methods of delivery in different markets.

So how do you think about like rolling out lockers more aggressively and accepting a lower utilization rate to increase adoption? And on the customer side, does it also make sense to maybe lower prices to incentivize customers to use the locker network? Or it could also be other forms of incentives such as gamifications or you get points to buy something and so on? Just your high-level thinking about the Lockers increasing.

So there is, of course, a different level of satisfaction, but it depends very much on the end customer. I always like to cite a study of an international logistics player that run a market survey in U.K. some 2 years ago. And amongst the youngsters, the preferred way of delivery was in a locker, 85%, I believe. And the main reason was a bit sadly, absence of social contact. So it depends a lot because people -- some people would prefer to go to a locker, some would prefer to go to a place and have someone to interact with.

But the main difference is, in fact, availability during the day because lockers are supposed to be, of course, not all of them, some of them are in shopping centers and in supermarkets that also closed at night, but most of them should be available 24/7. And I believe that is the main reason for higher satisfaction.

Our main concern is to have -- to deliver. I was looking for our locker man, I can find him -- he's there, is to provide a customer experience that is seamless regardless of being unattended or attended presence. We also believe that the increase in locker adoption will also increase, as I believe I've mentioned in my presentation, C2C journeys and returns. So it's not a matter of unit costs. It's more a matter of, well, delivering what people like. But in any case, it will be impossible for us to have today, as we do more than 20,000 pickup and drop-off points, if solely relying on lockers. So well, if any time, there will be possibly a matter of lockers only. Meanwhile, PUDO will play, in my view, a significant role.

On incentivizing through price, it's a bit the other way around because most of our customers in the locker, except for the C2C are not -- I mean, I'm not the people that use locker, are the sellers that deliver things to them, and we need to provide lockers so that our clients will enhance the customer experience.

And of course, for us, and everyone knows that, and I've just referred the kind of open relation we have with large clients, they know and they understand that our operating cost is lower in a locker. And they also try to propagate that to their final clients. And you have today many marketplaces or e-commerce online shops where if the final client chooses to have deliver in the locker, they pay slightly less than if it is to be delivered at home or any other physical place. So it's more a matter. It's more a tool for our clients to use and for ourselves to use.

Our next question comes from António and then Joao.

Just on the DHL partnership, I understood that it should start now from what you mentioned, so it should start in 2026. I don't know if you can provide some more color or if the information that you released some quarters ago is okay, it's enough.

Just taking consideration market shares that you mentioned, it's fair to assume that your both operations, so DHL plus CTT Parcels will increase by 25% to 30%, taking consideration the market shares that you mentioned or it's not right?

Okay. Thank you, António. So slightly more a touch of color on where we are. As you know, we are now running a competition process. And given the size of the operation and the size of the DHL, it runs in Brussels with digicom, the competition authority. We've been interacting very actively throughout time. We had summer in between, and we are -- I mean, we are reasonably happy with the process, a bit slower than we have predicted. And that's why Guy has mentioned that we are now aiming at the beginning of next year rather than this last quarter, that was our initial intention.

There is nothing particularly relevant that we would want to stress. Well, we possibly wouldn't let you know that -- in any case, there's nothing special. It's just a normal interaction, which is a bit slow and complex as it always happens. Regarding the market share, I don't know if Guy wants to complement what has already been said.

Let's see, António, we already share a number of data points. I think now it's for you to come up with your views. There is ample numbers within the presentation. I think it's easy to extrapolate what you are trying to achieve.

Joao, please go ahead.

Yes. 2 more questions. The first, going back to the DHL JV and also trying to link with what you mentioned in terms of Cacesa being a potential vehicle for new inorganic opportunities. And does the agreement with DHL forbids you from entering specific markets? Or there's no -- it's completely out of scope. So if you wanted to go to do last mile in Belgium, you could do it? So that would be the question.

And then the other one, just on the leverage. So you have the 2.5x net debt-to-EBITDA target. My first question is if this EBITDA -- so I suppose this EBITDA is before leases, so you would have to take out the leases as a better proxy to cash flow?

It's on the net debt. It's not on the EBITDA, but the 2 numbers are consistent.

Okay. And so when we think about that, then what would be the, let's say, the range in terms of leverage that would probably trigger you to do further buybacks? Is there -- do you think about that? Is there any kind of range that you say, I mean, below -- say, above 2, we won't do buybacks or below 1, we'll do a lot of buybacks?

Thank you, Joao. So there is no restriction whatsoever, the DHL joint venture agreement is an agreement for Iberia. But then there is good sense. And I believe you see ourselves sensible people, reasonable people. So we don't plan to go and try last mile in Germany, for example. But of course, we know where DHL e-commerce is present because DHL e-commerce has at least 3 types of presences, direct operation through -- fully through a partner on a commercial agreement and sometimes hybrid presence because they have, for example, a minority stake. And so in the exercises that we often do for Horizon 3 opportunities, we take that into account because we want to develop and further develop well, a friendly and fruitful relations with DHL, but there is no restriction whatsoever.

On buybacks, so we mentioned that we have that target area of operation, okay? And then we state 2 conditions to a buyback when it's leverage to be below that level. And there is market conditions. It depends on the valuation of your share. It's not only leverage that drives that.

Okay. Thank you very much for your questions. Joao and Guy, thank you very much. We will now go to lunch. Lunch will be upstairs.

In order for you to go to lunch, you will have to go through the place where you entered and you have to go through the museum, take the opportunity to go through the history of Portugal as well. You will be given tickets so you can go through the museum all the way up to lunch. Joao and Guy, if you want to do any final remarks?

Just a final thank you for coming and for your -- today for your questions and interest. We remain, of course, as always, available through our Investor Relations team and in particular, through Nuno.

So thank you again. And I probably am allowed to thank to CTT's team that prepared this yesterday's and today's event at a very high level. So thank you for that as well. And we hope you have a nice lunch and enjoy visiting the museum. Thank you very much.

Good morning, and welcome to CTT's 9 Months '25 Results Conference Call. This event is hosted by Mr. João Bento, CEO of CTT; by Mr. Guy Pacheco, CFO of CTT; and by Mr. João Sousa, CCO of CTT. Please note that this conference call is being recorded. [Operator Instructions]

I'll now turn the call over to Mr. João Bento, CEO.

Good morning, everyone. Welcome to our third quarter results presentation. I would invite you to follow us through the presentation that has been distributed yesterday evening.

So if we move to the first slide, Slide #4. We have a plot of the -- a bridge of the revenue and EBIT in the quarter, with our, we'd call resilient organic growth; revenues growing 6%; recurring EBIT doubling that, 12%, with positive contributions from all the business lines in terms of revenues. This 6.1% are, in fact, 17.2%, taking into account the contribution of Cacesa. And on EBIT, the pro forma growth of 12.3% is in fact -- corresponds in fact, to 38.1%, which illustrates how competitive the addition of Cacesa represented to our e-commerce solutions portfolio.

Moving to Slide #2 and with additional -- with additional detail on the growth of parcels volumes. We see a comparison between second quarter and third quarter, with a slight sequential improvement in e-commerce volumes. But we have to take into account that there were a couple of events, very significant in the end of September, that somehow impacted volumes in the quarter. Indeed, we have this typhoon Ragasa in South Asia that kept significant amount of volumes, e-commerce volumes sourced in China in the ground, so they could not fly. Some of them were sent by land, but there were also impacts in the border between Poland and Belarus, and some of the volumes that came through roads were also halted there.

There was also, well, I would say, meaningful delay in main volumes that we can discuss later on. The good news is that all these volumes were merely delayed and they showed up already in October. But on the right-hand side of the slide, we can see that we have, well, double-digit growth in July, in August and then in September, a flattish improvement basically for the reasons that we have mentioned. So because of that, we are -- we keep quite confident also because October is looking extremely positive, and we anticipate a strong growth outlook for volumes, around 15% year-on-year for the fourth quarter of this year.

Moving to Slide #6 and moving from volumes to revenues and margin. What we see is an improvement of 36% in revenues, that without Cacesa would even still represent a double digit, around 11% growth, which is significantly amplified when we move to the EBIT margin in the sense that with the pro forma of Cacesa, the growth would be very slight, 4.5%, but indeed a 50% growth on EBIT.

The good news that we'd like to highlight here is that although -- well, despite of these volumes delayed given the typhoon and the closing of the Polish border, we still see an improvement in margin from 8.7% to 9.5% that, as you know, is, well, the best EBIT margin for any parcel business in the market. So given the contribution of Cacesa, that differentiates our E&P offering. We -- with this integrated model, we continue to drive profitability in parcels. And in that sense, we think that we should signal that.

Moving to Mail. I will pass the floor to my colleague, João Sousa.

Thank you, João. Good morning, everyone. On Mail & Other services, as you can see, in the third quarter of 2025, we are already seeing a recovery in address mail, with volumes down only 4.3% compared to a decline of 8.5% over the first 9 months of the year. In fact, this improvement reflects a gradual stabilization of the activity after several quarters of more pronounced declines in traditional mail volumes. This recovery is mainly explained by the normalization of volumes and clearance of backlog from major clients, which had a negative impact in the previous quarters. And we are seeing also these positive trends already -- or continued in October that reinforce this recover momentum.

I would like also to highlight the business solutions that is driving good performance. Business solutions continue to play a key role in supporting both revenues and margin in the Mail & Others business area, with recording growth of 10.9% year-on-year. As with this mix of revenues and services, as a result of this, we have total revenues reaching EUR 341.9 million, representing a limited decrease of 1.9% comparing with the previous year.

On EBIT for the Mail & Other segments took on EUR 2.28 million for the first 9 months, maintaining a flat margin of 8.9%. This stable performance demonstrates that our operational discipline on cost control and continuous on to managing these ongoing structural change in the mail market.

On Slide 8, now we are going to financial services and retail. We continue to see a sustainable performance across public debt and insurance offering. Financial sales continue to show a solid and consistent growth, supported by stronger results in public debt products and insurance. Public debt placements, up to 167% in Q3 compares with versus period in last year.

Savings certificates maintain like a preference savings vehicle for the Portuguese citizens. And I would like also to highlight that the digital sale channels for these products continue to be performing strongly, and September was the record month for these channels. This has also allowed us to bring new citizens to this product.

Also, we are -- with a robust growth in insurance and health plans, we are in this strategic to build recurring revenue streams continue to deliver. Health plans -- the stock of health plans, growth, 69% versus the end of last year and almost 33 -- sorry, 12.8% on quarter-on-quarter.

Insurance products also, with a very good outlook, performing pretty well. And I would like also to highlight that in -- already in October, we launched a new health insurance that also allow us to have a new product in this area. And the first numbers give us also a very good highlight -- a very good outlook for the coming months.

Seeing this on this business area, the revenue is up to 57%, reaching EUR 9.8 million, and EBIT up to 44.8% to EUR 5.2 million. This reflects the success of our diversification strategy for this business area.

And now pass to Guy.

Thank you, João, and good morning to all. On Slide 9, we can see Banco CTT's numbers, where we witnessed a strong growth in business volumes, growing 11.4% year-on-year in the third quarter, with a strong performance on the loan book that grew 16.4%. And on the off-balance savings, that grew 25.7%, where we see Generali partnership already at cruise speed and gaining -- continuing to gaining traction on the market.

That translated to banking revenues growing 3.7% in the period, although with some compression in net interest margins as interest rates seem to reach a bottom, which gives us positive trends going forward. We see net interest income going up EUR 0.9 million, and commissions led by insurance and card commissions growing EUR 0.6 million in the period.

We -- in terms of profitability, a flattish performance as we continue to invest in our future growth, deploying additional commercial capabilities, be it digital or physical, and we invest in technology to support that growth. Our return on tangible equity stood at 13%, a slight increase vis-a-vis the 12.4% of last year.

Moving on to the financial review. In Slide 11, we have our key financial indicators where we see resilient growth throughout most of the metrics. On revenues, 17.2% growth. And if we consider Cacesa last year with the 6.1% growth in the third quarter, recurring EBIT growing 38.1% or if we account for Cacesa, 12.3%. Specific items reached EUR 7.6 million as we concluded the restructuring project that we have ongoing on the Mail division for this year.

We invested EUR 4.2 million in exits of people. M&A expenses and strategic projects account for the rest of the value. Net profit in the quarter reaching EUR 10.7 million, growing 35%, or reaching, in the 9 months, EUR 32.8 million, growing 18.4%. Our free cash flow stood at negative EUR 6.4 million, and this is due to strong working capital investment that I will detail towards the end.

On Slide 12, we see our revenue reach, where we continue to see Express & Parcels as our main contributor to growth. Revenue is growing 6.1%, accounting with Cacesa, with Express & Parcels growing EUR 15.7 million or 10%, with softer parcel volumes due to a weak September, putting some pressure on growth. And this was caused by the extraordinary effects that João shared, the typhoon and the military movements on the Polish border. Cacesa continues to perform very well.

In Mail, we witnessed a EUR 2.4 million decline or 2.3%. This is -- this shows 2 different performance, Mail declining EUR 3 million in the quarter or 3.4%, that were partially offset by the good performance of Business Solutions as we continue to diversify along the value chain of our customers in order to further increase the resilience of the revenues of these business units.

In the bank, EUR 1.3 million increase or 3.7%, fully driven by net interest income and commissions growth as we continue to grow our business volumes.

In Financial Services, an increase of EUR 3.5 million in the quarter, and fully due to the strong performance in public debt placements, that grew more than EUR 1.1 billion as debt certificates continue to be a very attractive product in the market vis-a-vis other low-risk alternatives and already with some positive contribution of the recurring revenues that we continue to bet on in order to find additional diversification on these business units. All in all, other key metric is the Express & Parcels in the quarter already are above 50% of our revenue, reaching 52% of our total revenues this quarter.

On Slide 13, we see our costs. Our OpEx grew 5.6% in the quarter, driven by parcel, in line with activity, but softer volumes putting pressure on our unit costs. As you know, we start to scale for the peak season, where we keep prioritizing quality as we see that as paramount to further growth in the future.

Mail & Others with a decline of EUR 3.3 million on OpEx or 3%. We continue to optimize our routes with a strong reduction on the number of routes and account reduction that mainly account for that OpEx savings.

In Financial Services, we see a EUR 1.9 million increase, fully in line with higher activity. And in the Bank at 5.8% increase or EUR 1.5 million, and this is fully to the commercial and technology investments that I already shared. Cost of risk this quarter with a good performance, reaching 0.7% of cost of risk. So good dynamics there as well.

In Slide 14, we see our recurring EBIT, where we posted a 12.3% growth with bank, flat and all the other business units with a positive contribution. In Express & Parcels, we see very resilient margins despite these lower-than-expected volumes in the quarter, with 9.5% margin and increasing EUR 0.7 million. In Mail, positive contribution of business solutions and cost reductions, leading to a EUR 0.9 million increase in the quarter. Financial Services, with good -- very good performance in placements, also contributing positively with EUR 1.6 million. And the Bank, with this flattish performance, with the investments in capabilities offsetting the growth in banking products.

Going forward, we expect a very strong peak season that will underpin the EBIT growth in Express & Parcels. Mail seasonality will lead to a sequential margin improvement as fourth quarter continues to be, seasonality-wise, the strongest quarter of the year. Financial service will continue to grow, although with a tougher comparable in the fourth quarter. And the Bank will post a flat to single-digit growth due to the continuous investments in commercial activity.

Slide 15, we see our consolidated cash flow. Operating cash flow reached EUR 42.9 million in the 9 months, with a strong growth year-on-year. Free cash flow also stood in 20 -- 12 -- sorry, 18.8%, also with a EUR 10 million growth. And our net debt now stands at EUR 61 million at consolidated level.

In Slide 16, we see pretty much the same figures, but excluding the bank or having the bank under equity accounting, where we see, in the 9 months as the operating cash flow reached EUR 20 million and due to this high investment in working capital. In the third quarter, our working capital increase EUR 13 million. And this is due to seasonality or third quarter is normally very strong in working capital investments, and that is due EUR 5 million to the travel subsidy to the Portuguese Island, a service that we provide to the Portuguese government, and because of summer normally has this high growth and payment terms with Portuguese that are always pressured. And we have EUR 8 million increase in accounts receivables, both by increase in activity and some delays in payments of some key customers that we expect to fully offset in the fourth quarter as normally we do.

Our net debt now stands at EUR 2.4 million due to this working capital investment, but we expect to -- that to be deleveraging towards the 2x in the end of the year.

And with all that, I'll hand you over to João Bento for his final remarks.

Thank you. So moving to Slide #18. We have a plot of the evolution of EBIT and the corresponding contribution of E&P that we see that, well, after the drop between '19 and '20 associated with the COVID crisis, it's been very, very steady. And looking at the trailing last 12 months up to the third quarter of this year, we see that we are already at EUR 105 million of EBIT, which means that we would require fourth quarter, that would be roughly EUR 10 million or more above that number.

The right-hand side chart, it illustrates the gap between where we are and what we need actually to do. So we see the fourth quarter EBIT of last year at EUR 30.5 million. If we would consider the contribution of Cacesa, that would take us to EUR 37.2 million, meaning that because we need EUR 41 million to achieve the guidance, we are at a 10.3% increase or 34.4% versus the actual number of last year. This 10.3% of growth quarter-on-quarter -- fourth quarter-on-fourth quarter is, I would say, significantly less than what we have exhibited throughout the year.

So at the top hand side of the slide, you can see that in the first quarter, we grew 19.5%, 28% on the second, 12% on this quarter, with all the delays associated with the typhoons. And so I'm not saying it's easy, but it's quite feasible, and that's why we are strongly committed to keep our ambition of recurring EBIT equal or higher than EUR 115 million. And by completing a quarter along those lines, this will, in fact, represent the conclusion of, I would say, notable transformation cycle that we have been taking this company.

I would still ask you to follow me on the last slide, just to remind you that we have our Capital Markets Day taking place next Monday and Tuesday. We have quite promising news for you. We're going to do the similar exercise that we did 3 years ago, discussing and illustrating the strategy for our business areas and committing with financial targets for 2028. So we are looking forward to meet you all there. And I believe that you'll be very pleased with the news that we have to bring.

With that, we remain available for your questions.

[Operator Instructions] Our first question will come from João Safara.

I'll start just with 2 questions. The first on -- to try to understand a little bit what is implicit in the fourth quarter margin for Express & Parcels. Obviously, and you've mentioned that you've been focusing a lot on quality ahead of the season.

João, sorry, we are having significant difficulties in listening to you. If you can speak louder, please.

Yes. Is it better now?

It's better now.

Okay. Sorry. Okay. Yes. So what I -- yes, so going back to my question, what I was wondering and trying to look implicitly to the fourth quarter. To meet your guidance, you obviously have to have some kind of improvement in Express & Parcel margins. So I think basically, I just wanted to have a confirmation there since we've been having in the last quarters, in first quarter, margins were flat, obviously, trying to exclude the impact of Cacesa, which I know it's difficult.

And then in the second quarter, you've recovered. And now in the third quarter, it seems that margins, again, they've more or less been flat versus year-on-year. And for the fourth quarter, according to my numbers, it would still imply an improvement in margins. So if you could -- well, just give me some color there on what are you seeing for the fourth quarter in terms of margins?

And then the other question is just on the extraordinary costs you had this quarter for the employment contract suspension. The question here is, I mean, basically, if this is something related to the plan you're going to present on Tuesday? Or is this something that was already contemplated and part of your ongoing cost savings?

Thank you, João. So on your first question, so we are expecting a strong peak season in Express & Parcels, that will once again be the main driver of our growth in the fourth quarter. Obviously, as you know, scale here plays a role and because we have this unforeseen lack of volumes on the third quarter, especially in September, that put some pressure on unit costs. And as such, our margin was stable-ish. And I would like to underline that, nevertheless, we were able to post a 9.5% EBIT margin that shows a lot of resilience of that business unit.

But nevertheless, as you said, we expect both a volume increase and a slight margin increase during the fourth quarter. That was again Express & Parcel as a main driver. We also expect growth coming from Mail -- sorry, positive impacts for Mail and the growth coming from Financial Services as we continue to see resilience on the placements, although the comparable will be tougher as last quarter was already very strong in placements last year.

On the specific items. So 2 main things. First, it's the restructuring project that we ended, and that we continue to explore opportunities to optimize Mail & Others as we continue to see that paramount to sustain margin going forward. And that project comes to an end in the third quarter. And now we also had some strategic projects that are, as you mentioned, linked with the next strategic cycle that we'll announce next week and some M&A expenses as we continue to have projects ongoing and what's ongoing, be it with the transactions already announced and other internal projects.

Just a follow-up, would there be, on the fourth quarter, additional nonrecurring cost?

On people, no. We should expect some costs around M&A, but nothing as meaningful as this quarter.

Our next question comes from Filipe Leite.

Yes. I have 3 questions, if I may. The first one is on Cacesa and the integration of Cacesa. Basically from the EUR 5 million synergy that you announced at the time of the acquisition. If you have an idea of how much do you have already achieved in terms of synergies, and when should you expect or should we expect the full achievement of this EUR 5 million synergies with the incorporation of Cacesa?

Second question on Mail and CPI used this as reference for the upcoming year. Mail price increase, I believe, is up to June or July. And the question is if you have already an idea of the potential magnitude of the price increase for mail next year?

And last one is a clarification on specific [indiscernible] because looking at the breakdown, you mentioned in 9 months, EUR 1.4 million positive impact from regulatory compensation. But in second quarter alone, this positive impact was EUR 3.5 million. If you can clarify what are those regulatory compensations and why the reversal in third quarter?

I'm afraid we didn't get exactly what you mean in the third question, but I will start with the previous 2 ones. So on Cacesa, things are going pretty well. What we can say is that we are more or less around midterm achieving the full synergies that have been announced, and they will be fully embedded across next year because there are several -- the nature of the synergies is diversified, but so we are probably halfway to be there.

On CPI, actually, the formula is public. We know the volume decline, we know the inflation. The issue here is that the proposal has been put, but it's not been approved. In any case, you should expect something around 6.5% plus or -- more or less around that, just not to give you the exact figure because it's not been approved. But it's very easy to compute the numbers and it should be something around -- well, between 6.5%, 7%, some like that.

On the third question, because we didn't fully get it, I suggest that Nuno Vieira will follow up with you in the end of the call.

[Operator Instructions] As there are no further questions at this point, I would like to hand the call back over to Mr. João Bento, CEO, for any additional or closing remarks.

Thank you, Nuno. Well, as we've seen, it's been a mild quarter, fortunately, positioning us strongly in line to achieve the guidance this year. And I believe that the most promising news are to be shared with you on the forthcoming Capital Markets Day next week. So thank you again for coming. We remain available to your questions through the IRO team, and hope to meet you all next week. Thank you.

Thank you very much for your participation. This earnings call is now concluded.

[Operator Instructions] I will now turn the call over to Mr. João Bento; CEO.

Good morning, everyone. Welcome to our first semester results presentation. I'd like to invite you to follow us on Slide -- Slide #4 where you can see accelerating organic growth with revenues growing 11%, recurring EBIT growing 28% if we account for a similar perimeter. But given that we are now accounting 2 months of Cacesa, revenue grew 18.3% and EBIT grew an impressive almost -- sorry, 47% year-on-year.

And talking about the contribution of Cacesa, I would invite you to move to Slide #5, where we have an outlook of Cacesa. On the left-hand side, nothing new, just to highlight that Cacesa has been growing significantly in the last 2 years, and it will keep growing this year based mostly on its customs clearance activity. But looking at the right-hand side of the slide, I'd like to refer to what I would call, I would say, extremely successful integration going along a number of tasks that we are following in a very structured way. We have unified sales strategy to leverage cross-selling between Cacesa and CD Express, given that this is an activity that we were already developing before the acquisition of Cacesa. We have also aligned end-to-end logistics, including route optimization and standardization of services between both networks. And of course, all the support functions, finance, accounting, planning and control have been already migrated to CTT with the new governments in place, including a new Board of Directors.

So we continue focused on the integration of Cacesa in the CTT universe to ensure a smooth and efficient transition and we start already -- we have started already seeing the results in this quarter. Moving to the next slide, Slide #6. we highlight this positive outlook for growth. We've been growing our parcels volumes with a peculiar quarter in the sense that a growth of 8% in volumes was a combination of a very peculiar month of April in which between the blackout in Iberia, the fact that we had 2 less working days and also that Easter moved to the first quarter, we had a very difficult April month. But then we see growing volumes. And in fact, the level of growth of parcels volumes that we are expecting for the remainder of the year is around the figures that we've seen in June, therefore, above 15% growth. And this is what we are guiding in terms of volume growth for Parcels this year.

This growth, if we move to Slide #7, on volumes derived obviously growth on revenues and recurring EBIT and including an expanded EBIT margin given, again, not only the growth of volumes, but also the contribution of Cacesa. We have observed the 14.4% growth on revenues in the quarter or a 29% growth on EBIT. But again, if we account for the contribution of Cacesa and add to the organic growth, this produced a 34% growth on revenues, and an impressive 73% growth on EBIT. And probably more important than that, we have seen one additional percentage point added to our EBIT margin that is it's now stabilized at 9.5% EBIT margin. So Cacesa enhances and differentiates our offering more than already have because we have this value proposition that covers a larger -- a wider part of the value chain of e-commerce logistics.

And because we are integrating Cacesa for some customers also with last-mile delivery, this will improve further our profitability on the Parcels business. So all in all, a very good quarter with a very significant contribution from E&P. I will now pass the floor to my colleague, Joao Sousa, to address starting with Mail.

Thank you, Joao. Good morning, everyone. On Slide 8, as you can see on Mail revenues, Mail revenue was impacted by April blackout, like we see also in Express & Parcels, putting pressure on overall quarterly performance. Addressed mail volumes down 10.5% year-on-year, falling from EUR 99.2 million to EUR 88.9 million on volumes. Saying this, Mail and other revenues performed resiliently, growing 2.9% year-on-year despite the election effect we had in May of '25. Excluding the election effect, revenue declined 4.8% year-on-year. Total revenue reaching EUR 118.7 million comparing with the last year or year-on-year EUR 15.4 million, helping by Business Solutions that growth 10.5% year-on-year. Business Solutions continued to contribute positively to shifting the revenue mix on this business unit.

Also average price increasing on mail increasing 6.72% year-on-year and also helping here to managing the revenues on this business area. Recurring EBIT grew 49.6% year-on-year from EUR 1.8 million to EUR 2.7 million. Margin improving 2.3% year-on-year versus 1.1% last year, even with the positive effect of elections that we saw comparing with minus EUR 2.2 million from -- coming from activity. It's important to say here that EBIT remains subjected to volatility during the quarter due to the client behavior on large accounts decisions, particularly on central government because -- it's difficult managing the behavior of these clients. So during the quarter, it's very difficult to managing this EBIT. And on these business areas, we stay focused on remain -- we maintain focus on profitability.

So in that way, we still have a strict cost control to protect the profitability on these business areas. We are expanding the business solutions pipeline to helping this business area and also churn management with the digitalization solutions format. On Slide 9, as you can see, we are commercial productivity continues to underpin financial service performance with very good public debt placements with strong performance in the financial services. Public debt placements increased more than 259% year-on-year this quarter compared with last year and more than 13.4% versus the end of '24. This results on a daily subscription more than 90 million per day. We see a sustainable outlook for the coming days despite the falling interest rates, but we maintain a positive and stable outlook for the coming days, mainly because of the positive communications we see in the news and also seasonal factors such as immigrant’s savings and holidays people typically put on these products.

Also, we see a sustainable growth in subscription-based services like insurance and health plans. As you can see, we grow health plans 49.8% in the second quarter versus the end of last year and already after we already grow more than 700% year-on-year in the last year. That means for us, this business area, the revenue growth 64.8% in this quarter from EUR 5.5 million to EUR 9.1 million in revenues and EBIT grows from EUR 2.7 million, sorry, to EUR 4.5 million this year. We maintain this strategic retail footprint because more than also selling the public debt placements and selling insurance, this big retail network also, as you know, it's very important to claim in the market that we have the largest food network in Iberia. That, as you know, is also very important for the Express & Parcels business area. And now I pass to Guy Pacheco.

Thank you, Joao, and good morning. Starting on Slide 10. We continue to see strong progress on the business volumes of the bank that grew 12.5% year-on-year with a sequential acceleration driven by the loan book and the off-balance sheet placements. These trends also translate to the banking revenues where we see a growth of 13%, driven by net interest income with volumes driving that growth. And in commissions with off-balance sheet and commission accounts also with a strong dynamics. In terms of profit before taxes, we see 1.2% growth -- that reflects the buildup that we are doing in terms of digital and physical and commercial capabilities as we transition the bank to a new growth phase.

In Slide 12, we can see now the key financial indicators of the group. On the second quarter, we obviously, as Joao mentioned, we include 2 months of Cacesa, and we have a strong dynamics throughout the KPI. So 18.3% on revenues, 47.4% on recurring EBIT. Net profit also grew 34.3% and free cash flow reached EUR 23 million in the quarter. In the Slide 13, we can see our revenue growth detail. I will focus on the pro forma numbers. So accounting for Cacesa in the perimeter in 2024. We see strong growth driven by Express & Parcels that continues to be our most important contributor of growth with a 14.4% growth in revenues, driven by 8% growth in volumes, also positive contribution on unit price and obviously, customs clearance growth all contribute for this 14% growth.

Mail growing 2.9%, mainly the contribution of elections [indiscernible] share. The bank growing EUR 4 million or 13%, driven by volumes that drove net income -- net interest income and commissions. And also Financial Services also growing EUR 3.6 million or 64.6% and this is the result of the EUR 1.2 billion placements of public debt or a growth of 259%. So all in all, all divisions contributing for growth, but that is a very strong performance. In the next slide, we see our operating costs that grew 9.1% pro forma. EUR 15.3 million coming from Express & Parcels or 13.1%. This is the combination of increased volumes and the investments in capacity as we continue to prepare our business to volumes increase.

In Mail, we see EUR 2.5 million increase. That is mostly explained by the EUR 5.4 million costs related with the elections. If it was not for that effect, we will be declining almost EUR 3 million in cost due to the restructuring that we keep doing in this business unit. In Financial Services, we see EUR 1.8 million growth in costs driven by activity. And in the bank, we see EUR 4 million of increase in staff and IT costs that reflect the digital and physical investments in capabilities. Also contribution from the impairments where cost of risk now stands at 1% in the bank, up from 0.9% in the same quarter last year. In Slide 15, we see our recurring EBIT with a very strong progress of 28%. Our margin now stands at 8.6%, up from 7.5% last year. This is mainly driven by the growth on Express & Parcels, volumes and customs clearance contribution, and higher margins are driving this growth.

In Mail, the growth came mostly from elections as we saw and Financial Services with a very strong quarter, also contributing EUR 1.7 million for the EBIT growth. In the bank, a slight growth of EUR 0.1 million, and that is some trend that we'll continue to see this year. Looking forward, we continue to see strong growth in Express & Parcels, above 15% in volumes and some more margin expansion as we continue to integrate Cacesa and we continue to see the benefits of scale in Iberia. Mail in line with previous years with seasonality being very strong in the fourth quarter, stable placements in financial services. The bank remaining strong in the volume growth, business volume growth and some stabilization on margin as we continue to invest in the capabilities of the bank.

In Slide 16, we see our consolidated free cash flow. Operating cash flow stood at EUR 36.4 million. Free cash flow, EUR 25.2 million, and now our net debt stands at EUR 44.5 million. On Slide 17, we see our cash flow, but excluding the bank contribution or the bank is accounted under the equity method, where we see a very strong progress on operating cash flow that grew 74% and our free cash flow almost tripled in the quarter. Our leverage now stands after dividends and the Cacesa acquisition at 2.4x net debt to EBITDA. But as we guided that we will remain below the 2.5x after including Cacesa, and we should see deleverage going forward as free cash flow generation and the proceeds from the JV with DHL will help us deleverage going forward. And with that, I will pass you to Joan Bento for his final remarks.

Thank you, Guy. So if you follow me on Slide #19, the main message here is obviously the upgrading of the guidance to more than EUR 115 million with the 8 months of Cacesa accounted. And following the main topics for the quarter on operating performance, I would like to highlight once more the differentiated offer that we have in Express & Parcels that combining a growth that we see for the remainder of the year, about 15% in volumes with the contribution of Cacesa will -- well, provided for a very good quarter and will remain as such for the remainder of the year.

We've seen also the bank reaccelerating growth in business volumes while investing in platform -- digital platforms and the stores to prepare for further growth. And we have seen, of course, a recovery of public debt placements at levels that are clearly above what we have last year. On solid cash -- on the cash flow front, Guy already mentioned, very good performance for the quarter, 74% on operating cash flow and 3x more free cash flow than the equivalent of last year. So a very good quarter in terms of cash generation, which provides for a balance sheet with as much flexibility as we have guided in the sense that we remain below our net debt over EBITDA ceiling that is in itself quite conservative. So good news also on the balance sheet front.

The contribution of our inorganic transactions. So Cacesa goes without saying, it's been, I would say, an extremely successful integration process. On the DHL joint venture, antitrust process, we are now guiding that completion should be closer to year-end. Things are progressing well between ourselves, DHL and European Commission. But it's as we would expect, a rather complex process, but going well. And the final comment on shareholder remuneration because we had 2 meaningful events in the quarter. One is that -- the first one is that we have closed the EUR 25 million acquisition of shares of our third recent share buyback whereby we have acquired 3.3% of the CTT shares. We have also canceled the outstanding shares on May 13. And it was also in the quarter, as always that we have paid a dividend of EUR 0.17 this year.

Moving to our last slide on Page #20. So all in all, we have reinforced our growth profile, asserting ourselves as a leading e-commerce logistics player in Iberia. Actually, the e-commerce logistics player that shows exhibits the higher growth in -- amongst all the e-commerce logistics players in Europe, not only in the first quarter, but we expect to have the same to happen in the second quarter. We have a sustainable growth in E&P that is now reaccelerating through volume growth around 15% for the remainder of the year, but also expanding margin given the additional contribution that we have from the customs clearing service, which is, as you know, a service with a higher EBIT margin.

This differentiated service portfolio has been reinforced with the acquisition of Cacesa that will now remain with us and growing at a very significant pace. Finally, in terms of Mail against the backdrop of some volatility on revenues and the corresponding lumpiness in EBIT generation. We will continue to deploy cost-cutting initiatives, and we are also seeing some of the backlog of state-driven Mail coming back. And finally, as I stated before, our revised 2025 EBIT guidance is for now more than EUR 115 million, including 8 months of Cacesa. And we believe that with strong execution, this is going to be achieved this year. So thank you for being with us. We will now remain open for your questions.

[Operator Instructions] We will take our first question from Joao Safara from Santander.

I have one question that is -- well, several questions in one question, but is just trying to understand here the drivers of growth in Express & Parcels in the second quarter. So I mean, basically, the question here is, I mean, is this being driven already by synergies? Or were synergies meaningful already in the second quarter, synergies from Cacesa and is Cacesa growing above or below what is the average for the rest of the business?

And the third is this also -- which was something that we didn't see in the first quarter, some operating leverage on your business that basically didn't happen. Is that something that happened in the second quarter? So you're seeing a higher growth in EBIT from your business ex-Cacesa and that's -- and these are basically my questions regarding Express & Parcels. And then also I have another question just on the public debt placements. I was trying to -- I mean, obviously, I know that the EGCP reporting is not very -- doesn't compare entirely with your numbers. But it was curious to see that your -- when you compare the growth in the first quarter to the fourth quarter, that's 13% above for your placement. But when you look at EGCP numbers, there was actually a decline of 9.5%, if I'm not mistaken. So just wanted to understand if there's any specific reason for that difference.

Thank you, Joao. On the last question of the public placements, I will ask in the end of my answer to reframe it because I'm not sure we fully understood it. Regarding the question of the drivers of the growth on E&P and Cacesa contribution, what we can say is as we saw volumes were -- had a difficult month in April and then resumed growth that we continue to foresee coming in the next months. So above 15% growth and that dynamic continues to go well in what we call the old perimeter. The operational gearing also resumed in E&P as unit costs are now with a better evolution and growth starts to dilute the capacity investments that we saw and that we did in the end of last year.

And Cacesa is growing, but the Cacesa growth also includes growth synergies as part or more 50% of the synergies that we announced in Cacesa or revenue synergies that we are already in delivering on this quarter, although something that will be reinforced as we grow. So Cacesa growing above our traditional business, operational gearing already happening in the old perimeter. But as we need full flexibility to continue to manage integration, it's difficult to keep discussing perimeters going forward as we have a very strong integration in terms of revenues and also in terms of operational business in Spain, obviously, the other markets are obviously a different discussion.

Let me just reinforce this. Joao, this aspect that we mentioned is very important for -- even for your modeling in the sense that we need to be fully free to allocate customers to Cacesas or to CD Express for customs regarding -- well, a number of options that we have and they have. So it's -- sometimes we would not allocate them to one or the other. And therefore, the growth of each other are influenced by -- the growth of Cacesas is somehow influenced by the growth of CD Express and vice versa. Having said so, the Cacesas growth is obviously -- has been obviously higher than we had in volumes in CD Express for the quarter.

For the public steps, I would ask you to...

Yes, sorry. And thank you very much for the explanation. It was very clear. Now the numbers are the following. I mean if you sum just the flows in -- coming from the GCP, you get roughly EUR 1.6 billion in the second quarter. And if we look at your numbers, you get EUR 1.1 billion. And then when I compare this with the fourth quarter, like you do in the presentation, in your case, there is a growth of 13.4%. And in the case of GCP, there's a decline of 9.5%.

So basically, what has been happening in the past was that the -- let's say, the ratio of your placements versus what we see in the GCP was closer to, I mean, 55% to 60%. And this quarter, it jumped to 75% -- so I don't know if there's a reason for this other than the way EGCP reports. And I'm thinking about, for example, the fact that you develop the app and if this is getting more traction and that you're basically getting flows that would go through the EGCP web and now instead they go through your app. But again, I don't know what happened there.

Thank you, Joao. I will propose for us to discuss this further offline, but we don't see that decline that you are seeing in our numbers. What I can comment is we have flat to growing share vis-a-vis the ECP during the fourth, first and second quarter. But maybe we can discuss this in detail with Nuno.

We will now take our next question from Filipe Leite from CaixaBank BPI.

I have 3 questions, if I may. First one is actually a follow-up on João initial comments regarding guidance for the Parcel volumes. Can you clarify what is your expectations in terms of Express & Parcels volumes for this year? Second question on competitive mail because looking at the breakdown of regulated and competitive Mail, you can see that the revenue drop of this competitive mail accelerated in the second quarter. Can you elaborate on the reasons for this higher drop and if you are seeing more competition and also your expectation for this subsegment for the future? And last one, if you can also elaborate on the regulatory compensation of EUR 3.5 million impacting specific items during this quarter? And what is this related?

Filipe. So on the Express volume growth for the year -- so we have seen this strange month of April for reasons that are, I think, quite objective. And we've seen then growth resuming to the levels that we believe will be here for the remainder of the year. So in terms of guiding for volumes on Express & Parcels growth, as I've mentioned and Guy also has referred, we are expecting a growth in the range of 15% growth in volumes. This is driven by volumes growth in the clients and some client acquisition as well. On the -- on the regulated and competitive mail, I will ask Guy to address the question.

Let's see, we -- in competitive Mail and regulated mail, we have a difficult month of April as in Parcels, pretty much the same dynamic, the market dynamics, it was the blackout and the less working days that put a lot of pressure on that month, the same on April. We continue to see a lot of volatility in the dynamics of those customers also in the government mail as elections and some constraints on the value chain of mail have been putting backlogs growing.

So it was a difficult -- a difficult quarter on that regard. We see strong dynamics in the fourth quarter as we saw last year and the previous one where you see some softer declines during the second half of the year, very back-end loaded in the fourth quarter that are also the seasonality of that business. So we see better trends throughout the second half and ending the full year on that guided range between the 6% and 8% full year declines on volumes. Regarding that regulatory compensation that you mentioned in specific items, as all the communication sector has been claiming past taxes or regulatory fees collected by ANACOM due to some inclusion of costs that were deemed not to be recoverable by ANACOM. And we -- as all the sector also did the same, and we are recovering some amounts that are included in that number. The recovery that we are seeing is above EUR 4 million for the past years.

So these are taxes that were illegally charged by ANACOM and we are now recovering them.

It's the same in the telco sector if you follow it. The reasons are the same.

We will now take our next question from António Seladas from A|S Independent Research.

So next question from Joaquin Garcia-Quiros from JB Capital.

I think you mentioned something, but I wasn't able to -- I didn't listen very well. It's just on the bank profitability. Just to confirm, you said that for this year, we shouldn't expect much growth in profitability and then because you are going to keep investing in the division, I guess. And then should we start to see some growth in 2026? And then another question regarding to Financial Services on the yield that you get it was much lower this quarter compared to the previous quarter. Should we expect similar yield for the next quarter? And then on the number of placements, the EUR 1.1 billion, EUR 1.2 billion, do you feel this is a comfortable level if nothing in the macro changes for the future quarters?

Thank you, Joaquin. Starting with the placements, we see some stabilization at the second quarter number, so between EUR 1 billion, EUR 1.2 billion in placements, if nothing changes on the macro and interest rate environment, that is the scenario that we are working with. In the bank, yes, we -- as we previously mentioned, we are investing in increasing the commercial capabilities of the bank, and that entails investments in the people and in the stores and in the digital channels of the bank.

So that obviously entails increased costs in staff and IT. And it's what we are seeing this year with a setup -- a step-up on those costs that are eating the growth that we see in banking income. That is a trend that we will continue to see this year and the beginning of next year. And then you should start -- we should start to see those costs stabilizing and the growth accelerating as we continue to invest in acquiring more customers and increasing the revenues per customer that we currently generate. The net interest margin, if that was your question, we see stabilization on these levels, so to 2.1%, 2.2% range as we have been mentioning to the market.

We will now take our next question from Antonio Seladas from A|S Independent Research.

Okay. So I have 2 questions. First one is related with -- if you would like to provide some color in terms of price increase on mile for 2026? And second one is related to the bank and nonperforming loans that continue to grow. I know that if you sell it, you will reduce it. Nevertheless, just if can comment on it and why you are not selling nonperforming loans or what kind of level of ratio do you think is reasonable for the bank?

Antonio, I'm not sure we understood the question on the price increase for Mail for '26. But if you were asking any clarification, the formula is basically the same. With the new cap for the yearly price increase on 12%, which is something that we don't foresee could be activated in any case. So we have basically the same formula that we have up to now where inflation and volume decline are automatically compensated. We have actually a detail which improves slightly our case because the indirect costs that are associated with the volume decline that we do not incur in those costs has now been reduced to, I believe, 15%, where before it was 16%. So it's basically the same formula with a cap that is not activated in a foreseeable situation and with a slightly improved accounting for indirect costs.

Regarding the price increase for next year, it's still early days to share it. You should expect something in the line -- aligned with 2025 increase, but we are still in discussions. We are not comfortable disclosing any number right now.

But it will be, of course, a function of volume decline between June and June and deflation. And so as we said, it should be something along the same range, but a bit early days.

On the nonperforming loans, as you mentioned, we still -- it's still not activity that we perform the sale of portfolios frequently. It's something that will be increasingly do in the coming months. And with that, we see stabilization going forward around these levels. And that's what we -- subject to the recurring -- more recurring sales of these portfolios that we foresee in the future.

Okay. Just a follow-up question on bank. The risk-weighted assets have been more or less stable, slightly above EUR 1 billion. So that is something that we should continue to expect? Or do you think that once you finish on digitalization and all the process that we are going through, it should increase. So basically getting more exposure to risk.

Antonio. We continue to see the underlying trend of RWAs in line with the loan book. This quarter or this first semester, we have a positive effect of regulation on the mortgage capital consumption in line with the EBA new rulings. And as such, that in a way, offset the underlying trend of growth that is driven by the loan book as we foresee the loan book continue to increase and even accelerating that trend should be seen in RWAs going forward.

We will now take our next question from [indiscernible].

Good morning from Netherlands. One question from my side, please. Last month, one of your peers, InPost took over Sending in Spain. They've already got 3,000 APMs in Spain, plan to increase the number by 1,000. You have a -- yes, in theory, fantastic collaboration with DHL. Unfortunately, you have to wait for permission for this deal. So in the meantime, your competitor is making progress there. How do you see the competitive environment in Portugal and Spain? Has anything changed on the back of that deal in your perception, how you look at this market? And would that -- could it lead to pricing pressure? That's my question.

Okay. Thank you for your question. So well, first, starting with the fact that we have to wait for authorization. InPost also has to wait for authorization, although it's probably a much quicker and simpler operation, but they will also -- they also are pending from competition authorities’ authorization. We feel very comfortable with this. Sending is a very small company. InPost operates on the out-of-home delivery mostly, not to say alone. But in Iberia, CTT is the player with the highest and wider and largest network of PUDOs, being it lockers, mostly in Portugal or other physical PUDO shops.

And so we feel very comfortable with that. More than that, CTT has a totally differentiated platform in Iberia, whereby we cover a wider portion of the value chain of e-commerce logistics, mostly given the fact that we are very strong actually market leaders in customs clearance. We are a top performer in terms of quality in Iberia to Iberia flows. And with the coming of DHL joint venture, we will also be a very strong player on B2B in which InPost is totally absent. And we will most likely lead on outflows to the world and inflows from the world given the sales reach of DHL. So of course, we like competition. This is a very competitive market. We don't see that particular move of InPost by acquiring sending as a relevant threat to our leadership in this market.

Another question from Antonio Seladas.

Just a follow-up question related to your DHL deal. I guess that taking consideration your performance on parcels, I'm assuming that Cacesa will be included on the deal. I don't know if you are able to provide some color on this or not.

Thank you, Antonio. So as it was publicly disclosed because we had to close the -- well, the signing of our agreement with DHL almost at the same time as we announced the acquisition of Cacesa, the deal of Cacesa could not be included. So what DHL has stated publicly is that they are willing to join this. And what was agreed was that we should now allow them -- we should -- after the signing and the closing of Cacesa, we should allow them to do the [due diligence] that they didn't have the time to do. That process is almost reaching the end. We are doing that with them together. And they should take a decision sooner than later if -- well, the expected outcome is that they will be part of the deal as an equity partner. If not, they will certainly be a customer of Cacesa.

And as there are no further questions at this time, I'd like to hand the call back over to Mr. João Bento, CEO for any additional closing remarks.

Thank you, [indiscernible]. Well, thank you for attending and for your questions. Once again, we believe that this has been a very decent quarter. We have upgraded our outlook. We are very positive on our forthcoming performance on Parcels.

And allow me a final word to repeat once more that the growth we expect on Parcels given the pipeline that we have and the market dynamics in Iberia is going to be at least 15% growth in volumes. And that's why we feel confident that the EUR 115 million of recurring EBIT that we have guided for is going to be achieved. So once more, thank you for coming, and we remain available to further clarifications or questions that you have through our IR team. Good morning.

This concludes today's conference call. Thank you for your participation.