bpost NV/SA

Thank you. Good morning, ladies and gentlemen.

Welcome to all of you, and thank you for joining us. I'm pleased to present our second quarter results as CEO of bpost Group.

With me, I have Philippe Dartienne, our CFO; as well as Antoine Lebecq from Investor Relations. We posted the materials on our website this morning.

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

Philippe, over to you for the financials. I'll then come back with the financial outlook and to follow up on some of our strategic priorities for 2025.

Thank you very much, Chris. Good morning, everyone.

Welcome. As you can see on the highlight on Page 3, our group operating income for Q2 stood at EUR 1.092 billion, an increase year-over-year by 10.5%.

At constant perimeter, excluding the EUR 195 million consolidation impact of Staci, our operating income decreased by 9% or EUR 91 million, mainly driven by the following factors: persistent headwinds in North America following contract termination announced in '24 and in the earlier part of this year. Lower Press revenue driven by the new press contract that came into effect in July last year, combined with a decline in domestic mail against high comps in 2024.

Our group adjusted EBIT came at EUR 58.3 million with a margin of 5.3% or EUR 37.7 million, excluding the EUR 20.6 million EBIT contribution from Staci. On a like-for-like basis, this reflects a year-on-year decline of EUR 20.1 million.

On constant perimeter, with the exception of our BeNe Last mile segment, where EBIT is down, primarily driven by Press as lower revenue have a significant impact on profitability, all our other segments are growing, notably supported by continued margin actions at Radial U.S., where we managed to absorb the revenue decline and maintain a stable EBIT. More broadly, at bpost Group level, the results we are presenting today are in line with our expectations.

Before diving into the financial performance of our business units, you will note on Slide 4 that below EBIT, our financial result decreased by EUR 44 million. This is mainly due to four factors, most of them being noncash.

Within the cash item, we note that high interest expense, reflecting the increase in the debt following our bond issuance in October last year and mid-June this year and lower interest income driven by lower money market rates and a lower cash balance following the acquisition of Staci in August last year. Together, these factors account for roughly between EUR 10 million and EUR 15 million.

As a reminder, following our Capital Market Day, we successfully issued a EUR 750 million bond in mid-June in anticipation of the EUR 650 million bond maturing in less than 12 months. Through a cash tender offer, we have already repurchased just under 30% of this bond.

The remaining amount will be repaid next year using the proceeds temporarily placed in money market instruments, securing a positive net carry compared to the coupon of the maturing bond. Most of the variation in the financial result is linked to noncash items, including unrealized FX impact, mainly on our USD intercompany loans and the absence of last year higher IAS 19 results.

Let's move now to the details of our three segments. I'm on Page 5 with the Last Mile segment.

We see that revenue declined by EUR 40 million to EUR 536 million. Domestic mail recorded around EUR 42 million decline in revenue, of which EUR 22 million comes from the press, mainly due to new contracts with the editors following the end of the press concession in June last year.

Excluding press, Mail recorded a sharp revenue and volume contraction this quarter, mainly due to a base effect as last year performance was uplifted by notably the European federal and regional elections. Mail recorded an underlying volume decline of minus 12.4% for the quarter compared to only minus 3% last year.

The decline in mail volume led to a revenue impact of EUR 30 million overall, though this was partially offset by a positive price and mix impact of plus 4.1%, equating to EUR 10 million. As a result, the domestic mail revenue decreased by 8% or roughly EUR 20 million year-over-year.

On Parcels, our revenue increased by EUR 4 million or plus 3.1% year-on-year, reflecting a volume growth of 4.1% and a negative price/mix effect of minus 1% this quarter. On the volume side, the reported 4.1% actually corresponds to an underlying growth of 1.6% when adjusting last year for the volume loss called of the April strikes in 2024.

Over the past months, this growth has been mainly driven by the outperformance of marketplace and strong momentum in apparel, supported by favorable weather condition in June this year. As for price/mix, it stood at minus 1% this quarter.

When adjusted for commercial one-offs, it's in the low single-digit range, consistent with our full year guidance. Revenue from our other activities, including retail, value-added services and personalized logistics declined by EUR 2 million year- over-year, mainly due to the repricing of state services, while DynaGroup revenue remained nearly stable.

Let's move to the P&L on Last Mile on Page 6. Our total operating income decreased by EUR 37 million or minus 6.2%.

And on the cost side, our OpEx including D&A slightly declined by 0.7% or EUR 4 million. This mainly reflects lower FTE resulting from lower mail and press volume and efficiency gains, notably with the resumption of the strikes of the organization in our distribution routes and in retail offices.

But on the other hand, some other higher salary costs per FTE with a plus 3.4% year-on-year increase driven by salary indexation in June '24 and March '25. Starting next quarter, our performance will be assessed on a like-for-like basis following the end of the press concession in June.

This quarter, however, the minus EUR 33 million decrease in adjusted EBIT is mainly attributable to the drop in press revenue and to a lesser extent, to lower mail revenue against a strong comp prior year. Moving on to 3PL on Page 7.

3PL revenues increased by EUR 143 million overall, but declined by EUR 54 million or minus 20% when excluding the EUR 197 million contribution from Staci consolidation in the quarter. In 3PL Europe, Staci's revenue remains broadly in line versus last year.

Radial and Active Ants sales were up 13% year-over-year, continuing the trend of previous quarters, fueled by customers onboarding as part of our international expansion efforts and upscaling activities targeting existing customers. In 3PL North America, revenue decreased by EUR 59 million.

At constant exchange rate, this corresponds to a decrease of 23%, resulting from revenue churn from contract termination announced in '24 and early '25 and lower sales from existing customers, our so-called same-store sales, which offset the contribution from new customer launches, mostly coming from the Radial Fast Track initiative. Let's move to the P&L on the 3PL on Slide 8.

Excluding Staci, while the total operating income decreased by 20%, our operating and D&A were down by 22%, primarily driven by lower variable OpEx in line with Radial U.S. revenue trend and a continued and stronger improvement in Radial U.S.

variable contribution margin rate. VCM increased by approximately 6% year-over-year, reaching its highest level to date and delivering a gain of EUR 10 million this quarter compared to the same quarter the year before.

At constant perimeter, our adjusted EBIT improved by EUR 6 million year-over-year from minus EUR 5.5 million to just breakeven in Q2, mainly reflecting Radial's effective margin action despite a 23% top line drop. Regarding Staci, the EBIT contribution came at EUR 21 million with a margin of 10.6%.

Moving on to cross-border on Page 9. Cross-border Europe revenue increased by EUR 3 million or plus 3.4%.

This growth was supported by solid volume increases from China across all key destinations, including Belgium, which helped offset adverse market condition in the U.K. As in previous quarters, our top line in North America remains under pressure.

Cross-border North America revenue declined by EUR 4 million or minus 7% as Landmark Global continues to face volume headwind, while the broader tariff environment is slowing down existing business and delaying new business opportunities. Overall, our cross-border operating income slightly increased by roughly 1%.

As shown on Page 10, our OpEx and D&A decreased at the same time by 2.7%, driven by lower volume-driven transportation costs, reflecting lower North American and U.K. volumes alongside improved transport rates.

This quarter, we also benefited to a lesser extent from a favorable cost phasing, which is expected to reverse in the third quarter. Coupled with the productivity gains in North America, this resulted in a EUR 5 million decrease in EBIT.

Moving on to Corporate segment on Page 11. Adjusted EBIT improved by EUR 3 million to minus EUR 8 million as lower consulting costs helped offset higher payroll costs driven by more FTEs and inflationary pressure from salary indexation.

Then we move to the cash flow on Slide 12. The net cash inflow in the quarter amounts to EUR 482.5 million, mainly reflecting the bond issuance and the cash tender executed in June this year.

Besides that, the main items to flag are the following: cash flow from operating activities before change in working capital stood at EUR 134 million and decreased by EUR 30 million versus last year, mainly reflecting higher EBITDA and lower corporate tax payments. Change in working capital and provision amounted to minus EUR 125 million.

The plus EUR 4 million variance is primarily explained by the termination of the price concession in June last year. As a reminder, under the former price concession, compensation was typically prepaid whereas the revenue under the new price contract are now invoiced according to the standard billing cycles.

This quarter also includes the impact of the settlement of some terminal dues. The net cash outflow from investing activities totaled EUR 27.5 million, driven by our CapEx for international e-commerce logistics, parcel lockers in Belgium and capacity expansion and our domestic fleet.

This item constitute the main variation in our free cash flow. And in the net cash outflow from financing activities amounted to EUR 500 million, mainly reflecting the issuance of the -- and the cash tender on the maturing bonds as well as the absence of dividend payment this year.

Hence, this now bring us to the outlook and our strategic priorities of 2025.

Thank you, Philippe. And we can happily announce an improved outlook.

As you remember, in February this year, with the results of '24, we had an initial guidance of EUR 150 million to EUR 180 million of group EBIT. In May, at the Q1 results, we had an unchanged outlook, but with a reduced exposure to the low end of the range.

If we look today, and we can announce an EBIT of around EUR 100 million for the first half of the year, which is largely in line with the results -- with the plan that we had. It allows us now to reaffirm our guidance, but even also to say that we target now the higher end of the range.

Several elements will support in the second half of the year, this result. Let's zoom in maybe first in Radial U.S.

Radial U.S., we see that we continue to reach productivity gains with an improved variable contribution margin. Secondly, we have increased our lease exposure there.

So we have a better occupation rate that will kick in as of July going forward. And also in Belgium, there is some good news.

So the reorganizations have been at full speed over the last quarter and we'll continue to do so, which makes sure that we have our cost under control for the BeNe Last Mile activity. So obviously, we are living in an uncertain world, but we are confident that we can actually target now the higher end of the range.

If we then zoom in on our strategic initiatives, at the Capital Markets Day, we already said that we were making speed that many of the pilots were in good shape. I'm not going to elaborate fully in this quarterly update, but at least give you some highlights on the progress that we've made.

If we zoom in on 3PL Europe, meanwhile, the new organization structure has been installed, and we continue to deliver synergies. As an example, you see that Staci has already onboarded meanwhile, one of its clients in the Polish market, so that moved from France to Poland as well.

So we're serving them now in multiple markets. And also Active Ants has now a client that they onboarded for the French market recently.

So that is actually also an element of cross-selling that we do today, thanks to the bigger geographical reach that we have. In the U.S.

Fast Track is really starting to create momentum. There are already six clients that we are actively serving, while the product was only launched in March, and we have six other ones in the pipeline that will be onboarded soon and will also contribute to our revenue growth, obviously, in a market where same-store sales is a challenge, but we see that the new product is really compensating for what we see happening there in the U.S.

If you look in Belgium, we have launched already a year ago the renewal of our products. Most of them become more hybrid and more quality products.

In the [ funeral notices ], we see that the quality that we needed to achieve is achieved, meanwhile. So high- quality product to me with little complaints in it anymore.

We also launched a new product for the license plates. The government has decided that the emulation of a license plate in a postal office is abandoned as a public service, we launched a commercial product on that side.

And also, if you look at the side of the B boxes or locker product, we are soon reaching 2,000 lockers, and we still aim to have 2,500 of these B boxes installed by the end of the year. So we're fully in momentum over there, and that's quite important to better serve our clients, both at the sender side as at the receiver side.

And as I said before, many of the B2B pilots are in good shape. We're ready now to scale them up.

If you look at cross-border, we have been focusing on two new lanes, the reverse lane in North America from Canada to the U.S. seven new clients have signed up for that new lane.

And also in Spain, we have a first large e-commerce player that has been onboarded as we speak and will start to deliver as of Q3 of this year. And obviously, given the fact that the group is further expanding, we also realize more and more synergies at the transportation side.

So as you can see, we are building up momentum. We're preparing there where we can to scale up and to speed up.

But obviously, this is all in an environment with some challenges, but we have an optimistic outlook going forward. And therefore, we are now ready to take any questions that you would have.

Again, two questions each, please, so that everyone gets the chance to be addressed during the session. Operator, please open the lines.

I have two. The first one is on Radial.

Can you give a bit more color on the fast track and what to expect in the second half and the phasing of it because it was still down more than 20% this quarter, but that should improve in the second half and then especially going into the start of '26. So a bit more color on that.

And maybe more important, you were able to keep your profitability in the second quarter at Radial U.S. quite decent, even improving versus last year.

What should we expect for the second half year, especially that you have some real estate management and some benefits from the leasing coming into effect into the second half? Should we maybe even expect an improvement in the profitability in the second half for Radial U.S.

So that would be my first question. And the second one is on the volumes, the parcel volumes in Belgium, of course, a bit of a tailwind compared to the strikes from last year.

However, underlying, it's still 1.6%. You guided at the start of the year, mid- to high single digits.

Later, you came back and said it was maybe more around the mid-single-digit range. But evidently still a bit of a catch-up in the second half, which is more of a good comparable.

How do you expect to achieve this? Or what should accelerate this trend?

Those would be my questions, please.

Okay. Thank you.

Maybe on fast track, as said, we onboarded six clients meanwhile with an ACV, which is in the higher EUR 40 million. I'm checking with Philippe...

Yes, yes, yes.

That's correct. And we have another six that signed, but we still have to onboard.

I think what is important is that you see that the time between signature and onboarding has become much shorter than what we had in the past. So there, we actually have a relatively optimistic view.

Second thing is as well, we have in that new verticals portfolio, we have less cyclical clients, means, of course, that we have less of an effect of a peak season in yen, but also that we continue to onboard clients throughout the peak season in this specific product. If you look at the profitability, yes, indeed, the teams have done a really decent job in controlling the cost in the light of some client losses that we have announced earlier this year.

And so I have to congratulate our teams over there for the good performance they had over there. However, I would say like I would now not expect additional profitability coming in from that side anymore because they rightsized the organization.

They have managed the lease exposure. We don't have in the pipeline at this point of time.

any further improvement coming from that side. So you will still have a little bit of Fast Track effect, but the profitability improvement, we captured it fast.

We could turn around it fast, but we don't expect additional things coming in, in the second half for Radial. If you look at the volumes in Belgium, indeed, what you see is we could win back some of the client volumes.

However, we still are, say, impacted by some of those clients that went dual carrier as a consequence of the strike. So still working on capturing a higher share of wallet within those clients.

It's a little bit, let's say, difficult to have a precise view of that. For sure, it will not be at the higher single digit.

It will be closer to somewhere in between where we were now and the middle single digit as announced. Our teams are working every day to win back those clients.

But as you know, sometimes it takes a little bit of time before we win back the full confidence of that. So those volume forecast, I would be at the cautious side as we speak.

One quick follow-up on Michiel's question. You mentioned the onboarding of the six new clients at Radial with a EUR 40 million annual run rate.

Is that correct for each?

No, no. The ACV is on the already onboarded clients in which, as you might have seen in some of the communication we've done there is one large client which is actually above the typical fast track size, which means that we actually have a higher EUR 40 million ACV of the already onboarded clients, but the size of the clients that we have in the pipeline are typically the size of the client that we expect, which is, let's say, in the range between EUR 2.5 million and EUR 5 million.

That is a typical, let's say, client in the fast track range. And so the six ones will not add the additional volume that you would have seen in the first one because there was a, let's say, an outsized client in that portfolio of the first six.

So one is -- just from my understanding, one is EUR 40 million and the rest is EUR 1 million to EUR 2 million. So...

No, no, no. We are typically in the range of EUR 2.5 million to EUR 5 million per client, but you have one which is substantially above in the first six.

What is then the EUR 40 million?

The sum the six together of the first six onboarded.

Exactly Okay. And are there -- is there already some revenue in Q2?

Or is everything coming in, in the second half?

No, there is some revenue in Q2, but it's rather limited so far.

So we started shipping in May, I think.

Yes.

For shipping in May, we had a full fast track.

And then on your outlook, you made almost EUR 100 million in the first half adjusted EBIT and your outlook says at the higher end. So that's suggesting that there's a maximum of EUR 80 million to come.

But last year, you made almost EUR 100 million in the second half. Well, you have some extra tailwinds coming, onboarding of new clients, still some lower lease costs, potentially no impact from strikes, et cetera, et cetera.

Let's hope so. So you have a few positives as well.

You have one month extra from Staci. How would it be that the result for the second half, which your guidance is so much lower than last year?

Is that logical?

So I start -- yes. So in fact, the situation is different business unit by business unit.

Typically, if I start with cross-border, mostly H1 equates to H2 or the other way around, it's more or less the same. They are not so much impacted by peak.

When it comes to Radial in the U.S. H2 is by far higher than H1 because it's very much peak sensitive driven.

It has always been the case. There is no change in the pattern on that one.

When it comes to 3PL in Europe, we will see a higher Q2 -- H2 than H1 because the synergies will start kicking in, in the second half. They already start kicking in, but mostly in the third and the fourth quarter.

So that would lead to having H2 that would be significantly higher than H1 based on what I've explained. But in Belgium, it's the opposite.

We always have seen that H1 was significantly higher than H2. Again, it's not '24, it was '23, '22 and before.

The highest quarter is typically the first quarter. The second one is the second in rank.

Due to the low volume in the summertime, the third quarter is close to zero in terms of EBIT. And then there is the impact of the year-end peak, which has always demonstrated to have higher top line, but from a percentage margin contribution, it's lower than the first half.

So if you mix all together, that explains why we are guiding on those numbers.

But then that would be quite a significantly marked down on average Last Mile versus last year as well.

But you have a combination of postal impact and an increase in parcel volume, but also compensated by higher cost to handle because it's based on flexibilities that we have to bring into the system. And so we don't make a substantial better EBIT.

So there is a higher revenue in the fourth quarter, but, let's say, a stable or slightly increase of EBIT. But the third quarter actually is the one that is, let's say, the least attractive quarter for us.

And there, you see that the impact of the sum of the two makes the total result combined with mail, in BeNe Last Mile, so the Belgium business, the postal business combined with the parcel business will be lower than in H1. Which is fully in line with what we've seen in the past with the announcement we've made around that.

So there's no surprise in that. It's just what we have always said.

Yes, true. But if you look back, also the second half is not that much weaker than the first half.

We have a few extra tailwinds and some headwinds you have now in the first half and the strikes and stuff. So that would mitigate a bit the difference between first half and second half.

And that's why I'm feeling that there's a bit of caution building.

It's really the fact that to deliver these higher volumes, we really need to add a lot of additional resources and it comes at a cost. That's really what Chris explained.

And this is something that we have observed since many years. Of course, when you were comparing face value of it, you had in those numbers in the past the press that was extremely stable quarter-over-quarter.

So it was diluting a bit that impact or having a bit that seasonality impact. Now it's really come at full light.

Yes. Okay.

Maybe one quick follow-up on the price mix on the parcel side was a negative. I think initially, you always guided for a positive full year impact.

Is that because of the client mix changing? And is that continuing that we should also expect maybe a negative price mix in the second half?

That's still an impact of the strike where we see that the large clients, which typically have a lower margin have come faster back in terms of the volume than the ones that we see on the smaller clients. As you can imagine, of course, our sales force is full out to capture back those clients.

you start obviously with there where the biggest volumes are. And then you have to go one by one with the other clients, which takes more time.

And so there, we're still in the process of winning them back. And so that gave this negative impact of product mix.

So the compensation that we have seen in the volume loss due to the stride, the win back was faster on the larger clients than on the midsized and smaller clients.

I've got two. The first one is on your financial expenses this quarter at EUR 42 million.

I mean you disclosed that there are some other elements in that number. But just wondering what could be, let's say, a normal run rate for financial expenses for Q3, Q4 and also what we should expect directionally in 2026 on -- again, on the financial expenses number?

And then the second question is on Staci. So if I look at your slide on Page 7, you're basically showing that all of the 3PL Europe revenue increase is coming from the consolidation of Staci.

At the same time, you have got Radial Europe and Active Ants growing 13%. Am I right in thinking that Staci revenues are actually down year-over-year?

And if overall Staci revenues and business performance is developing in line with your expectations?

Let me start with the financial expenses. So thanks for your question.

So what we said that in the financial results, there is some cash and noncash element. If I come on the cash element, which the variation equates for variation between EUR 10 million and EUR 15 million, which is just the situation that before prior to the Staci acquisition, we had cash that was invested at higher interest rates.

And now we have a lower level of cash. And by the way, interest rates went also down.

And we have additional debt coming from the acquisition of Staci. So basically, based on what we shared with the market, the issuance of the bond that we did last year and this year, you have a pretty fair view of what it's going to be going forward.

Now this is for the cash part. The noncash part, which is, as I said, if the cash part is between EUR 10 million and EUR 15 million, the noncash, you could do the math compared to what I said, is highly volatile and depending on the evolution of the U.S.

euro exchange rate since we have intercompany loans, so between bpost NV to the U.S. market.

And since the U.S. dollar weakened, of course, we had to do a mark-to- market of this revaluation, if you want, at the end of the quarter since it's a balance sheet item, then explain most of the variance.

If we would be making the close of the book as we speak, we would have already regained 1/4 of the shortfall that we are seeing due to the exchange rate evaluation. So to guide you, I think you should take the rates that we have seen on the issuance of the bond.

This is what is the best proxy for future interest expenses on a cash item. On a noncash item, I cannot predict the evolution of the U.S.

dollar-euro rates. On Staci, I start and you continue, Chris.

So on Staci 3PL Europe, indeed, you're absolutely right, we continue to see significant growth on retail and active since we were enjoying that one since many quarters. And Staci itself delivered a good profitability because we -- as we said, 10.4% EBIT percentage to sales, which is a very reasonable one.

It's fair to say that the top line development on the portfolio of Staci was a bit less strong than we could have expected, while having different situation, we have U.S. really growing very well.

U.K. being a bit difficult -- by the way, this is what we have mentioned also on other parts of the business.

We see that the U.S. -- sorry, the U.K.

market in terms of volume development is difficult. Our colleagues of cross-border also experienced that one.

And in France, the activity was equal to the year before. But profitability was in line with expectation.

Okay. If I can follow up on that topic.

I think you are still looking for management role for 3PL Europe. Is that right?

How the process is going?

Well, the process is on track. It's not yet in the phase that we can communicate, and so we will communicate at the moment that this process is coming to a conclusion.

Two, if I may. I'm afraid I need to come back or follow-up on the H2 profit that is implied by the guidance.

I guess I understand what you said on BeNe Last Mile H1 versus H2 expectations. But still, I believe your guidance implies then that BeNe Last Mile H2 this year versus H2 last year, there will be quite a step down in profitability.

And if you can help me understand how that happens? And then the second question, more like a macro question on Radial U.S.

And if you could elaborate the -- if you expect any impact on Radial U.S. from the abolishment of the U.S.

de minimis regulation that end of August will basically now affect all countries in addition to China, Hong Kong. Will this have any impact on Radial for Q3, Q4 or for 2026?

Or is Radial not all exposed to any e- commerce business that was coming into DS under the de minimis regulation?

You take the first one.

So H2, really, I want to emphasize on the fact that -- the peak execution come at a higher cost than the normal operation. Also in terms of absolute EBIT, it's -- the EBIT contribution will be dependent of the volumes itself, the top line.

We see that the consumer confidence in Europe is not at its highest to the contrary. So if we combine the two, we believe that it's the best forecast that we could make at this stage.

This being said, we will continue to improve on an operational standpoint. So we will not take a potential lower growth rate on top line as a fact and not doing something.

I think operational measures are taken has already started in the first quarter, the second one and some additional will come to be able to compensate for that. But we do not believe that it will make the fourth quarter as a very high in terms of EBIT, unlike we can see in the first and second quarter, where it's more base loaded where we have the best operational efficiency.

At the de minimis change, what we see is quite some activity around discussions on local fulfillment, but not yet leading to specific contracts. So what we see that is realized in the pipeline was already, let's say, in a discussion before that discussion of de minimis, but we could expect when it comes through that there is an increase of local fulfillment, which is positive for the business of Radial.

Obviously, it also has the whole tariff discussion in the U.S. has quite an impact on what is happening in our cross-border business.

And there you see shifts in lanes. Luckily, our teams have been able to go with the shift in lanes.

And so we see that they are managing it fairly well so far. It's a very complex environment where we see that, for instance, the U.S.-Canada lane is under pressure.

It is compensated to some extent with the Asia-Canada lane, where we have now higher volumes coming in. You see as well that we're developing new lanes, the reverse lane from Canada to the U.S., the lane in Spain that we're developing.

So teams are working well and are still delivering on the plans. But what you see is quite some important shifts in the flows within the business that we see today.

But on the side of the fulfillment, I think that you have two effects that we can expect. One is likely more possibility in the fulfillment space to grow the business.

On the other hand, probably pressure on same-store sales in the longer run, given then the decreased purchasing power as a consequence of the tariff war that you see, which is expected to leak at some point of time in less, say, consumer confidence in the U.S., not today as we see, of course, but something in the long run. So we see those two parameters that will weigh on each other.

Hard to predict fully in detail which one will win in that dynamic. But I think the good news is we have a very active sales team today really hunting on the opportunity side, both in the cross-border and in the Radial business.

So we're confident that we try to get the best out of these changes in the market.

And something we have not seen that could have potentially seen is in anticipation of these changes, higher volumes, we have not really seen it.

Yes. So we looked as well in the lease optimization if there was an opportunity for earlier inbound into the U.S., which we have not seen.

Well, looking at today's figures, I guess you can say the first blow is half the battle. I've got two questions.

One is a follow-up on the previous question with regard to cross-border. Chris, you said you were seeing higher activities on the China-Canada lane.

And at the same time, we see you've been adding clients in cross-border on the Canada-U.S. route.

Is that a structural thing? The de minimis rule is now affecting all countries in the world.

And yes, we all know that the relationship between the U.S. and Canada is not at its best shape ever.

And the second question I had is on the parcels, and that's on the negative impacts of the price/mix effect. Is that more like a mix effect?

Or is it something like you had a strike in the first quarter. Is it a sort of piece offering to the clients, to keep the clients in?

And have you seen any material damage to your client base on the back of the strikes we've seen in the first half -- sorry, in the first quarter of this year?

Yes. Okay.

Let me take them one by one. On cross-border, it's, of course, hard to predict because what we saw already in the Canadian situation was even before de minimis change and even before tariff impact on Canada, we saw already a changing buying behavior of Canadians.

So there was a lower volume on the U.S.-Canada lane and an increased volume on the Asia-Canada lane. And so it's not only driven by tariffs, it's also driven by a sentiment.

And of course, predicting the sentiment with the current situation in North America is a little bit hard for us to say. I think that the good news for us is, of course, that we are present on both lanes.

And so whatever will shift in those lanes, we're also looking at other lanes towards Canada where we can reinforce our presence. So we try to make sure that we continue to be a very strong player on that Canadian market there.

What you see is new, which is that before the flow of Canada to the U.S. was fairly lower, and we have actually seen an increase of activity also pushed by extensive sales efforts for our team, but we see now that we are reinforcing our position in the reverse flow that we see from Canada to the U.S.

And so that is probably something that we think will be a structural trend. Also to be admit as well today, it's not that material that we should make it a big point, but it's important that we see that there's a new dynamic starting there and at least we're part of that new dynamic.

Price/mix effect is really a volume mix effects that you see today. So that is that as an effect of the strike, we have a number of clients that deviated, they were already dual carrier that deviated to the other carriers, some of that volume, and it took us time to bring it back.

But overall, actually, these are typically the large accounts who were, let's say, really good in rebuilding that confidence with them and ensuring that they would come back. What you see is, of course, in the, let's say, the clients that bring lower volumes, it takes more time for us because it's more sales effort linked to that, and that's typically volumes that come at a slightly better price mix than the ones that you have in the larger side.

So it's today not a we discount to win clients back. We spend time to get the right volumes back, but we have a little bit of a negative mix effect on the speed in which volume comes back to our facilities.

And we the temporary discount?

No, we have not done that. No, no temporary discount.

It's really building on that. Obviously, I'm not going to reveal the details of that, but there's a lot of commercial discussion on that, which are more to do about reliability, ensuring to have better plans and all these kind of elements to ensure that we can deliver high quality to our clients in any circumstance, which we have spent quite some time on, but it has not been about commercial discounts to keep volumes.

If I understand you correctly, you're saying there's no structural damage in the client base as a result of the strikes. And as far as the negative mix effect is concerned, with a bit of luck, we might see it turning positively again if the smaller clients come back again.

I'm happy to see your confidence. We're a little bit more cautious than you are in the sense that, of course, we have to talk to these clients every day.

And I think that there has been some confidence issues with some of those clients. I don't think we're back to normal level yet.

But we see that we're on the right track to build it up again. And obviously, if we're able to build it up again and build that confidence, that obviously is a very good base for future growth of our activity.

But it's a little bit early to already cry victory on this one.

We'll not cry victory on the war, but the battery maybe because in the quarter, the second quarter, the price mix effect was slightly positive.

Okay. And would you allow me a small follow-up on the first answer you gave.

Is it fair to assume that the growth in clients on the Canada-U.S. lane could be a prelude to clients opting for local fulfillment as well?

Yes, it's clearly linked the one to the other. That's a good observation, I would say.

Okay. Thank you then, everybody, in the call for having taken the time to be with us and for your interesting questions.

As a reminder, our third quarter results will be published in early November, exceptionally this time on a Wednesday, November 5, instead of the usual Friday. Until then, we look forward to staying in touch.

And for those who haven't taken their holidays yet, I wish you a great break. Thank you very much, and have a nice day.

Thank you.