Welcome to CTT's 9 months 2026 results conference call. This event is hosted by Mr.

Guy Pacheco, CEO of CTT, Mrs. Joana Freitas, CFO of CTT, and by Mr.

João Sousa, CCO of CTT. Please note that this conference is being recorded.

For the duration of the call, your microphones will be disabled. We will have a Q&A session at the end of the presentation, and analysts will have the opportunity to ask questions.

To do so, simply click on the button to raise your hand, and we will give you access to the microphone. If you are dialing from a phone line, press *9 to raise your hand and *6 to unmute yourself.

I'll now turn the call over to Mr. Guy Pacheco, our CEO.

Good morning to you all, and thank you for joining the third quarter results earnings call. I will invite you to start on page 5, where we can see the end of the customs de minimis exemption had an heavy impact on the third quarter e-commerce solutions, while we saw Mail & Services and Banco CTT with solid performance, providing a partial offset of the revenues that decline 1.2% organically in the quarter, with a big impact on e-commerce solutions of €14.1 million, and that were partially offset with good performance on mail and strong progress also in the bank.

On EBIT, a decline of 34.5%, it was this one regulatory event affecting one segment, specially on profitability, and we are acting to fix it as we'll detail on the next slides. On page 6, we can see what was the impact of de minimis.

On the left side of the slide, you see the evolution of the European market, where we saw progressive decline of volumes, stabilizing around 55%, 56% decline. The shock was market-wide.

As we can see, we didn't lost share. CTT performed well, but the volume decline increased throughout the quarter, and this is increasingly challenge as we manage capacity.

On the right-hand side, you see the big slowdown on the growth path that we had, we were growing above 20% on the second quarter, and this impact had sequentially degradation of the volumes to 2.9% on the third quarter. On page 7, we see that our volumes were quite resilient despite these events, and that is because Iberian e-commerce continues to show robust signs of progress.

We grew 43% year-on-year on this kind of customers, and in EU, saucy marketplaces, 37%, strong performance on the Iberian lags that were offsetting this 43% decline on cross-border. Our weight of non-EU marketplaces is also decreasing.

It decreased almost 20 percentage points. That is good news for the further growth, as we are building a more healthier and diversified mix going forward.

On page 8, we show the big impact of the mix change that decrease of 20% of the Chinese had in the volumes that we transport, with a very sudden and marked change on the type of flows, with 24 hours increasing 39.5% and almost 27% quarter-on-quarter. The weight that we transport also increased by 1.3 times, and we have more scattered pick-ups with 90% increase throughout Spain.

This is because of the change of Chinese e-marketplaces to Iberian flows. These are the impacts on the cost profile that we can see on page 9.

Our opex grew 4.8%, and this is a function of two things: the cost per item increase because of inflation, we continue to see fuel cost inflation; and the change of mix that is driven by the drivers that we saw in the previous slides; and capacity, because we continue to invest in capacity with decisions made 1 1/2 year, 2 years ago, as we envisioned a profile of growth that was different from what we are witnessing today. On page 10, we see also the good impact of the new mix, as these kind of volumes command a higher revenue per item, and that is showing through the P&L, as we were able to almost offset the volume declines of 2.9 with a 2.4% revenue per item increase.

This is also good news going forward, as we work to fix the economics behind the new volume reality. On page 11, we see the impact of this sudden changes on our EBIT that declined 71% on the CEP side.

Volumes decrease, new mix, and the capacity investments that we made for a different volume reality are indeed impacting our EBIT on this quarter. We act immediately.

We are adjusting costs to align the pressure in volumes and new mix, we are rightsizing our structure. We reduced more than 300 FTEs in our Spain facilities, and we are reassessing all the new network expansions.

We are also acting on the price lever, as inflation continues to affect our business. We need to be more efficient passing through those inflation costs to our customers, and we need more price discipline on the areas of growth.

We are accelerating volumes outside of the Asian, something that we already see, but we want to accelerate further, assuming the same attacker posture in Spanish and Portuguese domestic volumes, and increase the proactivity in international outbound volumes cater or using the new partnership and the new offering that we are getting from our new partners, DHL. On page 12, we see our customs clearance activity that had a deterioration of the revenue in the third quarter of 2026, same trends that we saw in the last mile, but with less diversification alternatives.

Outside of Europe flows are 95% with origins in Asia, and as such, here is pretty much no alternatives of diversification. That's why we are acting heavily on resize the cost base.

We are accelerating FTE reductions in June. We are closing a number of geographies that on this new B2B reality doesn't make sense, and as such, we are aligning also the operating structure to these new volumes.

We are refocusing our network on the new B2B flows. Since de minimis of 1st July and this new handling fee introduced this past weekend, we see a massive diversion of the flows to B2B.

As such, we are adjusting our footprint where we see scalable custom clearance hubs in B2B and concentrating our resources on those corridors that we see migrating for Eastern Europe and Central Europe. With that, we expect to rebuild the profitable growth where we will see scale resume throughout the year of 2027, with Poland already seeing those early signs.

Poland remains profitable and is growing, and we see that growth accelerating in the near future. With that, I'll hand you over to João to give you color on other business units.

Thank you, Guy. Good morning, everyone.

As you can see on slide 13, on Mail & Services, we delivery a strong performance supported by a robust demand of public debt debt savings products that benefit from higher investment limits that was changing this year and also attract attractive interest rates. Also, the launch of new treasury savings certificates in in in July further boost on demand of this of this product, that was very good for for for our network.

As with that, you can see that the volumes increased 105.7% year-on-year and 45% against the the last the last quarter. I would like also to highlight that our digital channel also continued to perform pretty well, attracting new savers and and broadening our customer base of of of savers.

We continue to diversify our offering across our retail network, complementing the logistics and the saving products with insurance and healthcare plans, as you know. As you can see on the right side of the of the slide, healthcare plans grew by 19% year-on-year, and with this, together with insurance, we are creating and building a customer portfolio that generate recurring revenue that we think it's very important for our retail network and for CTT.

Finally, I would like to highlight that this already this quarter, we launch in our all the retail network our the international offer of DHL, with and the and the early signs are very positive, it's also good for the for the coming quarters this product in the retail network. On slide 14, you can see that Mail & Services revenue increased 5.2% year-on-year to €124.3 million in Q3 of this year, supported by a strong growth of savings placements, like I told before, and also the stable of mail revenues, despite the 8.7% decline of of addressed mail volumes.

The pricing of mail is helping us to to to put flat the revenues on mail, and and and savings placements revenues helping to put this business unit growing. The quarter also demonstrate that the value of diversification is is good for for this business unit.

Recurring EBIT increased 87% to €7.8 million, driven by 89% growth in savings placements. This translates an recurring EBIT margin to 6.1%, up to 3.4% year in the year year earlier.

With that, I pass to Joana to talk about the bank.

Thank you, João. On page 15, we can see that Banco CTT had a very strong quarter in terms of growth.

Current accounts continued to grow year-on-year, with a growth of 4.1%. If we look at the business volumes, they grew nearly 13%.

What's interesting to note is that they also grew significantly above market. The loan book grew nearly 16%, which is above 11% on the market.

Deposits grew 12%, compared to 3% on the market. Continuing to be one of the fastest-growing banks in Portugal.

This was translated into a growth in banking revenues, both in the net income interest and commissions, a small decrease on other elements linked to nonrecurring credit recovery in 2025. In terms of the recurring EBIT of the bank, the quarter saw a continuation of growth to €8.1 million in the third quarter of '26.

This is consistent with the nine months relatively stable recurring EBIT, as the bank continues to invest in technology, commercial capacity, and ability to grow and to start increasing EBIT as of next year. Overall, a strong momentum for the bank, marked by volume growth, net income interest expansion, and good margins.

If we move now to the financial review, on page 17, here we have our key financial indicators, including full consolidation of the bank. We can see for the first nine months that we continued to have resilience in the revenue line, that grew 9.2%.

Recurring EBIT, as also seen before, was hit by the regulatory change and dropped by 20%. This takes us, for the nine months, net profit attributable to equity holders to €19.8 million and a free cash flow of €19.6 million.

If we look now on the revenues, costs, and EBIT by the different business units, here we see again that Mail & Services and the bank had a very positive contribution to the evolution of revenues in the quarter, nearly offsetting the effect of regulatory event. We continue to have above 50% of our revenues attributable to e-commerce, the largest portion of our revenues continues to stay in that category.

Looking at costs, this was a segment where the evolution of costs was mainly driven by the change in mix in the CEP, the growth in activity in several elements of services and the bank, and also fuel inflation. We are operating in an inflation environment.

In the e-commerce solutions, the increase in costs is essentially linked to this change of mix, which also was reflected in the change of revenues per item. Fuel costs also had a significant impact, €2.2 million.

In the non-CEP where we have Cacesa, we can see the effect of reducing costs is -€6.9 million, while the company is aligning its cost structure with activity levels. In Mail & Services, mail actually continued its cost reduction, it reduced by 0.6%, and the rest of the growth is linked to increased activity in financial services and retail.

The bank is continue its investment in branch network, commercial capabilities, and IT infrastructure, leading to this increase in €3.5 million quarter-on-quarter. Moving now to page 20, we see the overall results in EBIT that we've seen before.

Again, the positive contributions of Mail & Services, a relatively stable contribution of the bank, and in this quarter a penalization of the e-commerce solution, with initiatives underhand already in the quarter to recover both on costs and on revenue. On page 21, we can see the cash and debt numbers.

The nine-month cash flow, as you can see, was impacted by the decrease in activity. However, the fourth quarter is where we usually see a significant recovery of this category.

Seasonally, the third quarter is a weaker quarter in terms of cash flow generation, but it was improved versus last year. In terms of our net debt, it continues under control.

It's reducing, and that leaves us with a net debt to EBITDA leverage ratio of 2.0, clearly below our threshold of 2.5, and so leaving us with flexibility to make decisions on our portfolio. With that, I would hand it back to Guy for outlook and final remarks.

Thank you, Joana. On page 23, we can see our guidance update for post-de minimis trading environment.

We have a regulatory event that changed our earnings trajectory. Our cross-border volumes fell sharply and above our expectations.

We were working with a more benign scenario following our customer expectations in the beginning of the month of July that were worsening throughout the quarter, and we remain with some lack of visibility after the new November regulation. As such, we are revising our guidance for €80 to €85 million for the full year of 2026, that has an implied €21 to €26 million on the first quarter.

We continue to have a diversified portfolio that continues to provide support to the business, with Mail & Services delivering strong recurring EBIT, and Banco CTT remained on this planned trajectory, where it is reinvesting the growth on commercial capabilities in order to accelerate further this growth trajectory. Execution now is centered on margin recovery.

As we saw, we have a number of initiatives that prioritize volume diversification, pricing, and also rightsizing of our growth capacity and operations. The recovery will extend beyond the fourth quarter, as a number of initiatives will impact not only the end of 2026, but will flow throughout 2027.

As such, we believe 2026 is a reset year, where we are building a diversified growth engine. On page 24, we chose to give you a little bit more color how we see the near term.

As we are using this regulatory disruption to accelerate towards a more diversified and integrated play on Iberian e-commerce, we see 2026 as a reset year, where we are rebasing the earnings base following a big impact on the de minimis. We are stabilizing not only the economics of the CEP business unit, but also stabilizing the operating base of Cacesa, and we are choosing to streamline our portfolio with strategic review to increase focus on e-commerce.

E-commerce in Iberia remains an opportunity, and the opportunity remains intact. That's why we see 2027 as a year of recovery and scale, as we see the growth diversification from Asia to Iberian to continue to increase.

We are seeing already strong growth there, but we think we can double down on that and increase it further, as we reposition Cacesa as a customs clearance more leaned to the B2B flows, and also opening a new opportunity of fulfillment. All of that while we continue to cross-sell and scale our international flows offering on the back of the partnership with DHL.

2028 will be a year of further acceleration, as we return to sustainable earnings growth, as we see some rebuild of the Asian flows that will come on that horizon, where we see ourselves capturing selectively some recovery marketplaces, where we combine a full integrated offering from parcels, customs, and fulfillment, and also out-of-home, in order to provide service to this platforms. On the next slide, we'll start to detail this.

In 2026, we launched a number of initiatives that are already underway, we have €15 to €20 million of initiatives on e-commerce solutions business unit. This is from CEP and customs clearance, and these are basically initiatives linked to reposition our cost base to the new volume reality, not only in terms of volumes and scale, but also in terms of profile and mix, specially on the CEP, where we can progress faster as we wait to scale to resume.

On page 26, we see a detail of how we envision the future. We are seeing two ways of growing.

One and it is the most important right now, that is focusing on the Iberian growth. We are already seeing, as we showed you, a strong growth of around 40% on Iberia, but we think we can increase it further as we aim to grow share in both domestic flows, Portugal to Portugal and Spain, where we want to continue to combining acquisition of SMEs and as we develop new distribution channels, and we also capture more of the C2C segment, that is a segment that is already sizable and growing on Iberia.

We want to also scale with the Iberian flows and grow on the international outbound. We now have a more deeper offering with a strong brand that is DHL, and we see good traction of this new offering.

We have implemented across all our channels in Iberia, on corporate and SMEs and also on the retail network on C2C basis, the international product of DHL, and that has strong early signs of traction, and we are very confident that this will also help us accelerate the growth of the non-Asian markets. Of course, our strategy until 2028 continues to have some recovery of Asian, specially throughout the second half of 2027 and throughout 2028.

It will be a different kind of flows. We see the direct-from-Asia B2C parcels alter structurally to what we call the end-to-end flow, as clearance moves to B2B, and we will see bulk clearance in more concentrated markets because of the capital requirements that this entail for the marketplaces, as they need to build fulfillment capabilities.

We see opportunities in our Iberian market to capture some of that fulfillment logistics, as we provide an integrated offer from customs, fulfillment, and last mile. Also, we continue to develop offering to cater to more out-of-home delivery and also to more efficient on pricing solutions, specially on the high-density city centers as we see some competition of insourcing of these marketplaces, where we need to have price-efficient options that will be from our out-of-home offering.

The end of de minimis exemption disrupts the direct B2C flows, but moves the value upstream into bulk customs as European stockholder and domestic distribution evolves. That is also linked with the reposition of Cacesa, where Cacesa was on a strategy operating in almost all European airports and growing to the expansion of its footprint.

We see now a reposition of that footprint around the main hubs, B2B hubs, but we see that initial concentration also then dispersing again, we'll see a first move of concentration on B2B hubs in Poland and Benelux. In a second wave, we see growth resuming in Spain, linked with that fulfillment opportunity.

Good news is that we already see these early signs in Poland. Poland is growing 47% year-on-year on the third quarter and profitable, and we see that further accelerating throughout 2027 in the first half, as we see then recovery on the secondary markets, where we have Spain.

Cacesa is pivoting from a dispersed B2C footprint to two focus platforms in Poland and Central Europe and selective satellite hubs on that second wave of growth. On page 29, on a different note, we see the decision we took.

We have a strategic review to support Banco CTT next phase of sustainable growth, and the board decided to initiate the sale of a controlling stake of Banco CTT. The strategic rationale is to reassess CTT strategic option regarding Banco CTT, while we continue to support the bank growth path.

This portfolio review is targeting a simplification of CTT structure. We have a preferred partnership model where CTT would remain as a long partner of Banco CTT, and potentially continuing both with a equity interest and the use of CTT retail network, but we'll continue to assess all the alternatives to protect CTT interest and its shareholders, while safeguarding the interest of other stakeholders, and including the bank, on those stakeholders.

CTT is opening a process for control of Banco CTT, while seeking to remain invested in and commercially linked. Our preference is to continue to have the bank using our retail stores as a main channel of distribution, and the bank remaining one of its biggest customers.

The macro environment remains supportive for Iberian banks as GDP growth continues to outperform most of European Union. The interest rates environment continues to be benign, and Iberian banks valuation are peaking, as we see on the slide, on the chart on the right-hand slide of the slide, with valuations approaching 2.2 price-to-tangible book, and P/E multiples on 10.7%.

To conclude, we had this de minimis hit on the third quarter. We are restoring growth and margins throughout 2028.

The end of de minimis exemption cut our cross-border e-commerce volumes in the third quarter of 2026, with an higher than expected impact. We were working with softer declines than in the end realized, we saw it eating a hit on the e-commerce solution earnings.

This led us to revise the 2026 recurring EBIT guidance that is now on €80 to €85 million, where we saw Mail & Services and Banco CTT with solid performance. For the future, we are rebuilding the e-commerce solution margin through price discipline, lower unit costs, and leaner overheads, as we adapt to this new mix.

We have a €15 to €20 million of initiatives that will have recurring impact on our EBIT throughout the end of '26 and 2027. We are also diversifying our growth sources towards intra-European flows and Iberian domestic flows, while we rightsize our capacity to this new custom cross-border reality, and we rebuild the customs clearance model around the B2B hubs and the fulfillment model.

So, 2026 is a year of reset, '27 a year of rebuild, and 2028 will see the delivery of our strategy. CTT has initiated at the same time a sale of the controlling stake in Banco CTT with the aim to increase its flexibility to sharpen its investments on e-commerce franchise, while remaining a long-term partner of the bank.

With that, we'll open to Q&A. Thank you.

We are now available to take questions. As a reminder, analysts that wish to place a question should click on the button to raise your hand, and we will give you access to the microphone.

Analysts dialing from a phone line should press *9 to raise your hand and *6 to unmute yourself. Our first question comes from Joaquín García-Quirós.

Joaquín, you have been allowed to talk. Please unmute yourself and ask your question.

Yes, thank you very much for taking my questions. The first one is if you could help us think a bit on the potential drivers of the EBIT recovery for next year in 2028.

Beyond the €15 to €20 million contribution from the efficiency measures, would it be reasonable to expect some additional benefit from the recovery in Asian flows during the second half of 2027, or is that more or less included in that €15 to €20 million that you're already expecting? Then the second one, you've talked on the recovery to 2028, but given the weaker earnings base this year, do you still see the 2028 EBIT targets as achievable?

If so, what gives your confidence in the recovery required to get there? Thank you.

Thank you, Joaquín. On the first question, we are seeing growth on our e-commerce solution coming in 2027 from the diversification to non-Asian.

The good news that is our revenues remained resilient despite this big decline on cross-border non-Asian non-EU volumes. We had a very profound change of mix that impaired or impacted our unit costs, and that is what we are seeing as the rebase and the fixed measures that we are doing, as we shared, it's between €15 and €20 million on EBIT.

The growth of non-non-Asian and some Asian recovery should add to that €15 to €20 million, and that will fuel the recovery throughout 2027. That we see a progressive recovery, we'll see more marked growth on the second half of 2027, as we reshape the sources of growth during the first half, because the first half was still benefiting from the growth of the Asian marketplaces, and that unfortunately won't be there on the beginning of 2027.

Our 2028 targets had a basis of a strong B2C market growth that we don't see possible without some recovery or some significant recovery of the Asian, that we continue to believe that will happen. As such, with more risk, because we have more uncertainty and less visibility, we continue to believe that will resume growth during 2027 and will enter 2028 with a stronger profile of growth, that will be in the vicinity of those targets.

Let me be clear, that assumes some recovery of the Asian flows, that we are not seeing on the same basis, it's not pure last mile, is a combination of, as we showed in a slide, is a combination of revenues coming from customs, fulfillment, and last mile, and more out-of-home, as we see competition on dense areas increasing, and we need to use that competitiveness to continue to compete with these new entrants on dense areas. Thank you.

Thank you.

Thank you, Joaquín. Our next question comes from Filipe Leite.

Filipe, you have been allowed to talk. Please unmute yourself and ask your question.

Yes, hi. Good morning, everyone.

I have three questions, if I may. The first one on Banco CTT, and if you can give us any indication of the expected timeline for the sale process.

Second, also on the bank, is actually a clarification, because you mentioned, and I'm seeing in the report or in the presentation, you mentioned that the deal is subject to existing contractual obligations between the current shareholders. Can you clarify what are these contractual obligations and whether Generali has any kind of preemptive right or any right to acquire or to sell a stake as part of this deal?

Last one on e-commerce, you mentioned in the presentation an increase in the cost per item, explaining this with a mix of clients and products. This should be seen as an adaptation under this quarter, or expecting a delay in recovery of non-EU volumes in the future, should we see this as a new normal in terms of cost per item?

Thank you.

Thank you, Filipe. On Banco CTT, I cannot detail too much, but so our partners have standard rights on this kind of minority stakes, and so nothing that can jeopardize the process, but we need to comply with them.

In terms of timeline, we are on the initial stages, this is something that will take a while. It's something for the beginning of the second half of next year, and then still subject to regulatory approval, that will take a while longer.

We are working with a closing in 2028 and a signing before. In terms of unit costs that you mentioned, that is twofold.

We are witnessing a change of mix, and because the network was working under a different environment, will need to adapt, and part of the cost measures that we announced is that adaptation to the new reality. There is some loss of scale as well, that is putting a pressure, but we see scale resuming, and that will impact positively unit costs.

These items are also more costly to transport, but they also command more revenue per unit, and so that should be margin-accretive on that regard. There is a portion that will stay, there is a portion that will disappear in the near future, and there is another portion that will disappear as scale resumes.

I hope I was clear.

Thank you, Filipe. Our next question comes from Mathias Paladino.

Mathias, you have been allowed to talk. Please unmute yourself and ask your question.

Yes. Good morning, everyone.

Sorry, I was briefly disconnected, I'm not sure whether you have already addressed this point, but I have two questions. If non-European cross-border volumes remain around the current level, how much of the €15 to €20 million EBIT improvement could still be delivered through the measure already announced?

If we look beyond the recovery plan with the shift toward the Iberian and intra-European volumes, do you believe e-commerce solution can eventually return to the previous margin level, or should we expect a lower structural margin? Thank you.

Thank you for your question. On the first question, the €15 to €20 million would flow mostly regardless having a recovery or not of non-Asian flows.

There is something related to scale, but we think we can achieve it with non-Asian flows. We should see most of that without a significant recovery on Asian.

Regarding the margins, there is two things. We need to remain competitive on the marketplace, and this transition that we already envisioned will need to happen faster, we need to gain share and we need to remain competitive on the marketplace.

The Asian flows were in some segments very profitable, and they are more profitable than the other subsegments of the market. We should see a progressively convergence to the previous margins.

I'm not seeing that happening throughout 2027, as that year will be a year of strong market share gains in the Iberian market, and we need to remain competitive in order to achieve so, but we see in a longer timeframe that margins to resume.

Thank you.

Our next question comes from Henk Slotboom. Henk, you have been allowed to talk.

Please unmute yourself and ask your question.

Bom dia from the Netherlands. Good morning, and thanks for taking my questions.

I've got a few. At slide 27, it all sounds pretty logical and pretty rational what you want to do.

However, a couple of things. We see a lot of Chinese moving their warehousing and fulfillment to Europe, and you quite rightly say that you want to play a role in fulfillment there as well.

Up to now, and maybe I missed a few, but I've only seen a few deals, one or two deals, with former incumbents on warehousing and fulfillment. Temu last year signed MOUs with virtually every former incumbent in Europe, and the only deal I've seen from their side was a deal with the Romanian former incumbent on fulfillment and warehousing.

What are you seeing there in Portugal and Spain? Have you been successful on that front already?

Connected to that, you already said earlier on that the Chinese flows were fairly well profitable. With volumes gradually moving to Europe warehousing and fulfillment gradually moving to Europe out of Asia, how do these margins compare to call it the pre-de minimis model?

You now have to compete with parties like Spring, with Landmark Global, and that sort of things, and everybody is trying to do the same. Is it fair to expect that margins can at least remain on the same level there?

My final question is, you're planning some reductions, also headcount reductions. Does that involve any restructuring costs?

Those were my questions. Thank you.

Thank you, Henk. I'm afraid I cannot greet you in Dutch, but thank you for the bom dia.

I can understand your point of view, but we are seeing actually pipeline in Iberia. We have conversations and we have engaged in some tests with some of these big players.

As we have been mentioning, we are seeing these what we call secondary hubs, because we don't see that many opportunities on their main hubs, as they view this as a core to their operations. We see some outsourcing happening, namely in Spain and Portugal, as we see also movements in the market of them looking for that capacity, and as I said, we are engaging and we have pipeline on that.

On the margins, you are right. We see pressure on the current model of last mile.

What we are envisioning is we think the only way we have to differentiate ourselves from these more opportunistic operators is by having an integrated offer. That integrated offer also entails synergies that come from that integration.

We are also seeking to have alternatives that are more price-efficient for these players, but also they command more margin for us, as a locker offering and even a more deferred SLAs offerings that we can use even the postal network to do that. As such, on the combination of all the links of the value chain, we see the ability to recover that profitability.

As I said, it will be a more integrated value chain and less only last mile. For the restructuring costs, I was forgetting that.

This is mainly redundancies on Spain, and the legislation is more flexible. We are seeing some restructuring costs, but the paybacks are very fast, are below half of a one year below one year, more around half an year of

If I may add, we've started with the temporary staff, where we have more flexibility, and that has allowed us to act more quickly with very limited restructuring costs, both in Cacesa and in the e-commerce.

That's clear. Thank you.

Thank you, Henk. I would like also to remind again analysts that wish to place a question should click on the button to raise your hand, and we'll give you access to the microphone.

Analysts dialing from a phone line should press *9 to raise your hand, and *6 to unmute yourself. Our next question comes from António Seladas.

António, you have been allowed to talk. Please unmute yourself and ask your question.

Hi. Good morning.

Thank you for the presentation, and thank you for taking my questions. There are two two questions.

First one is still related with your cost side on the parcels business. You mentioned that

António, sorry, we are having difficulties in listening to you. Can you speak louder maybe or get closer to the microphone?

Yes. I have two questions.

The first one is related with your cost side on the parcels business, you mentioned that the change on mix increased your costs, but from my understanding, you are already performing this kind of business. Your business was not all from Asia.

You are already aware of the costs, and for me, it's a puzzle how you performed so so badly. Is that related with DHL joint venture, where you have to be more competitive on prices to continue to increase your revenues, or not?

That's the first question. The second question is related with Banco CTT, since you are going to sell the controlling stake, are you allowed to deconsolidate the bank, to change the methodology of consolidation?

Thank you very much.

Thank you, António, for your questions. I'll start from the last one.

For this accounts, as you saw, we are allowed to still consolidate. That will mostly depend on the maturity of the process, that we don't envision still impacting the end-of-year accounts, but that needs to be revised as maturity of the process evolves.

On the cost side, there is no impact of DHL here. This, as we tried to explain, this is basically function of two things.

We still had €2.2 million of inflation of fuel, and on the Spanish side, where we have more specialization of networks, and we are more dependent on the Asian flows than obviously Portugal, because Portugal we have 40% of the domestic market, and as such, we have a more diversified portfolio, and where we, as you rightly say, we move those kind of volumes in Spain. It's different, and we tried to show that or depict that on slide 8, where we see a sudden change on the profile of that we transport.

Mainly on the change on 24 hours, 24-hour So, reminding you that the Asian flows normally work with a 48 hours SLA. What that implies?

Implies that normally the cargo arrives during the weekend, and we always have a stress on our capacity during Monday and Tuesday. The Asian flows allow us to level the capacity, having a higher capacity than we need for the average of the week on Monday and Tuesday, and then using the 48 hours to fill that capacity through the week.

Also, when you think about trucks that connect our facilities, in some cases you are not allowed to comply with 24 hours to use a big truck that comes from Barcelona to Lisbon, for instance, to comply with 48 to 24 hours. Even the cost of moving objects increases.

Is this the kind of mix changes that we are referring to, and this is twofold. First, these objects will be increasingly having higher cost per unit, but also higher revenue per unit.

Specially, the change that was so dramatic in a so short period entails a rapid adaptation, and that induces some loss of productivity in the beginning, and those is the ones that we are working on.

Just a follow-up question. Do you need to have more facilities, to increase your capex on facilities to overcome this problem, or is more about the current infrastructure that you have on parcels?

We don't need more facilities. What we actually have, and you see the fixed cost impact, as we were working with a different scale and a bigger scale for this peak, as there is a lead time to build infrastructure, and we took decisions 1 1/2 year, 2 years ago to build for a different capacity.

That shows on the fixed costs that we gave detail, that's why we are having a higher percentage of overheads right now as we lost scale. To change to this new mix, the changes are more in the way the network is organized and the way the facilities operate, and what kind of machinery they use, than investing in more nodes.

Just a final question, sorry about this. The management team that is in place in Spain that led the recovery is still the same, or there were any change on the people?

The team is the same, with the exception that we changed the leadership in the end of May, as the person was reaching retirement age. We have a new CEO of the business unit that was previously with us on the executive committee of that business unit, but the operational team and all the others remain.

Okay. Thank you very much.

Thank you very much to you all. As there are no further questions at this time, I would like to hand the call back over to Mr.

Guy Pacheco, our CEO, for any additional or closing remarks.

Thank you, Nuno. As we saw, this quarter had a regulatory change that removed a large part of our cross-border volume, with a higher impact than we expected, that led to our revision of the guidance.

I would like to remind that this shock hit the whole market, not CTT. Our cross-border volumes behaved in line with the market, while our Iberian business grew more than 40%.

Margin protection measures are underway, and we have a €15 to €20 million EBIT actions that are under implementation. At the same time, we are simplifying CTT.

We are focusing our capital management attention in Iberian e-commerce, on top of Mail & Services business that keeps generating cash. We see 2026 as the year that resets the base, and we have a clear path going forward, as 2027 rebuilds earnings, and 2028 will be the year that delivers our model.

Thank you.

Thank you very much. On behalf of CTT, thank you for your participation.

This earnings call is now concluded.