Welcome to Posti Group Q4 and full-year 2025 results news conference. My name is Marja Mäkinen, and I'm heading Posti Group's Investor Relations and I'll be your moderator today.

Joining me here are our President and CEO, Antti Jääskeläinen, and CFO, Timo Karppinen. First, Antti will walk you through some of the highlights from the reporting period and Q4, as well as provide an update on our strategy execution.

After that, Timo will present our financial performance in more detail. Following the presentations, we will be happy to take your questions.

You can submit questions at any time during the presentation using the chat function on the webcast page, and we will address them in the Q&A section. Please note that this presentation may include forward-looking statements that are dependent on future events, and you can find the related disclaimer in the presentation.

With that, let's move on to the result presentation. Please, Antti.

Thank you, Marja, and a very good morning to everybody online. Happy to start the presentation with maybe a familiar slide to you, reminder of Posti operating countries and businesses.

We are one of the leading delivery and fulfillment companies in Finland, Sweden, and Baltics, and a couple of highlights there. Maybe 71.5 million parcels delivered in in Posti system, up 7% from last year from the previous year.

Maybe another thing to note is our personnel number, 13,800. This is down from approximately 15,000 a year ago and reflects our transformation of of our business mix.

Now going to our Q4 and then full-year key numbers. We had a strong Q4 driven by our decisive actions during the year and a very operationally successful peak season management.

We had good service quality, positive feedback from customers, and then our resource efficiency was on a very high level during the peak season. As Q4 is seasonally also our strongest, highest quarter.

During '25, we kept improving our result during the year. Q4, always the highest season, but these results are not only due to the seasonality, but also the actions we have taken during the year to improve our efficiency, profitability, and to respond to the declining postal volumes during the year.

In Q4, the top line, €390.4 million, that was minus 3.3% compared to last year, fully driven by the Postal business group. We did see some growth in the in the ECD and and FLS segments.

Timo will come back to those later. Then when it comes to adjusted EBITDA and adjusted EBIT, improvement, clear improvement from from the previous year, which we are very happy about.

One thing to note is our relative profitability, 15.9% on the adjusted EBITDA margin and 7.7% in the EBIT margin. These are the highest relative profitability margins that we have had in in over over 10 years in in any quarter.

These reflect our relative competitiveness and the and the actions taken during the year, those actions that are in our hands to improve our profitability. In the end, we obviously strive for absolute profit growth and and also top-line growth, but we're happy about the development in the relative relative margins anyhow.

Going to the markets and volume development, in these two pictures, the trends of of the transformation of our industry and our company are very much visible. Now these trends were somewhat accelerating during the year and and very visible in Q4 as well.

If we look to the left-hand side, the parcel volumes, we did see 11% growth in in parcel volumes in Q4. As you see, that was somewhat accelerating during the year.

The average for the full year is is 7%. Recommerce, the second-hand products in the in the B2C side, that is the driver.

The growth fully comes from the B2C side. Our B2B parcel side has been slower all along the year.

For the full year, it those volumes declined with a small small single-digit percentage. This implies, as we have discussed before, mix change inside the the parcel volume.

Then if we look at the addressed letter volumes, here ended up being minus 20% in in Q4. All along the year, we have seen somewhat higher decline percentages versus in in previous years.

Now digitalization has accelerated, and both in the government-side developments as well as in the private sector. This actually also impacts somewhat our seasonality.

We'll come back to that later in the presentation, but obviously the the good thing is that we have found a good strategy and way to adapt to this market reality and adjust our costs downwards with the with the same same pace if if not faster. As said, these two pictures quite nicely describe the transformation of our industry and and of our markets.

Going then to the group business portfolio, as a result of of these changes, then the relative share of of postal services for the full year declined from previous year to 37%. Then the Fulfillment and Logistics Services business group and the eCommerce and Delivery Services business group, the which operate in long-term growing markets, their share of the group sales reached 63% in last year.

Then I want to share some highlights from from our strategy execution during '25, some of them Q4, but but also for the full year. If we start from the commercial activities, it was in the first half of the year, but but feels like long ago, but it was an important part of our OnePosti approach.

We moved to operate under one one brand. We have Posti in Finland and Sweden, and then in in the Latvia, Lithuania, Estonia markets, SmartPosti.

Then we have invested and developed our parcel locker service point development, almost 500 new new expanded automated parcel machines, including outdoor lockers in in cities. Then also market and growth-driving development, we have Saturday deliveries, which have become more more and more popular, and then the small parcel to door service, where we utilize the synergies of maximum shoe-size packages are are delivered in the postal network.

We continued to invest and continue to invest in in this growing recommerce segment by making the it more efficient, increasing consumer self-service capabilities, sending from lockers in in Finland and in the Baltics. This is something we we continue to develop as the mix of the parcel business has been changing.

OmaPosti has been developed, our digital app, and and the digital postal locker. A lot of positive development in our sales capabilities, new sales organization recruitments, higher sales efficiency, and this we certainly want to continue.

On the operational side, I already mentioned the successful peak season management. Maybe there to note that as as we as we have developed already earlier, these automation rates were were again higher, now also in the Christmas greetings or Christmas cards deliveries, and that was a big step forward in being more efficient.

These are traditionally handwritten notes, almost 9 9 million of them, and now we were able to machine and auto- automate-handle majority of those, and which brought further efficiency. We have continued to execute delivery model changes, resource optimization, sorting automation, I mentioned, and we have done several pilots to explore how how we can advance further synergies in our delivery networks in Finland.

In the Fulfillment and Logistics side, both in Finland and Sweden, we have executed warehouse consolidations, resource optimization, efficiency improvement, and we have a rollout ongoing of the new warehouse management system in Finland and Sweden, which we plan to gain efficiencies from. Then on the sustainability side, our own emissions, Scope 1 and 2, decreased by 25%.

We have advanced our clean vehicle roadmap in in investments, but also better algorithms to route planning and and optimization, which saves both cost and emissions. Then I think not not a bullet point on the slide, but obviously our personnel has been personal engagement and and satisfaction has been improving also.

In a service business, this is highly important. Despite many of our changes and developments and efficiency improvements, we have continued to improve our personal engagement.

These topics, both commercial excellence, striving for growth in the in the parcel and logistics services continues, and so does our work to improve cost efficiency and and network synergies. With that, at this point, I would like to hand over to Timo for for more details on our result.

Good good morning. Thank you.

A good morning from from my my behalf as as well. Let's start going through the the the key points here in in in our financials.

In Q3, like said earlier, our net sales decreased slightly, this 3.3% in in at group level. This is now driven by the the Postal Services.

If you look on the right, this is describing the the how the sales development was in in different business groups. In the Postal Services, about €19 million decline.

1/3 of that is the unaddressed mail discontinuation, and then rest is kind of the the normal normal volume decline that we are are having. We are really pleased about the the other business groups, kind of e- eCommerce and Ful- Fulfillment and Logistics Services side.

We start seeing the the sales increases, although slightly, but but still sales increased in in in these business groups. If you look at the quarterly development, the sales declines are kind of decreasing from 6.5% level to 3.3% level.

This are clearly driven by our own actions. The unaddressed mail is the big part of that.

Then towards the towards the later part of the year, we have been implemented actions to to improve the sales like price increases in postal side, and then clearly see that the parcel volumes start start growing. It was evident towards the latter part of the of the year.

Then what we are extremely pleased about is the development of the the profitability. Starting with the adjusted EBITDA that increased with the help of our execution in in the in operations and the kind of bringing this improved operational efficiency in in table.

In the adjusted EBITDA increased to to €62.1 million, €8 million better than we did year ago, representing now record high 15.9% and kind of percentage against the the sales. As if you can see, on on a quarter-by-quarter during the year, we've been able to to to improve this relative profitability improvement.

In the Q4 being the the highest season for us is is where we had remarkable results on on the way we did and and run the run the operations. In in looking at the business group, despite the fact that Postal had an negative sales of almost €19 million, they're actually able to improve the profitability by 1.

or EBITDA by €1.1 million. This is the key on on this great great operational kind of efficiency.

Then what we are really happy about is the Fulfillment and Logistics Services now turning into into profits, making in in in fourth quarter. The eCommerce and Delivery Services had a had a had a good good quarter, a good profitability, but the mix changes are kind of kind of slowed down the the profit profit increases.

Maybe this quarterly or seasonal pattern that we have is start to be the the norm nowadays. We are seeing that the Q4 is the one where the the most of the profits are generated during the year, and other quarters, especially Q1, is start to be the weakest weakest quarter for us.

Then finally on the adjusted EBIT as well increased significant, the same €8 million improvement compared to last year. Again here, the EBIT margin was was extremely good, record high in in in our case, representing the 7.7% of out of net sales, more than 2% improvement compared to to last year.

A same pattern with the with the businesses. All the all the all the business group, except the ECD, improved the profitability.

Then on on other side is describing the good management that we have on on overall our cost base. Most of that is coming from our own actions, how we have been able to kind of manage the costs outside the business groups.

Then as well, there were minor minor costs that were one-off in last year, but now disappearing at this year. Quarterly pattern here as well, the Q4 really is bringing the the biggest part of our our profits, and this pattern is expected to continue this year.

We wanted to mention about the special items, which was unusual for for last year and were unusual and unusually high because of the the listing that we we did in in October. The special items totaled now five more than €5 million more than it was year ago, up to €17 million.

The main main issue there is is the listing listing costs. When we exclude the listing costs, our kind of the normal special items decrease compared to to year ago.

Obviously, this is impacting the net profitability that that we had for the year. What we can also say that this kind of the the normal special items, which decrease from the last year level, we expect them to to continue in this declining trend coming coming this year.

Then on the investments, as we have been saying, our investments level are are stable. In and and stable in meaning that the investments cash flow and the payments of lease liabilities would on annual level be around €120 €20 million level.

Same continued in in last year in total. We are now ended up on €124.4 million level, very much on on according to our our own estimates.

Now point to note is we have added the strategic project CapEx, which was related to the building up a new warehouse in Järvenpää and and the terminal in into Tallinn. Those is now was €23.4 million, then €23.7 million last year, but it's now completed, and we will have not do not have any more of this strategic CapEx going forward.

Then on the balance sheet, so as well the booked investments are remained and actually decreased from the from last year level, €175.1 million. There, the kind of main increase is coming from the additions to the rights-of-use asset, which are actually these lease liabilities increased.

These are now related to, which we had quite a big increase in Q4, which are related to to certain existing logistic and sorting center lease renewals, where we secured our key positions and places to do that sorting in in Finland, which were Tampere, Kuopio, and Vantaa, and actually as well in Pirkkala. Those those lease were renewed during the Q4.

Then as well of the moving into new Posti headquarters, the lease lease liability came into the books during Q4. Then the the balance sheet remained strong.

At the end of the year, the net debt to adjusted EBITDA was 2.6, but again consisting mostly on the lease liabilities. The financial net debt to EBITDA was only 1.1, €220 million, which is then consisting the the minor part of our kind of net debt to EBITDA levels.

There were some increases to the lease liabilities during the Q4. As I described, these are related to this renewal of the the lease lease warehouses in in Finland or logistic center in Finland.

Now the financial net debt itself remained low, and it was during the year, the only reason for that why it increased was the extra dividend of €150 million that we we paid prior the listing during the year. Then looking at a bit more closely on the segment level, the Q4 results, and and starting with the eCommerce and Delivery Services, here the key point is that the parcel volumes continue to to increase, and then the operational efficiency as well are is improving, which then overall supports the profitability in in this segment.

The parcel volume in Q4 increased to by 11%. Like said, this has been growing throughout the year, and there the the small items or mainly recommerce market is the one that boosting now the volume volume growth.

There's minor minor kind of decline in overall sales, and this is mostly driven by the the mix change in in consumer parcels, and then somewhat continued sluggish market in in into B2B side, which we as well expect to to improve this year. On the on the adjusted EBITDA and adjusted EBIT decreased slightly, which is coming from providing the services for the the recommerce parcel volumes and then the change of the the product mix.

Overall, the profit level, whether it's EBITDA or EBIT, remain at at a at good level. Then what we are really happy about is the positive development that we had in in Fulfillment and Logistics Services side.

There was a positive development in warehouse market demand during the quarter. There's an the net sales improved by more than €3 million in in the quarter, representing this 4.4% improvement in in sales in in and that was especially growing in Sweden, where the Sweden operations sales increased by more than 10%, in Finland as well by by 1%.

These are mostly all related to our own actions that we have implemented in in managing the sales in in these countries. Then what we are really pleased about is the profitability improvement.

In in Q4, there was €2 million improvement in EBITDA, and the EBITDA margin improved by two and a more than more than 2%. The same thing with the adjusted EBIT level, where we almost made then break even in in this business, and it's kind of proving the fact that what we have been saying, that we can improve the profitability in FLS business.

This the profitability improvements are are coming from the the warehouse consolidation that we put in place in during the year, and then operational things like resource optimization and cost discipline overall has started to to bring the the results. Finally, as said earlier, what we as well are extremely proud is the in in the Postal Services, how the kind of strong operational efficiency increase the profitability here significantly.

This happened despite the fact that this the address letter volumes continue to be decline, and it was almost 20% in in Q4, one of the highest kind of volume declines that we have seen. Then we have an an good system to manage the the volume declines and and and implementing kind of new new product offerings and then price increases, etc., which then limit the the sales declines into into into in lesser level.

The sales only declined by 11% in in Q4 despite the fact of volume decline by by 20%. What's an remarkable here is the extremely strong execution in in in operations.

Here the delivery model, the resource optimization that we have in place, and then high level of sorting automation has been now improving the profitability in this segment, we can say significantly. Adjusted EBITDA improved, and EBITDA margin went up to 23.

almost 24%, and then adjusted EBIT here to to 16% level. These are the levels we have have not seen in in in this business for for for many years.

Then moving on to the guidance that we are now be able to give. For the guidance for for this year is that we are expecting the our net sales to be in the range of 1.4 to 1.5 billion, and then adjusted EBIT to be in range of 63 to 79 million in in this year.

Below is the ones that in how we did that this year, and this is the kind of wider range of guidance that we are now able to give for for the year. The the and just as in recap about the mid-term financial targets and our dividend policy, we see our average organic net sales growth to be at least 2% in group level and at least 5% outside the the Postal Services.

This is and then average adjusted operating result, meaning adjusted EBIT, to to grow over 5% on average compared to to to last year, '25, and net debt to EBITDA to be less than 2.5. This is how we see the the the coming years starting '26 to be starting to to perform.

Then on the dividend policy, which we are now stick as well from the '25 results, we are now aiming to to pay continuously increasing dividends, where the payout ratio to be at least 60% of of net income. That leads to the proposed dividend payout for the for the last year.

Here the the Board Board is proposing for the AGM to decide that the dividend to be €34 million in total, increase from by €1 million from last year level of 33, and then dividend per share of 84 cents, increase from 83 cents from from last year. This is now and the payout ratio is is high, 144.7%.

We can we can propose and do this with the with the help of sort of strong strong results, but as well with the help of strong financial position that we have in place. That leads to the final part.

Thank

you. Before the Q&A session, just to recap the key takeaways.

We delivered a strong Q4. Our EBITDA and EBIT margins are higher than they have been in over 10 years.

Our relative profitability is good, and the seasonal operations were very successful. Second point, our market transformation continues and it is even more visible in the Q4 numbers, where the market volumes continue to diverge, faster growth in parcel with a changing mix, and then letter volume decline accelerated to 20%.

Then the third one, which is related to the previous ones as well, we continue to execute our strategy. We have excellent improvement in operational efficiency, and we have a recipe to adapt and adjust to the declining volume in Postal, and we certainly want to continue commercial and operational excellence to drive growth in parcel and logistics services.

With these words, handing over to Marja.

Thank you, Antti and Timo, for the presentation. Now we will move into the Q&A.

Just to remind you, if you would like to ask a question, please send it through a chat function on the bottom of the audiocast webpage. Let's take the first question.

Can you please add some more color to your sales and earnings guidance range for 2026? What would needs to happen for you to reach the lower end versus the top end of the range?

I can start. There are many elements that can impact to this.

One is on a postal side, what level the volume decline will continue, and as well how our actions to mitigate the volume declines with the help of new product offerings or price increases can impact. As well, we are now making changes to where the pricing actually is been done, which we are quite positive about.

Then and as well, it comes very much on how the market develop. On ECD side, it's about the way the parcel volume will actually start moving and then an overall kind of volume movements in our freight business, which is then, like said, a bit on a market-related thing.

Then on FLS business as well, it's very much on the market side. If you are now, as we are seeing, kind of improvement in transaction that we see and the warehouse utilization is increasing, and the kind of product movements in warehouses is in a increasing trend.

If that continues, then will impact positively. Difficult to be more specific, but these are the ones impacting the ranges.

Further to say that if we are now moving towards the lower part of the ranges, we have definite actions in place to maintain the profitability as we have been doing over the last year.

Thank you, Timo. Then the next question regarding the seasonality of our businesses.

Should we expect normal sales and result seasonality in 2026?

Yes, thank I can take that. Now the question is that what is referred to as normal?

Maybe I would like to point out that, as Timo was referring to, and we have also written into the report this seasonal background text slightly differently as as before. If if '25 was more normal, similar pattern is something we expect, i.e., really the peak season is the Q4, and and then Q4 Q1 was the worst worst quarter in '25.

This in the earlier years, there has been a comment that Q1 is is a is a strong postal volume quarter, and and this we have now changed in the text for the specific reason that what used to be a January, February high mail season when public sector tax authorities, maybe pension insurance companies, all all different kind of bodies used to send, banks, financial institutions used to send their annual statements or or different kind of mail items in the beginning of the year. Here, we see a big digitalization impact, and and we have stopped in our report noting that Q1 is a strong postal season.

It is not anymore.

Right. Thank you, Antti.

Then moving to our next question. It's about your sorting automation.

Sorting automation-related efforts and other efficiency measures seem to work really well throughout last year and Q4. How much more is there still to be gained within further automation or efficiency measures?

What are your plans on further measures this year?

Yes, thank you. Yes, the automated sorting percentages start to be quite high, above 90%, and as said, the traditionally relatively manual process of Christmas card handling was taken a big step forward into automation and this kind of machine vision type of handling this year.

There's still room to improve that on the next quarter. However, the automation percentages by default cannot be more than 100.

There the benefits continue even though the automation percentage doesn't go up. The next stage of improvements and cost-efficiency improvements comes from automation, but it comes indirectly that the automated sorting enables us to do fast and agile changes in our delivery routes.

That is the main source of efficiency already today, but going forward. Here a note that our total delivery routes cost base is actually bigger than the sorting cost base.

Automation continues to bring new and better cost efficiencies also in the future despite the fact that it starts to be more than 90%.

Thank you. The next one: is the B2B parcel volume decline solely due to softer markets, or have you seen any increasing competition-related pressure?

We don't see any, for example, new competition or new entrants. From a market share and market participation point of view, it is relatively stable.

Then as for the year, the B2B parcel market for the full year was a single-digit negative volume development. Those kind of markets typically then induce, of course, competition among players.

However, I think the main reason for the B2B volume softness is really the Finnish economy. The industrial or trade or even the construction industry is partially one of the customer industries there in the B2B freight and parcel.

It is the underlying economic low economic activity of these customer sectors in Finnish economy that we see as the main driver of softness, to say.

Right. Thank you.

Then there is ask for clarification for the comment regarding the impact of the discontinuation of unaddressed mail in Q4. Will there be an impact from the discontinuation in '26?

I can say that no, not not anymore. That that this unaddressed mail product we discontinue to to do that at the beginning of of '25.

The biggest impact of that is came in the Q1, but actually throughout the year, so that product is not In comparable terms, we'll not be there anymore in in '26.

Thank you.

That's one of the items that enable us to do the operational efficiencies, putting in place which then came more visible towards the end of the year. That's now need to be reminded, yes.

Thank you. The next question regarding the parcel product mix.

How much slower are the C2C parcel margins compared to B2C? What can you do to improve the C2C profitability over time?

Maybe I don't directly comment on the margins because the cost to serve is different and they utilize the same system. There's a little bit of a allocation game also going.

The price points of B2B parcels are in very broad terms, they can be double or more compared to the recommerce or lower-end B2C parcels. Clearly one B2B parcel is more highly priced than a B2C parcel.

What we can do to improve our cost to serve and margins in this changing mix is, on the one hand, improvement of the sorting procedures in a way that the C2C or the recommerce parcels are the one area in our parcel product mix which are, to say, not in a hurry. They're not time-critical.

Consumers are typically waiting for them anyways for 5 or 6 days, and even the senders have depending on the platform, up to a week time to send. It is a category where we can optimize transport and many things as we don't have a service promise necessarily for next day.

Then the other area which is really important is the optimization of the first mile. We have now enabled this automated and digital app-related locker-to-locker sending, which is self-service by the consumers, and we aim to continue to develop these self-services to consumers.

Maybe a very simplistic parallel is that as in the airports and airlines, the check-in procedures have been already years ago moved to the consumer and not done necessarily by personnel. This is the same development we want to see also in the consumer-to-consumer sending area, where we can have self-service printers, for example.

Good. Thank you.

The next questions is regarding Postal Services. Looking ahead, what can you still do to improve the Postal Service profitability as the sales continue to decline?

These will be the similar actions that we have been putting in place and which are very visible in the second part of the year last year. In the sales side, if the volume decline was 20%, the sales decline was only 11 11%.

There are actions that we can do to improve the sales. It's actually most things are around the operational things.

Like Antti said earlier, we are now almost all or 90 more than 90% the sorting is automated. We can still increase that a bit.

The things that we can then able to do with the sorting automation is the delivery route optimization, and then actually as well the optimization of our resources to do the deliveries. There are similar level of cost decreases that we can continue to do in the coming years as we have done in the past.

Good. Thank you.

The next question: can you remind us of when did you implement the price increases in Postal Services and when are you going to do further increases next time?

There are several dates, but as a reminder, during '25, there was the consumer stamp increase in May. There was a portion of the business-to-business letters end of June.

Then there was a relatively big chunk of corporate customers in August. Then obviously, as the pattern is that we have done these price adjustments earlier than what one might expect that we will continue to do them this year as well, so.

Good. Thank you.

Are there any recent changes in the competitive environment that you would like to highlight? Do you assess you were able to keep your market shares or market position in 2025?

This is business by business, obviously. If we take one by one, Postal Services, we have 14 companies delivering mail in Finland.

There may be certain, let's say, low-price, low-margin deliveries that we have chosen not to take or not to participate in certain biddings if we don't consider it profitable. Over the years, our market share in postal has gone to roughly 80 80%, and obviously it used to be 100%, but it's relatively stable.

In the parcel side, we will see the official market statistics a little bit later, but we don't see big changes there either. In the Fulfillment and Logistics side, Finland and Sweden, this is obviously a more slower-moving business where winning a contract and then doing the transition may take 6 to 6 to 12 months.

There, we have a strong pipeline and we know of some, for example in Sweden, certain publicly known exits by competitors where we have gained some new customers.

Good. Thank you.

Just still to remind you, please, you can send the questions through the chat function on the bottom of the audiocast webpage if still you have some questions. I have here one last one in line: so how large was the discontinuation of unaddressed mail impact during Q4?

We have told last year that it's in level of close to €30 million.

Thank you.

Was it the full year? For the full year.

For the full year.

Just below €30 million.

Good. Thank you.

Now it looks like there are no further questions, we will conclude the Q&A session. Thank you for all your questions and joining us today, and thanks to our presenters as well.

Thank you, everybody. Thank you.

Posti's Q1 results will be published on April 29. We look forward seeing you then, and in the meanwhile, if there is anything I can help you with, don't hesitate to contact me.

Thank you once again and wishing you a great weekend.