Ladies and gentlemen, I warmly welcome you to KPN's Annual Shareholders' Meeting from our headquarters in Rotterdam. We are delighted to welcome you again this year, both in person and virtually. This means that our shareholders can fully participate in this meeting, both in person and virtually, including asking questions and casting their votes. As Chairman of the Supervisory Board, I will preside over the meeting. I hereby appoint Mr. Spanbroek, the Company Secretary. He's next to me as Secretary of the meeting, and now I would like to introduce a few of those present. Here at the table behind me are the members of the Executive Board and the Supervisory Board, and in the room we have Ms. Brinkman and Mr. Lijnse on behalf of PwC, who's our auditor. Ms. Leemreize, she is a civil law notary in Amsterdam, and Ms. Bosman, a candidate notary also in Amsterdam.
They will be drafting the minutes. On behalf of the Executive Committee of the Central Works Council, we have Mr. Voors and Kroesen, and on behalf of the KPN Preference Shares B Foundation, we have Ms. Aris, Mr. Croiset-Van Uchelen, and Mr. Overmars. The meeting was convened in a timely manner and in accordance with the required formalities by posting the notice and the agenda on KPN's website on the fourth of March of this year. I would also like to address a few administrative announcements and formalities, starting with a note regarding the voting process. The shareholders in this room will vote using their own smartphone or tablet, or the tablet that was given to them at the registration desk.
To vote, you have to be logged in to the voting platform, and insofar you have not logged in yet, then please do so right now, because we will be closing the registration in a few moments. If, however, you're participating online, you can also vote online provided you've registered and are logged in. During the entire meeting, so already right now, you can cast your vote on all voting items. Voting on all items will not close until the end of the meeting before the question and answer session, and the voting results on all items will be announced after that Q&A session. This minimizes disruption to the meeting's proceedings caused by potential internet connection delays for shareholders participating virtually. Obviously, if you use KPN, there will be no such delay, let me say that as a side note.
One final note regarding the language of this meeting, the official language will be Dutch. However, questions may be asked in either Dutch or English.
will be translated in English. Questions can be asked in English. Answers will be given in Dutch and then translated into English.
As announced on our website, the following options are available for asking questions. For those in the room, if you'd like to take the floor, then please raise your hand so that we can give you the floor. For shareholders participating online, in the online environment, you can use the button "Request to speak" to indicate that you wish to ask a question, and that will place you in the virtual waiting room. A KPN operator will then connect you to the room. Please note that there is a slight delay in the video connection, so we will first address questions from the room and then any questions from virtual participants. Now, to assist the persons drafting the minutes, I would like to ask everyone to state their name and place of residence, and to formulate their questions as briefly and concisely as possible.
A recording will also be made for the purpose of drafting the minutes. Now, I would like you all to put your phones in silent mode for as long as you've not done that yet, and I wish you, of course, an interesting and very informative meeting. Let's start with agenda item two, which is the fiscal year 2025 report of the Executive Board. In the following presentations, we will discuss that year, and for that, I'd like to first give the floor to our CEO, Mr. Joost Farwerck, and then to our CFO, Mr. Chris Figee. Afterwards, you may ask questions about both presentations. Joost, take it away.
Thank you, and apologies for the noise. There was a bottle of water next to my feet that I didn't see. Thank you, Gerard, and welcome everyone.
It's great to see you all here in Rotterdam at this annual shareholders meeting. 2025 was the second year of our Connect, Activate and Grow strategy, which we launched at the end of 2023. Last year, we achieved our financial targets and we further strengthened our strategic course. We see that innovations, including the rapid development of AI, are creating new opportunities to further improve our network services and customer experience. This puts us on track to realize our medium-term strategic and financial ambitions. Let's take a look first at the fundamentals of our strategy. During the strategy update in November of last year, we confirmed the course of our Connect, Activate and Grow strategy. We've set our ambition for nationwide fiber optic coverage at a maximum of 85% by 2030.
We will continue to invest heavily in our digital infrastructure and customer environment in the next few years, as well as in our resilience and in cybersecurity. At the same time, we're focusing on growing our client base and further simplifying our operations. This way we want to further strengthen our leading position as the number one internet provider in the country, grow our revenue and operating profit by an average of approximately 3% per- year, and continue to offer our shareholders an attractive return supported by growing free cash flow. I'm convinced that our strategy will enable us to create sustainable value for all stakeholders, i.e. our customers, our shareholders, our colleagues, obviously, and the Dutch society as a whole. Our strategy includes a fully integrated ESG agenda with ambitious goals in the areas of responsibility, inclusiveness, and sustainability.
In doing so, we're actively committed to a better internet, right? This means not only that we provide a super-fast connection, but also that we work toward a green, safe, and more social online environment, an environment where everyone can feel welcome and connected. Safety comes first, and under this Security First principle, we continuously protect our network and offer simple, reliable security solutions for consumers, businesses, and governments. This way, we ensure that everyone can be safer online. In addition, we're strongly committed to digital and social inclusion. Through our campaign and also jointly with social partners, we help young people, for example, and their parents, to prevent online exclusion. Also in the field of sustainability, we're making clear progress.
We have further reduced our emissions across all three emission scopes, and we have set the goal of using only sustainable electricity at every hour of the day. Last year, we began purchasing solar energy directly, and starting next year, the majority of our power will come directly from wind and solar sources. All right. Let me walk you through our results of 2025. Revenue from services rose by 2.7%, with contributions from all segments. In addition, the EBITDA operating profit and free cash flow exceeded our guidance, our expectations at the end of the year. After years of rising costs, we succeeded this year to reduce our indirect costs by EUR 10 million, which is a very important turning point. Last year, we also invested heavily in our infrastructure. For example, together with our joint venture, Glaspoort, we connected about 400,000 additional households to fiber optics.
Once again last year we were recognized with the award for the best mobile network in the Netherlands. We also achieved the highest score worldwide. As said, we indeed have achieved our targets, our goals. The financials, the revenues from services, for example, grew by approximately 3%. EBITDA slightly above guidance, free cash flow at EUR 952 million, exceeding the increased outlook we provided in our half-year results despite a slightly higher CapEx, and the regular dividend of EUR 0.182 per share for 2025 is still on the agenda for later this afternoon. In addition, we bought back EUR 250 million worth of shares. Let me also tell you something about our operational performance. We hold a clear leading position in the Dutch fiber-optic market. Together with Glaspoort, that joint venture, we now cover nearly 6 million households, which represents about 70% of the country.
To maintain this leading position, we have further optimized our rollout process, and we're increasingly focusing on connecting not only households and activating customers by in that way increasing our footprint. We see this reflected in a rapidly growing number of fiber optic consumers. In the consumer market, the revenue grew by 2%, driven by that consistent growth in optic fiber and also mobile services. Also, our client base has continued to grow this year. The number of broadband customers rose by a record number of 38,000. We also added 129,000 mobile subscriptions, and this growth exceeded our market share. Throughout the year, we saw the net promoter score, let's say customer satisfaction, continue to rise. That was thanks to operational excellence, the new services that we call Combivoordeel, and initiatives that strengthen digital engagement.
As a result, customers are increasingly really experiencing the difference when they are a client of KPN. In the business market, we see that the revenue from services rose by 3.6% quarter-over-quarter, driven by all three divisions. In particular, the SMEs and also tailored solutions, i.e. projects for large clients once again grew strongly. Security is also a core component of our business propositions. Currently, about 70% of our SME clients have additional protection by default, and we block large numbers of cyber threats every single day. For vital critical sectors, we provide customized solutions, including DDoS protection and high availability of security. In this way, we strengthen the Netherlands' digital resilience by really focusing on the business market.
In that very same market, we also saw our NPS improving over the year, reflecting customer confidence in the stability, reliability, and quality of our network and services. Finally, wholesale. Revenue from services rose by 3.5%, driven by both the strong increase in fiber optic services and the continued growth in mobile, and especially international sponsored roaming, which is a rapidly growing market in which we enable other providers to utilize our global roaming deals. KPN hereby sells capacity to, among others, travel SIM providers, among others, so that they can serve their customers worldwide. Now I'd like to hand the floor to Chris to discuss our financial performance in more detail. Thank you.
Thank you, Joost. Good afternoon. As Joost mentioned, we achieved our financial targets from last year, and we are fully confident that we will be successful again this year.
The financial results last year were solid and form a strong foundation for the future. Let me highlight a few key figures. Firstly, the adjusted revenue increased by 3.5%, driven by growth in service revenue across all segments and higher other revenue. Second piece, the adjusted EBITDA after leases. Our operating profit rose last year by 5.1%, supported by higher revenue and lower indirect costs. The EBITDA margin improved by 70 basis points to 45.2%. Thirdly, our underlying net profit rose by 0.9% this year. Fourthly, our free cash flow amounted to EUR 952 million. Despite, or perhaps even thanks to, the fact that we once again invested more than EUR 1.2 billion. This represents a 5.8% increase compared to 2024. EBITDA grew this year, largely driven by strong underlying performances.
Even excluding the positive contribution from the acquisition of Alcadis and two one-time settlements related to patent uses, our EBITDA grew by 3.1%. This means underlying growth exceeded our 3% CMD guidance with the one-time effects further boosting total growth. The growth was driven by higher revenues from services and also supported by a strict cost control. Direct costs rose mainly due to mix effects in B2B and higher access costs with third parties like Glaspoort, the joint venture. In 2025, we reduced our indirect costs by EUR 10 million, which is a clear turnaround after two years of inflation pressure. These savings resulted from disciplined cost management, a focus on automation and digitization, optimization of the lease portfolio, and a reduction in the workforce of approximately 300 FTEs on an annual basis.
Already, as explained during the strategy update, we're aiming for EUR 100 million in savings on indirect costs over the next five years. The operational free cash flow, measured as the operating profit minus CapEx, grew by nearly 10%, or approximately 6% excluding the settlements and Althio. In 2027, following the completion of the peak of the fiber optic rollout, we expect a reduction in CapEx of about EUR 250 million, bringing our CapEx below EUR 1 billion per year, more or less. Driven by the EBITDA growth and this CapEx reduction, we expect operating free cash flow to grow by an average of approximately 10% per year. This will increase the operating free cash flow margin from 24% to about 30%, positioning us among the European leaders.
This underscores our long-term value creation model, and it reinforces our confidence that we can achieve sustainable growth in our cash flows in the coming years. As said, our free cash flow amounted to EUR 952 million, which is an increase of 5.8% compared to last year and accounts for 16% of our revenue. This growth was primarily driven by a higher EBITDA, but was partially offset by changes in working capital, higher taxes, and higher interest expenses. Our cash position remains strong with over EUR 500 billion in cash and short-term investments. KPN remains focused on creating value, as evidenced by the strong return on capital employed. Our ROCE improved by 30 basis points in 2025 to 14.7%, bringing us closer to our medium-term target of 15%.
We're slowly getting there. This improvement is attributable to our operational efficiency and shows our ongoing commitment to value creation within all our operations and investments. Before I continue, let me briefly explain our risk management statement, the VOR in Dutch. In this statement, we describe how we identify and manage our most significant risks and which level of assurance is provided by our internal controls. In 2025, the scope of the VOR was expanded in line with the Dutch Corporate Governance Code. Whereas the statement previously related exclusively to risks surrounding financial reporting, it now also covers sustainability reporting and compliance and operational processes. Strategic risks fall outside of this code. At the same time, this code is less explicit about certain financial risks, like financing and tax risks. Therefore, for the purposes of the VOR, we classify funding risks as strategic risks and tax risks as compliance risks.
KPN has been investing for many years in a robust internal risk management and control systems, including for operational risks. This is also closely aligned with our structural investments in fixed and mobile networks and also our security-first initiatives. The expanded VOR largely builds on existing systems and processes and helps us further codifying them. Since 2025 is the first year of this broader statement, we've established a dedicated project organization with close involvement of both the Executive Board and the Supervisory Board, particularly through the Audit Committee. Our auditor was also involved, not to provide assurance, because that's explicitly not requested, but to advise us and to also verify consistency. All right. Within the control framework, we distinguish between basic measures and supplementary measures. Basic measures apply organization-wide and to all risk categories.
We then implement additional measures where our risk appetite is lower and a higher level of assurance is required. We've explained this approach in more detail in the annual report. In short, the lower the risk appetite and the higher the desired level of assurance, the greater the emphasis on supplementary measures. Right? We apply this approach consistently within KPN and is also explained within the VOR. This brings me to the essence of the risk management statement. For financial and sustainability reporting, the level of assurance aligns with the Code's requirement. For operational and compliance risks, we use a double negative statement in line with standard market practice.
The VOR itself does not provide an unambiguous indication of the period to which it relates, but in line with our risk management system and how it operates, and in line with the scope of the annual report, you may read our VOR as a statement that relates to the entire fiscal year and not just to the situation as of the balancing date. Any areas for improvement identified were addressed in consultation with the External Auditor and have not resulted in errors in the external financial reporting. Having said that, I would now like to give the floor to our Chair.
Thank you, Joost and Chris. Ladies and gentlemen, I would like to point out that the slides from this presentation will be available on the KPN website after the meeting. Does anyone have questions about these presentations, either in the room or via the video link, the presentations of Mr. Figee and Farwerck? Once again, if you would like to state who you are and where you are from, that would be convenient for the minutes. Excuse me.
Yeah.
All will be well. My name is Robert Fregée of WeConnectYou, and I'm from Amsterdam. I am specialized on a dialogue with businesses and the government. When I look at KPN and Ziggo, I notice the following. At least when figures are correct, KPN is doing fine. Slight growth, 3%-4% a year, stable revenue from subscriptions, and growth mainly from fiber and bundles. When we look at Ziggo, their revenue is decreasing by 2%-3%. It's losing broadband clients and needs to adapt the strategy. That is my view on the matter. If you don't agree, please tell me so. Something else. Looking back in time, 1972, we had the Rome report, and now, 50 years later, the global heating is 2.5 degrees as of the year 1900.
In 1973, we had an energy crisis, and 50 years later, we don't just have an oil crisis, but also a gas crisis. Worldwide, it's one big mess. KPN should put more emphasis on sustainability. By AI, we get large data centers all over the place, and it's very difficult to stop that. Of course, you can use the heat and use solar panels on the roofs and use plants, but you can use the heat to warm up houses. Geothermal, it's a great battery to make sure that we store all of the heat, and we are not so dependent on fossil fuels, because KPN is a very smart business. They are really innovative. Herman Dijkhuizen was a member of the World Wildlife Fund, which is very important because the Earth is heating up, and forests will help you to cool down.
I was in Suriname, and the size of the country is four times as big as the Netherlands, and you only have 500,000 inhabitants, and 95% is covered in jungle. KPN could contribute to make it more sustainable to increase the amount of forests, and you have nice positions. It would be such a good idea if somebody from the Board of Directors of KPN would become a Supervisory Board member at the World Wildlife Fund and make sure that we make the Earth greener and protect forests. Herman Dijkhuizen knows what the journey is towards that. Indonesia has a lot of forests, but these are affected because they have so many inhabitants, too, and we could help that. Now, KPN is doing worse even. I was at ING, and there were lots of people that were protesting, and they are becoming more sustainable.
You can ask ING, for instance, why don't you accelerate? You can do it a lot faster because the less we provide grants and use money to make the company more sustainable worldwide. Well, I believe that I have very clear questions. My question is, one, to summarize. Can KPN be very clear towards ING from the chain to become more sustainable? Furthermore, plant woods with this Earth that's heating so much. The World Wildlife Fund can assist you. It's not just responsibility of KPN, but also for other businesses in the Netherlands to accelerate. Because the issue right now is we had the Club of Rome report and we had the energy crisis in the 1970s, and we hardly learned. To the contrary.
We need a lot of activity, and this applies to your grandchildren and the nephews and the nieces you have. Ask your children, ask your grandchildren. They will love this if you become more sustainable and plant a lot of forests. These are my questions, and I can give you more clarification if you need it.
No.
No, I do think you've made yourself very clear, and you've had an ample opportunity to elaborate. Well, I can be brief. If it's about what we have to do towards other businesses, it's not in our nature to dictate to other businesses what they should do. Obviously, we do discuss matters with other businesses and also those businesses that you've mentioned. Indeed, we have consultations. It's not our position to tell these people what to do. With regard to engagements of other members of this Executive Board with NGOs such as the World Wildlife Fund, we have a very clear policy. If members of the Executive Board would want that or have ambitions to do so, we will allow them an opportunity to do so, and we will support them.
With regard to our own sustainable efforts, you heard it from Mr. Farwerck that we are on track, and it's fully integrated in our operations. Let me leave it at that. Thank you so much. Moving on to Mr. Everts of the VEB.
Thank you, Mr. Chair Gerben Everts on behalf of the Dutch Shareholders' Association, and fortunately, they allowed me in. Now, your annual report and the explanations was read clearly by us, and we noticed that the strategy that you've started is really creating value and becoming effective and is very good. KPN is performing very well with a lot of investments to increase fiber, but we do notice that it's a positive distinction from the entire industry in Europe. Now, in the years before this and also last year, you are aiming for value over growth.
The cash flow, of course, towards the shareholders is something we appreciate. I believe that KPN is for many investors and many people that are members of the VEB has become very attractive for those investors that are looking forward to a predictable cash flow and return on investment. Now, what we wonder about is how viable is it, and will you be able to continue this, and will the pressure on the markets increase? Questions about that. When we talk about the rollout of glass fiber and the customers, in October last year, you confirmed the goal to have about 80% of households in the Netherlands on fiber, and the strategy in November changed that up to 85% and then in the year 2030. You've increased your timeline. Now, is it because there's delay or is there a different reason for that? Please explain.
You say that KPN is shifting its focus from cabling, from putting glass fiber in the streets towards the houses, the households. Homes Passed and Homes Activated, the changeover, it is stabilizing at around 47%. Are you happy with that, with optic fiber? Now, is that what you want, or would it put pressure on the rates and on the margins? We were wondering as well, what is the actual cost price to make sure that you connect people? Of course, there is inflation in the chain, so does that have an impact? In other words, what does the shift of your focus mean for the expected return, IRR, on optic fiber projects? What variables are decisive? Are these the investment costs, the returns per customers, or development of the margin? This about optic fiber.
Now, a second item of concern is dependability on third parties. If glass fiber is slowing down, to what extent would KPN need to hire or lease capacity from companies such as DELTA Fiber? How does it structurally have an effect on the cost level? I believe there are about 200,000 connections of DELTA Fiber that you are intending to take over. ACM has announced that they will investigate it, that's why it's taking long. Do you take into account that it may not materialize, that takeover, and what's Plan B? I would also like to ask another question about the 3-3-7 strategy. I don't know whether I've exceeded the number of questions I can ask. Growth of the group service revenues in 2025 was 2.7%, when the guidance for last year was 2%-2.5%.
Now, if the revenue growth is structurally below 3%, that 3-3-7 ambition may be under pressure or not. You've stated that it's difficult to make sure that the growth of the consumer service revenues is over 1.5%. Now, what specific indicators grant you the confidence that in 2027 or in 2028 you can achieve that? A final question about costs and AI. When we look at the Q4 presentation, we've read that of course, and if we read it correctly, the indirect operational costs after increasing for two years have decreased by EUR 10 million in 2025 to approximately EUR 1.7 billion. Number FTEs was lowered by 307. The cost developments towards 2030, you aim to decrease costs by EUR 100 million. You are expecting EUR 25 million in decrease. Does it mean that in the period 2027-2030 will you achieve the rest?
The recently agreed increase of wages for 5% for everybody at KPN, what will the effect be on that? Will these agreements hit the margins, affect the margins? When we're discussing AI, in your annual report, you state that AI is at the core of our transformation. It should lead to lower costs and better service. You mention applications as client interaction via chatbots and other items. My final question, what part of the intended EUR 100 million cost savings towards the year 2030 will specifically be addressed to AI? Does AI already provide you with tangible efficiency improvements, higher productivity? Can you control the costs to comply with the EU AI Act and controlling the algorithm risks? Do you, in other words, make sure that the ROI on AI investments, do you keep track of that?
Now, if you allow me, and other speakers too, a few individual questions, they are related to last year's results. Of course, we have some questions for your Auditor.
Thank you for your questions. About optic fiber, I would like to ask Mr. Farwerck to reply. Feasibility and the 3-3-7 and the costs, I would like to give Chris Figee the floor.
Well, thank you for your questions. You've asked quite a number of questions. Let me see if I can reply in a structural manner. Indeed, extending the optic fiber, yes, we had a target for 80%. We did so at a time when we believed that 350,000-400,000 each year was the maximum. We scaled up so much that we managed 600,000, 650,000 households, Homes Passed.
When you realize that DELTA and another company were also rolling out, and ODF were also rolling out. Now, about 90% has already been provided, and about 70% by KPN. Now, it used to be true that KPN would connect all the households to copper and have large subscription. The government paid for it. We are now a private business. We have to choose. We chose for a higher threshold, 85%, but that will be the limit because all of the Netherlands will be connected. That's one, and we are proud of where we are. Will we go beyond the 70%? Yes, that's why we put the limit at 85%. It's very important that you use what you roll out. It was claiming regions, what people do, to make sure that you can impose your business on that.
It is very important that we connect houses, not just making sure that indeed the cables are in the street as competitors do. We are activating a lot, nearly 50%. You mentioned the numbers of Homes Passed to activated, which is a very high number. When you look at the older regions, we are over 60% and I can bet that we may hit 70%, because when you move, you want to take a new glass fiber connection because it's already available. In new areas, we need to cover a lot of ground. It's only 30%. In the mix, nearly 50% of Homes Activated is actually better than what we believe was possible when we started out. We're very enthusiastic, but there is a limit. It's important for the shareholders. We can't continue unlimitedly. We need to yield what we've built. I think 85% is quite a stretch.
If we would achieve that by 2030, I would be very happy. I think it is a very good pillar for the Connect and Growth strategy. You ask for the cost price. Well, rolling out glass optic fiber is, of course, for construction. It's all about building points of presence and activating equipment. Now, those prices, of course, have increased. Maybe Chris can give you more information about that later. We are also innovating together with our contractors. Eight years ago, we started with a rollout in a manner that has changed over time. It takes a lot less time to achieve that. Of course, labor costs make sure that our rollout costs increase, but we also know how to reduce those costs. Using third-party networks, of course, we are a company that builds assets and then uses the network.
We serve our customers on a copper network that's of high quality. Mainly in cities, it can last for a few more years. We were looking for other regions to switch and serve our customers. Our earning model we see, yes, in our own network. In some cases, we use other people's network. I think near Harderwijk, we have an optic fiber company that we've made agreements with so that we can serve customers over there. In general, you would like to say the KPN strategy is to serve asset-heavy customers. 200,000 is what we want to take over from DELTA by Glaspoort joint venture. It's taking a long time. Will it materialize? We don't know. The fact that it's taking so long indicates that ACM has a lot of doubts about it, to put it clearly.
It's a very straightforward transaction between DELTA and Glaspoort and KPN. It's about 200,000 houses. You would say just a few months of work for us. It's not a game changer for us, but it's interesting to see what the arguments of ACM are when they finally approve. I don't know why they shouldn't approve, but it's taking very long. Well, that's the Netherlands for you. 3-3-7. Chris, maybe about AI. We have no strategy in which we say AI will make sure that we earn so many millions. We have clear programs, clear targets in the operating on autonomous operations. To summarize, everything in the customer environments, everything in other domains will be supported by AI solutions. We're very enthusiastic, and the transformation programs, together with other activities, will make sure that we reduce costs by EUR 100 million.
AI is really important for us, important on how to serve customers and how to improve that for our customers, and also in transformation to the new business that can operate at a lower cost level. It's not like AI is an independent strategic theme. It's part of the transformation of the business. Costs, the final matter. -EUR 10 million. Is the rest all backloaded? Well, in the past few years, we were increasing by about EUR 50 million. If you move from EUR 50+ to -EUR 10, the difference is EUR 60. That's how I approach 2024, 2025. It was a very important transitional year, and the inflection point is very important. If we were able to achieve -EUR 10 now, we will end up at -EUR 10 in the next year and then accelerate. Actually it is very realistic.
I don't think I could have put it any better. First a question about 3-3-7. The first 3% is our revenue growth, the second one is EBITDA and profit growth, and 7% is the average cash flow growth. You're right that the revenue growth, the first 3%, is now 2.2%-2.5%, and our profit growth will be maintained at 3%. That means that we have to do more with the costs. The model to achieve the 3% EBITDA growth was, in the past, largely because of revenue growth. For the next period, it will be mixed a little bit more with cost decrease a little bit more. Last year, this year, we see the same thing. Indeed, to get the EUR 100 million, we have to accelerate the cost savings every year.
That's part of the plans also, as part of the transformation programs that he spoke about. The second three will be achieved. It might be 2.8%, 2.9%, and then in 2026, maybe 3%. That depends a bit on the technicalities. The 7% of free cash flow growth is largely dependent on the CapEx. Business is going to make the difference. That's why the 3-3-7, which we will apply for the entire plan period, will be achieved. For now it will be 3-5-7, but the average will be 3-3-7. For the cost side, indeed, we will accelerate things through transformation programs, but also by simply looking at how you spend, right? Whether or not all your expenses are indeed useful. There was one question about growth in the Consumer Market, and what can we do to accelerate it?
Well, in volumes, it is for us a way to basically keep clients for a longer period as a client. We see that it is indeed happening. The migration number is going down, and also we see the number of new sales increasing. If we have a wise and moderate price policy, subject obviously to annual inflation indexation, we see that clients are staying. To stimulate really client to move to bigger bundles, faster speeds, et cetera. I think that's my answer.
Thank you. Are there any other questions?
I represent the VBDO, and we are established in Utrecht for sustainable development. Thank you also for the talk we had prior to the meeting. This year, we have three questions about an affordable wage and CSRD, and I will ask them in one go.
Firstly, I would like to compliment you with identifying wages that might have a potentially negative impact because they are below the livable wage. However, in your policy documents, you use different terms with different meanings. For example, adequate wages, fair wages, and wages above living standards. My first question is, would you consider to monitor the implementation of a livable wage under your own employees and then implement that in your next annual report? Tell us what the timeline is for tier one providers. Second question about the livable wage. Can you explain how the ILO definition of a livable wage has been implemented in your policy documents, and whether or not you have clear expectations for providers? About CSRD, KPN made sustainability statements, included them in the annual report, and the EU Omnibus Act also came into force in March.
How do you plan to assure transparency and consistency in your sustainability reporting? Specifically, which CSRD-related disclosures will be initiated voluntarily, and how can you assure that investors can keep comparing risks, et cetera, despite a possible reduction in the mandatory reporting?
Thank you for your question. First thing, the wages. Hilde? Yes. The wage matter is about our own employees and the ones in the chain, right? From your perspective, you see a difference in the definitions that we use. What I think is important to mention is that the living wage is a very important topic to us. We believe that, especially for our own employees, we have a very good package of employment conditions that really represent a living wage at a very nice and good level.
In the chain, we have agreements with our suppliers, also through a code that we use, whereby we really determine through EcoVadis and the JAC, which is an industry organization. They help us to ensure that also very focused audits take place and that actions are taken when necessary. Finally, something we could report more on towards the future is about us having set up a working group on taking additional steps in the future.
Thank you, Gerard, for that.
The CSR questions for you. CSRD, actually. Yes, as Joost said, sustainability and social entrepreneurship is part of our DNA. You do that with or without the CSRD. We report, of course, in accordance with those guidelines. In our annual report, I think that it has really transitioned now to make it more readable.
For the first time, it was a little bit more stringent, and now it's become more compact and more easy to read. We see the Omnibus regulations in the same way. Not to reduce the reporting, but to simply make it more legible, make it simpler, and make sure that you do keep track of the most important points. Climate, governance, et cetera, they are very important for us, and they will be topics that we continue to report on. We will also do a new DMA analysis this year. We really see the Omnibus as a way to simplify things and to put focus, not to reduce. The comparability is definitely an important topic for us. Even if the simplification should result in a switch to different types of measures, then of course we'll come with comparable data.
For us, it's a simplification, but not a substantive reduction in the reporting at all.
All right. Thank you. Any other questions in the room perhaps or online? Oh, yes. Someone in the room. Please use the microphone.
Gerben Everts from the VEB. Thank you again, Gerben Everts from the VEB. You gave a very clear answer to my other question, so I might as well ask a few more, right? The recent hack that took place at Odido underlines, of course, the importance of cybersecurity in the telecoms industry. To what extent does this give rise for KPN to invest more in security, and how do you assess your own risk profile in this regard? Does KPN, as a result of the incident, see any commercial effects, for example, an inflow of more customers, or have clients changed their behavior? This is one. I have five brief questions.
Frequency licenses. They end, I think, in 2029, 2030, and they will be auctioned off by the government again. Can you please tell us which costs you take into account for this and how sensitive they are to a less positive auction? What can a possible higher result mean for the planned shareholders' payouts, which are now around EUR 6 billion? Number three, mission-critical applications, i.e. defense. KPN positions itself very gladly as a partner for, among others, the Ministry of Defence. Can you tell us precisely what contracts and services they are, as far as they are not bound to confidentiality, and what do they do for the revenue and the profitability? Photonica, photonics. Many people say that that is even beyond AI, the new investor's tip. You are also involved in that because KPN Ventures invested technology companies at a very early stage.
What is the strategic objective behind these investments, and on the basis of which criteria do you determine whether they indeed create value for the company? The final question before I go to the other topic, the Business Market. In the Business Market, we see especially that SMEs are growing, that segment, but the big companies are lagging behind. What are the most important reasons for this lagging behind of the growth of very big companies, and what concrete steps are you taking to have that part grow? Of course, the Risk Management Statement deserves attention, and Chris has already addressed that he's involved in all different ways. It's part of the Corporate Governance Code.
This was the first- year that you had to report on it, and you write that the introduction of the VOR, that statement, has led to a separate structure, and that it applies company-wide. It involves all the relevant parties, and that also you have selected international frameworks and have set reliability levels or standards. How has that implementation of the VOR affected the internal review of the framework, especially last year? What has concretely changed vis-à-vis previous years, and which parts are manifestly more severe or more strict, or have become more formal? You're saying that there are no major failings as it's called, but you do mention two main points for improvement, governance around authorizations and monitoring of access rights and more consistency in change management processes and controls. My question is, why does Koninklijke KPN not identify these as material shortcomings?
Where does the limit lie between an improvement area and a major failing for you, and which concrete KPIs and deadlines are part of these two improvement processes? When do you expect these topics to have been completed? You're saying that certain things are outside of the scope of influenceability of KPN because there are external factors. Which ones are there? I mean, not all of them, but the most material ones, because there might be more than 100. Which are the most relevant ones for the in-control statement? Does it concern, for example, dependability of the rollout of Glaspoort, or is it something else? How did you concretely include these considerations in the conclusions? Thank you.
Before I pass these to the members of the Executive Board, I'd like to make a remark because you mentioned the name of one of our competitors, and we will not address that. This is KPN's AGM, and of course, we will share with you what KPN is doing with respect to cybersecurity, but not other companies. I would like to give the cybersecurity questions, including the licenses, to Joost. Mission critical and defense, I will pass on to Ms. Vergouw and the Large Business Market. Joost, can you also do the final one? Sorry, Chris. Yes. The VOR is his specialty, so of course. Joost. Yes.
This only shows how important cybersecurity is and how sensitive the digital infrastructure is. Generally, it is doing very well compared to other companies. It's also very important to our economy and its growth.
Since 2012, we have taken enormous steps in investments and in the organization with respect to cybersecurity. The hack as such was a small hack, but of course, it was seen as a triggering event by us as well to change our whole mindset and the security-first is something that's been part of our DNA for more than a decade. We invest a lot of money in the resilience of our own environment, and we have a CISO organization, as it's called, that is, I think, one of the best of the country. Our compliance is fully focused and directed on it, and with everything that we do, the security-first mindset is very important, and our people are also trained.
On how to use the interface correctly, our operations, and we made the step also to services, because we believe that we can help the country by offering good solutions in this regard. Large companies have to take care of their own line of defense, and we can help them, and Chantal will say something about it in the context of mission critical. The SMEs don't have the time, nor the budget, or the people to work on this. That's why we have services for the SMEs free of charge. It's not something we can switch on, because then we would formally filter traffic. Like I said in my introduction, 70% of our clients are using it, and that means you work in a safe environment. We did the same thing now for the Consumer Market.
All clients or customers of KPN can turn on a functionality that enables them to work in a safe environment. We train, of course, clients as well as to what can you do to operate safely and to work safely. For us, it is super important. Why is it so important? Well, because we believe that this is what KPN represents. It is part of our brand. That's also why people see us as a very important player in the domain. That's also the same reason that the Ministry of Defense selected us as a preferred partner. That's why I'm part of the Cyber Security Council, advising the government. It's not only an opportunity, but also an obligation that we really distinguish ourselves here, and we do that. That with respect to security.
The licenses for 2029, there is indeed a multi-auction, multi-broadband, whatever thing going. Probably several licenses will be auctioned at once. We've had good and bad auctions. The good ones are the ones whereby the costs don't go up too high, and the most recent one, the 5G, was a very good one, whereby the Ministry of Economic Affairs really opted to not go for the highest price in the market to really motivate the mobile operators to invest as much as they can in the network with all kinds of obligations, of course, attached to the network. The result is the two best mobile networks are in the Netherlands. I hope that the ministry uses the same wisdom and vision to set up the auction for 2028 or 2029 or 2030. We don't know exactly when it will take place.
Obviously, we're talking with them frequently to point to the necessity and the need and the use for it, because the digital economy is super important for the Netherlands, and it would be sad to lose that great position that we have now. It's part of our financial framework, which parts from our financial strategy to allocate money to our shareholders. Of course, we have some room left for an auction, but also other events that may present themselves. With respect to our balance sheet, we do anticipate for the auction. Photonics. Chris, where are we? Let me address the KPN Ventures. It has a little bit less than EUR 100 million, and we invest here in companies that we have something with and that we can add something to.
They have a product or service that we would like to have in our portfolio, like our clients that we would like to help develop or services that we would like to actually procure. Because as we become more adult, they may be useful to us in the photonics. ElevenLabs is another example. It's a very successful platform for speech agentic AI tooling, and aloSIM is a travel eSIM party, one of our biggest partners, and Veesion is also a developer of software that identifies theft from stores. When you buy something at the supermarket or whatever clothing store and you steal something, they can see that. We have a whole range of products. It always will be a minority investment share. They are companies that we believe could be something either for our clients or for us, ourselves.
Photonics is one of them, and until now, they have been very successful investments.
Thank you. Yes, indeed, the risk management statement. We spent a lot of time on that. For us, it was a way to make sure that the risk management framework on compliance, et cetera, was scrutinized. What is our approach is something we wanted to decide. Is the framework good enough? Is it robust enough? The model of the basic control measures and enhanced control measures was developed in that perspective. It was a way to address the risk, and the VOR was indeed the starting point. It was a latency in the organization, but now we were forced to really detail it and to classify all the risks. It did assist us, and I believe we are much more aware of the urgency to make sure that the risk tolerance on network level must be very low. The network must be in operation always.
That's something that we really expressed, and we aligned the network framework along those lines. It helped us to make sure that the framework in which we control the risk ourselves was really helpful. Authorization management, change management, these were items for improvement because they were finalized at the end of the year. Earlier in the year, they were not in control, but we did a lot of manual controls to make sure that in 2025, at the end of the year, everything was under control. These were items to be improved over the year, and that's what we wanted to do. I think that indeed the risk management statement helped us to be more determined about it. We want to be honest. These are examples of matters that we could improve.
Change management is now where we want to be, but we are indeed looking forward to improving on that, and the auditors will also make some statements about that later.
Thank you, Chris. I would now like to give the floor to Ms. Vergouw for the market items.
Let me start with the Ministry of Defence or rather mission-critical. Indeed, it's correct. As Joost said, it's an important partner to us and a big customer. As you understand, I can't discuss customers. What I can inform you about is because the Ministry of Defence has indeed published it themselves, is that of course, we are working along with a lot of the highest spend that you see in the Ministry of Defence. It's not the percentage you notice in the newspapers. Most of it is spent on equipment and people, but also mission-critical activities.
We said that the core portfolio is obviously available for this industry, and sometimes we run projects made to measure for them. The ones that they have indeed published is the Staatsgeheim Cloud, and we are indeed engaged in projects like this and that we breathe along with the desires that would fit into the KPN business. Now, obviously, a question about your SME market and the growth figures in volume, which also applies to the returns. We have two flavors. The mass market business, that's what we opted for in the last periods to improve that, because e-commerce has caught up with us and we are able to make sure that we can serve a lot more digitally, so the volumes are bigger.
I think as KPN, we have an impressive partner network in which we have very intensified relations that sell our portfolio to a large extent, and we chose therefore to make sure that businesses within 150 and 650 staff can also be served by the model, and it led to an important impulse. That's why mass market and SME are really doing well, and we want to shape the corporate partnerships. Large businesses is a different dynamics. As you know, every big business has to make sure that our costs are considering the costs, and that's why we want to address that. You notice that we are not with two or three big players in the market. Hundreds of competitors are also from abroad, and I mean the hyperscalers, but also from Asia that work at different labor costs.
I don't know who is receiving a call, but somebody's trying to locate somebody. Yeah. Yes. What's important is that in the large business level, people are not looking for convenience so much. They are not distributing it across various suppliers. You've also read the newspaper, perhaps today there's a lot of information about it in politics. We have a view on the matter, of course, but I think that there are many more competitors, and it is from different regions with different labor costs than in the Netherlands, and therefore the margins and the volumes are under a lot of pressure sometimes. We do know that we have a very strong relation model, and sovereignty also helps us so that we can develop new business models to take it further in the future.
Thank you, Chantal. Any other questions on this topic? No further questions. No online questions. Just checking with the Secretary. No online questions. Now, I have found that no further questions have arrived, so I would like to complete this item on the agenda. Moving on to item three on the agenda, approval of the financial statements for the 2025 book year. Financial statements for the 2025 year have been audited and certified with an unqualified audit opinion by PwC. The country-by-country report has also been audited and certified with an unqualified audit opinion. The sustainability information is accompanied by an assurance report. Throughout the year, PwC discusses its report with the Executive Board, the Audit Committee, and the Supervisory Board. Of course, reports are also the subject of discussions between the Supervisory Board and the Executive Board.
In addition, both the Chair of the Audit Committee and the Chair of the Supervisory Board hold separate consultations with the auditor regarding the auditor's work and their findings. The relationship with the auditor can be characterized as open, critical, professional and constructive. Based on the various consultations, as well as the content of PwC's Board reports, we as Supervisory Board have concluded that relevant topics and considerations were discussed in a careful and transparent manner between the Management and the auditor and are fairly reflected in KPN's financial statements. I would now like to give the floor to the auditor, Mrs. Brinkman, to provide an explanation of the audit work that PwC has performed for KPN. In order to address the shareholders with full transparency, KPN has, for this occasion, released PwC from its professional duty of confidentiality.
It's also worth noting that PwC's External Auditor has a duty to correct any material misstatement. That is to say, if KPN makes any announcements today that present a materially incorrect picture of the financial statements, the sustainability report, or the auditor's report, PwC will request a correction no later than the final adoption of the minutes of this meeting. I would now like to give the floor to Mrs. Brinkman.
Thank you, Chair. My name is Jacobina Brinkman. I am KPN's External Auditor on behalf of PwC. In this role, I'm responsible for auditing KPN's 2025 financial statements and for the assurance engagements related to the sustainability report in the tax governance section. I would like to explain our work. We've issued an unqualified audit opinion on KPN's 2025 financial statements.
This means that, in our opinion, the financial statements present a true and fair view of KPN's financial position as of December 31, 2025, and of its results and cash flows for the year 2025, in accordance with IFRS and Title nine, Book two of the Dutch Civil Code. With regard to sustainability reporting, we've concluded that nothing has come to our attention that leads us to believe that the sustainability presentation contains material misstatements. In other words, we've issued an unqualified, unmodified, limited assurance conclusion. In addition to the limited assurance on the entire sustainability statement, we've audited KPN scope one and two emissions measurements with reasonable assurance and issued an unqualified assurance report. Finally, in 2025, KPN expanded the tax governance section in the integrated report in line with GRI 207. This section was subject of a limited assurance engagement on which we issued an unqualified conclusion.
Now, for the group audits, we applied a materiality threshold of EUR 50 million based on EBITDA. Excuse me, revenue, in which 89% of the consolidated revenue, 99% of total assets, and 97% of the adjusted EBITDA were covered. The first year of collaboration, 2025 was PwC's first year as KPN auditor. Last year, we devoted extra attention to getting to know the company, its strategy, the revenue model, the internal controls, and the IT environment. We also reviewed and discussed the files from the previous auditor to gain sufficient comfort with the 2025 opening balance sheet. I should have changed my slide. We coordinated the transition with the Board and the Audit Committee all along. Both KPN and PwC invested heavily in ensuring a smooth transition. This resulted in a successful transition and a solid foundation for the coming years.
Now, I would like to highlight the key areas of focus for our audit that we've identified for the year 2025. The first is the acquisition of Althio, and secondly, the reliability of the IT systems, including cybersecurity. First of all, the acquisition of Althio by KPN in the year 2025, reporting of this acquisition requires significant assumptions by management, for example, regarding whether KPN has control, the allocation of the purchase price across the various assets and liabilities, and the valuation of the divested infrastructure. We reviewed the transaction documentation, valuation reports, critically assessed management analysis, and consulted our own valuation, tax, and accounting experts. Based on this work, we consider the assumptions used and the accounting treatment of the acquisition in the financial statements to be appropriate. Second key audit matter concerns KPN's IT environment.
KPN processes a large volume of transactions, fully automated by means of a complex landscape of billing and supporting systems. Reliability and continuity of these systems, including cybersecurity, are therefore crucial. Following on last year's conclusions, KPN continued to work on two areas for improvement in the year 2025, IAM, identity and access management, managing and monitoring access rights to systems, and IT management, the consistent and controlled implementation of IT changes. We mapped out KPN's IT environment and tested the design and operation of IT controls. Where necessary, we performed additional, more data-oriented procedures. This means that in certain areas, we rely less on the systems and more on the underlying data and transactions. In addition, we assess the measures that KPN has implemented in 2025 to mitigate the identified areas for improvement regarding identity and access management and IT change management.
Based on our work, we've obtained reasonable assurance regarding the reliability of financial information. Important estimates and judgments. In our audits, we always pay attention to the significant estimates in the financial statements, such as deferred tax assets, evaluation of derivatives, obligations related to the decommissioning of networks, asset retirement obligations, and the Glaspoort joint venture. For items like this, Management's future expectations and assumptions are of great importance. We've tested these assumptions, compared them with external information when possible, and assessed them for potential bias. We consider the estimates used to be within an acceptable range. Following on from the Management Report, I would like to address fraud risks briefly. KPN has further developed its fraud risk management. This includes the use of thematic fraud risk assessments and an overarching fraud risk analysis.
In our role, as usual, we specifically examine fraud risks and, based on this work, have found no indications of fraud. Now, the risk management statement, as stated before, KPN has included this VOR for the first time. It's our role to determine that this does not conflict with the information we gather during our audit. We monitored the preparation of the VOR and concluded that this process was thorough at KPN. I will now briefly address sustainability. We've reviewed KPN's sustainability statement. This means that using a combination of document reviews, interviews, data analysis, and sampling, we assess whether the sustainability information is in line with the ESRS requirements. In addition to limited assurance on the entire sustainability statement, we also provided reasonable assurance comparable to an audit of the financial figures regarding KPN Scope one and Scope two emission measurements.
A number of errors were identified in the 2024 sustainability data, including in Scope one emissions and other indicators. These errors have been corrected, explained, and the comparative figures have been adjusted. Finally, the readability of the report has been improved this year. The DMA has been enhanced, and steps have been taken to further develop the internal control framework for non-financial data. Ladies and gentlemen, this concludes my remarks. I would like to thank the Executive Board, the employees, and the Supervisory Board for their professional and open cooperation in the past year, and I would now be happy to answer your questions.
Thank you, Mrs. Brinkman. Do we have any questions in the back of the room? Thank you. Gerben Everts, VEB, once again.
Thank you for explaining matters. You discussed the IT systems, including cyber systems.
These were a key audit matter, and in your presentation, you clarified room for improvement in the identity and access management and IT change management. My question to you, but also to the Executive Board, because that's the first party to reply, but then you. What specific deadlines and milestones does KPN apply for completing these matters with room for improvement, and when do you expect that these will no longer require an additional audit procedure? That's a question to the Executive Board. A question to the auditor, we read the goodwill impairment test, and we read that carefully. We noticed that for Consumer this year, you assumed an EBITDA margin of 51%-54%, when over the past few years, adjusted margins of over 65% were achieved. My question to the auditor is why is there such a difference between 51%-54% and 65%?
What assumptions are the basis for that? Final question, but to both of you. Important, I believe. For the obligations to make sure that cables you no longer use, to remove them from land held by third parties, there is no provision on the balance. According to KPN, you cannot give us a reliable estimate. We do see outphasing of the copper network, not everywhere, but in a part of the Netherlands. Don't you think it's logical that this obligation will materialize over time? To what extent is there still a latent obligation that you do not show in your balance sheet? What do you estimate to be the risk or the opportunities that these become material? As we noticed, digging in the soil presents the highest costs. You will have to dig. Will it put pressure on your cash flow? That's the question.
Thank you for your questions. First of all, I would like to ask the Executive Board to reply to the first question. Mrs. Stammeijer.
Okay.
All right. The question was about IAM and the improvement of IT change management. Look, for both topics, we have short-term improvement plans and structural improvements that we believe are necessary. Identity and access management is, of course, a broad topic in the entire industry. There are many companies that are addressing this because the systems landscape is enlarging and increasing. We have a program that ensures that you have one central application that you can manage IAM better. It requires a number of connections, so it's a multi-annual program because it also requires architectural changes. It will take some more years, and it will always require maintenance.
In the short- term, we've done a lot for the reconciliations extra, and we believe that we are in control of the things we have now. That's the most important for this year to continue to assure. We will also use and need short-term fixes so to speak, or measures, because the program will be completed only in a couple of years. In the end, this means that you have to select the right supplier. For change management, the same thing basically applies. For the short- term, there are improvements that we have made. It's important, of course, to ensure that changes are always well in order and that they take place in different systems. It requires the coupling to a central system to have a better overview.
There, too, that is also a long-term improvement that will take place over the next one-two years, and then we believe we'll have taken the right steps. That was with respect to IAM and change management. We have to set up an integrated control system because you have to comply with all kinds of rules, regulations, and the more you have set up integrated controls, the better it will be and clearer it will be for the entire company. We're taking steps there, too. This is also a multi-annual program. We are addressing all these points that you mentioned, and we'll keep doing that obviously, and we'll keep reporting on it in our reports.
Thank you, Wouter.
Let me give the floor to Ms. Brinkman for the same point, but then from her perspective and also the question about the margin differences.
Yes, I can only confirm what you just said, and indeed, you were looking in my direction, and I was nodding because what you said is correct. This year we will look at this also very carefully. As I said last year, we've checked the improvement points necessary for IT, and we really argued, just like Wouter and the others said, for making it a structural solution. Because in hindsight, it's always easy to say, "Oh, look, those and those had access to the system and it was all fine." You have to also be sure beforehand, right? It's important to ensure that this is always something you can know, and this requires a structural approach.
We're working very hard on it, and important steps have already been taken. In 2025, it was not fully done, and it was already said also last year. We haven't stood still and by the way, things can always be improved. Yes, we keep working on it. The next question about the margins, I don't know exactly what causes the difference, but what we do do is that we look very extensively at data. We use market data. We have valuation specialists who also take a look with us, and we always look back, too, because the whole testing has a lot of assumptions from management. We always look at what about the presumptions and assumptions from last year. Did they materialize, yes or no?
Because if they indicate to a certain trend, and if not, then we have to take into account, et cetera. It's a model, of course, that is very much future-oriented, and so we are very critical of it. We use market data, look back, look ahead, and have the right specialists. For them it's a daily job. I don't know exactly what the difference is, what caused the difference.
All right. Thank you. Well, perhaps we can get back to that offline if that's okay. Joost, the story about the cables in the ground and the provisions.
Look, there is no statutory obligation to take cables out of the ground if they're no longer used. However, it is our policy to decommission them. That is an introductory remark. It's a policy, but if you roll out a new infrastructure, you cannot immediately remove the old one from the ground, so to speak, right? Because you first have to migrate all your clients, and we have 1,800 copper lines in one cable, and now all that has been replaced by optic fiber. When we have to go inside, we do take them out, and then we sell that. That has already all been done. A bit lower in the network, you have the connections to the homes, right? They are very, very thin copper wires that we will not remove. Tests also show that it has no negative effect on the environment whatsoever.
They are protected cables that have coating around them, and with most municipalities, we have a covenant in which we have agreed that we do not have to remove those copper home connections. We only do it once the land is open, and we have access. Many thresholds do not play a role. We did have the discussions in the past with the government, but now it turns out that there is no need. In all reasonability, I think that we have a good and prudent policy and that it's also in line with what the government expects from us.
Thank you, Joost. Any other questions? No questions. Do we have any online questions? No? Okay. Good. I can state that there are indeed no questions. Thank you, Ms. Brinkman, for your very extensive explanation. We can now proceed to the vote.
This is the first voting item on the agenda, and the Secretary will inform you of the number of shareholders present and also the number of votes represented by those people. He will also explain how you can vote. Take it away.
Thank you, Mr. Chair. Ladies and gentlemen, good afternoon. 23 shareholders are represented here in the meeting. In addition, two shareholders are participating online. In total, the holders of 3,017,785,287 shares are here represented, and that is 79% of the issued capital with voting rights. Of them, more than 3 billion have been issued to the civil notary through a power of attorney. They're all with a voting instruction. They have already been introduced in the system, and the numbers of votes that you'll see at the end of the meeting on the screen also include those votes. A brief explanation about how to vote.
The shareholders, if they've logged into the system, can use their own device, and the ones in the room will have to vote on their own tablet or smartphone. You should already be logged in with the information that you received upon registration. If not, then please let us know now. If there is someone we can help, then please just raise your hand and we will help you. Now, if you look at your screen, you'll see three options, in favor, against, or abstention. As soon as you've voted, the screen will tell you what you voted. You can cast your vote right now or later on, up to any other business item. The voting will be open for all agenda items. Up until that moment, you can even change your vote if you wish.
As said, the results will only be displayed on the screen after the meeting, so after any other business item. Does anyone have a question about this? No. Good then, Gerard.
Thank you, Jasper. I would like to now request you to vote on this topic, which is the proposal to adopt the financial statements for the fiscal year 2025. Number four, item four, is the proposal to approve the remuneration report for the fiscal year 2025. We would now like to inform you about the implementation of the remuneration policy for members of the Executive Board and the Supervisory Board during the past fiscal year. You may cast an advisory vote on this matter. I will get back to that shortly.
I'd like to give the floor to Mr. Noteboom because as the Chair of that Committee, he will inform you about the implementation of the Remuneration Policy for the Executive and Supervisory Board in 2025. Ben, the floor is yours.
Thank you, Mr. Chair. I love this. The Remuneration Report. I love what that sounds like in Dutch. Anyway, to begin with, the Remuneration Policy is based on principles that are in line with market and social standards. I would like to explain the principles of the current Remuneration Policy for the Executive Board, which was already approved in 2024. Like I said, it is based on principles that are in line with market and social standards, and the Executive Board's compensation package consists of a base salary, a short-term, and a long-term Variable Compensation, and additional benefits.
The short-term variable compensation is cash-based, with an on-target level of 90% of the base salary for the CEO and 60% for the other members of the Executive Board. The compensation is contingent upon achieving three financial and two non-financial objectives, weighted at 70% and 30%, respectively. The maximum payout of the STI, the short-term incentive plan, is 150% of the on-target level. The long-term variable compensation is based on performance-related shares with an on-target level of 135% of the base salary for the CEO and 9% for the other members of the Executive Board. This compensation also depends upon achieving three financial and two non-financial objectives, with respective weightings of 70% and, again, 30%. The maximum performance under the LTI, the long-term incentive plan, is 200% of the on-target level.
Looking back to 2025, I would first like to explain the results of the variable compensation plans for the past period, and you can see the results on the screen. The outcome of the short-term variable compensation plan, the STI, for the calendar year 2025 totals 90.90% of the on-target level. Compared to the financial targets set at the beginning of the year, performance on adjusted EBITDA after leases and free cash flow exceeded the target and fell between the target and the maximum level. Service revenues showed further growth during the year, but ended up just below the preset target on the balance. Regarding the non-financial targets, the NPS, the Net Promoter Score that Joost already referred to in the Business Market exceeded the maximum level, and in the Consumer Market, the NPS was just above the threshold level, partly due to external factors such as increasing living costs.
Regarding the broadband lines objective, we spoke a lot about optic fiber already, but in any case, we observed that developments in the Consumer and Business Market proceeded according to plan. However, the development of Wholesale broadband lines fell short of expectations, underscoring also the more volatile nature of that segment. Due to this composition of the total broadband portfolio, the outcome for this objective fell below the threshold level. All in all, this results in a total STI outcome for 2025 of 90.9% of the on-target level. In line with the existing remuneration policy, up to 50% of the short-term variable compensation after deduction of statutory taxes will be paid out in the form of shares if the Board members do not yet meet the share ownership guideline.
That guideline is based for the CEO on 250% of the base salary and for the other members of the Executive Board on 150% of the base salary. The long-term Variable Compensation Plan reflects the outcome based on the 2023 LTI plan because it has a duration of three years, for which the financial and non-financial targets were measured over the years 2023, 2024, and 2025. The performance of the long-term Variable Remuneration amounted to 89.7% of the on-target level. This outcome is the result of the performance of the financial targets in the areas of Relative Total Shareholder Return, Free Cash Flow, and the non-financial targets in the areas of sustainability and gender diversity. Relative TSR performance is measured against the STOXX Europe 600 Telecommunications Index. It's a reference group that consisted of 21 companies at the end of last year.
Although KPN achieved a strong absolute total shareholder return over the three-year performance period, the LTI plan focuses on the relative TSR position compared to this reference group. Within this reference group, KPN finished in the 13th place. This means the performance was below the median of the reference group. That means that no vesting occurred for this component, 0%. The free cash flow performance measured as a cumulative target for these years, 2023 through 2025, fell between the on-target and maximum levels. Regarding the non-financial targets, the sustainability target, based on the reduction of Scope three emissions across the entire supply chain, exceeded the maximum level. The gender diversity target for the senior management population fell just short of the preset target. However, further growth was again achieved compared to the previous year. The target for the sub-top level fell below the threshold.
Again, all in all, this results in a total vesting of the 2023 LTI plan at 89.7% of the on-target level. On the screen, you can see the number of shares to be received on the basis of this plan. Those shares may not be sold for a period of six years, and that is known as the lock-up period. As it does every year, the Compensation Committee assessed whether this was cause to adjust the outcome, but we saw no reason to do that. However, the Committee did decide to increase the base salaries of the members of the Executive Board by 3% as per July 1st, 2025. For the CEO, it was a 5.5% increase.
This decision was taken into account the development of the CLA agreement, salaries within KPN, general market trends, and the results of external benchmark. The higher increase for the CEO reflects the fact that his compensation was relatively lower within the peer group, while the compensation of the other board members was closer to the market benchmark. The 2025 remuneration report also provides insight into the company's internal pay ratio. This ratio shows the relationship between the CEO's compensation and the average compensation of other employees. Based on IFRS principles, this pay ratio for 2025 is 28. For the short-term variable compensation, in addition to the financial targets, we will again consider the same ones that were last used in 2025. We will also look at the Net Promoter Score and the number of broadband lines.
For the long-term variable compensation, the LTI Plan 2026, in addition to the financial targets, the reduction of Scope three emissions and gender diversity within the senior management population will remain included. We believe that these objectives also align well with the company's purpose, the strategy, and the long-term ambitions, and that they contribute to sustainable value creation.
Thank you, Ben. We will now move on to questions regarding this agenda item. Who would like to be given the floor? Someone in the back of the room. I love being the backbencher.
Thank you, Mr. Chair. We have a lot of appreciation for everything that went well in KPN, but now we have some critical remarks to make as well. Mr. Noteboom just said that for the STI, 19.90% of the target was achieved.
But if we look closer at the underlying calculations, then there are a few critical remarks to be made. Firstly, the adjusted EBITDA AL, the 50% weighing in the whole. You use the realized performance of 2.636 billion euros, so very close to the maximum of 2.652. That's why the score is high, of course, 135%, resulting in a payout of 33.8% of this part. However, the growth in the adjusted EBITDA was 5.1% compared to the previous year, and that also explains that it's well beyond the average of 3% and also above your own outlook for last year, which also amounted to 3%. However, in the figure reported, there are two items that change the image a little bit, and this was also acknowledged in the explanation on the annual report.
The IPR benefit, which is about EUR 50 million that KPN received as a result of a settlement in the patent case, that was not related to operational performance, but the result of legal negotiations, this was for the Q2 and was explicitly listed as a one-off that should not be part of the underlying figures. The second item, and we discussed Althio already, is related to the consolidation of Althio, which is a separate company with activities that was part of a joint venture. This also is a company that generates external income from us that are not part of KPN, and still the EBITDA, therefore, grows mechanically. It's correct, but it doesn't improve your own performance. If you were not to include these two items for the EBITDA, it would be 3.1% growth, just above the threshold. Not bad.
It's above the threshold for the variable remuneration, but well below the justification of the 135%. Also, nothing was corrected. Can the Supervisory Board, especially the Remuneration Committee, explain why items of which KPN explicitly said that these are one-off things, why were they included in the calculation of the variable remuneration? One final question about service revenue, the other 25% post or item. This amounted to EUR 5.357 billion, so below the target of EUR 5.373, just below. The score of 89%, regardless, results in a payout of 22.2% for this part of the 25% that could be the maximum because the threshold was set well below target. 2.7% is the revenue growth. Also in the mid to long- term, you parted from 3%. A payout of 22.2% for this part is attributed to a performance that is not even meeting its own goal.
Does the Supervisor believe that the threshold is sufficiently ambitious, especially given the fact that it still results in a very high bonus, even though the objective wasn't met? I know that this is an advisory vote, but still, towards the future, would the Supervisory Board, having heard this, be willing in the future Remuneration Policy or Report to split it between organic and non-organic components, continuous activities that are fine and to separate those from the one-offs?
Thank you. Let me start by the latter manner. It's complicated because if you invest capital, for instance, with Althio, you will include it in all other aspects of the financial results. We do know that both items that you mention as one-off, as a part of KPN. We do not state that these are very large one-off items, such as matters that happen outside the control of KPN. We want to make an exception. We believe that this is part of operations. Once more, you need to detail everything, and we still believe that it is part of normal operations. The LTIP, what was that? Oh, yes. Service revenues. Joost? Chris.
Well, it was about the topics of the IPRs, a part of which we achieve a lot of revenue each year. That's what we've been working on for many years. It's an organic flow. I think that what Mr. Figee meant was that we cannot take into account extra revenue each year because this was a very good year. I wouldn't like to call it a one-off. That would not really contribute to the work that people do and the people that protect IPR for us. It was a very good year. Mr. Figee has warned the market that every year will not be as good as this year was.
Well, yes, indeed, I hear what you say, but let's lay that down properly. These are integrated parts, so the one-off of the consolidations, I'm still not quite certain about it, but with regard to the legal revenue, I can imagine that. Let's agree that this is laid down, that you agreed with the shareholder. That's an integrated part of the activities of KPN.
If in other years, won litigations may turn out with less of a benefit, it mustn't be corrected, because in this case, ladies and gentlemen couldn't help it that this happened to them. That means that everything's included within KPN. I don't think we will redefine this now, and I do believe that patent matters cannot be mixed with all litigation that could happen. It is rather non-transparent to agree that now. As always, we will detail why we do what with regard to remuneration. It will always be within the policy that we agreed. We attempt not to intervene or hardly ever, and it was an agreement that we've made, so we don't need to make a new agreement now, so unfortunately, we will not.
The other item was actually not reply to the target you said of 3%. You are below the target. Still, there is a rather large extra remuneration. We believe that variable remuneration is good, but exceptional good achievement must be reached. If you don't meet your own targets, it is rather odd to remunerate people a lot extra because the performance was not as expected or as required. If you are really underperforming, shouldn't you have a bigger decrease in the remuneration?
I don't know. Perhaps in addition to what Mr. Noteboom has already said, of course, we run the risk to compare apples and oranges. The 3% you refer to is a long-term 3% growth that is integrated in the Capital Markets Day presentations. To be clear, the budgets or the remuneration, both long-term and short-term, are linked to the budgets that we agreed. Budgets must be feasible but challenging. That's the rule. Next, we don't intervene.
It means that, and you can call it windfalls or a bit more than usual, it's all money that was earned. It's not about accounting adaptations. It's money that we've received and is in the bank. The Executive Board will have to accept windfalls and things that don't turn out so right. This is what we manage. It's exactly what the argument was all about.
Any other matters about the remuneration policies?
I adopt that there are no further questions. I would like to ask you now to cast your advising votes on the Remuneration Report. Please cast as you would like. For or in favor means that you are accepting the report. Against, you mean that you cannot accept it.
Your votes will not have any effect on the report for 2025. You can now cast your votes, and you can also cast your votes until we end this meeting, until any other business. Now, let's clarify the financial and dividend policy. I would like to give the floor to Mr. Figee to provide with an explanation on the dividends and financial policy. An attractive dividend combined with a solid financial profile is important for both KPN and for the stakeholders. All of our decisions are therefore made with careful consideration, prioritizing financial soundness, and taking into account the interests of all stakeholders. That is why I would like to walk you through an explanation of KPN's financial position.
In 2025, we maintained a strong and resilient balance sheet with a leverage ratio of 2.4x net debt and EBITDA, which was stable and below our self-imposed limit of 2.5x. The interest coverage remains strong. The average cost of senior debt decreased by 30 basis points, primarily due to an optimization of the derivatives portfolio. Exposure to variable interest rates remains limited to 14%. Liquidity position of approximately EUR 1.6 billion remains strong and covers repayments up to the end of 2028. We've announced our intention to pay a dividend of EUR 0.182 per common share for the 2025 fiscal tax year. After deducting the interim dividend payment of EUR 0.073 per share, a proposed final dividend of EUR 0.109 per common share remains. The final dividend will, upon approval, be paid out on 27 April next.
Our financial framework is focused on long-term value creation for all stakeholders, and therefore we remain committed to distributing all free cash flow to shareholders. For the year 2026, we intend to pay a regular dividend of EUR 0.20 per share, which is an increase of 10% compared to last year. That's thanks to the successful execution of our strategy and our healthy financial position, so we can supplement the annual growing dividend with structural additional payouts to our shareholders. In 2025, we repurchased EUR 250 million in value of treasury shares, since launched a buyback program for 2026, also valued at EUR 250 million. On the entire period from the year 2024-2027, we expect to repurchase up to EUR 1 billion worth of treasury shares. That was my clarification on the financial and dividends policy, and I would like to hand the floor back to our Chairman.
Thank you, Mr. Figee. We will now move on to questions with regard to this item on the agenda. Does anybody in the room or in the video link have anything to add or to ask? No, not in the room, not online. I establish that there are no further questions or incoming questions. I would like to conclude the discussion of this agenda item by noting that the Annual General Meeting of Shareholders has been informed about KPN's financial and dividend policy. We will move on to item on the agenda six, proposal to determine the dividend for the 2025 year. Mr. Figee has just provided an explanation on the financial and dividend policy and also addressed the previously stated intention with regard to the dividend for the 2025 year.
In line with the intention and as explained in the agenda, the Board of Directors, with the approval of the Supervisory Board, proposes to the Annual General Meeting of shareholders that a total dividend of EUR 0.182 per common share can be declared for the year 2025. If you approve to this proposal, the final dividend for the year 2025 will amount to EUR 0.109 per ordinary share. In accordance with Article 33 of KPN's Articles of Association, and it will be paid out on 27 April 2026. Do you have any questions about this topic? If not online either. I see that no questions have arrived, and I would like to invite you now to cast your vote on this agenda item. The vote concerns the proposal to set the dividend for the 2025 tax year at EUR 0.182 per share.
As announced, you can cast your vote now or later during the meeting, up until any other business item on the agenda. We will now move on to items seven and eight on the agenda, with regard to the proposal to grant discharge to the members of the Executive Board and item eight with the proposal to grant discharge to the members of the Supervisory Board. As we do every year following the adoption of the Financial Statements, we ask you to grant discharge to the Executive Board and the Supervisory Board. This discharge pertains to the policy as reflected in the Financial Statements or as communicated to you otherwise. We've already addressed this under agenda item two, the Executive Board's report on the 2025 tax year. When voting on the discharge, a distinction is made between the Executive Board and the Supervisory Board.
Uncertain.
We will now move on to item on the agenda nine, opportunity to make recommendations regarding the appointment of a member of the Supervisory Board. Upon the conclusion of the Shareholders Meeting, Ms. Koelemeijer's first term of appointment will end, and the Supervisory Board intends to fill this vacancy, which arises due to the expiration of this term of office, by nominating candidates for appointment by this Annual General Meeting of Shareholders. The vacancy must be filled in accordance with the profile of the Supervisory Board. In particular, Supervisory Board seeks a diverse composition in terms of age, gender, experience, and expertise. Furthermore, candidate must possess knowledge of or experience with the management of large businesses, national and/or international businesses, finance and/or corporate social responsibility. In addition, candidates must have an affinity with the telecommunications and IT industry.
Specifically for this vacancy, it's subject to the Central Works Council's enhanced right of recommendation. As you've read in the agenda, we intend to propose the reappointment of Mrs. Koelemeijer. However, in accordance with the Articles of Association, I would first like to give the General Meeting an opportunity to make a recommendation for the appointment of a member of the Supervisory Board. Does anybody wish to make a recommendation for a member of the Supervisory Board? Prior to this meeting, we did not receive any recommendations for a candidate either. I note that the General Meeting has not made a recommendation for a candidate. We can proceed immediately to the proposed reappointment, Agenda Item 10. Proposal to reappoint Mrs. Koelemeijer as a member of the Supervisory Board. I will briefly explain the nomination to you and would also like to refer you to the additional information in the agenda.
As I mentioned earlier, the nomination for this position is subject to the Central Works Council's enhanced right of recommendation. The Central Works Council has recommended Mrs. Koelemeijer's nomination. The Central Works Council's recommendation can be found on the company's website, and you can find them where the meeting documents are available. Mrs. Koelemeijer meets the requirements of the Supervisory Board's profile. As a professor of marketing at Nyenrode Business University, and thanks to her other roles and experience, she possesses extensive knowledge of marketing, supply chain management, innovation, digital transformation, retail, and e-commerce, which the Supervisory Board was able to use during her first term. Mrs. Koelemeijer is considered independent within the meaning of the Dutch Corporate Governance Code. Mrs. Koelemeijer was appointed as a member of the Supervisory Board for her first term on 13 April 2022.
She's performed her duties adequately and meets the Board's expectations, and she made valuable contributions and exercised oversight through her roles on both the Nominating & Corporate Governance Committee and the Remuneration Committee. The working relationship with the Central Works Council is constructive. In 2025, Ms. Koelemeijer attended all regular meetings of the Supervisory Board, with the exception of one ad hoc meeting. The nomination is also supported by the Executive Board. We will now move on to any questions with regard to this item on the agenda. Does anybody have any questions on this topic, either in the room or online? I establish that no questions have arrived, so you can now cast your vote. We may now vote.
This concerns the proposal to reappoint Mrs. Koelemeijer as a member of the Supervisory Board for a term of four years, ending at the close of the Annual Shareholders' Meeting to be held in the year 2030. Voting on this item is open now until when we start item on the agenda, Any Other Business. We will move on to agenda item 11, information with regard to future composition of the Supervisory Board. At the close of the meeting to be held in 2025, five vacancies will arise as Mr. Dijkhuizen, Mr. Heemskerk, Mr. Noteboom, and Mrs. De Jager will complete their first four-year terms, and Mrs. Sap will have reached the end of her final term and will step down permanently. That will be quite different for her. Now, the Supervisory Board intends to fill these vacancies and will nominate candidates for this purpose to the General Meeting.
Of course, the Supervisory Board aims to maintain a good balance of expertise, diversity, and knowledge in accordance with the profile we will discuss below. The vacancy left by Mr. Heemskerk is also subject to the Central Works Council's enhanced right of recommendation. Do you have any questions with regard to this item on the agenda? Not any questions online, so I establish that there are no more questions. That brings us to Items 12, 13, 14, and 15. Item 11 is the proposal to authorize the Board of Management to resolve that the company may acquire its own shares. 13 is a proposal to reduce the capital by cancellation of its own shares. 14 is a proposal to designate the Board of Management, the Executive Board, as the competent body to issue ordinary shares.
15 is a proposal to designate the Executive Board as the competent body to restrict or exclude preemptive rights upon issuing ordinary shares. These four agenda items are very closely related. I'll explain them to you all at once. You may, however, vote on them separately. The proposals grant the Executive Board, under the supervision of the Supervisory Board, some flexibility regarding the issuance and the buyback of shares. These provisions are on the agenda annually and are fully in line with standard practice in the Dutch market. We therefore ask you, as we do every year, to, one, authorize the Executive Board to repurchase up to 10% of the company's own shares. Two, to cancel shares thus repurchased, thereby reducing the issued capital. Three, to grant the Executive Board the authority to issue up to 10% of ordinary shares.
Four, to grant the Executive Board the authority to exclude or limit the statutory preemptive right in connection with such an issuance. For the exact details of these agenda items, I would like to refer you to the explanatory notes to the agenda. Finally, I'd like to remind you that these resolutions are valid for a period of 18 months as of today, and if approved, they will replace your resolutions from last year. Are there any questions about this agenda item? No? Not online either. Good. I note that no questions are raised on each of these agenda items. You may now vote. I would like to request you to do that, because after this item, we will conclude the full voting process.
Number 12 is, according to all the specs that you saw in the agenda, the proposal to authorize the Executive Board to resolve that the company may acquire its own shares. 13, the proposal to reduce the capital by cancellation or withdrawal of its own shares. 14, proposal to designate the Executive Board as the competent body to issue ordinary shares. The last one, 15, to designate the Executive Board as the competent body to restrict or exclude preemptive rights upon issuing ordinary shares.
I would like to request you now to cast your votes and also give the floor to the Secretary to conclude the voting process. Yes, ladies and gentlemen, these agenda items are the last voting items this afternoon, and in a few moments, we will close the vote. Please cast your votes on all the items insofar as you've not done that already. I'm now looking around the room whether anyone is still looking at their screen, avidly voting. It seems not to be the case, so I hereby conclude and close the voting for all agenda items. In a moment, after the any other business item, we will show you the results. Thank you. Let's move on to item 16, the any other business. Yes, I already see a hand raised. Please state your name. Before we give you the floor, are there any other people who would like to ask a question?
No. I do have a few, but they're all brief. The first one, I'd like to make a remark about the excellent organization of this meeting. I think that deserves a compliment. Secondly, I have a question because last year I received a letter that my SIM card was almost or has become obsolete. I went to KPN store and I was given a new one, but it didn't work. I put it in this very phone. Really it's not a museum phone, just until recently it worked, but then suddenly it no longer worked.
I started to try all kinds of things, and in the end, I found out that the SIM card that came out was a Telfort SIM card, and this was a locked Telfort phone apparently. I went back to the store, but no one knew how to unlock anymore. This phone actually saved me during the NATO summit. It avoided me having to go to jail because I was just checking out a post and I was told, "You cannot take any pictures." I said, "I'm not even carrying a phone." I don't have an iPhone. I said, "No, I have a Nokia phone," but I do have a big mouth. You know where I learned that? He said, "No idea." You know, in the military service.
When the military police heard me say that, and that I only had a Nokia, they moved away and didn't throw me in jail. I'm still very happy with my phone, is all I'm trying to say. The employee at the Alexandrium stores found all this so exciting that he said, "You know what? I'm going to give you a new phone," a KPN phone. A Nokia phone, nothing special, but still. That's my first remark. Internet. I have KPN internet. I've had now for more than almost a year, actually, because it was right after last year's meeting that the problems occurred. Five times I've had a mechanic, and still after five different routers, it doesn't work.
Now, I went to a KPN store and the employee asked, "Was optic fiber perhaps placed or did the prep work take place in your street?" I said, "What does that have to do with it?" "Well," she said, "once there's optic fiber, the signal basically is sabotaged by KPN, the signal over the copper line." That really concerned me. I don't know if it's true, but that's the story that's going around people, and that's not good. Something needs to happen. Now I have perfectly working internet, but it is Ziggo. It's no longer KPN. I think this should be on your radar because you're now moving away. You're wishing people away.
Last year, I also made a remark about the fact that I like KPN's being reticent with respect to what they were going to do with the European Championships of football in Qatar, and now it's even more up for debate. What is your view?
Thank you for your questions and your compliment. I got a little concerned when you started talking about Telfort and old SIM cards and Nokia, and I was like, "Oh my God, how do we solve this?" I'm glad it was solved. Of course, we want you to be a client at KPN and not go to Ziggo. If you could please go to Mr. Stammeijer after the meeting, then he will personally arrange this for you. About the football championships, I give the floor to Joost.
Yes, I was saying, five mechanic visits, two store visits. You seem to be the only person next to Mark Rutte still using a Nokia. Apparently we invested a lot in you, so I really hope that this error of moving to a competitor is a very temporary error because of course you have to stay with KPN. You're very welcome.
Indeed, these two people, Stammeijer and Marieke Snoep will tell you how to go to the KPN network because obviously it's much better. We are a sponsor of the KNVB, and we sponsor the Dutch national team. We are no longer a sponsor of the Eredivisie, but we follow the policies of the KNVB. The Dutch team is going to play in the West and partly in Mexico, I believe. We will all watch it, of course. We're not going there, I think. Maybe a few of us, but we're not going there formally, but we see no reason to not support the World Championships. Of course, we leave all that in the hands of the KNVB, the Dutch National Football Association.
There were no other questions for any other business. Not online either, I assume. Good. I hereby note that there are no other questions, and then I can move on to the results. For that, I give the floor to the Secretary.
Yes, let's take a look at those results. I would like you to show them on the screen. Here they are. Per agenda item number three, you can see the proposal to adopt the financial statements was completed with 99.65% in favor and 0.35% against. Agenda item four, the proposal to approve the remuneration report, adopted by 96.57% in favor, 3.43% against.
The dividend, also approved and adopted with 99.7% in favor, 0.3% against. The discharge of the members of the Executive Board, 97.59% in favor and 2.41% against, also adopted. The next page shows the discharge of the members of the Executive Board, also adopted 97.58% with 2.42% votes against. The proposal to reappoint Ms. Koelemeijer as a member of the Supervisory Board, also adopted by 93.29% in favor, 6.71% against. The proposal to authorize the Executive Board to resolve that the company may acquire its own shares, also adopted. The withdrawal of its own shares, also adopted 99.74% and 2.26% against. The proposal to appoint or designate the Executive Board as the competent body to issue ordinary shares, also 99.77% in favor, 0.23% against.
The final one also adopted, namely to designate the Executive Board as the competent body to restrict or exclude preemptive rights upon issuing ordinary shares. 99.49% voted in favor and 0.51% against. All items adopted.
Thank you very much, Jasper. This means that the General Meeting of Shareholders has approved all proposals submitted to it. This result also means that I can congratulate Ms. Koelemeijer, or Kitty, as we call her, on her reappointment. Kitty, great that you'll continue to be part of our team. Finally, I would like to thank you all, our shareholders, staff, suppliers, et cetera, and of course, also the Executive Board, on behalf of the Supervisory Board for all your efforts and your support in the last year. I would like to thank you all for attending the meeting, either in the room or virtually.
I really hope to see you later at the drinks and snacks that we have available for you. You'll see once you leave the room. The next Annual Meeting will take place mid-April, and of course, the final date will be announced as soon as it's known on the KPN website. I hereby close this Annual General Meeting of Shareholders. Thank you.