Investor Call

Sep 30, 2021

Slides

Hello and welcome to PostNL's 2nd deep dive for the financial markets. Back in June, we talked about digitalization as one of the drivers of our strategy. Today, it's all about sustainability. Thank you for joining us today. My name is Jochen van der Laixhoek. I'm the Head of IR and Communications. We have the following program for you today. First off, Herna Verhagen, our CEO, will talk about our strategy and the pillars driving it, focusing on sustainability, of course. Then I will talk with 2 colleagues, Iris van Beek, Director of Operations the Parcels and Nikoi von Herrmann, the Manager Services responsible for facilities, our fleet and also real estate. After those conversations, there will be time for your questions. You can ask questions in the chat function in your browser and we also have a couple of analysts who are joining by conference call. Herna, over to you, please. Thanks, Jochem. And it's very good that we all are all together here this afternoon. I would like to start with a slide you probably all do know, which is about our purpose, ambition and strategy. They didn't change, so this is not new. But I think important to repeat, our purpose is to deliver special moments. And of course, With doing that being your favorite deliverer, being part of the heart of our customers and consumers, With a very clear strategy to be the leading logistics and postal service provider in, from, into and from the Benelux region, With very strong networks in the Netherlands and in Belgium, and of course, with Spring as an important part for our international volumes. That strategy is, of course, further worked out in how do we create value For our shareholders and how do we make this company attractive? Important in that is our value creation proposition and this is what I presented Last February as well, with Parcels, which is managed for profitable growth by enhancing customer interaction, but For example, also by managing our network capacity and utilization of our infrastructure. And Mail managed for value To deliver stable and predictable normalized EBIT and cash flows going forward, together with keeping the business accessible, reliable and affordable. And our new program introduced last February, Digital Next, where we want to transform our commercial engine And of course, our core logistics together with scaling the successful platform we already have. What we didn't discuss a lot by that time were our strategic objectives. And today, we all focus on improving Our environmental impact, because we do think that, that is a license to operate when it comes to running our business going forward. Talking about ESG, talking about that license to operate And of course making immediately clear which of the UN Sustainability Development Goals are supported with the several aspects of our ESG Policies. Important in that, of course, is environmental, improving our environmental impact. And I will show you in the next coming slides how we can do that best. But clean kilometers are in that of huge importance, next to network efficiency, Our buildings and facilities and of course developing more green products and services. And because we are the biggest network in the Benelux on parcels and mail, being green, being sustainable is as Important as many of the other things. Many of our customers and also many of our consumers do expect that PostNL plays a pivotal role In changing, of course, and making this world a little bit a better place by being sustainable. It's what we do on the social side as well. And to realize the full potential of this organization, it's crucial to also realize the full potential of our people and act as a responsible employer. We try to measure that by, for example, our employee engagement. And later on, I'll show you the improvements we've made over the last few years, but also staying safe and healthy. And how important was that during COVID crisis, Keeping our people safe, keeping our people healthy and with that, of course, keeping the network running in difficult times, Together with realizing the change, because workforce optimization for sure within our Mail divisions remains crucial going forward. And the last, the G is about governance. Being a transparent, responsible and accountable company On the environmental aspect, social aspect, financial aspect and lots of others. We do have a very clear governance structure with a 2 tier board. We try to take into account, of course, what stakeholders expect from this company, for example, by stakeholder dialogues With very clear business principles and also, of course, the UN Global Compact. We do think that being that green business going forward is one of the crucial things for this company to be. We've linked our ESG approach to the long term impact of our activities and, of course, to the sustainable development goals set by the United Nations. And we've chosen 4. These 4 are what we think are best applicable to what we have to do and what we can do to impact Environment, social and governance in a positive way. We see it as our license to operate and have embedded it already In our strategy, culture and also our day to day operations. And to give you a feeling around how we measure, Steer but also control ESG, this is this gives you a few examples. First of all, ESG is part of ambitious non financial targets, which are frequently monitored. And you probably do know these as well From the non financial targets that we, as a Board, took upon us. We've set those targets at PostNL levels, But also at our unity level, so that it is clear for everyone what they can contribute to our ESG targets. The targets are in line with the Paris Agreement and are validated as scientific based targets. And they do support, as just explained, Of course, the sustainability development goals. It's also embedded in governance and policies By, for example, setting clear strategic objectives for 2025, but also 2,030. And with that, We've developed a planning and control cycle. It's part of our risk management framework and also part, as just explained, of our performance measures Our remuneration policies. Embedding ESG in our governance and policies is Crucial to make sure that not only today, but also tomorrow and the years after, it will be part of our strategy and will be part of the way How we report externally. And that brings me to the 3rd pillar, which is the integrated reporting. Of course, we want to be compliant with the relevant laws and regulations. And what we try to do in our annual report is To give you full insight how we comply, where we can improve, but also what we already have delivered. And I think it's a beautiful example of an integrated report, which we, of course, will further improve going forward. ESG is not from today. Started already in 2007. By that time, still TNT. And by that time, it was a special thing, which was not done by many companies. But we've built it up and out over the last 14 years to what we are today. We actively steer on ESG since 2007. Unfortunately, the whole world next to us, of course, developed lots of charters, lots of other certificates, which we have signed, which we are part of To contribute to being a more ESG approved company. We do think that Underwriting all these principles, but also being part of them is important, and it gives us a very strong foundation to work upon going forward. All in all, long term, it gives us a long term and sound foundation Upon which we can build. If you think about where we come from, 2007, How we implemented ESG in our organization and how we've put into our framework of governance, policies and reporting, We are happy, of course, that we're also recognized for it. And here you find some of our key performance indicators And the external ratings. And some of them you did see before because they are regularly part of our financial updates, which we give every quarter. When it comes to environmental, we have more emission free last mile delivery kilometers than we had in 2017. So here we improved. In carbon efficiency, we did not. And that is mainly a result of the sharp rise in parcel volumes, partly related, of course, to the COVID crisis and partly influenced to the number of kilometers we travel with large trucks. And then a few slides later, I will give you an overview if we have had taken none of the measures which we have taken over the last 3 years, How carbon efficiency would have developed at that in that case. Of course, social. As said, we want to be a responsible employer, but we want also to be seen by our own people as an employer where it's safe to work At, with and of course, where it's fun to work with. And that's what we see in the development of our employee engagement. The employee engagement came up from 17% to 20%, from 67% to 84%. And the first measure we've taken in the beginning of 2021, it grew even a little bit to 85.7, Something which we are very proud upon. And governance, women in senior management positions, 28% where are at this moment in time and we want to grow further, of course. I'm especially proud When I look to the Dow Jones Sustainability Index, we're taking part of that sustainability index already for many years. And what you see over here is that we have been seen and also have been rewarded as a top 3 worldwide company When it comes to transport and infrastructure. And that's what we want to continue going forward, being a world leader when it comes to sustainability. Of course, let's move to the topic which we want to give you a little bit more insight in today, Which is the environment and then especially not looking back, but looking forward. I think, First of all, let's move to our targets. These targets are in line with the Paris Agreement And are validated by Scientific Based Targets Institute, which means that they contribute to reaching our Paris Agreement targets. We've divided them in 3 scopes, scope 12, which are our own fleet, own buildings and scope 3 It's what is emission by our delivery partners. By 2025, we want to have 25 city centers in the Netherlands, Well, we deliver fully emission free. By 2,030, we want to have our last mile emission free in the Benelux region. When you then take scope 1 and 2 into account, that means that in the relative CO2 reduction, it will be a reduction 80% and in absolute CO2 reduction, it will be a reduction of 60%. If you take Scope 3 into account, Then it will be an absolute CO2 emission reduction of 18%. By 2,050, we want to be Net 0. So we have net 0 ambition. Until then and from the next year, We will offset all emissions we cannot reduce yet to guarantee that all mail and parcels are delivered net 0 from 2020 I, however, would like to stress that we continue to focus on reducing our actual footprint in scope 12 And 3, to come to an emission free last mile by ourselves by 2,030. If you want to discuss CO2 emission reduction, then of course, you look into and How do we create CO2 emission? And then looking into our networks and the way we work, you find four main reasons For our CO2 emission. And the first one, which is by far the biggest, is kilometers. 85% of our carbon reduction targets Needs to come from clean kilometers, while we will replace our fossil fuels with fleet with electrical vehicles And of course, other fuels. We can also do something in our reduction via network efficiency By reducing the total amount of kilometers traveled, of course, by our people in vans, trucks, etcetera, etcetera. By having sustainable buildings and facilities, and you find 2 abstracts because we already have 0 emission There and of course by developing green products and services. But as said in Orange, clean kilometers Are our main focus points when it comes to the contribution to the carbon reduction targets, which we have set. Think about the network we have. And this is a reminder because many Parts of this slide already discussed in many situations. But this is the network we're talking about. So when we talk about the reduction Of kilometers, when we talk about more clean kilometers, when we talk about buildings and when we talk about green services and products, then this is what we talk about. 2020, 337,000,000 parcels and more than 2,000,000,000 letters. It was an exceptional year. It means 8,100,000 letters a day 1,100,000 parcels a day, more than 40,000 employees. For example, more than 1,100,000 kilometers transported in the Benelux region, per day, Not per year, per day. It's 1200 times around the world to give you an idea about how much it is. 31 sorting centers in the Netherlands and of course, 2 to Come in Belgium. Lots of solar panels and lots of vehicles. So if we talk about creating less CO2 emission, then this is the network we talk about and this is where we have to do the work with. In the next slide, I'll show you our road map to reduce our environmental footprint. And what you see over here is what I already said, that if we would have not taken actions between 2017 2020, The development of our CO2 emission would have developed like you find the dotted line. So the fact that 2017 2020 are not that much different takes into account The enormous growth in volume we did see within Parcels nationally and internationally. Towards 2,030, you find a big reduction. And what the slide show you is that and that was already set, 85% of this reduction will be in last mile delivery. That's the reason why the orange part in 2,030 is almost reduced to 0. In air and large truck transport, and I'll come to that in a minute to a little bit more detail, it's, of course, a little bit more difficult. There we are dependent on other developments, which we want to introduce as soon as they are available. I think the more light blue, gray and orange part in 2,030 also gives you an insight Why it is that important that we do lots of that we take lots of actions to reduce our CO2 emission? So this is the road map. And this gives you an idea on how we want to set targets towards 2025 and also towards 2,030. If we dive a little bit more into the details of the important parts of this graph, then I would like to start first With the largest part of our emissions, which comes from last mile delivery and road transport. The way we want to reduce that is by increasing the use of renewable fuels as a transitional solution towards percent electrical fleet, but also throughout the full supply chain, which we have. And of course, we have an accelerated approach to our delivery partners, Scope 3, from 2025. Important milestones at this moment in time is that already within Mail and the Netherlands, 70% of what we do is emission free delivery And already 30% of our large truck transport kilometers are driven on sustainable fuels. So renewable fuels, sustainable fuels will drive, of course, our sustainability for the next coming years And then taken over by having a bigger electrical fleet year over year. And as of 2025, Also introducing much more electrical fleet with our delivery partners. An important part. The second important part is, of course, the reduction of our carbon emission from air transport. What do we do to create lower emission from air transport? First of all, where we have the opportunity or possibility to go from air to road, we do. And we changed lots of the routes in Europe from air to road over the last few years. We optimize our packaging and we optimize our route planning, also important when we talk about network efficiency And important here as well because it means less load in airplanes, less load in trucks and therefore also less CO2 emission. What we did do, because this is not fully in our hands, we do not have our own fleet, so that means that we're partly dependent on what on the developments Of the air industry and developments also, of course, in the large truck industry. Those we follow closely and want to implement opportunities Where we find opportunities of CO2 reduction, we want to implement them as soon as possible. An important milestone in 2020 is that we developed It's an air carbon emission calculation tool together with the University of Delft. And that gives us the opportunity to calculate much simpler Our CO2 emission and therefore also think more clearly about how can we reduce. A third important part in the reduction of to and of course, also bringing this company to a 0 carbon emission It's buildings and facilities. And we're proud here because, as you can see, there are no carbon emissions From our buildings and facilities in 2020, and that's also, of course, what we expect going forward. We've invested a lot by solar panels, by energy efficiency, by, of course, making sure that the new buildings we created We do have a BRIM certificate and also the ones we've build it before are now, of course, transferred to BRIM certificated sorting centers. Currently, we do have 32 centers in the Netherlands, 26 of parcels, 5 of mail, 1 of international. And we will open our small parcel sorting center next week. And of course, we're opening early 2022 our first sorting center in Belgium. Although sorting centers are set up to be 0 emission free, we have more than 25,000 solar panels Already at this moment in time on the roofs of our sorting centers, they generate more than 50% of the sorting centers' energy And we want to build it out further. So this is an important element in our CO2 emission free strategy as well. And of course, as you can see over here, lots has been done already. That brings me to value drivers. Because in the end, when you talk about CO2 emission reduction, you talk about what's going to happen in the next Coming 9 years, if you think about the target we've set for 2,030. And of course, nobody knows exactly how future looks like and nobody knows exactly How quickly certain developments will come up and will be available for companies like ours to reduce our CO2 emission. That's also the reason why we tried to make visible what are the important value drivers behind the CO2 emission reduction. And there you find, of course, our network mix, which means that we step by step will step over to an electrical fleet, Which gives, in the end, emission free last mile delivery to kilometers in the Benelux. It's fleet composition, but it's also our fuel mix. And you find here the way we still have to go from 2020, 2021 to 2,030 to realize our I think important to say is that we manage this in a carefully decision making process. That means that, of course, we try to align these developments to our volume development. That's 1. We try to align these developments To the possibilities we see in the external world and new developments we see on CO2 Remission opportunities. And what we try to do is, of course, to do it financially as efficient as possible. That leads to the following curve. And here is made visible how we do see the reduction of carbon emission towards 2,030. And on the other hand, of course, how we see the improvement in 100% emission free last mile delivery in 2,030. The improvement step as of 2025 to 2,030 is because as of that moment in time, we introduced Scope 3 Into our calculations, that's what sorry, it's already in our calculation. We introduced it, of course, into the way we act. And that also means that we put much more focus on our delivery partners as of that moment in time. So it's not a linear road. And there's still a lot to do to reach 2,030 with the 100% last mile emission free delivery target. What we announced Q2 is that we also will accelerate the spend To sustainability between 2022 2024. In total, we will spend €80,000,000 in that period, which is fully included in the financial projections towards 2024. It's an acceleration in investment and also an acceleration in cost, And that's the reason why we made the orange and gray parts in the graph, which gives you a view on what is OpEx and what is CapEx and Lease. Of course, as you can imagine, the majority of these initiatives are at Parcels, so the majority of investments are as well within Parcels. And this is an ongoing commitment to 2,030, which means that investments after 2024 will continue. We're fully committed to reach the 2024 roadmap, to reach the 2025, of course, The 25 cities in the Netherlands and by 2,030 to reach the 100% last mile emission free delivery. That commitment is again showed on this page. We see ESG as a very important license to operate. And one of the important pillars behind or underneath our strategy and value creation model. We've made a sound road map, Which is tested by the business, which delivered targets which are ambitious on the one hand, but reachable on the other hand as well. And hopefully, we will be helped In the next coming year, by more speedily developments than we can foresee at this moment in time. And it's integrated in our business, of which I do think it is crucial that people are clear about targets we have set, That they are measured, that are of course given feedback upon that we can steer upon them and it therefore is also an important part of our decision making process. An important step forward, which was worthwhile, I think, spending 25 minutes of presentation with you to give you more insight in our ESG strategy. And I'll hand over to Jochem again. Thanks a lot. Thank you, Herna. We're now going to dive deeper into 2 topics related to sustainability. The first is electrification of our fleet. Let's look at this video. My name is Nikkei Vermund, I'm Henningben Wehrksamers Managing Services by Pontzenel and I'm Henning van Werk Forschhoort, The house vesting and facilities and Oggetwagpark. PostNL, Outlaken Tradhuisendater, alla Paquette and Brieven So I'm joined here by Nikkai and Iris. My first question goes to you, Nikkai. You must have one of the coolest jobs within PostNL because you get to go on our rooftops. My first question to you, from your perspective, what would be the biggest challenges towards reaching those ambitious goals for environmental footprint? Yes. As you can see in the video, we have been testing and piloting a lot over the last few years. And now we're actually entering the phase, what I would like to call, the scaling up phase. For that, we have a clear road map. You could also see in the presentation. And the biggest challenges are either on the technical side. So now you need to think about the availability of the electrical fleet by our suppliers, but also on the capacity that we need To load our all electrical vehicles, that's a challenge. But also how do we maximize the utilization of those charging facilities? We will be investing in them, but that needs to be we have to maybe adapt our operations to fully maximize the investments. And the second one also shown in the video is how we engage our delivery partners because they are part of our 2,030 targets. So what can we do to help those partners to accelerate with us? Yes. Actually, the first delivery partners are already making that step Together with us, that's very good to see. But then you can think about how can we help them and actually give To our markets, our suppliers, maybe you can help them either in buying or leasing electrical vehicles. But on the second hand, I mean, 2 years ago, we invested in our first electrical vehicle, and we are leasing all our parcel vans. So In the next 3 years, the first, secondhand, electric vehicle will be available, which could be very interesting for our delivery partners. And on the other hand, we basically can help them by, yes, making our charging facilities available for them as well. Clear. Iris, you're the Director of Operations in our Parcels business. Can you tell us how will the shift Do electric vans impact our operation? Yes. Your day to day life, so to speak? Yes. My day to day life, but also The day to day life of my management who is responsible for our sorting and distribution centers. Yes, it's a big change and it's a big transition. I think one of the Key pillars is that we stay very close to the current network setup that we have. So the vans that we choose are actually very much, Let's say, talking to the structure, we actually load directly from the sorter into the van. So it's important to have The same kind of setup of the van. It has to be a good working space for the delivery, boy or girl, man or woman, Because we want them to be happy and to be able in the operation to do their work in a proper way. So that means that we have to adjust, Let's say, market standards of electrical vans into to our needs. So that's a very The second thing that's important is our route structure. So our route planners get a different KPI. We add, let's say, 0 emission or carbon efficiency as a KPI to route planning, and that's a new game for them. So they are normally on cost efficiency, And now we actually add the carbon emission and KPIs to their the way they structure the routes. So and we do that with very, very good reporting on a very low level. Actually on route level, we can see carbon emission per route And this actually empowers route planners to create the good route structure. And the third one is very important is the roadmap for our management Because every manager has who is responsible for sorting and distribution depot has also a road map towards 2,000 and 30. So we actually help them, giving them the tools, the vans, the infrastructure, Nicar will provide them with the fuels, the right fuels, but they will set up their own road map Towards 2025 2030 to reach the objective. This has to work economically as well, especially for our audience today. How is this a viable business case for us? What we see is that the cost of an electric van and the total cost of ownership at the moment is higher than the Traditional diesel vehicle. But however, we expect in a few years that this total cost of ownership will change in favor of the electric van. We do have also the we call it the HVO 100 transition fuels that we use In our depots, which are only slightly more costly than the current diesel. So in that mix, we are able to actually, let's say, Have an acceptable, let's say, extra cost on the last mile, which will change over time in a couple of years. Do the current electric vehicles comply with your requirements when it comes to reliability and the quality of our deliveries? As I said in the beginning, I think the van, the delivery van for the driver is very important. So if he can do his work in a proper way, he can move in around The van in a good way because he spends like 80% in and around the van and only maybe very limited time towards his delivery area and to go back. I think for when his work is facilitated well, he will for sure provide the right quality. But also the availability of Structure and fuel station is important. This is why I need Nikkei for this to ensure it. And so it's a very close cooperation with Trust staff and local management in order to have this high quality that we are having in a high value is also Certified. Clear. Going back to you, Nikkae, what do you expect from further changes in regulation in this area? Well, we actually expect that all the cities will start raising the bar on sustainability. You've seen in the presentation that we selected 25 cities, But maybe that can increase. So that will be something we need to be aware of, that we maybe We should be able to adjust our plans to facilitate that as well. And also, it's not only regulation, but also we need to Find our cooperation with other companies and also with net operators from the grid, where we have some technical challenges. And how can we, Yes. Combine our forces to get it done. Because in the end, we also need to think of that creating all those charging Facilities just for your own operation might not be a really good idea. And so we have to look at collaborations with neighbors' companies And other people to optimize the use of the facilities. Thank you. Very clear. Now let's move on to the next deep dive topic, which is renewable fuels as a transitional solution. Let's look at this video. My name is Malie Shand, and Ik Ben Eint, Prasdvolk, from Transport Ben Drive. PostNL Transport is an amazing energy intensive network So Nikaj, the big question is probably when do we get those first electrical trucks on the road, do you think? Yes. As you could have just seen in the video, the big trucks are a really different challenge. At the moment, we are driving the small trucks And electrified, so that's working. But on the large trucks for us, next to what you saw in the video, Yes. The loading capacity that you need to charge the vehicle, that's on a technological point of view a whole different ballgame. And on the second part, if you look at our operation at the moment, there is no time to charge because the large trucks, they keep driving between all the sorting centers. So we are awaiting or following closely the technology development of that. And as soon as that large truck is available, we would be Very happy to test it as one of the first companies. But in the meantime, yes, we're making the transition on the fuel part and introducing the HV-one hundred. That actually results in also 90% less carbon emission, so which is a very convenient In between step. But as soon as it is available, I will be lucky to drive it as the first colleague of Boss But looking forward to that, this is obviously going to be a big step. Iris, any opportunities you see to speed up the process towards improving the environmental impact, specifically in large transport. Yes. Well, we do on the one of the largest Truck companies, I think, in the Netherlands. So we do see it as our responsibility to be ahead and to speed up. I think as Marlise said in the video, we did Put a beautiful basis already on investing and starting with biogas trucks. We have now almost 100 running On LNG and Bio LNG. And on the other hand, also 100 trucks that are now on renewable fossil free fuels. So I think the base is already there, which means that once we have the, let's say, the infrastructure Fueling, again, I'm looking to Nikhar for this, but also indeed what Malis stated also you have to look to government And even other authorities to push that. I think we can speed up because our fleet is quite young. We have a big, big owned fleet. I think we have of course, we have a Scope 3 charters that work for us, but we have a big, big owned fleet. I think you can see them every day on the road. So yes, I see an opportunity to speed up once we have the availability of the fuel. One of the things I learned when preparing for today is that you have different sorts of renewable fuels. How do you know that the quality of that sort of fuel Meets for purpose is the right fuel for us. It starts with good certificates And the right fuel on the purchase side. For that, I again, I look to my colleague. But if The reliability would be the question. I think I would have Marliese on the phone at the moment because she's already running 200 trucks On this alternative fuels. So I think at the moment, we can say that it's very, very reliable. Towards the future, I think we monitor closely That the quality keeps up to the standard when it comes to those renewable fuels. Very clear. Nikkei, is electrification of the fleet the end game? Or do you expect other developments Sort of follow-up on electrification as the solution. My personal opinion, I don't think it is. If I would think it is, I would have told everybody this is the end game and this is how we move forward. What I mentioned in my own video as well is that we need to look around and what's happening on the technology side, because Hydro oxygen might be a solution. Maybe the renewable fuels go that far that it's Same as running the large electrical fleet. And that doesn't harm our operation, to put it that way. So to be honest, We need to look around and I don't think electrification is the yen solution. Okay. Thank you. Well, let's See what the questions are that come up from our audience. There are 2 ways for you to ask questions. The first one is for most people to use the chat Facility in your browser. And the second one is for a couple of analysts who are on the line and can ask their questions by audio. We're going to pause for a moment to allow for your questions to come in. So we're back and let's look at the questions that come in. The first This one is for you, Herna. Are you satisfied with the progress that we're making in this area at PostNL? Yes. I'm quite satisfied. So I think we've made a lot of progress when it comes to buildings and facilities. We're also making good progress when it comes to our fleet And Ios already discussed and talked about that in your short Q and A round, which we just had. And I think where we have to Spend and as was also already said by Nikka, where we truly have to spend attention to is, of course, the developments in the Air and Large It's transport industry because there we're partly dependent on what others do. And yes, as soon as possible as We can move forward there, we will do. So the answer is, yes. And I I think still lots to do. That's the other side of the coin, of course. But yes, I'm satisfied. Yes. Our first question from D'Aire, So to say is the use of cargo bikes becomes more important, and some cities prefer to ban delivery vans. How do you expect the mix bikes and electrical vans to develop going forward? How do you plan to organize this? Iris, I think I'm going to ask you this question, if that's okay. That's okay. Of course, we already initiated The use of cargo bikes in a couple of cities in the Netherlands in the inner city. It is in an investing phase. So We're actually testing them and piloting them. But I can say that they're very promising. It's a very cost efficient way of doing delivery in our city. It also It's helping congestion in the inner city. So I have a great belief in that you will see a lot of cargo bikes with the PostNL brand in the coming future in the inner cities. Yes. Well, as a bike fan, I like to hear that answer. Yes. Thank you. Yes. Herna, second question for you. Where do you where do we stand compared with competition or in a broader in the sector. Yes. I think almost everyone at this moment in time is, of course, active in Trying to make their companies more sustainable. That's also the case for our competitors. As PostNL, I do think that we're a Frontrunner, when it comes to the Benelux, looking to the amount of vehicles, we already have more than 1300 vehicles, which are Or of course, a little bit different, but our CO2 emission free, the development, so the money we put into development And of course, the cargo bike Eos is talking about has a possibility up to 3 roll containers of parcels in that Cargo bikes, so that gives us truly a good possibility to have an emission free delivery in the inner cities. So I would say front runner. And that's also expected from customers and consumers that we are, of course, A big distributor in the Benelux and therefore also we have to do something around it. Next question is for Nikkei. You mentioned hydrogen, many companies are already testing trucks. What is happening at PostNL in this regard? We are looking at it and we're trying to prepare our first test with it. But also there on hydro oxygen, Yes, you have the availability of it, which is a big discussion at the moment. So we're trying to both test it and await technology On the supply of it. And a follow-up question on that would be looking at buildings. Herna already talked about it and said we are carbon neutral today. The next step is probably BREEAM certificates. Can you talk about how many of our buildings locations are certified already and are we working towards full certification in that regard? Yes. And then we talk about mostly the parcel sorting centers. The last 7 we built over the last few years, they're all they don't have any gas connection. They are BREEAM certified, outstanding on the highest level. And today now we're working, we're hoping to end this year to certify all the other 17 existing buildings, also a BREEAM certification. So that enables us to prove that the buildings are sustainable, but then it doesn't stop. So we'll keep trying to reduce The energy consumption, even if it's green electricity, but we try to use to reduce it and make it On that level even more sustainable, but also more cost effective because nowadays, energy prices are, Yes, supporting sustainable investments. So we've talked about the fleet, we've talked about the buildings and A third obvious factor would be the people. It is looking at you. When you talk with people in the operation, what is the level of enthusiasm around this topic among drivers. How can they contribute themselves? How can you get them engaged basically? Yes. I can see A lot of engagement on the local level, on management level, but also on from the drivers. They see that we actually invest In a good van, that's ergonomically working well for them. On local management, we do I see that they are very competitive, of course, local operational management all is very competitive. Once you show them their KPIs, they go and run. But also it makes them very proud to be front runner on sustainability because they get a lot of also compliments when they Actually deliver a parcel to a customer with an electric van, they get a good response. So I also see a lot of pride. So I'm not worried about lack of engagement from my people, I have to say. And is that same answer true for delivery partners? Because obviously, they are quite a factor There as well in this In fact, I do speak to delivery partners from time to time and you see that they are also realizing that They are going to be in this transition as well. So it's not even a pull. I think it's even a push from their side and they ask us how can you help us To set the kind of example and so that they can learn from us, we also can sometimes learn from them. So I do see that delivery partners are very aware This is coming. And being entrepreneurs, they also look ahead and plan. So it's a very big topic on the table at the moment, yes. Herna, you are using 4 SDGs, which seems a bit narrow according to the person asking this question. There are other postal companies and who also look at number 11 SDG, sustainable cities and communities, which seems to be closely related to sustainable transport. Would it be an idea to add that one, you think? Yes. The I think we've chosen 4 to indeed narrow a little bit the actions we're taking on certain of those development goals. Number 11 is very close. When you think about what we do in the cities in the Netherlands and what we try to do to get the inner cities It's emission free that truly, of course, also contributes to sustainable communities and cities. And next to that, we're also investing a lot in, for example, Jorg Jop, which is an association in the Netherlands helping Young children who are not able to celebrate their birthday because they do not have money enough, so there are also lots of social initiatives in our company, Which can help in being in creating sustainable communities and cities. So the answer is yes, we could add. And I also always think about, is it easier to add it to or is it easier to make it more explicit in one of the current 4? Or should we add a 5th one? Clear. Can you explain, you mentioned in your presentation that We have chosen to offset our emissions as of 2022. How do you see that develop going forward over the next few years? Yes. The reason why we offset as of 2022 is because we find it important to be sustainable And to have the possibility to be indeed emission free in our last mile. If you look forward and if you think about the graphs I showed in my presentation, then of course, what we have to What we have to how do you say that? I'll say it in a different way. I think what we try to do going forward is, of course, to do it more by ourselves. And that means that year over year, we have a bigger electrical fleet. That's 1, secondly, year over year, hopefully, we have more HVO 100 vehicles. We have hopefully more big trucks That can run on LNG or even better on hydrogen fuels, etcetera, etcetera. So when time passes by, The amount of or the percentage of reduction we can do ourselves with our own means becomes bigger and bigger. And hopefully, and that's what I said in my presentation as well, developments go much faster than we think today. And that will help us to speed it up even more Than what we're doing at this moment in time. We will close off with a couple of financial questions for the audience today, of course. Yes. So first off, we have indicated on the 9th August that we're going to make extra investments, not just in sustainability, but in a broader range of targets. And we have talked about the flexibility that is required in making those investment decisions. How does that apply to the ESG investments? How flexible can you be in that regard? Yes, the €80,000,000 is part of The €450,000,000 or €950,000,000 we've mentioned at Q2. So it's part of that. It's partly OpEx And it's partly CapEx. And around €35,000,000 is OpEx, around €45,000,000 is CapEx. So that's more or less a division between now and 2024. If you want to, of course, have your emission free last mile by 2,030, You need to keep investing also after 2024. So I do not expect big changes as of the year 2025. And hopefully, but that's what I said already quite a few times, we will be helped by some developments as well. Next question is about what the role of ESG is in our conversations with shareholders. You and I are both quite regularly participating in roadshows and in interaction with shareholders and investors. Maybe you can talk a little bit about how ESG is becoming more important in those conversations and how we play into that? Yes. Yes, I think It is more important than it was, for example, 3 or 4 years ago. So in many more of the meetings we have with shareholders, ESG is a topic. And when you are a fleet and people intensive companies, it's in most of the cases both areas. It's, of course, fleet Our fuel, our kilometers and its people. The way we play into that is, of course, by, for example, what we've presented now and which we've Communicated to shareholders in a certain way already in the discussions we had. Next to giving them an update on the progress we make. Also the reporting is the internal reporting, therefore, is crucial. And of course, talking a little bit more in detail about Some of the ideas we have, some of the developments, the pilots we do and also the innovations we can do ourselves, like the tool we developed with the TEU Delft. So we try to give feedback on this topic in many ways. But these are the important Elements which we see at this moment in time in the discussions. And it's not I think 5 years ago, it's much it was much more questioned. If it was a wise investment, that is not the case anymore. So there is a big change, I think, took place over the last 5 years. Clear. I think a final question going back to the financial question. Today, we announced €80,000,000 to be spent on sustainability OpEx and CapEx. Beyond 2025, what can you say about the development you expect in in those years towards 2,030. Yes. My expectation is that the investments remain to be part Of our OpEx, CapEx budget and the amounts we have not forecasted yet exactly and We did not communicate around that. But nevertheless, I expect more or less the same line And the same view on the investments we have to do both in OpEx and CapEx to make this company year over year more sustainable. Very good. We have no further questions at this stage. If you were to have any further questions on the topic of sustainability, you know where Find us investorrelations@postnelle.nl and you know where to find us by phone. We look forward to meet again with you Over time, if possible, for instance, in the small parcel sorting center, where we would be happy to invite you To look at the new operation that we are opening next week as Herna mentioned, for now I would like to thank you Herna, Nikkei and Iris for your contribution. Thank you for joining us in this webinar. Hope to see you next time. Thank you.