Good afternoon, ladies and gentlemen. Welcome to Postetariane's financial results for the Q2 of 2021 presented by our CEO, Matteo Del Fronte and our CFO, Camilo Greco. Following the presentation, we will be glad to answer your questions. Now team. Let me pass it over to Mastelio.
Good afternoon and thank you for joining us. We're pleased to present Positaliana results for the Q2 and first half of twenty twenty one. CFO. Let me start with the key highlights. Then I will hand over to our CFO, Camilo Greco, for a more detailed business review.
After that, I will present and closing remarks. Beginning on Slide 3. Our diversified business model is continuing to deliver strong financial results. Revenues increased across all divisions with a different mix adapting to a changing environment and in line with the new plan direction focused on top line growth. Our flexible cost base continues to support business growth with an increasing share of variable costs linked to revenue growth.
Moreover, we continue to demonstrate flexibility to effectively manage our FTE base. EBIT for the quarter amounted to $429,000,000 reaching over $1,000,000,000 for the first half. Let me also remind you This level of EBIT is a significant achievement as it brings our business back to 2019, thus fully recovering from the impact of lockdown despite some restrictions being still in place during 2021. In 24 SI, sustain and innovate, we define our target as ambitious but achievable with a focus on revenue growth to create and deliver higher and sustainable value to our stakeholders. There are 3 key agreements which give us high visibility, significantly reducing execution risk attached to the plan.
1st, in July, we signed a new group labor contract, A 3 year partnership has been renewed with Amazon, enabling volume and revenue growth, balancing urban rural area volumes and introducing higher value added services such as scheduled deliveries. Finally, our universal service obligation contract covers the 2024 plan horizon, embedding the next generation new initiative of Posit Italiane on new digital solution and cooperation with more municipalities. And let's move to group financial results on Slide 4, please. Overall, our business activities are progress and in line with the trends embedded in our 24 S I plan. Group revenues benefited from the lockdown of 2020 CAGNY and the Q2 increased by BRL434,000,000 representing 18.7% increase year wouldn't be accurate.
As in the last heat of the pandemic in Q2 of 2020, we implemented contingency measures resulting in $170,000,000 one off cost savings. So effectively, our cost base is well under control and higher costs are only borne to support the growing revenues EUR 429,000,000 In the first half, EBIT exceeded EUR 1,000,000,000 up 37% year on year. Our focus on business growth and ability to harness industry trend supported the net profit, which increased 36% on an early basis to $326,000,000 in the Q2. Year to date, net profit achieved 773,000,000 record high level, posting an increase in excess of 40%. Let's move to Slide 5, where we compare the current financial results to those of 2018 activities are back to pre pandemic levels.
Thanks to our ability to successfully adapt to emerging business trends with a different revenue mix. We successfully addressed a low interest rate environment focusing on investment product distribution and we sized a real opportunity from digital payment with an increase in our card business. Let me also underline that new activities such businesses are already up and running and will further contribute to revenue growth at a higher pace starting from the next quarters. On the cost side, the increase is related to a different business mix based on variable costs linked to revenues, costs related to the COVID-nineteen emergency and the consolidation of MEXC as we are still in the process of extracting all the acquisition synergies that we have in the plan. All this considered, our cost base is well under control, and our operation are carryout with some 7,000 lower FTEs compared to 2019.
As a result, EBIT bottom line, we're back to business, growing organically and keeping building our physical and digital distribution platform stronger than ever. We're optimizing our multi channel strategy supporting sales efforts in postal offices with customer calls initiated by digital contacts with potential clients, a seamless interaction with Poste to optimize user experience. Moving to Slide 6, 24 SI implementation is fully on track initiative underway and business trend updates. Let me go segment by segment, starting with Mail Parcel and distribution. The new labor agreement, as I mentioned, signed back in July at group level is in line with the plan.
Thanks to our constructive relationship with the unions, we now have increased visibility on HR cost over the course of the plan. Strategic pillar for Italy, we're also proud to contribute to the EU recovery plan, which covers the implementation of key national projects aimed work stream. The first one aims at creating in 7,000 postal offices, a smaller municipality, public administration hub that provides citizen with easy access to government services. The second line of action envisages a network of around 250 co working locations, community and training spaces TNC Solutions and extended changing station network and photovoltaic energy production. Besides, in June, we inaugurated Italy's largest e commerce logistics hub with a daily capacity of up to 300,000 items.
This hub will contribute to reducing parcel cost per unit, optimizing variable costs. In terms of the business update, we are registering a normalization of parcel volumes, team. Both trends are in line with our expectations. Moving to Financial Services, in line with 24SI, We are successfully focusing on Wealth Management to offset NII decline in the current interest rate environment after securing the contribution from active portfolio management for 20 Our new activity to buy tax rate has been going extremely well with about €2,200,000,000 nominal value acquired to date, end of July. Furthermore, we're now able to use a portion of our deposit to buy additional tax credit, enhancing the yield of our investment portfolio and providing further flexibility in our active portfolio management.
On loan and mortgages, the joint venture with BNP Paribas on salary backed loans is now fully up and running, adding to our portfolio another key product factory ability to structure a comprehensive product offering. In Insurance Services, the multi class product now represent over 60% of gross written premium, in line with our 2024 target. We have also recently signed agreement with Intesa Sanpaolo for a joint venture in real asset investment. This partnership will enhance our expertise in alternative investments enabling us to further diversify our investment portfolio in line with 24 SI plan. Team, we were able to anticipate part of the full year target in half 1.
Looking at payment and mobile, our payment transaction continued to increase both on our physical and digital channels. Let me also highlight that this business segment has been able to build and manage a diverse equity portfolio in high growth international company, which is being continually monitored and optimized. For example, our stake in CNXI 3.5 times our initial investment at the beginning of last year. Moving to the Energy business, we're progressing Moving to Slide 7, where numbers, I believe, speak for themselves. Revenues are well above the pre pandemic levels with all business segments back to the growing trajectory set with 24SI.
Insurance Services, Parcel and Payments businesses show a very healthy double digit increase in line with the growth focus strategy envisaging in 24 SI. Also financial services improved with a 2% top line growth compared to Q2 2020. Folio yield decline has been more than offset by the revenue increase coming from investment product distribution, in particular from life insurance. And now let me hand over to our CFO, who will take you through a more detailed business review. Over to you, Camilo.
Thank you, Matteo, and good afternoon, everyone. Let's look in more detail at each segment, starting with Mail, Parcel and Distribution on Slide slide 9. As Matteo previously mentioned, both in the second quarter and the first half of twenty twenty one, all business slide, revenues have been growing, leading to a strong improvement of the underlying EBIT. Following record high Q1 'twenty one, up 19% year on year, Q2 posted the best yearly revenue progression, up 30%. This is still true even if we SKUDA contribution from Nexive Consolidation, thanks to the recovery of volumes, especially in the registered mail items.
Q2, Q2 'twenty one, which compared to a very strong Q2 'twenty when many items could only be purchased online international lockdown. Finally, other revenues are also up as here we booked, amongst other items, the expense recoveries related to the rollout of the vaccination plan. Distribution revenue growth accelerated at 7.5%, consistent with easing lockdown measures and the general recovery of commercial activities. EBIT stood to minus $159,000,000 in the second quarter. This is flat year on year on a reported basis, but the underlying dynamics point to a rather strong improvement when we consider one off pandemic savings of $170,000,000 that we benefit from in Q2 'twenty.
We focus on those savings when we look at the cost group cost evolution later on in the presentation. To conclude, in the first half of twenty twenty one, we recorded the EBIT loss of $102,000,000 improving by $92,000,000 since last year. 51% in the first half with the highest growth still coming from B2C supported by key customers and China. In Q2, Parcel volumes trended towards a new normal, in line with expectations. If we compare Q2 'twenty one Q2 2020 when online shopping was the only way to do shopping, it's natural to serve that the growth trajectory started to flatten.
Moving to B2B, the comparison is polluted by many corporates who were shipping to retail customers at the peak of the Sanitalia merchants in 2020. C2X, the comparison in 2020 is partially misleading as during lockdown, we were the only postal operator open for business. Results have been rolled out with C2X online orders now more than doubling versus 2019. In terms of pricing, the average B2C faster tariff was up 2 percentage points in the quarter, mainly improving thanks to a favorable mix and higher tariffs from top merchants. Moving to mail on the right side of the slide.
Volumes grew 23% in the 2nd quarter and 14% in the first half. Sales team. As already mentioned, the growth is supported by both Nexil consolidation and the recovery from lockdown. We registered mail items growing 56% in Q2. The average mail tariff also improved with the mix effect supported by higher margin products segment was up 3 percentage points.
Moving to Financial Services on Slide 11. Financial services segment has witnessed positive revenue growth, driven by Wealth Management activities. Gross revenues grew by 6% in the quarter expected by low interest rates, but this was fully offset by a focus on the distribution of investment products, in particular, intersegment contribution from insurance, which Banco Posta receives as coordinator of the group Wealth Management Strategy, represented the largest proportion of the revenue increase in Q2. Postal savings fees were down 5% when compared to a strong Q2 'twenty, Q2, while in H1, we were on track to meet the 2021 target. Loan and mortgage distribution fees are recovering, further contributing to this revenue line going forward.
Transaction banking fees are also recovering from last year's loss
strategic initiatives, which are
expected to gradually decline over the planned horizon. In Q2, we did not book any material contribution from active portfolio management, But leveraging on a low interest rate environment, we have already secured our 2021 target, which will be booked in the second half of the year. As Matteo already mentioned, we have also locked in more than 50% of Cabral gains planned for 2022. Operating profitability was in line with 24 SI with EBIT down 11% in the quarter as the year on year comparison is expect 2 refund customers bearing loss from real estate funds dating back to early 2000s. Moving to Slide 12.
TSAs reached $576,000,000,000 up by $28,000,000,000 year on year and up by $7,000,000,000 when compared to December 2020. This figure is already in line with the full year 2021 target. Net inflows amounted to $5,800,000,000 thanks to deposits and multi class life insurance products. Full components of TFA were up over the first half. Postal savings increased by $300,000,000 with accrued interest more than compensating outflows, which were also mitigated by their investment of expiring bonds.
Net technical reserves were up by $2,700,000,000 with Multiclass Products net inflows more than offsetting the negative market effect. Deposits increased by a strong $3,500,000,000 supported by continued customer preference for liquidity products. Moving to Slide 13. Insurance Services posted a robust performance. Operating profit grew steadily in line with the plan supported by increasing volumes and by higher margins from our multi class products.
In Q2, Life revenues were up 49%, supported by both increasing volumes and higher profitability. Multiclass products now represent 64% of new production out of $4,400,000,000 gross written premiums. The Life revenue line also benefited from a higher investment margin, strategic initiatives, taking advantage of favorable market conditions and contributing in advance to the full year target. The Non Life business team is producing healthy volumes in terms of new production, although revenues were impacted by costs related to COVID-nineteen employees' policies market with higher than expected average tickets. Our focus on this area is also contributing to reducing the historical level team of under insurance in Italy.
The rollout in motor insurance offer is progressing well and is all show, and it is now available in almost 4,000 post offices. At EBIT level, the progression continues to be a strong 49% in Q2, notwithstanding increase in intersegment costs for distribution due to higher inflows. Let's move to Slide 14. Costa Vida Group's solvency II ratio stood at a robust 288%, above our 200% managerial ambition through the cycle. The solvency II ratio decreased in the quarter with higher spreads more than offsetting the benefit from higher risk free rates.
Additionally, from the end of July, the solvency ratio is 7 percentage points higher, strengthened by a $300,000,000 intercompany restricted Tier 1, CFO, which is funded by $800,000,000 corporate hybrid bond issued in June by Poste Italiane. As a reminder, $350,000,000 have already been allocated from the parent Post Italiane to the ring fenced portfolio of Banco Posta to strengthen the Basel leverage ratio. Transitional measures provide additional 28 percentage points to the solvency II ratio to address potential market volatility. Moving to Slide 15. Payments and mobile revenues continue to increase, up by a strong 20% in Q2, customer, confirming the steady progression of this business over time.
Card payment revenues were up by a material 25% in Q2, subscription, supported by an increasing number of Postpaid Evolution cards as well as the increase of transactions value year on year. Other payments increased 42% in the quarter, mainly supported by the recovery of tax related payments. Telco revenues grew 9% in the quarter, benefiting from a lower churn rate on mobile and strong increase in fixed lines. EBIT was up 5% in Q2, impacted by higher telco costs related to increased data usage. Team.
As Matteo already said, EBIT will improve as we are already reaping efficiencies from the ongoing migration 2 Vodafone network to be completed by year end. On Slide 16, here you can see how Post Italiana's workforce evolution is progressing. Over the course of Q2 of 2019. Last semester, our average headcount was down 2,400 FTEs from almost 125,000 to around 122,000 FT feet feet feet feet feet feet
feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet feet
Es tends to continue turnover and subsidized exit more than offsetting new hires. While Harries are expected to accelerate in the 2nd part of the year, we confirm our flexibility in effectively managing our workforce. Team, the value added per FTE continued to grow year on year, now reaching €70,000 per FTE. Moving to group HR costs on Slide 17. The most significant KPI here is the ordinary HR cost on revenues.
For the first time, below 50%, now reaching 48%. The HR cost increase was mainly related to the one off savings booked and disclosed in Q2 2020 related 2 contingent management actions to react to revenue headwinds last year. In particular, dollars 65,000,000 savings were achieved during the commercial incentives in relation to subdued business activities, while additional $75,000,000 were saved as we deployed our own emergency funds to support employees at the peak of the pandemic. A lower FTE base continues to positively contribute to the decrease of HR costs by $34,000,000 year on year, while savings on salary and benefits components fully offset the effect of Nexive consolidation for €10,000,000 Overall, the ordinary HR cost base to support growth in Parcel, Payments and Telco Businesses. 2nd, D and A, which were both Q2, which were up both due to $80,000,000 higher CapEx year on year and to a positive one off booked in Q2, 2020.
Let me remind you that last year in June, we completed the reassessment of the residual life and value of certain real assets. The effect of this review started in January, but the benefit related to H1 was entirely booked in Q2. Third, the consolidation of Nextiva, mostly related to COGS. As a reminder, Q2 costs include $25,000,000 of emergency related one off costs since we continue to provide all the necessary protective equipment and sanitization to ensure highest health and safety standards for workplaces, employees and customers. Sales as a tangible sign of efficiency gains, the ratio between variable cost and variable revenues excluded 72% in line with 2021 full year target, while total fixed costs and revenues are down to 59%.
On Slide 19, we can see the detailed EBIT progressions at segment level. As you have seen on the previous slides, the underlying operating profitability was strong across all divisions. In Mail, Parcel and Distribution, we see a significant improvement once the one off cost savings realized in Q2 of 2020 are excluded. Segment EBIT for the first half of twenty twenty one is well within our full year target. Financial services profitability has been stable in the quarter, also considering the above mentioned reserve release accounted last year and despite low interest employees.
Insurance Services showed solid growth, increasing 49% year on year, supported by strong business dynamic in line with our plan. Payments and mobile is also improving and will further benefit from lower telco costs. Let me now hand back to Matteo team for some closing remarks. Thank you. Thank you, Camilo.
Before taking your question, let me reiterate some key messages on Slide 20. Our focus on generating revenues proved to be The RISE strategy and in Q2 2021, the revenue exceeded pre pandemic levels across all business segments. Costs will continue to support revenue growth, while we'll retain additional flexibility as we have demonstrated effectively managing our FTEs. The key initiatives underlying the successful execution of 24SI are already in place, which give us higher visibility on our ability to achieve targets significantly reducing the execution risk attached to our plan. The company as a whole is fully committed to succeed.
Stay tuned. And let's now move to the Q and A session. Over to you, Maci.
Thank you.
Team.
The first question is from Gianluca Ferrari, Mediobanca, Gianluca
Yes. Hi, good afternoon. Ciao, Matteo, Ciarmillo. Three questions, if I may. The first one is related to the increase in the SCR.
I A bit more exposure to illiquid equities are healed. Is it fair to say that this is the way to rate this increase in SCR and is this going to last in the next quarters? I. E, you will use part of the robust solvency You have to sustain more of the financial income of the life insurance segment going forward. Point number 2 is If you have any update for us on the agreement with CDP.
3rd and final question is, if it is fair to assume The devaluation of Siya now could be a bit closer to $350,000,000 than the previous comment I think you made of evaluation
Thank you, Gianluca. Starting with the agreement with CDP, As is known, there is a new CEO that has taken the full responsibility in May and since Then we have made significant progress. So we are even more comfortable than before capital gain, the answer is simple, it's yes. And in terms of the reason for the SCR increase. I will let Camilo take this specific question.
Thank you, Matteo. Yes, it's fair that the SCR went up by circa 2 $200,000,000 from around $3,900,000 to $4,200,000 That is mainly driven by market risk up due to higher spreads
Thank you. And the next question is from Monona Meroni from Bancaimi. Trego?
Yes. Good afternoon. I have four questions. The first one is on Parcel Business. Revenues in Parcel Business grew by 28% year on year in this quarter.
Can we take this 28% as the new normal for the parcel business going forward? The second question is on cost. In the closing remarks, you mentioned to have some levers available for the cost reduction. You mentioned something in the telecom business. Can you please elaborate a little bit more on that?
The third question is on NII. Can we expect Reduction in the pace of decline in NII considering your activity in with the tax credit. So Any comment on that would be useful. And the last question is on your business plan and the guidance for 2021. We are clearly as of planning parcel business and life business.
So I'm wondering if we can expect some upward revision of your guidance for the full year 2021.
Okay. Thank you, Manuela, I'll take the last two and leave to Camilo the first two questions. And I would do it in reverse order. Yes. We are ahead of the plan in at least 2 segments.
And we will take a few more weeks to monitor the involvement of our business. But for the quarterly result of November, we will certainly have an answer to your question, a more clear answer, Probably in the direction that you are suggesting. In terms of the third question, the NII decline to be counterbalanced by the tax credit? Absolutely, yes. As I mentioned, we have now 2.2 €1,000,000,000 that we bought at the end of July.
These generating over the course of the plan $250,000,000 of NII. And by the way, it goes all the way down to profit. So it's extremely accreting as a business. So certainly, we're seeing significant demand for the product and is good both in terms of obviously economics. And I think it's also very important for us in terms of building new client all clients that want to sell a tax rate to post, they have to open an account.
And today, around 80% of the sellers are new client to Poste. So answer yes, and I think this is probably one of the most positive news that we will discuss over the course of the next few weeks. In terms of revenue on parcel and cost flexibility, please, Camilo. Thank you, Matteo. So starting with parcel revolution.
We had in the plan which we shared with you back in March expected growth in B2C of around 20%. You guys have seen that in the Q2, we reached a growth of 28%. We think that on a normalized basis with respect to our ability to cut down costs or rather manage costs. As I think we said in the presentation, there are 3 business lines that are running at variable costs, which are namely parcels payments and telco. So to the extent that those businesses don't grow, the costs associated to those business will not materialize in the P and L.
And in the appendix of the book, you have an example of that as we showed it in the first half rather than the first second quarter. In the entire first half, we had €208,000,000 of additional costs related to businesses that are running at a variable cost. Let me also remind you that this level of variable cost and variable revenue ratio, which we have same pages consistent with the level that we showed in the plan of 72%. Additionally, I will conclude with this. You can also see that the overall total fixed cost base is going down as a percentage of revenues and you're also So testament of that in the evolution of HR FTEs that you guys have seen are below what we had
Thank you very
much. I have one question from our webcast from Alberto Cordara. So you mentioned EUR 200,000,000 restructuring charges to be taken in Q4. Can you also let us know how much more capital gains are you expecting for the year after the $200,000,000 booked in Q1?
Yes, please Camilo. So we had a target for the year of active portfolio management of around 4 $400,000,000 we and that's the target we confirm for the year. And I think that there is Delta missing around $150,000,000 sorry, dollars 180,000,000 compared to what we booked in Q1, which was 220,000,000 With respect to the second question, yes, we reconfirm provisions for early date armaments
next question is from the Marco Donachina, Equita.
Please, Marco.
Yes, good afternoon. A question on the performance Insurance Services division, which was extremely strong, in particular, on the progression of the percentage of the multi class, Which is progressing very rapidly. Do you think now we may see a pause in The percentage of multi class in the coming quarters? Or you expect these, let's say, percentage to keep growing At similar pace we saw in the last two quarters. And also if you can remind us what is the profitability gap with the rest of the portfolio and if the increase in margin in EBIT we saw in the quarter is mainly due just to the mix effect or also you benefited from other factors?
Thank you.
Okay. I'll take the first question and I'll start the second. And then if Camilo, you want to jump in on the second as well. No, I think the pace of the multi class is there non capital protected multiclass in the sense that the target asset allocation that You assume for a client could be 35 Equity and 65 Class 1 capital protected is achieved over 18 months. So the 35 non capital protected, debt, which is actually not even equity, is balanced fund, is not invested on day 1, exposure to the market over 1.5 years.
So the product is as close as it can be to Class I. And that's why our network and our sales team has founders extremely safe and interesting and they sell it extremely well and comfortably. In terms of the margin, please, Camilo. Thank you, Matteo. So yes, we confirm that the investment margin in the first half benefited from market opportunities related to some of our investment in the portfolio debt weighted for around €150,000,000 on the margin, and that explains part of the increase.
In any event, part of this anticipated margin will be recognized to policyholders in H2 2021. And in any event, It was accretive to our target for the in for 2021 for Postevita and there might be also some potential upside to that depending on how market moves between now and the end of the year.
Team. The next question is from Elena Perini, Banca EMEA. Please Elena.
Yes. Good afternoon. I've got Some questions on the insurance business too. Well, you were talking about the investment margin. Expectations on the second half.
I know that it is not easy because it is market related, But if you can share with us some thoughts. And then I would like to ask about the Non Life business. And in particular, I am referring To the fact that it seems that the new business in Non Life It's going up is in Slide 25 in the appendix. So I was wondering if this trend marked in the second quarter is going on. And so if we can expect some recovery in premiums and in business trends for the second half.
Then I saw an increase in the combined ratio first half twenty twenty one compared to first half twenty 20, approximately 11 percentage points. So I was wondering if this is related Mainly related to COVID-nineteen protections as you were mentioning in Slide 13 or if there are any other elements and if this increase was mainly concentrated in the Q2. Thank
you. Okay. I'll take the again, the second and the third and leave The first one as a follow-up to Camilo. Starting with the last one, Elena, thank you, first of all, for your questions. The increase is technical.
So the 75 that becomes 86 would have been 77, so an increase of 2 only if one would delete the increase explained by 1, employees' COVID protection that we gave for free to our employees And 2, the rule and the enforcement that the regulator made on Dormant on sleeping contract. And the sum of the 2 element was in the 2nd quarter 13.6 $1,000,000 of provisions that translate into basically 9 gross written premium. You see the effect again on Page 13, the effect of the COVID related and the dormant life contract. You see it also on the left hand side of the chart in the segment revenues. So we are more or less in line with our plan on non life.
We have a production that is growing month by month. I think we can do more, but the machine contrary to what we have seen in the last few quarters is now working and has now basically endorsed the product. So now it's just a matter of getting all our sales people on the case, but we are running at almost 1500 contracts investment margin in the second half. Yes. So we had put out back in March an EBIT For post EBITDA of €1,200,000,000 rounded up €1,200,000,000 I think that what we said earlier was that we've asked that the evolution of the margin, of the investment margin, which, As I said, part of which will be recognized to our policyholders will contribute toward the target.
There might be some marginal upside based on market conditions, but it's too early to say we certainly confirm forcefully at least
that target. Thank
you. Next question is from Ashik Musaddi from JPMorgan. Sreedhar.
Thank you, Maxi, and good afternoon, Matteo. Good afternoon, Camilo. I just have a couple of questions, if I may. I mean, first of all, if I think about it, what you're saying today is NII is better because of tax credit compared to your plan. Parcels is doing much better compared to your plan.
Mail is doing better than your plan because you are including NextEve in other segment rather than in Mail. We have higher gains, campaigns from CEAA, insurance is growing faster than the plan that you have given. So clearly, I mean, majority of your business lines are doing much better compared to what you have shared as your 2024 plan. And I agree, it's very early to think about that plan again. But do we expect to get when do we expect to get some color on what your 2021 earnings could actually look like given that majority of the divisions are doing far better compared to what you guided to us in March.
So that's the one first question. Second thing is, congratulations on your Amazon partnership, but would be great to get some color about how this what is this what is the partnership this time? What is the update on that? I mean, are you comfortable with your parcels plan or are there any hiccups in terms of pricing, volume? Are they keeping more?
Are they giving you more? Any thoughts on that would be very helpful. And just last question, I would say is, when you get your Siya money basically, I mean, what is your plan for your stake in Nexi once the CRD merger is complete. Are you going to keep it, give it back to investors? Any thoughts on that.
I agree it may be a bit early, but I would still give it a shot. Thank you.
I don't know why, but I keep starting from the last question. First of all, the plan for the SIA money is a bit early, but I believe that there might be some opportunities. We keep looking at the logistic space. We keep looking at potentially new activities that can accelerate our plan as we have done with some marginal investments. So I think part of the money now is the first contract was signed back in 2017, 2018.
So The partnership is up and running. We remodulated the agreement in order to get more value on the urban areas, which is clearly where Amazon tends to do the job their self. And so we have now different agreement for those areas. The profitability of the contract is very solid and is a fair relationship we have with them. And the good news about this activity, I think, is in two lines.
The first one is that is an important contract, but every day is less important than the day before The volumes in the business from China, from all the other clients and platform we serving as growing much faster than Amazon. So our original plan, Ashik, to use Amazon as a sort of a springboard to build the competence in the space and then slowly do less with them because naturally they're building as they're doing all over the world. Their own network is actually proving the correct strategy. The second good element, which it's linked to the first one is the fact that they help us in a way entering the quality of this business speakers. As everybody knows, Amazon has very high quality standards and as a deliver company of Amazon.
If you don't give the quality this week, next week, you don't get the parcels. So our people are now used to deliver good services, but I don't want to say, but very, very much in line with the best practices now. And that, I think, has changed also the culture of our delivery space, and I think this is extremely important. As far as the first question, I think you are right. And I think it was mentioned before, by Manuela.
Yes, I mean, all elements are pointing into positive direction. We only feel that having announced plan only 12 months ago is probably a bit premature to revisit those assumptions. VAT, all the optimism that the numbers are Givinas is well grounded as far as we can see today.
Okay. That's
Vijay. Just one follow-up. I mean yes, maybe we'll take it later.
Yes,
Ashik. Sorry, we lost you, Ashik.
Yes. No, I mean, Just related to that, I mean your guidance for this year EBIT is $1,700,000,000 You have already hit 1050. So that means you need to do $650,000,000 for second half. I mean, yes, you have one negative of early retirement scheme, but then that's offset by capital gain. So I just don't see how do I get to $650,000,000 It just looks very low.
But I guess it is to the same point that numbers are pointing in the right direction. It's just that it's a bit early to change the assumptions. Yes, probably that is the thing, yes.
Yes. I think you're right. There is not much more than I can add.
Thank you. And the next question is from Giovanni Razzoli, Deutsche Bank.
Good afternoon to everybody. One question, because if I look at the trends on the average current accounts in this first half in the Q1 and in the Q2, this is one In my view, one of the most positive elements of your trends in the first half twenty twenty one, There has been an acceleration both on the corporate and retail trends since the beginning of the year. I was wondering whether especially on the corporate side, you can give us more color about these trends. And I guess that this also supports your is going to support your NII via additional incremental Acquisition of our fiscal credits or BTPs, right? So there is also a volume effect behind this.
Thank you.
Yes. I mean, I think we can be more specific in terms of what we have seen in 2021 in terms of new clients, we're above 30,000 on the individual side and we're short of 10,000 on the corporate side. And The current account, which is open in order to benefit from the tax credit transaction is free, so you don't make extra money on the current account, but clearly is a client that then can benefit from our, for example, acquiring products, if you're talking the corporate side or if you're talking the individual, clearly there is much more we can do in terms of
insurance
or PLC products that we can sell. So I think the cross selling that will come to these clients. And then Giovanni, and thank you for the question, the positive vibes that new clients that bring to the network, I think is very important for us because these are clients that are coming to us not by advertisement, not because we make special agreements, but because we have good products, both in terms of process and pricing. And this is really word-of-mouth that is creating this momentum for us. And if there are no additional question, I just would like to specify that for the rest of this week, ourself over here, IR specifically is available for any additional questions.
And thank you again for participating in this call and allocating time to Post Italiane. And good holiday for those of you that
Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephone. Thank you.