Good morning and welcome to Poste Italiane conference call for the third quarter and nine months 2026 results and TIM integration update. Today, our CEO, Matteo Del Fante, will take you through some opening remarks and update on the TIM integration process. Our CFO, Camillo Greco, will take you through our financial performance. The presentation will be followed by Q&A session where you can ask questions either via phone or through our webcast platform. For any topics we will not be able to cover today, please do contact the investor relations team who will provide any clarifications you might require. With that, over to you, Matteo.
Thank you, Giuseppe, and thank you all for joining us. This is our first result call since the completion of the TIM acquisition, and therefore, I will spend some time today to update you on the progress we are making on the integration. Let me take also the opportunity to welcome all TIM colleagues, TIM professionals, and TIM investors in this exciting journey we are starting together. Let us start with our results. I am pleased to report another record performance for nine months, driven by profitable growth across the platform. These are the strongest third quarter and nine-month results in our history. All businesses contributed to a robust 5% year-on-year increase in revenues, reaching EUR 10.2 billion. Adjusted EBITDA grew by 7% to almost EUR 2.7 billion on the back of top-line growth and continued cost discipline, while adjusted net profit reached EUR 1.8 billion.
Since the start of the year, we have seen strong commercial momentum across financial and insurance, with investment flows reaching EUR 4.5 billion, also thanks to the implementation of our new commercial service model. TFAs now stand at a remarkable EUR 614 billion. Our Solvency II ratio remains strong at 269%, including the accrual of 100% remittance to the parent company. In a quarter of significant spread widening and higher rates, our solvency position has proven extremely resilient. TIM balance sheet has been consolidated as of the 30th of September, with pro forma leverage below 1.5x EBITDA after lease. P&L consolidation started on October the 1st. On the back of these results, we confirm our upgraded full-year 2026 standalone guidance of EUR 3.4 billion adjusted EBITDA and EUR 2.3 billion adjusted net profit.
Today, we are announcing an interim dividend of EUR 0.43 per share to be paid on 25th of November , which is up 7.5% versus last year for a total of EUR 686 million. Now that TIM is part of the group, we are focused on unlocking the full value of this combination, and we are moving very fast. We are bringing together highly complementary assets, Poste Italiane's unparalleled physical and digital network, customer reach, and trusted platform, together with TIM connectivity and tech infrastructure. The result is an unmatched AI-powered connecting platform and domestic tech leader. To deliver it, we are putting in place a highly disciplined integration plan. Around 200 people from TIM and Poste Italiane are working across nine joint work streams, coordinated by a full dedicated Integration Management Office.
We confirm at least EUR 700 million of run rate synergies with a bottom-up and inside-out analysis, with no impact from listed TIM minorities. On cost, we have a clear roadmap to reach at least EUR 0.5 billion of run rate savings by 2028, with tangible quick wins already delivered on procurement, funding, and real estate. On revenues, we target more than EUR 0.2 billion of EBITDA from incremental revenues from 2029 by adding TIM products to our customer platform and driving Italy digital platform transformation through AI, cloud, and data sovereignty. Our partnership with TIM is already underway. A TIMVISION and fiber offer dedicated to our employee offer, friends and family, is now available in our post offices. Next week, TIMVISION arrives on our super app, and the first TIM shop-in-shop are opening in some of our landmark post offices.
Management is fully focused on the integration and preparation of the combined business plan to be released and presented to the market in the first quarter of 2027. Let's move to group financial results on slide five. Poste Italiane delivered the best Q3 and nine-month results ever in terms of revenues, EBIT, and net profit. Looking at the first nine months, revenues reached EUR 10.2 billion, up 5% year-on-year. Adjusted EBIT came in at almost EUR 2.7 billion, up 7%, and adjusted net profit reached EUR 1.8 billion, up 4%. In the quarter, adjusted EBIT reached EUR 910 million, and adjusted net profit EUR 629 million, up 6% and 4% respectively. Since 2016, we have more than tripled our dividend per shares from EUR 0.39 to EUR 1.25 last year, a clear reflection of the strength of our business.
In 2026, we continue the trend. Interim DPS is up 75% to EUR 0.43, with the total interim dividend up 32% to EUR 686 million, reflecting the enlarged share count following completion of the TIM offer. Looking ahead, we'll continue to reward our shareholders with a compelling and growing dividend policy from 2027 onwards. More details obviously on this to come with the new plan. Moving to slide seven, revenue growth remained solid across all businesses. Focusing on the quarter, mail parcel and distribution, 3% revenue growth was driven by market share gains across parcel customer segments, contract logistic expansion, and mail repricing. In financial services, revenues increased by 2% year-on-year to EUR 1.4 billion, driven by solid investment portfolio revenues and commercial momentum. Insurance services deliver strong profitability in both life and protection segments.
Revenues rose 13% to EUR 500 million reflecting stable CSM and higher release. PostePay services reported solid top-line growth across payment and energy, with revenues up 6% to EUR 435 million. Let's move to slide eight and EBIT evolution by segment. Mail parcel and distribution reported an adjusted EBIT of EUR 48 million, in line with our full-year guidance. Financial services operating profitability is up 3% to EUR 269 million, including fees driven by NII and overall strong revenue trends. Insurance services adjusted EBIT is up 12% to EUR 429 million, supported by both life investment and protection. Finally, PostePay services strong EBIT growth of 17% is driven by solid top-line trends and cost discipline. Let's now move to the next section for an update on the TIM integration. The Poste Italiane-TIM combination builds on highly complementary business capabilities and client relationships, creating an unmatched consumer platform and a national tech champion.
Our strength is one platform that brings together physical and digital channels, customer data, and AI. Our AI learns from over 4 billion clients' interactions to offer the right product and the right advice, both on digital channels and by supporting financial advisor in post offices for products where human advice matter most. The result is deeper client relationship, more cross and upselling, and higher customer lifetime value. On the enterprise and public administration side, the combination creates a true national tech champion with the scale and critical infrastructure to support Italy's digital transformation. TIM brings solid enterprise commercial capabilities and unparalleled connectivity and computing infrastructure with 1.1 million kilometer of fiber usage rights, 125 MW data center capacity, by far the largest in the country.
Combined with our own tech capabilities, this put the new group in a unique position to lead Italy's digital transformation and AI adoption while playing a strategic role in developing the country data sovereign picture. Capturing this potential requires discipline execution. That is why we've set up a highly structured integration approach with clear governance, accountability, and targets. An integration steering committee with the CEO, general manager, and CEOs of both companies set the direction. An integration office led by a fully dedicated officer run the program. Nine work streams oversee 27 sub-work streams, jointly led by Poste Italiane and TIM with 200 people involved and more than 30 on average working sessions every week. We're using AI to support this integration itself, including a live synergy dashboard tracking delivery against targets and an integration log flagging delays and dependencies among different work streams.
This approach give us speed, transparency, and execution discipline with a clear focus on delivering the synergies, a top priority across both organizations. Since closing, we have been able to work with a full set of inside-out data. You remember that our estimate was based on outside-in information before we launched the tender. Confirming at least EUR 700 million of run rate pre-tax synergies with no impact from TIM listed minorities. Delivery will be phased. Cost synergies of at least EUR 500 million will reach run rate first in 2028, but will start coming to our accounts in 2027. Followed by more than EUR 200 million of EBIT from incremental revenues from 2029 across consumers, enterprise, and public administration. Importantly, this is already moving from planning to execution.
We have translated the targets into specific initiatives with clear ownership and selected quick wins already in execution phase this year. Let me stress one key point. These synergies are fully additional to the standalone initiatives we announced with our Q2 results in July 2026. The one-off integration cost is also confirmed at EUR 700 million pre-tax, and they will be expense mainly between this and next year. Slide 13 details the actions behind our cost synergies. The combination of Poste telco and energy with TIM Consumer will lower infrastructure and commercial cost. The transaction perimeter and structure are currently under definition.
In digital technology and operation, we're moving to one IT and operation platform powered by Poste Italiane and TIM AI and hybrid cloud infrastructure with tangible savings from software and system integration efficiencies already in 2027. On real estate, we are rationalizing TIM office space by using Poste Italiane sites. We anticipate around 50 TIM locations to be potentially rationalized across 2027 and 2028. We're looking into building mobile towers on Poste Italiane sites as well. We expect significant savings from joint procurement and supplier rationalization as we map around EUR 1 billion of TIM contracts and tenders expiring in 2027. We have already renegotiated two major IT contracts generating EUR 25 million of cash savings. Marketing and communication expenses will also be streamlined, leveraging Poste Italiane nationwide visibility.
In HR, we will consolidate corporate support function while, also thanks to AI, we will redeploy people to higher value-added tasks through reskilling and upskilling across both companies. By leveraging Poste Italiane higher rating and centralizing liquidity and funding management, we have identified at least EUR 50 million of annual savings by 2030, with additional upside by 2035. On page 14, you can see what it looks like on the ground. On the left, our dedicated TIMVISION and fiber offer for Poste Italiane employees and friends and family, available since October, and TIMVISION products will appear next week on our super app. On the right, our TIM shop-in-shop in landmark post offices. Rome open on Monday. Milan, Turin, and Terni will open by year end. Let's turn on page 15 to revenue synergies, where we see over EUR 200 million of incremental EBIT opportunity.
We see significant cross-selling potential on respective client bases, and we are already moving from opportunity to execution. In consumer, we have already initiated a joint TIM Consumer and PosteMobile commercial strategy, a first step towards improving market efficiency and penetration. In October, we launched a pilot TIMVISION and fiber offering to our employees and family and friends, and we've seen a strong initial response with around 20,000 contracts signed across approximately 1,000 post offices only. TIMVISION is coming to our super app from November 19, while, as anticipated, shop-in-shop are already opening in selected locations. At the same time, Poste Italiane energy and insurance products are already successfully being distributed through the TIM network.
On enterprise and public administration, in addition to cross-selling opportunities across the two customer bases, we're building a comprehensive end-to-end offering across connectivity, cloud, AI, cybersecurity, and internet of things to lead Italy's digital transformation and data sovereignty. To accelerate execution, last month, we appointed Mirko Mischiatti as CEO of TIM Enterprise. Mirko, our former head of digital technology and operation, will lead the group enterprise and public administration strategy. I'm confident he's the right person for the job. Let's look at the Fincantieri Ontology Project that we launched on slide 16. We are particularly proud of the Fincantieri Ontology Project announced yesterday, a landmark pilot project with Fincantieri, which is Europe and the Western world's largest shipbuilder, bringing physical AI into the shipyards. TIM and Poste with Fincantieri are building an enterprise digital brain for shipbuilding.
It is an important validation of our AI and data platforms by an external company, market leader in this space, and a major step forward in our ambition to lead Italy's transformation and AI adoption. A shipyard's most valuable asset is its knowledge, the tacit expertise of its engineer, supervisors, and workers, and everything captured in its internal documents. We will turn all of this into an ontology, a shared vocabulary for the art, written in a language AI agents can understand and operate. Before anything is built, design, planning, and supply of the supply chain are all simulated, and the ship can still be redesigned while it is under construction. In the yard, AI agents operate within company rules. People approve, AI agents execute. Everything that happens in the yard then flows back into the brain, creating a continuous learning loop.
Our infrastructure decides two things: where the knowledge lives and where the inference runs, at the edge or in the cloud. This is a question of security and technological sovereignty. Fincantieri know-how is captured, protected, and put at work in Italy, including defense data with no lock-in to a single provider. In essence, by combining Fincantieri industrial know-how with the technology capabilities of TIM and Poste, we will enable AI agents to understand and act on real-world industrial knowledge. This pioneering project is a strong recognition of our technology leadership and demonstrates the potential of our platforms well beyond our traditional business. On page 17, we show you an example how we can fund the expansion of our data center capacity in a capital-efficient way. We see strong appetite from third-party investors, both equity and debt, in this space.
This allow us to develop data center capacity through dedicated SPVs outside the group consolidation perimeter, reducing the group capital commitment. Importantly, this investment also offer a stable long-term return profile that makes them well-suited to the insurance and asset management products we offer our clients. We are already putting this model into practice. Last September, the Bank of Italy approved our BPF Alternative Co-Investment Fund, which we launched with a target size of EUR 600 million, which invests on behalf of our policyholders through segregated funds. In its first pilot, direct co-investment will finance a small 20 MW of new data center capacity. Equity commitment will be shared with Noovle and TIM and third-party investor, while debt will be financed off-balance sheet for 80% of the total investment.
This creates a virtuous model. It supports the expansion of strategic data center infrastructure, preserves capital efficiency, and gives our clients access to attractive long-term investment opportunities. Thank you. And now over to Camillo for the financials.
Thank you, Matteo, and good morning to everyone. Let me start with the first view of the combined entity on a pro forma basis for the first nine months, assuming TIM consolidation from January 1st. As you can see, financial insurance still accounts for 64% of total adjusted EBIT at group level, rising to over 80% if we focus on the domestic business. TIM is consolidated in the P&L from October 1st, while the balance sheet is fully consolidated as of September 30th. The new divisional reporting with three business units will be implemented from Q1 2027, and over the coming weeks, we will provide a detailed financial database with pro forma historical figures consistent with such new divisional view. Let us move to slide 20 on mail parcel and distribution. Revenues amount to EUR 961 million in Q3 and EUR 3 billion in the nine months, up 3% and 5% respectively.
Mail revenues of EUR 461 million in Q3 and almost EUR 1.5 billion year to date are in line with our FY 2026 guidance. Parcel revenues grew by 4% to EUR 436 million in Q3 and 10% to over EUR 1.3 billion in the nine months, supported by market share gains across customer segments, repricing, and contract logistics expansion. Excluding the volumes from China, which were impacted by the recent duties applied by the EU, growth was significantly stronger at 13% in Q3 and 16% in the nine months. Distribution revenues increased by 3% in both Q3 and nine months, reflecting strong commercial trends. Adjusted EBIT at EUR 101 million year to date is progressing in line with our 2026 guidance. Let's look at pricing and volumes on slide 21. Pricing benefited from positive trends across both parcels and mail, driven by business mix and ongoing contract repricing.
Average parcel pricing rose 4% in Q3 and 1% in the nine months, while average mail pricing was up 8% and 6% respectively. Parcel volumes, excluding China, registered a solid 11% growth in the quarter and 16% in the nine months, benefiting from market share gains across the B2X customer base. In Q3, 45% of parcels were delivered through our postal network. On mail, volumes were down 9% in the nine months, in line with our expectations. Moving to financial services, gross revenues grew 3% to almost EUR 1.7 billion in Q3 and EUR 5.2 billion in the nine months. Net interest income reached EUR 690 million in Q3 and just over EUR 2 billion year to date, up 1%, benefiting from an improved rates environment.
Postal savings fees remained broadly stable, EUR 444 million in Q3 and EUR 1.3 billion in the nine months, supported by improving net flows and in line with full year guidance. Transaction banking reflects lower traditional payment slip volumes at EUR 169 million. Consumer loans fees reached EUR 58 million in Q3 and EUR 188 million in the nine months, impacted by higher rates. Asset management revenues are up on a higher assets under management and inflows to EUR 63 million in Q3 and EUR 175 million in the nine months. Adjusted EBIT reflects top-line trends at EUR 269 million in Q3 and EUR 852 million in the nine months. Moving to slide 23.
TFAs continue to grow at EUR 614 billion, up EUR 14 billion from the start of the year. Net inflows of investment products were strong at EUR 4.1 billion, or EUR 4.5 billion excluding the Cronos run-off, well above the EUR 2.3 billion of the same period last year. Postal saving net outflows continue to improve thanks to strong commercial focus. Deposit grew, driven by higher PA balances, with retail deposits stable at EUR 60 billion. Insurance services revenues were EUR 504 million in Q3, up 13%, and EUR 1.5 billion in the nine months, up 10% year-on-year, supported by both life and protection. Life net inflows were strong at EUR 1.1 billion in the quarter, driven by multi-class product sales and improving lapse rate to 5.3% from 8.3% last year.
Life revenues grew 10% to EUR 434 million in Q3 and by 9% to EUR 1.3 billion over the first nine months, reflecting a stable CSM and higher release. Protection GWP were up 2% in Q3, with retail GWP up 7%, confirming a more selective approach on collective corporate policies protecting our profitability. As a result, protection revenues were up a remarkable 34% in Q3 and 19% in the nine months, with a combined ratio reaching 80% over the nine months and expected to stay at below 83% guidance. Adjusted EBIT reached EUR 429 million in Q3, up 12%, and EUR 1.3 billion in nine months, up 7%, reflecting top-line trends. Poste Vita's group Solvency II ratio was a solid 269% at the end of September, demonstrating resilience to the sharp spread widening and higher interest rates in the quarter.
The ratio already embeds the accrual of the 100% net profit remittance to the parent company, fully compensated by internal capital generation. As of yesterday, Solvency II ratio is estimated in a range between 260% and 285%. Moving to PostePay services, revenue grew 6% in Q3 to EUR 435 million and 7% in nine months to EUR 1.3 billion. Payment revenues are up 7% at EUR 318 million in Q3 and up 6% in the nine months to EUR 959 million, supported by higher transaction value and total number of ecosystem transactions up 7% and 9% respectively in the nine months. Telco business revenues remain stable, supported by continued client acquisitions. Energy net revenues were strong both in Q3 and nine months, reaching EUR 36 million and EUR 120 million respectively, driven by an expanding customer base now standing at 1.3 million clients.
Adjusted EBIT grew 17% to EUR 164 million in Q3 and 14% to EUR 474 million in the nine months, driven by solid top-line performance and cost discipline, including the phasing of MVNO savings. Average headcount was stable at around 119,000. Value added per FTE continues to improve, up 4% to EUR 19,000, while HR cost per FTE are up 2% to EUR 48,000. Ordinary HR costs increased by 2% in nine months to almost EUR 4.3 billion, reflecting the labor agreement salary increase. Year-to-date, ordinary HR costs on revenues are down to 38%. Non-HR costs increased by EUR 300 million to EUR 3.7 billion. A EUR 153 million increase in variable COGS is related to business growth. EUR 63 million is linked to fixed costs, while EUR 84 million to D&A, reflecting high investments in our business, including the Polis project.
In general, our focus on cost and CapEx discipline across all divisions remains laser sharp, and protecting the bottom line profitability as well as cash flow remains our top priority. Let's now look at our combined net financial position. In terms of approach, we are moving from a mail parcel distribution perimeter to an industrial perimeter. This means that the net financial position now covers all our non-financial businesses. Under the new divisional reporting, these are logistics and distribution and connectivity and technology. In addition, we look at the net financial position excluding IFRS 16 leasing liabilities, as we treat leasing as an annual cash cost. The key takeaway is the strength of our underlying cash generation, with Poste businesses generating EUR 167 million before the TIM offer and other M&A activities.
The cash component of the TIM offer and the related transaction cost had an impact of circa EUR 3 billion, while the TIM consolidation adds circa EUR 7.1 billion of net financial debt. As a result, the combined net financial position ex-IFRS 16 stands at EUR 11.4 billion, leaves the group leverage below 1.5 x EBITDA after lease at the end of Q3, in line with the target given upon the transaction announcement. While the group's organic development will further reduce our leverage in the fourth quarter and beyond, we believe the current level is already comfortable. It gives us significant financial flexibility to invest in growth, both at Poste Italiane and TIM, while keeping a competitive shareholder remuneration policy. Moving to slide 31.
The share component of the TIM acquisition generated an additional EUR 7.7 billion of capital reserves, which will become distributable by the end of 2026. Starting from the EUR 3.4 billion at the end of 2025, and taking into account the profit generated and the dividends paid and announced to date, our pro forma distributable reserves stood at circa EUR 12 billion as of September 30th. This is a solid base, giving us ample flexibility to deliver attractive and growing shareholder returns over time while we invest in the business. Thank you. I will now hand over to Matteo Del Fante for some closing remarks.
Thank you, Camillo. To conclude, the positive momentum we have built throughout the year continued into the third quarter. We delivered record nine months results across all metrics and confirm our upgraded full-year 2026 standalone guidance. A growing dividend remains central to our strategy. On the 15th of November, we will pay an interim dividend of EUR 0.43 per share, up 7.5% on last year. In absolute terms, this amount to EUR 686 million, up 32% year- on- year, reflecting the higher share count following the TIM acquisition. We reaffirm our clear commitment to a compelling and growing dividend policy going forward. Through the combination of TIM and Poste Italiane, we're creating an unmatched AI-powered platform. It brings together complementary assets and extensive digital customer reach and an unparalleled technology infrastructure.
We have set up a disciplined approach to this integration, with around 200 people working across nine joint work streams, led by a dedicated team. At least EUR 700 million of run rate synergies, we confirm, with no impact from TIM listed minorities. We have a clear roadmap with quick wins on both cost efficiencies and incremental revenues. Management, I can assure you, is fully focused on delivering the integration and on preparation of the combined entity business plan, which we will present in Q1 next year. Together, TIM and Poste Italiane have the scale, reach, and technology to lead Italy's digital transformation while strengthening the country's technological independence. We're Italy's connecting platform, creating value for our clients, our people, our country, and as we've done in the last 10 years, our shareholders. Thank you now. Very happy to answer your question. Over to you, Giuseppe.
Thank you, Matteo. We start our Q&A session now. Just a reminder, if you want to ask a question, please press star one, and to remove yourself from the question queue, please press star and two. We start from a question we have from the webcast platform before moving to the questions by phone. The question is from Marco Nicolai at Jefferies, and he is asking us, "Can you update us on the future of the Telecom Italia minorities?"
Yeah, thank you for the question. We stated several times, both the CFO and myself, in the presentation that there will be no impact of the minorities on our merger integration. You can see on page 12 the timeline of the cost and revenues synergies. It is clear to everybody that the value of the integration is very significant for the future of the company. So, we are totally focused on the integration. The board and myself have a term that expires in May 2029, and we will solve the problem of the minorities before the end of the term. But it is clearly not going to be in our agenda in the foreseeable months. You can see the dates.
We have to work, 2027, we start seeing some color in the yellow and in the blue, but we need to make that color as dark as possible, so we need to work into 2028, and that is really today our focus. Thank you.
Okay. Next question is from Alberto Villa of Intermonte. Hi, Alberto.
Okay. Thanks for taking my questions. I have three quick ones. One is an update on the network refocus that you presented, and if you can give us an update on how it is rolling out and what are your expectations now that you are implementing the project. The second one is on the monetization of the SPID. If you can give us an update here on what has been the churn of clients and the effective monetization that you are observing on the SPID payments. Finally, if you can give us some more details on the distributable reserves impact of the TIM acquisition, just to have some more details on how it works and what is really the effect for Poste. Thank you very much.
Okay. I assume that when you say network reorganization, you are referring to the retail network of the branches, which is a very strategic, a very important project for Poste, and I will let the CFO answer on this. Camillo, you can also take SPID and the third question on the reserve. Just let me remind everybody that we have, in parallel, an extremely important reorganization of our logistic network at the same time, which is a separate topic, obviously.
Yes. I will start with the network, and I will say that consistent with what we have also announced in the second quarter, that work is progressing well and that we are obviously pleased with the progress because we see the immediate benefits of it in terms of improved net flows in the business that have almost doubled compared to last year. We are at EUR 4.5 billion net inflows in the first nine months, if you exclude the impact of Cronos, which is, for everyone to know, Cronos is Eurovita, which had a negative impact of circa EUR 400 million on the outflows. But we are seeing double net inflows compared to last year. So that is working, and more to come in that regard with respect to the new plan.
The other thing I will point out is that maybe you have seen that we had a material better performance also on the postal savings, as the commercial effort has translated in materially lower outflows compared to what we had last year by the tune of EUR 2 billion +. So on both accounts, I think we are going in the right direction. We have to move to come in with the full year results. With respect to SPID, I think that here we are in a ramp-up phase, as it takes time to sort of put our entire customer base in the new, let me say, paying environment.
But we are going here too in the direction we have planned, and I think that for certainly 2027, we are looking at a number between EUR 17 million-EUR 18 million , and that is going to become a recurring number over time because the agreement for maybe some of you on the phone might be also a customer of ours, is EUR 5 a year plus VAT, which is obviously around EUR 6 on a yearly basis, which is EUR 0.50 per month. So that is something that we plan to have as an ongoing contribution to our P&L. With regards to the last question on distributable reserves, I think we wanted to make this point beyond the obvious accounting impact as we look at the combined business plan, and I also said it in my part of the speech on a CapEx distributed both at TIM and at Poste.
We need still to finalize allocation, see how the funds flows, but I think that the point of this slide is to provide evidence to our enlarged shareholder base that we have sufficient reserves to distribute dividend at the holding level, at Poste Italiane SpA, or the industrial Poste for the foreseeable future, irrespective of any internal dividend policy we are still looking at.
Thank you. Thank you for the answers.
Thank you. Next question is from Tommaso Nieddu at Kepler. Go ahead, Tommaso.
Hello, and thank you a lot for taking my questions. I have a few. The first one is on the commercial synergies. You mentioned around 20,000 TIMVISION and fiber contracts already signed for around 1,000 post office in the initial pilot. Could you give us some context on how you assess this performance relative to your expectations? Very, very curious on this. Did the response surprise you? The second question is on the combination of PosteMobile and TIM Consumer. You mentioned that the transaction perimeter and the legal structure are still being defined. I do not know if you can, but could you elaborate on the alternatives you are considering? I would say, in particular, should we expect the PosteMobile business to be transferred into TIM, or could some activities remain directly within Poste? The very last one is on NII.
We have seen another sequential improvement, and you often explained that you manage the portfolio on a total return basis. So, also given the increase in interest rates, should you expect the higher recurring income to be sustainable into 2027, or should be offset by some lower capital gains or losses? Specifically, if you have taken any actions to crystallize losses and reinvest at higher yields, perhaps already in Q4. Thank you.
Thank you, Tommaso. I will take the first two questions and then let Camillo answer on NII. The first pilot project for employees and family and friends on TIMVISION and broadband, not only TIMVISION, has shown us that our intuition of the power of our network and our distribution capability is actually correct. We will keep working in, as one of the work stream in our integration exercise on optimizing the network, on optimizing user experience across products. So, we think it is a good initial sign of heading in the right direction. On PosteMobile, I think it is probably easier, yes, we are defining the structure, but it is relatively clear-cut already at this point that PosteMobile will migrate into TIM, into TIM Consumer specifically. So, TIM Consumer will have the natural leadership for mobile and broadband in the group.
The rest of the work we are performing is more related to the energy business that most likely will also follow the PosteMobile direction. Please, Camillo.
Yes. So, with regards to the last question, I will be a bit more extended in the answer. At the beginning of the year, we had provided a guidance of around EUR 2.7 billion total portfolio return for 2026. That was in line with the year before 2025, but we had expected at the time a different mix with 100 million, 200 million of capital gains that has been done by NII. As the year progressed and rates went up, we increased that number to EUR 2.8 billion, maintaining the same level of capital gain that we had identified, around 150 million.
Now, as we look at the end of the year, we reconfirm the number, but as we see continuous strength in NII, we might, as you say, Tommaso, use some of those gains to solidify our NII for the other years, 2027 and beyond, and we are already taking some actions in that regard, and we might do more by the end of the year. I would also say, as an interesting data point, that in the first nine months of the year, we had around EUR 4.9 billion, EUR 5 billion, let us call it EUR 5 billion of BTPs, which we either sold or expired, which had an average yield of 3.36%, and we substituted that EUR 5 billion with purchase of EUR 8.6 billion, so EUR 3.6 billion more at a rate which is closer to 3.8% versus the 3.4%. So we had a 40 basis points pickup on that portion.
Thank you.
Okay. The next question is from Manuela Meroni, Banca IMI. [Non-English content]
Good morning. Thank you for taking my questions. I have three. The first one is on retail deposit that has remained pretty stable. I am wondering if you are seeing increasing competition for deposits from both in retail and corporate, or you expect some competitive pressure going ahead. This is what we are seeing at some European financials. The second question is on your financial and insurance activities. These activities now account for more than 80% of EBITDA. Would you consider further diversifying your financial services business through investments in the asset management area should attractive opportunity arise? The third question is on your logistic organization, if you can provide some update on that. Thank you.
Okay. Thank you, Manuela. I will answer in reverse order, taking the first two questions, letting Camillo answer on retail deposit and competitive pressure. On logistic, as I anticipated answering Alberto Villa before, we are also undergoing a very profound restructuring that started in 2024 when we basically created an internal line of express couriers for delivering parcel under the labor contract of Poste. Today, most of you remember us launching in 2016 and 2017 the famous Joint Delivery Model where the letterman was delivering parcel when he was going home delivering a letter.
We grew that model, and we obviously still deploy the Joint Delivery Model, but we created next to it a new line that works on Saturday, that has different time hours, that has extended the weekly hours, and that is basically the future of the company delivering, let's say, 10, 15 years down the road, only parcel and whatever is left of mail. That is ongoing, and it is working okay, but obviously is something that we will give you a sense with the plan. The results today are good because we have 45% of all parcel delivered by Poste employees, so we will breach probably next year the 50%, which is an important milestone for us.
The saturation levels are increasing on the courier line, which is clearly very important to make this transition efficient from a bottom line standpoint. The second is answer on financial services and asset management space. Absolutely not. It is not in our cards to expand our role in that direction, and I think I know what you are implying is, no. Not even thought and not even— open any kind of consideration or fry. Please, Camillo.
With regards to your first question, we are, as mentioned in the presentation, at around EUR 60 billion of retail deposits, which is a result that it also includes what I previously described as strong performance both on the investment side with more than EUR 4 billion going to insurance and mutual funds, and an improvement of EUR 3 billion on the postal bonds and booklets. We are also having kept deposits stable with that commercial performance is something we are satisfied with at this stage. Obviously, we want to do more, we can do more, and we think that the combination of the new network, which we talked about previously, but also the combination of PostePay with BancoPosta and the new commercial effort which will follow that combination will lead to superior performance.
We also had to add additional color, some high thresholds to overcome because, as an example, in Q3 2025, we did have the 100-year anniversary postal bond, which was particularly attractive as a product, which we did not have something similar this year. But despite that, we did have obviously a positive performance.
Okay.
Thank you.
Now we have Daniel Wilson-Omordia from Morgan Stanley. Go ahead, Daniel, please.
Hi, guys. Hope you can hear me. Thank you for taking my questions. I have a few. Firstly, on the Fincantieri strategic partnership, can you guys walk through how the fee structure there works? Any more information on how you guys benefit, what's the exact structure around that? I totally get the rationale and how it's an example of hopefully what's more to come, but would be good to understand the financials around it. Secondly, on TIM Brazil, understand that obviously you've got the capital markets day coming up next year, but if you could share perhaps what you're thinking about TIM Brazil as of now. I know there was some press recently around how you're thinking about using it tactically over the next few months, so if you could expand on maybe what that means, that would be great.
Lastly, just noticing on the payments side, your e-commerce transaction values growth has slowed down, I think, over the last nine months or so. How do you see the health of that market in general? Italy's e-commerce penetration is still, I think, well below the EU average, and so just wondering if this would be a temporary slowdown or you continue to expect to see this as a structural growth driver for you. Yeah, just generally how you're thinking about that would be good. Thank you.
No, thank you, Daniel, for your questions. On the Fincantieri fee structure, I mean, it's something that is under discussion, and we are not disclosing any figure at this point in time. TIM Brazil is producing bottom line, it's producing meaningful cash, it's performing very well. It has been a strategic asset for TIM, and it remains an asset that we care a lot about and that we will keep in the group. Should any opportunity be presented to us, we will consider it. On payments, please, Camillo.
Yes. So we do feel we had a respectable quarter also in Q3. I think you're referring to slide 53 of the appendix. E-commerce transactions are growing at 8%. I think we'd like to have a lot of business that grow at 8%. So, we expect that level to continue. We are seeing no weakness in that business at this point, and linking it also to what I was referring to Manuela, with the combined BancoPosta and PostePay, we are optimistic that this level of growth will continue also in the medium term.
Thank you.
Okay, thank you, Daniel. Now we have Andrea Lisi from Equita. [Non-English content]
Hi, thank you for taking my questions. The first one is on the impact, if you can provide any detail, that you expect from the measures currently envisaged by the budget law. We know that the definitive version has still to come, but as regards the current version, if you have any idea how the impact that could emerge, and in particular with regard to the postponement of the full usage of the Ecobonus. The other question I have is if you can provide us an update on the new financial hub, especially after what you have read regarding the approval of the decree allowing BancoPosta to acquire stakes in insurance companies. And again, on the pilot project with Fincantieri on AI, what should we expect now going on? Is it possible that this can be also used as a path for similar agreements with other companies?
Are you looking at something like that? Any color on this could be helpful. Thank you.
Thank you, Andrea. I will go reverse, taking the first and the second and leaving to Camillo the first question on the budget law. Certainly, yes, the Fincantieri Ontology Project is a pilot project. We have a second company that we already started working a few months ago, which is not that advanced, but it is on the same roadmap. We started with a very complex pilot because it is hard to think of a more physical and complex production factory than the shipyard like the one managed by Fincantieri, the biggest in the world. I think the largest one they have is more than 1 million square meters in size, just to give a feel of the sheer size. There is no automation. There is little automation at the moment in terms of processes. There is already robotic activity, but there is no automation in processes.
We started with a complex one in a way that we are showing the way, we are testing together the resilience and the efficiency of our solutions. We do this to give to TIM and Poste Italiane clients a solution for every single company interested. Polo Finanziario is, there are few elements to this from a strategic standpoint. There is certainly a bottom line upside. We indicated EUR 20 million from phase I, which was the merger of PostePay into BancoPosta, and around EUR 100 million on phase II, which is the one which has been enabled by, that will be enabled by the new legal framework. Certainly element one, bottom line. Element two is client centricity.
To give in terms of financial products, ownership in one single place will make us much more client-centric and able to give to our clients whichever best product through whichever best channel, physical and digital, or mix, being agnostic about the product itself within the financial perimeter. The third element is simplification. Clearly, the TIM acquisition makes a small extra layer of complexity in our equity story, so we want for our investors to have an easier picture within the financial space. These are the three drivers.
With regards to the answer to your first question, we have been looking in detail at the budget law, obviously, and the greatest impact on our P&L going forward is going to be the increase of 3% points of the IRAP, which we think that in 2027 and 2028 might have an impact of around EUR 40 million each year. With regards instead to your question on deductibility of tax credit, the portion which is impacted by the proposed change is limited, and we think that the cost of that change should be in the neighborhood of Circa EUR 10 million.
Very clear. Thank you.
Thank you, Andrea. We have now a question from Bingdi Fan from JP Morgan. Bingd i, please go ahead.
Hi. Thank you. Hope you can hear me. Just got two questions from me. The first one is on the broad AI topic. There has been a lot of discussions around AI and its potential impact on the industry. How do you see AI affecting your business? For example, customers can now use AI platforms to compare deposit rates more easily, and given Poste's history of having a zero deposit beta, is this something that you are concerned about, or do you just see limited risks in practice? The second question is that on CSM roll forward. Operating variances turned positive in 3Q 2026 standalone and compared with negative variances in 2Q. Could you please explain the key drivers behind that? Was this mainly due to improved net experiences, or were there any other factors also involved? Thank you.
Thank you, Bingd i. Thank you for your question. AI in the firm, we started the journey many years ago, and we can give you many examples, but I think you're referring to AI out with clients. We have 27 million daily interaction with clients. We analyze more than 4 billion data interaction points per year. We do extensive use of AI, and our interface with clients, our super app, is the most used platform. We will play that AI angle on the attack. I don't see in financial products, which are sensitive products. Maybe you can get it into utilities, but when it comes to putting your saving, putting your money somewhere, people tend to be more conservative and want to know where the money is in any case. I don't see it much of a threat.
And actually, we try to use the tool on the offense. On the second point, Camillo, you want to do it, or Giuseppe?
Yeah. No, I think that Bing di already answered it. Part of the answer is mainly driven by the difference in expected lapse rate.
Okay. Okay. Next question is from Michael Huttner at Berenberg. Please go ahead, Michael.
Fantastic. Thank you so much, and fascinating listening to all your projects. Amazing. CSM release rate, 11.3%, so nice rise. Is there more to come in terms of releasing faster due to the shift in business? Also on insurance, you highlighted the slower growth of protection premiums in group, not individual. Is this due to losses or bad experience or something? It just sounds weird because in the past, it was business you were super enthusiastic about, so I just wondered what the change is. And the other question is the EUR 11.4 billion, I think, net financial position, the 1.5x Or less than 1.5x Multiple to EBITDA. What kind of flexibility do you have here? I know in the past, you've had lots of investments in various projects. You bought businesses. You've invested presumably in logistics and all sorts of stuff.
Presumably now you have a bigger stuff you can invest in. It would be nice to know how big that potential flexibility could be. The last one is a really silly question. I did not hear the answers. It is not a real question. Supporting the EUR 11.4 billion, you mentioned a cash figure, which was very strong, but I was not paying attention. I am sorry. Thank you.
Yes. Okay. I will let Camillo answer on the first one on CSM and the net financial position and flexibility going forward, Michael. Just to understand better what you mean, we might have more needs going forward. We have done a lot. We have extended the perimeter with strategic transaction and after, so we do not anticipate extraordinary transactions going forward. Now we need to, as I said, we need to be focused on extracting the synergies and optimizing the platform. The third question is if there is a cash component of the EUR 11.4 net debt.
Yeah.
Please, Camillo.
With regards to the CSM, yes, we are pleased with the organic performance to date. With regards to what would happen in 2027 and beyond, we obviously will have to run the numbers at the end of the year and see where we are, and on that, we will update you in the capital market day. We certainly expect to continue to have a positive continued contribution to the CSM by the new business, as we expect the business to continue to perform positively. With regards to the protection business, you had a question on that too. Protection business comprises, let us say, two macro categories, retail and corporate. The retail business is a business which is more easily manageable also from a forecasting standpoint, and the corporate business is very competitive and subject to tenders.
So what we have done is that we have tried to become more selective when it comes to corporate business in order to protect the profitability of our business, which is in fact an increased combined ratio, which is going to remain below 83%. Going forward, we also expect the business to continue to grow. This is also a result of commercial decisions in the last quarter or so. Instead, with regards to your question on the net debt to EBITDA, we are at below 1.5x , which is what we had planned for, and rating agencies have confirmed the rating standalone of Poste Italiane. So we do have some financial flexibility there, but I think as the CEO was quite clear in expressing, I think we are not planning anything sort of major.
I think that what we want to say on this call, and we said it a couple of times also previously, is that we need to sit down with the management of Telecom Italia, as we are doing, and figure out what is the appropriate level of CapEx for the business for the next three years. So the message here is to say that we have flexibility to manage those together with paying a dividend, which puts me to the last point, which is of distributable reserves. As the dividend is paid at Poste Italiane SpA, we did want to make the point that we have, irrespective of any decision with regards to CapEx and dividend, we do have enough reserves to get us going for the long term, as we have EUR 12 billion of distributable reserves at the holding level.
Perfect. Thank you so much.
There are no further questions. Thank you all very much for joining us today.