Ladies and gentlemen, welcome to the Q3 2024 results conference call. I am Sarjan, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Harald Hagenauer, Head of IR. Please go ahead.
Good afternoon, ladies and gentlemen. Welcome to this conference call of Austrian Post, where we would like to present Q3 and nine-month figures. So I directly would like to hand over to Walter Oblin for the first time in his new position as CEO of Austrian Post. So please, Walter Oblin.
Good afternoon, ladies and gentlemen. It's a pleasure to have the opportunity to present to you our quarterly results. For the first time, as Harald mentioned, in a new management configuration, the supervisory board of Austrian Post over the last months has made decisions on the new management board of Austrian Post after Georg Pölzl retired after 15 years of serving as CEO. He retired at the end of September, and the board last December already appointed myself as his successor to him in his role as CEO. And in August, made the decision to appoint Barbara Potisk-Eibensteiner as new CFO within Austrian Post. Barbara has 12 years of CFO experience in large industrial, partly listed companies in Austria. We are very happy to welcome her. As of January 1st, until January 1st, I will serve both as CEO and CFO.
Peter Ummundum, who has been part of the management board of Austrian Post, was appointed Deputy CEO. He will continue to head the parcel and logistics business of Austrian Post. Moving to page three, I think we are well positioned, strategically well positioned in a challenging market environment. As a summary upfront, I can present to you good Q3 figures, good overall year-to-date figures for the financial year 2024. Our business portfolio consists of a structurally shrinking, however still strong and profitable mail business with last year around EUR 1.2 billion revenues. Parcel and logistics, our second segment, is the growth engine of Austrian Post, last year's revenues of EUR 1.4 billion. Retail bank, this is our third segment, comprising both our branch network as well as our bank 99, a focused retail bank that was founded four and a half years ago.
We also, in the meantime, are a strong international group that operates in 13 countries. In 11 out of those 13 countries, we operate own delivery networks, and with those delivery networks, we are able to reach 150 million citizens, so I think we really have relevance and a strong international presence in a region where we are among the leading logistics operators in the e-commerce segment. The environment continues to be challenging. Moving to page five, in Austria and in most countries of the Eurozone, we are still in a stagnating or recessionary GDP situation. Inflation, fortunately, is coming down, but we only now experience the factor cost increases as a result of past inflation. Our most important customer industry, the retail industry, is undergoing a major change, is a fundamental transformation.
In Austria, we see a strong consolidation in the stationary retail segment with insolvencies, exits, shrinking business models. Online e-commerce, online retailing e-commerce continues to grow. However, it's the large international platforms that continue to gain market share. And we're talking on the one hand about one very strongly established player from the U.S., but increasingly also Chinese online retailers that are aggressively expanding into Europe. In Turkey, we continue to face, again, a challenging market environment characterized by high, however shrinking inflation and a foreign exchange rate development that does not develop in a linear correlation with inflation, as a result of which, combined with hyperinflation accounting, we experience a strong volatility in the translation of Turkish revenues and earnings into Europe. Given this challenging environment, I think we are pleased to report, I think, very strong figures, both on revenues as well as on earnings levels.
Starting with the revenue overview, over the first nine months, revenues grew by 13.6%, so really strong double-digit growth. The good news is all three segments have shown revenue growth. Even our structurally shrinking mail business grew by 5.1%, supported by price increases and a strong election year in Austria. Our parcel and logistics segment has shown strong double-digit growth at 19.1%. Part of that is Turkish inflation, but even outside Turkey, a strong double-digit growth of 14.2%, and our smallest segment, retail and bank, is showing the strongest growth at 23.1%. Here, it's a combination of organic growth within bank99, supported by a favorable interest rate environment. Moving to group earnings, we were able to translate strong revenue growth into EBIT growth despite strong factor cost increases.
Overall, group earnings after nine months at EUR 144.7 million, a growth of 10.7%, with mail growing from a strong profitability level, supported, as mentioned, by elections. Parcel and logistics growing also from a good profitability by EUR 4 million. The operational EBIT increase would be even higher as we had to book an additional provision of approximately EUR 10 million for a put option in our cargo business, the put option of our 20% minority shareholder. Given the good earnings development in Turkey, the company is more valuable. And as a result of that, this put option provision had to be increased by around 10%. So the operational growth in parcel and logistics was higher than the EUR 4 million shown here. Overall, EUR 144.7 million. I think the Q3 standalone column shown on page eight matches overall the development of the last nine months, apart from parcel Turkey.
I think here we have to explain the impact from hyperinflation accounting combined with a strong inflation, strong also somewhat volatile inflation, and in particular, a currency which for part of the year has been quite stable and over the last three months has depreciated by roughly 10%. Given that hyperinflation accounting always translates all the revenues of the full year at the final exchange rate of the last quarter, we basically revalue the already reported first six months at the final exchange rate. And before that, we inflate the historic figures by the relevant inflation since then. This results in a strong volatility in revenue growth. You see here Q1 2024 plus 41.4%, Q2 2024 by a growth of 135%. This is always the Euro growth figure. And in Q3, even a negative growth.
The underlying business is stable in volumes, and we have good price realization and a good profitability, so the underlying business is stable, but this chart tries to explain the volatility that is a result of the hyperinflation accounting state. With that introduction, let me now go through the three business segments, starting with the mail division. Again, structurally declining, but relatively stable over the last year in revenues. This year, as mentioned, a slight or a substantial revenue increase by 5%. The underlying trend, page 11, is a volume decline of around 6% over the last years. This is also what we've seen over the first three quarters. As an average, with Q1 and Q2, a little bit higher in the order of magnitude of 7, and Q3 with some extra volumes from elections at minus 3%. We do expect this volume decline to continue.
At the same time, we, I think, have shown a good track record in exploiting opportunities. Elections are a substantial opportunity for Austrian Post, given that mail voting has grown substantially as a share of total votes cast. You see here that we, on page 12, that we have had three countrywide elections, Chamber of Labor elections in spring in the first quarter, EU elections, European Parliament in June, and most recently, end of September, national parliamentary elections. In each of those elections, the number of postal votes versus the last election was increased substantially. This is both the result of a general trend towards more mail voting, but I think also with a very strong service that we offer around elections and strong communication activities. I think we had also some contribution to this good growth.
We were able to deliver all those mail votes in time, and as a result, have seen a good financial contribution to our group results. Moving to page 13, even after the substantial tariff adjustment from last year, we raised rates in September last year, so now more than a year ago. Our tariffs are in the lower third compared to other European countries. So we continue to offer good quality at moderate mail tariffs. This is also our strategy. We think that is also a contribution from our side to a, in the past, relatively moderate mail volume decline in Austria. And the other element of our strategy is to move more and more volume in slower products or products that have a longer lead time to deliver.
More than 80% of the mail volume of the addressed mail volume is now in the economy product, which means that we have three days to deliver this mail. Moving to our direct mail business, here, a similar structural trend downwards at a rate of around 5% over the last years. Last year, even more pronounced given the crisis in the stationary retail industry, which, as mentioned, we've seen a number of insolvencies and exits from the stationary retail industry. We continue to have strong products in this market. Our unaddressed mail product is the print advertising product with the highest customer reach, with a strong distance to number two. This continues to be used quite frequently by, in particular, the food retailers. But, of course, this downward trend will continue in the future.
Given all these trends, I think a good result for the mail division on page 15 with EUR 911 million, our mail business continues to be a quite large business in Austria at a good profitability, EUR 115.2 million EBIT. Of course, there is support from those three elections. Let me now move to our parcel and logistics division. You see on page 16 that we have experienced very good growth over the last three years. This growth continues throughout 2024. Moving to page 17, this quarter plus 13%, which roughly matches the double-digit growth that we've seen in the first six months. So overall, very good volume growth fueled by strong growth of the large e-commerce customers in Austria, quite aggressive market entry from Chinese e-commerce platforms, and then underlying good online market growth.
Moving to Eastern Europe, next page here again, good volume growth at 19% over the last three quarters. Here again, strong inflow of Chinese volumes, which we, I think, have been able to capture a large share out of these volumes, so we see good growth in this region. In Turkey, a little bit different picture. Here we see a very good profitability at a more stable market development, volumes down 2% over the last nine months. This is the result from increased insourcing from the large e-commerce platforms that also operate their own delivery networks in urban areas. Over the last weeks, we have seen again some growth or some decline in the negative trend here, and we do hope to come back to a growth trajectory over the next months, but very good price realization and very strong profitability contribution from Aras K argo to the group.
Page 20 shows you our parcel and logistics P&L, EUR 1.2 billion revenues already after three quarters, 19.1% growth, and an EBIT of EUR 64.7 million included here an additional provision to a liability with regard to the put option for the remaining 20% of Aras Kargo in the amount of EUR 9.6 million. Moving to our third segment, retail and bank. Again, here on a, however, smaller level, good absolute revenue growth, EUR 146 million after EUR 118.6 million last year. Most of this coming from financial services. This is basically bank 99. Bank 99 has shown good growth in basically all dimensions, above market growth in number of customers, balance sheet size, credit volume, deposit volumes. So we see bank 99 on a good trajectory. We think the postal ecosystem serves well as a platform for a focused retail bank.
We reiterate our target of breaking even with bank99 over the course of next year. Page 23, in our Austrian branch network, the expansion of self-service is a very strong current focus. We came into the year with around 575 self-service stations, so postal lockers, however you want to call it. We are now at 1,217, so we more than doubled the number of postal stations over the last nine months. We do expect for end of year a number of order of magnitude around 1,500 postal stations. So very strong expansion of our self-service network. This is well accepted by consumers. Last year, more than 27 million parcels either collected or deposited, shipped via self-service. We are ready for an even larger share of parcels distributed direct to lockers.
Profitability-wise, the costs of the migration of the core banking system of the acquired part of bank99 still weigh on our results. However, we have seen the first positive months for bank99 over the last quarter. And for the full year, we do expect a profitability for the bank in the mid-single-digit figures. Group P&L on page 25, I think most of the key facts I have already explained. Good revenue growth, good development on EBITDA and EBIT, also translating into a good increase of the profit for the period of 16.9%. And also on an unexpected level, I think EUR 1.48 after nine months is a good figure. We continue to operate a solid balance sheet. Page 26, not much change over the last three months. Some expansion coming from the expansion of the bank balance sheet.
I think in many aspects, still a conservative balance sheet with low leverage and a strong equity position. Good cash flow generation at an operating free cash flow of EUR 209.3 million. There is some positive tax effect from previous periods here included. We continue to invest substantially in CapEx, roughly EUR 90 million over the first nine months. The green transformation to e-mobility in Austria is a substantial element, a substantial share of this EUR 90 million at EUR 35.6 million. For the full year, page 28, we expect a CapEx level of around EUR 140-160 million. Three core priorities of our CapEx program: growth in Austria and Eastern Europe and Turkey, technology and automation, and the green transformation, so the decarbonization of our CO2 footprint, in particular of our fleet. Page 29 shows you some of the progress in our green transformation.
By the end of the year, we'll have around 5,000 vehicles in our Austrian fleet without CO2 emissions. We converted our whole truck fleet in Austria to hydrotreated vegetable oil as fuel. We are starting to build up an electric fleet in Türkiye, and we have the first two electric-powered trucks in use in Austria. Let me close with our outlook for the full year and the first glimpse into 2025. I think we do expect the basic market environment to continue pretty much as it is. Few positive impulses from the macroeconomic environment. It will be the two big megatrends that shape our business that will dominate the environment. On the one hand, the structural decline of mail through electronic substitution, and the other big megatrend being e-commerce driving parcel volumes. For the full year, we do expect revenues of around EUR 3 billion.
The exact amount, of course, depending on the strong pre-Christmas business over the next weeks, but of course, also depending on the development of Turkish lira, but we are quite confident to reach EUR 3 billion. And on an earnings level, our guidance is that we'll see an EBIT improvement of at least 5% compared to last year, corresponding to an EBIT of slightly over EUR 200 million. Also, a first look into 2025, we think we can continue to deliver on our promise of being a stable, defensive business model. So our forecast for 2025, our first glimpse, also targets revenues of over EUR 3 billion for next year and targets an earnings level of around EUR 200 million EBIT again. So confident look into the full year and first confident look also into next year. Thanks for your attention, and I'm now happy to take questions.
Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to disable the loudspeaker mode while asking a question. Anyone who has a question may press star and one at this time. And the first question comes from the line of Amy Li from UBS. Please go ahead.
Hi, good afternoon. Thank you for taking my question. Just a quick one, maybe on your FY25 revenue and EBIT that you said would be broadly in line with 2024.
I appreciate that it's still early days, but wondering if maybe you can give some colors to how you're thinking about the different building blocks to get to that number. I understand that we might have less support from FX, and we might see a year-on-year increase in staff costs, but on the other hand, you're seeing very strong underlying performance in parcels. So just curious how you're thinking about the balance between those different factors.
Yeah, thank you very much for your question. I think you've given much of the answer already yourself to your question. If we go through the three different segments on mail, we will not have the roughly EUR 30+ million in election revenues that we've had from three elections. Second, we will see more clearly the volume decline.
Given that inflation is also coming down, it will not be the price effects that we've seen over the last years, so we are talking about inflation in Austria now coming down to around 2%, so this, from a regulatory point, will limit also our ability to increase prices going forward, so you will see less inflation also in revenues. I think we probably all understand that part of the growth that we've known over the last two years has been driven by inflation, so that is on the mail side. Second, it's possible. I think we're quite confident that we'll see a good market growth across the regions, which will be somewhere in the mid-single digit figures.
In Austria, the double-digit volume growth that we've seen also consists of market share gains of new Chinese volumes that next year, if you compare to the previous year, we'll already see a growth potentially, but not this growth from zero to quite substantial volumes, but we are confident that we can continue to grow on the parcel side. There will be some price element also on the parcel side, and then also in the bank, the growth will definitely come down. In our group P&L, we are reporting gross interest income, so when interest rates come down, this gross interest income will also be burdened by that. Yeah, so that is an explanation why overall we have to expect rather little growth next year. I think we're confident that we'll see some growth, but a rather small figure compared to this year.
Of course, there is the uncertainty of how the Turkish lira will develop. We have to expect that at some point in time, we'll see some stronger adjustment to purchasing power parities and that at some point in time, we'll see some depreciation of the Turkish lira. So I think that is the explanation on the revenue side. And I think on the EBIT side, yeah, we have a plan on how to compensate some of the factor increases that you were right to mention. Staff costs will increase. We have had a 6.45% increase effective more or less January 1st, part of the second half of this year with a one-time payment. But as I mentioned, overall inflation is coming down, which should also provide some relief with regard to the increase of other costs than staff costs.
So overall, as you rightly said, this is not a precise guidance, but more a clear signal. We are confident that revenue-wise, we can reach the same order of magnitude as we've seen this year. And that EBIT-wise, we are confident to be able to reach a similar order of magnitude of earnings.
Thank you very much.
The next question comes from the line of Marco Limite from Barclays. Please go ahead.
Hi, good afternoon. Thanks for taking my question. So I've got a first question on parcel volume growth in Austria, which remains very strong. Can you remind us how much the Asian retailers represent as a percentage of total volumes and how different has been the growth between domestic volumes and international volumes in Q3? And then the second question may be when we think again about the 2025 outlook.
In retail and bank, shall we still expect the EUR 2-3 million integration costs we're seeing in 2024, or 2025 will be, let's say, yeah, will be a clean year? And yeah, maybe the third question very quickly. I mean, you have mentioned about EUR 30 million of revenues from elections. I mean, in 2025, we should expect EUR 0 million, so 30 going to 0. And what is the EBIT attached to the EUR 30 million of revenues? Rough numbers. Thank you very much.
Yeah, Marco, thanks for your questions. I think on the Asian volume, we are talking about a good third of the growth that comes from Asian customers. In absolute terms, it's still a mid-single percentage share of total volumes. Question one. Question two, integration costs, retail and bank.
I think this year we're talking about yeah, somewhat higher single-digit figure that for the full year will be included in our P&L. And for next year, I would say a small single-digit figure depending on when we will be able to finally close this migration. The expectation is somewhere around end of Q1, beginning of Q2. So I think that's order of magnitude. And third, yeah, I would say the 30, it's probably €30-plus million from elections to a large share will be gone. We have two bigger regional elections next year. So I would expect a small single-digit figure in terms of revenues. Please bear with me that we are not providing detailed contribution margins on elections, but it is a business with good margin contributions. Yeah.
Okay. Thank you very much.
As a reminder, if you wish to register for a question, please press star and one on your telephone. There are no more questions at this time. I would now like to turn the conference back over to Harald Hagenauer for any closing remarks.
So thank you, ladies and gentlemen, for participating in this call. If you do have some more questions today or the next days, don't hesitate to call us. We are there to answer all of them. Thanks and bye-bye.
Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call and thank you for participating in the conference. You may now disconnect your lines. Goodbye.