Well, good morning, everyone. Welcome to Royal Mail's half year results presentation. Most of you will recognize my voice. I'm John Crosse, Director of Investor Relations. Just before we start, I wanted to draw your attention to the usual disclaimer in our release this morning on forward-looking statements. This sets out examples of the factors that can cause actual results to differ from any forward-looking statements that we may make. A summary of the principal risks and uncertainties which could affect the group were set out in today's release, and these will be updated in the annual report next year. All of these risks and uncertainties have the potential to impact the group's business, results of operations, financial condition, and prospects adversely. Without further ado, I'll hand over to our Chairman, Keith Williams. Keith, over to you. Good morning from me, and thanks for joining us this morning. These results can be summed up, if you excuse the pun, as starting to deliver. Over the last two years, the board has taken steps to tackle a number of issues. First, the appointment of a new management team and new structure. This has provided more visibility on the strategy and the performance of both Royal Mail and GLS. Second, we're starting to deliver the transition into a business which delivers more of what our customers want today, more parcels, more often. Around 70% of our total business is now parcels. Thirdly, we're demonstrating the ability of both businesses to be self-sufficient financially, particularly against the backdrop of economic uncertainty during the COVID pandemic. First, let's look at the progress being made. At GLS is already a distinctive and proven business model in parcels, which places it in a great position for future growth, both organically and inorganically in markets who are expected to grow double digit over the next decade annually. It's already starting to see a recovery in its core business of B2B post the pandemic, as well as continuing growth in B2C. There are also signs of progress in previously underperforming key markets such as France and the U.S. As you know, the board has been supportive of GLS's plan to grow internationally and to leverage opportunities in digital and technology under its Accelerate GLS strategy. This is now underway with the proposed acquisition of Rosenau in Canada. Looking at Royal Mail, Royal Mail has started to expand its customer offering into the growing parcels market, looking to grow its share in certain customer segments and delivering across more times in the week. The further transition into parcels is important as the decline in underlying letter volumes has accelerated during the pandemic. The changing marketplace has already had a significant impact on our U.K. business, and improved colleague and trade union engagement is showing early signs of adaptation and making the necessary improvements in flexibility and efficiency to be competitive. There's more to do in both companies, particularly to combat inflationary and other pressures. Looking ahead, firstly at GLS. GLS is already taking steps around pricing and operational efficiency to maintain its 8% margin target, while at the same time investing across its existing international network to improve its profitable cross-border flows. It is also looking to expand its customer proposition by investing in new products and services with greater use of digital. Looking at Royal Mail, the key is still to offset inflationary pressures, which remain high, and the delivery of our existing agreement signed with the trade unions 12 months ago are key. We've made significant changes and progress, but this needs to translate into hard efficiency savings in the rest of this year and into next year. We're already looking out further on changes to automation, and to changes in working practices and management procedures to drive further efficiencies into next year. At the same time, we can also see opportunities for revenue growth and revenue protection. We also have a clearer definition of what our services, both under the USO and outside the USO, should look like, and we'll be putting these forward as we work with our stakeholders. Finally, what does this mean for the group? We've demonstrated the self-sufficiency of our two companies. GLS is likely to be able to fund its own growth into the next few years from its own resources, but we'd be comfortable for the right business case to provide funding from the group. As we indicated previously, we don't see significant synergies between our two companies. There are, however, opportunities for both collaboration across a number of areas. For example, at GLS, expanding its footprint internationally and Royal Mail transitioning through Brexit allows us to focus on cross-border flows together, and both companies can benefit from joint working on customs simplification. Some of the uncertainties around the business are now dissipating. While there is work to do in both businesses, the new management team have had time to assess the position and prospects for both GLS and Royal Mail, and we continue to make progress in executing those respective changes. We also now have more insight into the market's unwinding post-COVID-19. Recognizing the high challenges of leverage, both operationally and financially, the board had preserved a prudent balance sheet earlier in the year, maintaining a net cash position, excluding leases, which is now over GBP 600 million today. We also committed to review that position regularly. The board has decided, while it's prudent to retain a strong balance sheet, we should reexamine our retained cash balance. We believe it is appropriate to now progressively move over the next two years to a net nil cash position, towards a net nil cash position on the balance sheet. As a first step, we will return GBP 400 million of cash to shareholders in line with our capital allocation policy, partly through a share buyback and partly through a special dividend for all our shareholders. I will now pass on to Mick to comment further on this and to look at the results and outlook in a little more detail. Mick? Thanks, Keith. Good morning, everybody. I'm gonna start by with a big thank you to all our people across both Royal Mail and GLS for their continuing dedication in delivering through the ongoing pandemic. Their efforts are nothing short of amazing every day, and the better results we're releasing today are a testament to their dedication. Thanks, everybody, and let's keep going. Moving to the slides. I'll first step you through what I think are a fairly solid set of results for the half, and then I'll look ahead to what is no doubt another challenging period to come. As Keith mentioned, I'll also take you through our thinking on the additional GBP 400 million capital distribution announced this morning and show you how, with two cash-generating businesses, we're now starting to live by the capital allocation policy we communicated back in May. The headlines for the half, we saw revenue growth in the period of 7.1% up to almost GBP 6.1 billion. This growth was depressed slightly by negative FX movements. Both the letters and parcel markets are in the process of resetting themselves at new levels. Letters at a structurally lower level, parcels structurally higher. This revenue step up has enabled operating profit to grow to GBP 404 million at a margin of 6.7%. Basic EPS was GBP 0.303. In-year trading cash flow has been good at GBP 218 million on a pre-IFRS 16 basis, GBP 298 million post IFRS 16. Net debt is GBP 540 million, and excluding operating lease creditors, we now have a net cash position of some GBP 685 million. The board announced back in May its intention to pay a dividend of GBP 0.20 per share for FY 2022, and the first 6.7 pence is due to be paid as an interim in January. We now also have the further GBP 400 million distribution, comprising a GBP 200 million share buyback program to commence immediately and complete ahead of the AGM in July, and a GBP 200 million special dividend to be paid in January alongside the interim. Moving on to our U.K. business segment, Royal Mail. Revenue is up to almost GBP 4.1 billion. That's up 6.4% as letter revenues recovered from the very extreme declines we saw during the first lockdown last year. Costs reduced 3% to just over GBP 3.8 billion, though the prior year was impacted by a GBP 140 million provision for the management restructure. Excluding this, cost actually increased very slightly. The growth in letter revenue has allowed us to benefit from our operational gearing. This half-year operating profit of GBP 235 million at a margin of 5.8%. For the first time, I'm providing the trading cash flow positions for each of our operating segments, and this is part of an evolution of how we're communicating our capital allocation policy. I want to emphasize the cash generating potential in both businesses and here in Royal Mail. In the first half of the year, we generated GBP 151 million of in-year trading cash flow before operating lease payments, GBP 101 million after. This in spite of a step-up in CapEx and a seasonal working capital deterioration. Some more details on the revenue growth. An increase of GBP 246 million in the half. Domestic parcel volumes were down 4% from the peaks experienced during the height of COVID last year, though revenues were up 4.4% benefiting from price and mix changes. At the same time, international parcel volumes suffered from a 40% reduction, where performance has been hit by something of a perfect storm of issues over the last 18 months. With UPU-wide price increases introduced by postal administrations in mid-2020, followed by COVID-related conveyance cost increases as the number of available flights reduced, and then in January, Brexit introducing new cross-border regulations with the EU. Our revenue declines have been only partially mitigated by price increases. Total letter revenues were up 15.6% as volumes recovered at the same time as we benefited from price and mix shifts. Addressed letter volumes, excluding elections, were up 11%, recovering from the 28% decline experienced during the first half of last year. Advertising Mail was very much behind that recovery. I provided updates to the monthly volume trend slides that we previously shared. In the first half, domestic parcel volumes are up 33% over the two years since 2019-20, so since pre-COVID. You can see that perhaps the move is stabilizing through the year, though we still have our busiest trading period to navigate in the coming weeks, and we should remember that the volume still includes some direct volumes from COVID relating to test kits and PPE. Moving to international parcels, we can see the really quite severe declines over the period. The level of decline isn't out of kilter with some of the data we've seen from ONS, so we're clearly not alone in this trend. Like others in our industry, the team's working hard to seek to provide the best possible cross-border solution for customers, though changes in regulations are ongoing in this area, so it remains difficult. On letters, addressed letter volumes excluding elections are down 19% since 2019-20, representing a slight acceleration from historic decline rates. Moving on to a status update on costs. Back in May, I shared the waterfall chart at the bottom of this slide highlighting the main movements we expected during the course of 2021, 2022 at that time. Here's a half-year update, as at the end of September, bridging the GBP 129 million loss from last year to the GBP 235 million profit this half. You can see the management restructuring costs and non-people cost savings are coming through as expected, and the frontline pay costs are accruing in line with the pay deal done back in January. On Pathway to Change savings, these have started to be realized now that the vast majority of the revisions have been implemented, but clearly there's plenty still to do with GBP 15 million of benefits delivered in the year to date. In terms of removing the costs of COVID, this has proved to be more difficult than had been assumed back in May. For example, flights remain expensive and absence rates are still high compared with pre-COVID levels. Transformation costs have increased with more activity on programs like establishing our new parcel hubs, and we've invested more in service, for example, in launching our Sunday delivery service. The GBP 213 million benefit shows the theoretical benefit from the growth in revenue we saw in the first half using a refined view of the gearing ratios we previously communicated. The other net cost pressures were GBP 25 million. Moving on to GLS, where trading has remained strong in the half. Revenue's up 7.5% to over GBP 2 billion, and this after taking a hit of GBP 87 million on FX changes. In euros, revenues were actually up 12.2%. We secured strong growth in our largest markets of Germany and Italy, with revenues of 12% and 12.6% respectively in euro terms. Eastern Europe, a primarily B2C part of the GLS business, increased revenues by 17.5% in euros. Operating costs are up 8%, 12.7% in euro terms. People costs are increasing not only as a result of growth, but also the inflationary pressures on labor rates. Non-people costs have been negatively impacted by the higher cost of scarce driver resources and a step-up in depreciation as the level of growth investment has increased. Operating profit was up 1.8% to EUR 196 million at a margin of 8.4%. Inflationary pressures are now being experienced across GLS's markets, resulting in higher unit operating costs. In the year to date, a combination of pricing and efficiency measures have been able to mitigate. Volume growth of 8% clearly benefited from a recovery in B2B, which has more than offset a slowdown in B2C growth, though it was still growth. 55% of parcel volumes are now B2C in GLS versus 56% in the prior period. You can see I'm now also providing the cash flow breakdown for GLS. On a pre-IFRS 16 basis, GLS generated GBP 117 million of trading cash flow in the period, which translates as EUR 136 million towards the one billion euro cash generation target from the Accelerate plan communicated earlier in the year. The next slide shows the monthly volume trends in the year to date. Volumes are up 29% over the two years since 2019-20. Again, there are some signs this may be stabilizing, but again, just like in the U.K., we have our peak trading period still to come. Moving on to outlook. How do we see the rest of the year playing out? Starting with Royal Mail. There obviously remains a degree of uncertainty in the top line with us now due to lapping an extraordinary few months in the prior year. I've color-coded the discs on this slide to illustrate our current view on outlook against the half year trajectory that I communicated earlier. So I'll just step through the items on that walk that I see as amber. On Pathway to Change efficiencies, we've delivered GBP 15 million to date, as I said, with the majority of value from the revisions program due to be realized in the last three months of the year. Our latest estimate is that we may fall short of the target due to a short delay in realizing the savings following the office revisions. It's more realistic to now expect benefits of over GBP 80 million for the year rather than the original GBP 100 million pounds. The exit rate, though, is clearly vital to provide a tailwind into next year, and we're still targeting an exit rate consistent with the original ambition. For the unwind of COVID-19 and international conveyance costs, our absence rates remain higher than would be normal, and international conveyance costs are still also high. We'll have a drag from these COVID costs for longer than was originally anticipated. On operational gearing, I expect the benefit we've seen in the first half to unwind as we move through the balance of the year. We don't expect revenues to match the really exceptional comps in the coming period, and so gearing will go against us. On other costs, we'll clearly see some pressure from items such as HGV drivers and the absence levels that I've already talked to. Overall, though, if revenue maintains a similar profile versus 2019-20 as we're currently seeing, then we'd now expect Royal Mail operating profit of around GBP 500 million for the year. Given all the coverage on inflation currently, I thought I should spend a minute on the medium-term outlook into 2022, 2023. In Royal Mail, we've got new pay deals to secure with our trade unions, as well as a GBP 40 million flow-through cost from the shorter working week we've introduced during this year. Of course, we'll be impacted by the 1.25% increase to employers' NI already announced by government. This on its own costs us around GBP 50 million per annum. We've already started our mitigation plans. On the cost side, we've already identified over GBP 190 million of opportunity for next year to offset this headwind, and more to come. On revenue, we'll take a look at appropriate pricing responses. On a slightly separate point, we're also due to hear from Ofcom on their thoughts on the ongoing review of the regulatory framework later this calendar year. That's one that we'll be looking out for and you should too. Moving to GLS. Like Royal Mail, in the second half, we'll be lapping a very strong prior period. At the same time, we're facing into significant cost headwinds in pretty much all of our markets. In spite of this, we believe a combination of specific pricing actions, good service quality, targeted efficiency measures will allow us to meet our guidance from May. If upwards pressure, particularly on wages, continues in the medium term, then our ability to continue to offset this pressure may diminish over time. Now, clearly, this will be a function of how others in the market respond, but this could eventually pose a threat to the 8% margin guidance target. Moving to capital allocation, where in May, I outlined our new capital allocation and dividend policy. I've already stepped you through the individual cash flows for Royal Mail and GLS. I thought this was an important evolution for communicating our policy, a key feature of which is that Royal Mail and GLS should be seen as independently cash generative businesses. Group cash is then pooled before considering other sources and uses of cash. At this stage, we prioritize the ordinary dividend. In the first half, you can see here that we paid out the 10p final dividend from FY 2021, so GBP 100 million. The policy then contemplates accretive and complementary M&A activity. Of course, while there were no payments in the first half, we do hope to complete the acquisition of Rosenau Transport later this calendar year for around GBP 210 million. M&A activity over the next 3-5 years is expected to be primarily, but not exclusively focused on growth in GLS. While we wish to maintain flexibility and optimize financial synergies by cash pooling and raising finance at the group level, as Keith said, we'd currently expect GLS to be capable of financing its acquisition program from its own resources over the medium term. As we entered COVID, like many businesses facing into a crisis, we moved to conserve cash. We canceled the dividend, we pulled back on investment in order to create a buffer against the risk that we were looking into. Due to the significant level of caution regarding our leverage position at the last year-end, we committed to regularly review the position. Now, while headwinds still exist on inflation, and we clearly have much still to do and much change still to deliver, overall, we now feel that we're making good strategic progress, and we've got much increased confidence in the plans we have in place. In line with our capital allocation policy, after assessing our alternative needs for capital in the short term, including the acquisition of Rosenau, we've concluded that over the next 1-2 years, we can start to make steps to return our leverage towards the levels we had in pre-COVID times, so towards a net nil cash position. In this respect, we've today announced a share buyback of GBP 200 million, starting immediately to be completed ahead of the AGM in July. It's not only a signal that the board believes the shares are undervalued, but it's also a signal of the increased confidence management has in their ability to deliver on their respective strategies in spite of the headwinds faced, and at the same time, to continue to make returns to shareholders. In addition, we've decided to announce a special dividend of GBP 200 million payable in January. This allows us to make a slightly accelerated move towards that nil cash position, and it reflects some reward for investors who preferred income, but also a return for the significant number of our employees who remain as shareholders. We'll assess our leverage position further at the end of the financial year. I believe this adjustment to our balance sheet position will be good for financial discipline in the group and help drive forward the maturity of our business in capital allocation decision-making. In summary, overall a solid half year. I think the progress we've made in the first half is really quite encouraging. As always, we still have plenty to do to realize our ambitions, but so far so good. Some uncertainty remains, especially as we head into our busiest trading period, but the direction's clear and the challenge is now for us to deliver. The board's confident now to start the journey back to move towards our historic levels of leverage, allowing us to announce the return of some additional capital to shareholders this morning. With that, I'll hand over to Martin to give some more information on GLS. Yeah. Thank you, Mick. Now I would like to update you on our performance and progress, as well as our outlook for the rest of the financial year. As Mick mentioned, we at GLS have continued on our growth path and are showing positive development with a revenue increase of 12.2% and a margin of 8.4%. I'm very pleased with the strong development and performance we have achieved despite the challenging market conditions. This once again proves that our business model is resilient and flexible. With our Accelerate GLS strategy, we've been focusing on delivering change and growth. We have refreshed our brand and further increased our emphasis on customers' delivery experience. Furthermore, we've made important investments, including our recently agreed acquisition of Rosenau in Canada, to strengthen our network and expand our international footprint. Looking forward, we are confirming our guidance provided for the full year. We expect to be challenged by rising cost pressure, but we have taken measures to successfully mitigate these risks, and we will continue to do so. Our strong performance is driven by higher volumes and revenues. Overall, revenue was EUR 2.3 billion. This 12.2% increase was driven by 8% higher volumes, better pricing, and higher freight revenues. Our operating profit increased by 6.5%. With lockdowns being lifted, B2B volumes recovered, with B2B domestic parcel volume growing faster than B2C. Recovery in B2B was more pronounced in those countries where we have a greater B2B exposure, for example, in Germany, or where there was a steeper decline during the early phase of the pandemic, for example, in Italy and Spain. Results in France and U.S. were in line with our expectations. GLS France delivered good revenue growth and secured the customers and volumes gained last year. In the U.S., revenue development has been encouraging, but we have experienced some margin pressure due to high inflation labor shortage. U.S. profits remained in line with prior year. Given the cost pressures we are seeing across all our markets, we have implemented price increases and taken actions to improve efficiency. Besides focusing on mitigating cost pressures, we remain committed to our growth ambitions as part of our Accelerate GLS program. With this program, we have further strengthened our position in key growth markets. To improve our customer connection and experience, we are implementing new, mainly app-driven solutions for our B2C customers. Quality has always been an important differentiator for GLS. We continue to invest in our network to remain quality leader, but we also have been looking more into customer satisfaction indicators that will help us to continuously improve. With that input, we can closely monitor and listen to customer feedback, implementing actions and processes to offer a great delivery experience. Additionally, as part of improving customer convenience, we are also growing our parcel locker and parcel shop network. One strand of our Accelerate initiatives has been to position ourselves more strongly. With our refreshed GLS brand, we stand out in the market. It builds on what has made us successful. It is contemporary and reflects our ambition, our entrepreneurial spirit, and pride that we share every day. It helps us to present ourselves as the forward-looking and agile company that we are. Customer and market feedback has been very positive. Now, I would also like to give you an update on our international progress. GLS has a leading position in the European cross-border market. To maintain that strong position, we continue to invest into our international network. We've been investing in several countries across the network, including Germany, Czechia, Slovakia, Romania, and many more. Additionally, we have implemented approximately 20% more direct city-to-city line hauls to further improve transit times for our European destinations. These investments are critical to deliver our promise of quality and agility, two of our key differentiators. Now, we've also invested further in the expansion of our international footprint. In early October, we agreed to acquire Rosenau Transport. This is a major step in expanding our network. Our Canadian business is a profitable freight and parcel business with healthy margins. However, our network so far was restricted to Eastern Canada only. By agreeing to acquire Rosenau Transport, one of the largest independent freight carriers in Western Canada, with revenue of EUR 150 million, GLS will become a national player together with the capability to connect to our U.S. network. This unlocks a range of new revenue potentials and synergies. Those will strengthen our unique parcel and freight proposition and business model. GLS success has been largely built on acquisitions, and I'm confident that this acquisition will also provide further growth opportunities. Looking forward, I can reconfirm our full year guidance. We are pushing ahead with our strategic agenda by, for example, strengthening our B2C capabilities, delivering digital innovation and continuing to invest. We will further scale up our proven business model and assess expansion opportunities. Having said that, we will be challenged by the rising inflation, global supply chain disruptions, labor shortage, and wage increases. We've taken the right measures to mitigate these risks, for example, through adequate price increases and improved operational efficiency. To wrap up, I would like to highlight that we are well prepared for the challenges ahead and will continue on our positive trajectory. Thank you very much. Now over to Simon. Thank you, Martin, and good morning, everyone. It's 26 weeks since we last spoke in May, and today I will give you an update on how we are doing. Before I start, I wanted you to hear from Terry, from the CWU on how he feels we're doing. I think it's been massively impressive six months and history-making six months within Royal Mail when we consider the turnaround in relationships, the progress that we've made on the agreement. When I think of the reach, our role in society, the universal service to every single person, our desire to build on that, the ambition that's still live to drive that amount of change and during a pandemic, I think is hugely impressive and I think everyone should be extremely optimistic about the future of this wonderful organization. We're refining our revision processes, whether they're, you know, small revisions or whether it's large-scale revisions. We're learning from this and we're refining them. So when we go again, you know, people will be more up to speed. We will as well more empathetic of what's needed, what enables us to move quickly, increase our productivity, but also make sure we keep on top of what is really the jewel in the crown, which is quality of service. With these centralizing the decision making, because that holds up people being able to respond on a daily basis. We've gotta trust our people. We've gotta push that sort of autonomy, responsibility down within parameters, of course. It's in all of our workplaces, and there's so many of them on a daily basis, decisions have to be made, and we've got to free people up, and we've got to trust them for the managers and the unions to work together within the right parameters and to make some of those decisions. They're, you know, they'll have the power and the autonomy to make those decisions, to make sure we maintain quality of service, to make sure we're doing a job as we should be doing it. We will step up. These, our revisions, we're trying to refine the ones that have already gone in. We're driving resourcing, recruitment. We will get ourselves into the best possible position. What we've got more than anyone else is we have still got a massive vocational sense of purpose amongst postal workers, and I know they will step up. They're terrific people. I agree with Terry, we're making good progress. We're making progress working alongside both of our unions, both CWU and Unite. Change at this scale and at this pace is difficult. Our team are embracing it, and we are learning how to be even better at changing as we move forward. We still have much more to do together. As a reminder, back in May, I talked about what a good year at Royal Mail would look like, and there were six areas of focus. Great quality for our customers. Our trust agenda, the way we will reinvent Royal Mail in a harmonious way. Our tickets to play, improving our productivity and managing our costs. On quality, we have good performance in most offices, but we still have more work to do. Our focus is on equalizing performance between all locations. Our trust agenda is progressing very well, and this is how we are reinventing Royal Mail in a harmonious way. Automation is ahead of where we thought we would be at this point in time against a very ambitious plan. The CW agreement execution has been very good. Now we are focusing on realizing the benefits of those changes. Non-staff cost control is good. Now let's look in a little bit more detail. Trust at the doorstep is what makes us different and better, and we remain number one for Net Promoter Score at the doorstep. It continues to be a battle between us and one other competitor. Our magnificent team at the doorstep continue to be our competitive advantage. Our digital interactions continue to improve with more improvements on the way. Our iOS app enjoys a 4.7 star rating in the App Store. We're rolling out improved estimated delivery windows. Customers do not want to wait in. As of today, 6% of our deliveries have a 30-minute window, and there's much more to come in this space as our data science team and our operational front line make great encouraging progress together. Looking at our delivery offices overall, we are delivering a good service in most offices, but we have more to do. There are a small number of delivery offices where the quality performance is disproportionately impacting overall national performance. We have over 1,200 delivery offices, and you can see that just 25 offices, or around 2% of our offices, are responsible for around 25% of our delayed items nationally. 10 of our offices are less than 1%, are impacting 14% of our delays. We have now done revisions everywhere, making our routes fairer, and this is something we can build on. There are many factors that impact quality, but what this tells us is we need to focus on equalizing performance. To help, we have created a delivery performance task force dedicated to support those units that need the most support. They will work with 10 offices at a time to provide dedicated support. I just want to say that our team have excelled as key workers. As Terry said, and I agree, they are terrific people, and I am sure they will rise to the challenge again. We learned many lessons last year. We have learned how to increase our vehicle fill from an average of 60% to 80% to increase our capacity. We've invested in Isotrak technology, so we now know where our trailers are and therefore where our customer orders are. We have invested in more equipment to meet demands such as Yorks, and we have trained and recruited a number of our team to become HGV drivers, and we now have a driver academy in place, including an apprenticeship program. What we have learned, we now have in place. As a reminder, our team have always been proud to wear the Royal Mail badge. Our opportunity has been our relationships. Our team asks for three things. Managers to be on the floor with them, tell us the truth, listen to our feedback and act on it. You'll see here we have been doing regular pulse surveys in different regions since our big trust survey in April. Not only are our scores improving, but this has also been achieved during large-scale change. Participation in the survey has also leaped forward. The difference between our best and our most challenging sites is still too wide. Again, we need to equalize performance. Trusted relationships are how we reinvent Royal Mail for the next generations in a harmonious way. Our program to reduce the amount of time managers spend on administration or what we call day in the life of or DILO, is now in all of our 1,200 delivery offices. It has released over 1.1 million hours to focus on quality for our customers and relationships with our team. Our policies have reduced from over 200 to 16 without putting our company or our team at risk. We have removed endless reporting and administration to focus on what matters. In our test delivery office scale in Manchester, the team went from the bottom half of performance rankings on our key metrics to the top 20%. All of our delivery office managers are now undergoing a development assessment to help them have the skills to win. We've built an academy to support them so they can be as good as they can. We are now looking across our organization to see if we can implement DILO elsewhere. Automation. We have a very ambitious plan in this area. Automation is good for cost, so we can compete, but it is also good for quality and for capacity at the critical times of the day. In 2018, 2019, our parcel automation was 12%. We entered this year at around about 30%, and last week we achieved 40%. Our improvements have largely been driven by new ways of working, not new equipment. 50%+ was always ambitious this year, but it is increasingly looking possible. The team are ahead of where we wanted to be. 50%+ is just one milestone on the journey to 90%. Our Northwest Hub is now in the commissioning phase and will open on time in spring 2022. Our Midlands Hub is progressing well and will open in summer 2023. We do not believe we will need to start building a third hub in the next 3 years. Using what we have in a better way remains a very good option. We plan to realize no less than GBP 80 million worth of benefits from our agreement this year. We are confident that our exit rate benefits are on track. Change at this scale and at this pace is very difficult. Our previous best number of revisions in 12 months was 132. We've done more than 1,700 in less than 6 months in delivery in our workshops, in fact, in all parts of our operations. We have around about 70 still to do, and we plan to complete the majority of them in early January. There can be a difference of up to 1.5 hours on a delivery walk and route between the shortest and the longest, and that is on a 5- to 6-hour delivery span. It's an enormous difference, and it has not been fair. Some walks have not changed for over 10 years. There are more than 2 million new addresses for us to deliver to compared to 10 years ago. The world has changed. I have to say that our team have done a brilliant job with these revisions, and we have learned a number of lessons along the way. We're just about to complete a formal lessons learned with our unions. We're not waiting for a report, we're already acting on the feedback we received. Revisions are an important muscle as we roll forward. We must keep changing on a regular basis to make sure everyone has the same workload. We must be fair. Remember, the change this year has been much more than revisions. We now have an agreed productivity standard with flight paths to achieve them for the first time. We've implemented scan in and scan out technology at all of our mail centers and regional distribution centers. We've trialed resource scheduling technology. We've successfully deployed delivery to specification to make sure that we deliver an economy service in an economy and economical way. We've completed our network review. We now have a new dispute resolution process, which is working very well. In November 2019, we had 595 disagreements that took an average of 80 days to resolve. In October 2021, we had 33 disagreements that took 33 days to resolve. Now we've implemented change at Parcelforce as well as Royal Mail. We have a joint initiative on improving our culture. All of this done with a workforce of 137,000 people in more than 1,700 operations since we last spoke. It's an enormous change, but we still have more to do. In terms of non-staff cost savings, we are on track. We promised GBP 200 million over two years. Last year, we delivered GBP 90 million of those benefits. The target for this year is GBP 110 million. In the first half, we've delivered GBP 42 million, and we expect to deliver GBP 68 million in the second half. We expect to achieve this target. The best companies not only grow, but grow their market share and grow the size of the market. Based on what we know and our internal modeling, we believe we are at least maintaining our market share in parcels this year. That's the first time for some time. It's an encouraging first step. Today, I wanted to focus on Sunday delivery. With the first 45 customers out of more than 100,000 customers that we have, volumes have ramped up very quickly since April. We're rapidly approaching a 50 million items a year business, but we've only scratched the surface. We are going to accelerate from here. We want a 7-day parcel service for everyone in the country, and all consumers, and the same price regardless of where you are. We are discussing how to make a Sunday part of our regular duty pattern. We have always said we would be a 24/7 business delivering when customers are in. On Parcel Collect, you now don't need to print a label at home, another point of customer friction removed. Why would you want to drive, park, and queue when we can come to you? We continue to roll out more barcoded stamps, and we'll have more to say on what this will allow us to do very soon. Our testing on the consumer's appetite to pick an environmental delivery is encouraging, and we're thinking about instant pain relief or same-day prescriptions, and it's maturing very nicely. We'll share more at the full year results. I've spoken a lot about how we've changed, but you really need to see it to believe it. Royal Mail are leading by example. I'm here launching the fleet of all electric vehicles. Royal Mail have begun delivering letters and parcels using this unmanned drone. The aircraft is controlled by computer as part of a trial to help connect remote communities. It's about quality of service for us. It's about making sure that every address, no matter where you are in the U.K., gets the best quality of service as possible. It is a wonderful thing to see, and it actually embeds the future of this as a sorting office for the foreseeable future, which is really good for all of the staff that work here, and it's great for Tyneside as well. We've made an impressive start to our reinvention for the next generations, but there is much more to be done. In the short term, we will continue our focus on revisions. This year has been an enormous change, but it's only the start of more regular annual revisions in our network. We will continue our focus on automation. We are approaching halfway to our 90% target and are going as fast as practical. For the medium term, we need to look at our working patterns to make sure we can deliver 24/7 and a parcel on a Sunday or a Monday at the same cost. We need to change how our delivery offices work. They are optimized for letters. We need to be optimized for parcels. Once we have equal performance and have regular revisions in place, how will we reward our front line for going above and beyond for quality or productivity or perhaps both? We'd like everyone to share in our success. All of these topics and a few longer term ideas are either at execution, trial, design, or discussion stage. We all want a sustainable USO. It's a great privilege to be the one company that has the responsibility to deliver to all 31 million U.K. addresses for one price, and our team love their role in serving all of society. Whether you live in the Highlands of Scotland, the Valleys of Wales, on the Isle of Wight, in Ballymena or London, we will deliver and collect from you for one price. The world has changed, and customers want more parcels and fewer letters. In fact, they use 60% fewer letters since the peak of demand in 2004 and 2005. We want to invest. We want to invest in services customers want, invest in our future. We want to deliver a 7-day, go everywhere parcel service at the same price. It's all about leveling up. Every household in the U.K. should benefit from the e-commerce revolution. Every retailer, whether you are large, medium, or small, should be able to access and compete in the e-commerce revolution. A parcel service for all every day of the week, but it costs money, and that means putting our resources behind what customers want. Now, we love letters at Royal Mail, and we believe there's an important role for them in society. Ofcom's recent user needs review suggested that our customers are open to change. Now is the time to define what a sustainable USO looks like. Our opportunity to invest in our future is now. We firmly believe a seven-day go everywhere for the same price parcel delivery and collection service is compelling. Due to our proximity to our customers, due to our team's sense of service and our close-to-every-doorstep infrastructure, we are uniquely placed to deliver this customer need. We don't cherry-pick where we go. We go everywhere. In summary, on quality, we have good performance in most offices, but we still have more work to do. Our focus is on equalizing performance between all locations. Our trust agenda is progressing very well, and this is how we are reinventing Royal Mail in a harmonious way. Automation is ahead of where we want it to be and against a very ambitious plan. The CWU agreement execution has been very good, but now we're focusing on realizing the benefits. Non-staff cost-saving control is good, but we've only started. We have much more transformation to do, whether that is new ways of working or a sustainable USO. What does all of this mean? Last time we were together, I talked about 5% margin sooner than our previous plan, and then we would lift our head. Our profit this year will be at least GBP 500 million. We do have headwinds for next year, but as Mick has said, we believe we are making good progress to have them covered. We believe by continuing to change, we can manage this reality. Of course, the market is still volatile, but we believe we are getting our fair share, which is a step change on where we were. Reinventing Royal Mail for the next generations is in flight. One more thing before I go. Back in September, we signed a new agreement with Unite. It's focused on management development, culture, and equalizing performance. Our management population play a very important role in our reinvention. Today I'm going to leave you with Gary from Unite, explaining how Unite are also participating in the reinvention of Royal Mail for the next generations. We are changing, and it is working. The agreement and the progress is going really well. It's probably the largest agreement we've done in around 17 years. We've certainly made some traction across the agreement, especially with things like dialogue, change in the way in which we manage our delivery offices to free our managers to have more time to interact with the staff. It's a massive undertaking, but it's also the right undertaking. It will do well for our business and its performance, and it will drive us forward. We are heavily focused on managerial de-development and training to ensure that our managers are equipped for the skills that they need to succeed, you know, with the new technological environment that we face ourself in. Royal Mail Academy does that. It's actually going over some of the core skills that we require from our managers and ensuring that when we need development, that we can actually focus and hone in on those areas that people need the support with. I see it as a huge benefit, not only for the business, but in the way that we operate and, you know, the fast-changing pace of our business. We're gonna focus heavily on equalizing performance. We want the same level of performance right the way across the organization. To do that, you must have the same structure. We will focus on ensuring that we've got the right people in the right places. If we can achieve that in this small step, that it would be a fantastic move for the company and for all of us moving forward. This is probably the best relationship that we've had with the business where we turn around and say, our agreement has actually put us in the room a lot earlier. We're all pointing in the right direction, and that is to transform our business to ensure that Royal Mail is fit for the next generation, and also, to ensure that this great icon that people trust is sustainable in today's world. To have us all pointing in the right direction is huge, and it can only be good for not just our customers, our investors, and the country as a whole. Great. Thanks, Gary, for that video. Right. Let's move to Q&A. I can see there's some questions already queued in the system. Nairobi, our operator today, if you could just remind people how they register for a question, and then if we could go to the first one, which I think is from Alex. The Q&A session is now open to telephone participants. There are currently no questions on the line. Please push the star followed by one on your handset to ask a question. If you change your mind and wish to remove your question, please press star followed by two. When preparing to ask your question, please ensure that your phone is unmuted locally. To confirm that, star followed by one to ask a question. Your first question today is on the line of Alex Irving from Bernstein. Please go ahead. Hi. Good morning. Hope all is well. First question is on cost dynamics, please. You point to inflationary pressures on the business, but can you please give us a little more color on what you're seeing here and the areas where this is most impactful? Following on from that, how does this play into a more market-wide context? Would you expect Inflationary pressures to maybe hit your non-unionized competitors more than yourselves. Would that end up with rising parcel prices and be a net benefit to Royal Mail, or is there some other dynamics at play? Finally, on the trust score, please. Really good progress, though I appreciate this is an aggregated number. Could you please go into a little more detail on that? Where are you seeing more progress? Are there some areas which are lacking, and what are you doing there? Thank you. You can take trust first, and then maybe, Mick, you want to Yeah, yeah. Come on this one. Hi. On the trust score, actually we are making really good progress as you've seen. I think that when we started this journey, our overall trust score was less than 60. It was around about at the 59 mark. In fact, actually in our last pulse survey, which I got last week, we're actually at 70. I think that's tremendous progress. The other thing I would say as well is that the difference between our very best and our less great side is actually closing as well. I think the overall narrative is clear is that overall we're making great progress. The gaps between our very best and those that need to improve is actually closing as well. The last thing to say on that one is that, you know, the team are really clear on what it is that they need. They want the managers on the floor with them. They want to be told the truth, and they want us to listen to their feedback and act on it. When that happens, actually we see the results not just within the trust score, but actually also in business performance. Hi Alex. I'll maybe pick up a bit more on inflation. Now, starting maybe in the U.K. this year, this is, you know, less of a concern to us for this financial year in the U.K. We're not immune, but less of an impact. We'd already done our pay deals for the year. We have a fairly robust hedging program in place around fuel and energy costs, which obviously have gone up quite significantly. We are seeing, like everybody else, some increased costs around HGV drivers and maybe some supply issues as well that we're having to deal with. I think, you know, overall, in that employment space, because our wage rates are really quite good for our industry, I think we're in quite a good place to be more successful than many as we try to recruit. I think as we move into next year, there's a kind of bigger headwind. Some of that hedging starts to unwind. We clearly have two pay deals to do with our unions, with that inflationary backdrop, which will, you know, have to, as normal, be deals for change. We haven't commenced negotiations, nor would we share them if we had today. There are though things like the full-year costs of the shorter working week that run into next year. That's the shorter working week we've given this year. That's about GBP 40 million of costs next year. National Insurance, the extra 1.25% of employer NI that's coming in April will cost us around GBP 50 million. There are headwinds for us to face up to and a program to offset that we've started to define. In GLS, I think that they kind of suffer the other side of that coin a little bit on wage rate inflation as a, you know, lower cost operator versus many of the posts, for example, in a lot of their geographies. You know, to the extent wage rate inflation comes through in the next period. You know, GLS to date has been able to offset that pressure with pricing and other efficiency initiatives. You know, the more that carries on and persists, the more of a strain that will become. That's why we've said today, you know, depending on where things go and depending on how the competition reacts, there may be a threat to that 8% margin in the medium term. Martin, do you wanna add anything on GLS or? No, I think that's pretty much covered. Maybe just to add that indeed in some countries we will face also minimum wage increases next year, which are rather substantial. For example, in Spain and most likely also in Germany. That of course will have an impact on the wages and on the costs accordingly. As Mick said, and as I also highlighted, we have measures underway and we're also working on adequate pricing measures. Plus we see a certain openness in the market from customers to also accept a higher cost leading to higher prices, not just with GLS, but also with other players. Okay. Alex, just very quickly, just to come back on Royal Mail. I think in simple terms, the way to think about this is that we've got shorter working week coming through into next year. We've got National Insurance, which we both know about, and that's about GBP 90 million. That's broadly offset with the flow through of benefits from this year. Then as Mick pointed out in the slides, we've identified another GBP 100 million on top of that, of potential savings and benefits from automation and the things that Simon's spoken about that are an offset to whatever we do in terms of inflation for next year. What we're receiving in terms of inflation in pay and other areas next year. Now, clearly, we can't tell you what that is because until we've done the pay deals and until we've seen the inflation come through, we can't give you a definite answer into next year. Okay. Great. Thank you very much. Thanks, Keith. Thanks, Alex. Next question I think is from Satish. Yeah, thank you. Thanks, John. So I've got three questions here. Firstly, on the absence rate. You said you're still seeing a high level of absence rate. If you could actually come give some color where we are today versus the peak, and what is the typical average absence rate. And then in terms of GLS B2B volumes, you said that it has seen a strong recovery. Were you, like surprised by some say, delayed recovery or slow recovery in some markets? It would be quite helpful to understand if you have any color by different markets that GLS operates. Then on Ofcom's review. Sorry. No, go ahead. Sorry, I interrupted. No. The third one is actually on the Ofcom review. What is your actually best guess expectation here? Do you expect some change to the USO going from six days to five days? Any color on that would be helpful too. Thank you. Thanks. I'll ask Simon to talk to absence, Martin to GLS by markets or geographies, and then Mick to give you a bit more detail on actually what the Ofcom review is about. Okay. Simon, do you want to cover it? Yeah, sure. Our absence rate is ahead of our expectation at this particular point in time, albeit we are starting to see some green shoots coming down in the right direction. What we're really focused on here is making sure that as we progress towards the end of the year, that we operate the procedures we have and the conversations we have with our teams to get as many back to work as we need them. That in essence is our overall piece on absence. Mick, I don't know if there's anything else you want to add on absence at all. I don't think so, Simon. Okay. All right, on the B2B question, yeah, indeed, we have seen a recovery, and it varies by region and/or country. It's got to do also with the share that we previously, prior to COVID, had in terms of B2B. It's not really a surprise to us overall to say that clearly, because as you know, our history stems from B2B, and we have a very strong footprint there, so we didn't lose any customers, just that they were trading less during the pandemic. As and when the shops opened, the customers started to ship more again. Overall, it's been not a surprise. We are just pleased that all the customers basically are sticking with us and also kind of entrusting their shipments, continuing to entrust their shipments with us. Just to give you a couple of examples, probably maybe in B2B, bounce back in Germany was around 11%. In Canada, where we have a very strong B2B footprint, which is also supported by the fact that we have freight volumes, which are largely B2B driven, there we have a 20% increase in the B2B volumes again. Overall, I think it is fair to say that we have an increase of B2B around 10%, whereas the B2C increase was around 7% across GLS. So both of the segments remain growing, which is really good news. For the last couple of months, B2B was growing a bit stronger. Just picking up on your question on the Ofcom review, I think it's worth saying while clearly the future of the USO is of critical importance to us, it's not actually a feature of the review that's currently ongoing with Ofcom. This review asks for kind of broader input from the whole market on the wider framework that they've been operating since they took over. The sorts of things Royal Mail asked for as a part of this review were things like more flexibility to innovate our products and services that we offer within the USO. For example, starting to offer tracking services within the USO product set that we're not currently allowed to offer, doing things like photo on delivery rather than obtaining a signature, that sort of optionality. We were looking for flexibility to do more of that, to modernize the services that we can offer to customers within the USO. Separately, we asked for them to take another look at the current what's called the access mandation regime. This is where on letter services we are forced to offer a service for final mile delivery to the Downstream Access operators at a given price. We asked for what we call fulfillment large letters, so items that aren't really letters. They're fulfillment items from retailers to be taken out of that mandated service. Of course, others in the market ask for whatever they would like to change at the same time. Ofcom are digesting all of that input and evidence that people from the industry have submitted. In, you know, the coming weeks, we expect them to go out to consultation on their initial view on what they might change. Thanks. Mick? Yeah. Thank you. Thanks for the colors. One quick follow-up actually on the absence rate. Does your GBP 100 million that you identified going into next year include absence rate coming back to normal levels, or what is the assumption there? Are you factoring in any unwind in those costs in your GBP 100 million savings into next year? Well, look, I mean, to some extent it depends on how the rest of this year goes. You know, of course, an element of that unwind of savings next year, sorry, is an unwind of the COVID costs. So some of the shortfall of unwind on the COVID costs would equate to absence improvement. I think at the moment, though, you know, to the level of absence that isn't directly related to COVID that we need to address. So, of course, if we can make advances there, then that would contribute to the benefit next year. Yeah. Thank you. Just to make that point clear, that the GBP 190 million that we've identified isn't a change in absence costs. Sorry, I didn't get that. Okay. Thanks, Satish. Thanks. Yeah, thank you. Next, I think we got Christian from UBS. Morning, Christian. Hi. Good morning. Thank you for taking my call. 3 areas of focus if I may. The first one, how do you think about pricing for U.K. parcels in the second half of this year and next year? I guess I have in mind one of your large competitor just opened a large parcel sortation center. There's another one scheduled for next year. Last time we saw that around 5 years ago, your average revenue per parcel was down around 2.5% per year for a couple of years. I guess how do you think the situation will evolve now? Secondly, coming back to the GBP 190 million cost saving, and apologies, you made already some very useful comments there, but could you split it up again, the 190 into the different buckets? Also maybe can you talk a bit about other areas that you are exploring to cut costs on top of that for next year? If I may add to this point, you know, is the timing of the negotiation with the union that can it impact to any extent if you don't have a deal in the first part of the year, does that reduce the 190 or is completely independent to that event? The last one, if I may, apologies. You said today on GLS and Royal Mail, both businesses are financially independent. You've also said today there are no meaningful synergies. If we look at the valuation out there, isn't there meaningful value that you can bring to your shareholders by selling a stake in GLS or separating the business? I guess why wouldn't you move in that direction is my question. Thank you. Okay. Shall I take the last one, and then I'll ask Simon to look at the revenue side of it and then maybe Mick to comment again on the costs. On the costs, we're not gonna break down the GBP 190 million beyond what we've given you, which is a GBP 90 million-GBP 100 million flow through from this year, and additional savings next year. I'll ask Mick to comment in a minute. On the GLS point, it's something that we keep under review. The board still believes that we are the best owners of GLS. Why do I say that? Although we've been clear that there are no synergies between the two, there are opportunities to work together and to learn from each other. We're putting those into place. That's one aspect. The second aspect is, if you look at the funding that we talked about today, there is no constraint on GLS growth, and the Board encourages not only the Accelerate plan that Martin has in place but potentially going beyond that. Again, that's, you know, Royal Mail, I think, can help GLS along the path. There are opportunities. The funding's in place. The self-sufficiency is in place. I think what we're demonstrating today is that, if you like, both companies are self-sufficient. Previously there was a little bit of an overhang of GLS subsidizing, needing to subsidize Royal Mail. That's obviously not the case today. We are comfortable with where we are. We will continue to review it from time to time, but as I say, comfortable in where we are. Sorry, Keith, just to add on the same point. I think a number of times over the last kind of decade plus, you know, the question about taking value from GLS has come up. The reality is, with the benefit of hindsight now, on each of those occasions, it would have been a bad idea given the growth and advancements GLS was able to make beyond that. I think, you know, clearly we understand why the question's asked, but I think, you know, we have real confidence in Martin and the team to keep taking that business forward, and we think we can back their growth plan as well as anybody else could. Simon? Yeah. On the pricing of U.K. parcels and the like, there are probably four points here. I think the first thing is that what we hear in terms of our market intelligence is that actually parcel pricing is going up. I think the second thing as well for us is Royal Mail, and I mentioned it a couple of times, is that we are actually maintaining our share of the market there now as well, which I think is a real good step in the right direction for us. I think in terms of wages in the market as, for instance, you know, and I think others' costs are moving towards our costs rather than us having to move towards theirs. I think that the way that we actually pay our people is proving to be a real positive in many ways. The other thing as well, which I've covered off here in the likes of automation, other things that's going for us, is that actually we are actually getting more efficiency within our, you know, within our operations so that we can truly compete. Thanks, Simon. Mick, do you have any other? I think we had another one, Christian, on timing of negotiation and potential impacts on the 190. I think that negotiations will happen, you know, towards the back end of this financial year. As Simon said earlier, you know, very broad conversations about what might be the content of the conversation, you know, are ongoing 'cause, you know, Simon and I both meet Terry and others regularly. You know, there's no negotiations yet at all. Of course, the 190, just to be clear, was the savings opportunity. It's kind of the gross savings opportunity. There will be an offset of any pay inflation that we agree, which is why I said, you know, the 190 is where we're at today, and we'll be looking to make that a larger number. Okay. Thanks, Mick. Thanks, Christian. Thank you very much. Thanks, Christian. I think we've got Moneeba next on the line. Morning, Moneeba. Good morning. Thanks for all the comments on the GBP 190 savings. As we think about EBIT for the U.K. business next year, I know it's still early days and the wage agreement is yet to be done. Do you think EBIT can grow from the GBP 500 million you're expecting this year? How are you thinking about top line for next year? Secondly, you mentioned letter price increases. Can you talk about which letter services could have price increases, and if it's possible to quantify that? Currently, what have you seen in October so far on parcels, and what are your assumptions for peak season in that GBP 500 million EBIT guidance for this year? Thank you. Thanks, Moneeba. I think you answered your own question on the first part, which is it's early days. Yeah. I'm not gonna speculate into next year until early next year, I think. Ask Simon to comment on top line, maybe, changes, and maybe, Mick, you'll cover off where we are on month to date and- Mm-hmm. Letters pricing. Yeah, sure. Yes, I think that, I think it comes back to what I said earlier on, is that, you know, this year, you know, we do believe actually that we are maintaining our fair share in the market. I think as the market, we know there's still volatility in the market, but we do feel that we can compete. I think that what we've also seen from our Sunday deliveries is that by doing the Sunday delivery with our retailer customers, it gives us the opportunity to win Monday to Saturday. You know, we believe that initiatives such as that, I think Parcel Collect as well, which is uniquely ours and is actually our cheapest channel as well in terms of acquiring customers and providing that service as well. I think that, you know, now that we have Labelless, which during our testing that we did, there was a 30% take up of Parcel Collect using the Labelless option. I think that again, these initiatives, plus the fact that we are, this year, we believe, are maintaining our market share, will mean that we do believe as we roll forward, we can compete in whatever market there is out there. Do you wanna just comment on top line for GLS? Yes, of course. With regards to the top line, as you've seen, we have had a healthy development on the top line in all markets. Since our Accelerate GLS strategy is moving ahead quite well, and it's well-recognized also within the local markets, I'm confident that we can continue a positive top-line growth, which will obviously also help us to manage the cost increases and inflationary tendencies that have been mentioned earlier on. Okay. Mick? Yeah, maybe a few words on October trading. We haven't given those results, but you know, there's nothing material in either Royal Mail or GLS that would change your view from the numbers that we've given this half. That those kind of monthly volume charts that I gave, you know, October is very much on trend. Letters remaining quite strong, international still weak, et cetera. You know, no new news to change any of yours or our views on the rest of the year. In terms of Christmas trading, look, you know, we're literally entering it almost as we're sat around this table this morning. You know, we'll know, and it kind of rushes upon us, and then it's incredibly busy, and we come out the other side and reflect on how it went in terms of service and productivity and costs and of course the top line. We do all the preparations we possibly can to get the best outcome for customers and of course shareholders from the period. We feel prepared, but we're now about to enter the period. So, more on that post Christmas with the trading update. On letter prices, I think this is an area where, you know, over the last two, three, four years, we've maybe pushed pricing a little bit harder against some letter streams. It's never across-the-board price rise for letters. You know, stamp prices, stamp price movements, we're always very cautious of, and indeed second-class stamps are price controlled. Where the bigger amounts of revenue for us are in things like Advertising Mail. Again, we're very cautious on price rises. Advertising's in a competitive market with other media, so it's very easy to switch customers off that media and our media if we push prices too hard. Again, very cautious there. Business mail, there are some streams within business mail, where there's a bit of evidence that volumes can be a bit stickier to price increases, and that's where maybe we look to push price a bit hard and we communicated some price rises to customers in that space, to business customers and access providers in that space a few weeks ago, where the average price rises were kind of 5%-10% in some streams of their mail. What we did at the same time though was offer customers an opportunity to hold their price broadly where it is or with much lesser increases with the launch of an economy letter service, which gives us 5 days to deliver the letter rather than the kind of standard 2 or 3. That extra time to deliver the letter gives us the opportunity to become more efficient, in the operational delivery side of things. It gives us more days to select from to deliver the letter, which allows us to improve the coincidence of our walking down the garden path and putting, you know, one or two letters through his letterbox, rather than just one all the time. There's an efficiency for us in that new product which allows us to offer a lower price. Okay. Moneeba, just to bring out one point. I think Christmas trading results are out February the tenth, I think. Is it? Yeah, so that's February the tenth. As you know, over the last year we've been announcing bi-monthly statistics because of the uncertainty in the market. We'll be going back to the normal half year, full year results after that. Okay. Okay. Thank you. I think we've got Alexia next on the line. Morning, Alexia. Yeah, good morning. Thank you for taking my questions. Just firstly on the U.K. Royal Mail, I mean, it was a little bit disappointing that the efficiency target has moved to GBP 80 million at least for this year. I just wonder if Simon could give a bit of color of what has surprised him as to the pace of the change. Appreciating the fact that obviously it's not an easy task, but what kind of has changed since the June or May presentation? Secondly, can you just give us the parameters around the payment of the GBP 60 million management bonus for this year? One last one was in regards to U.K. pay. I mean, clearly, Keith, I understand you don't wanna be drawn down to kind of being very precise for next year. However, the transformation plan is ongoing and therefore shouldn't we expect further improvement in the years ahead, i.e. you're still not fully there yet. Just finally, more on the dividend policy for the group. I mean, we've talked about the 20p being progressive. What kind of parameters are you willing to give us around the ordinary policy going forward? Thank you. Okay. Shall I take the dividend policy question and then maybe if you take the payment of the bonus? Yeah, we don't give the parameters. Yeah. Of the bonus- Yeah. Keith. Yeah. We won't be able to answer that question. Simon, on the dividend policy, as you know, the board announced progressive dividend policy earlier in the year, and that just is where we'll be going forward. You know, as we said today, is that as we see more cash being generated to the group, for Martin, you know, Martin might be self-sufficient in his funding requirements over the next three or four years, but if he needed more, there's funding available for the group. Royal Mail, just to bring out a point that Simon, I think is made earlier on, is that as much as we need capital transformation in Royal Mail, it's also about what I call human transformation. You know, when Simon talks about the third hub going back, it's because he can see efficiencies being generated elsewhere. You know, to answer your point on transformation is, yes, it's gonna be an ongoing program for a number of years. All we're saying today is we can see headwinds next year. We're looking into those headwinds, and today we can identify GBP 190 million, but that's not the end of the story. There's more to come, obviously. Just before we go to Simon. The question's come in from Liam Sheridan on the webcast. So just to let you know, we've picked that up, Liam, but it relates, Simon, to, I think, Alexia's question about some of the Pathway to Change agreement. Liam was just asking has there been a problem with revisions. I hear news about lots of mail being undelivered on a daily basis. So you don't have to come back twice, if you could just Sure. Sort of include that in the answer as well. All right. Would you like to take that one now, John? Yeah. Okay. I think on the benefits realization, I mean, look, the first thing I would say is that to do more than 1,700 revisions in six months versus our previous ever best of 130 odd in twelve months, I think the team did a totally brilliant job. I don't think we can underestimate the magnitude of that. I think the other thing as well to bear in mind, which I mentioned going through, was, you know, in some cases, some of these revisions in some offices haven't been done for up to 10 years. The amount of change that's being put in place in some places is extremely large. What I also said during the presentation is, in terms of the benefits that we'll get in terms of an exit rate, we believe they're intact. It's just a case of timing. What we're seeing that in some of the changes, in some of the places where we haven't had a change for a significant period of time and/or there has been larger change, it's taken the operation a little longer than we'd expected to actually realize those benefits. So I think that's that. I think the other thing as well is what we said is GBP 80 million or perhaps more. So let's see where it is that we get to. In terms of I think your second question, John, that you came here, that you put through, in terms of the quality of service, again, what I said earlier on in the presentation is that here we really need to equalize performance. You know, we've got 10 of our offices which are around about 14% of our delays. We've got 25 of our offices or less than 2%, around about 25%, of our delays. We're working with those offices now to get them firmly back on track. The other thing I would say is that the vast majority of offices are actually providing a really good service and of course that's a big focus at this point in time. Okay. I'll just ask Mick to come back on your other question. Yeah. We don't give the specific bonus measures, Alexia, but you know, it's a kind of balanced scorecard of things in the U.K. around things like profit, service, quality, safety, trust. The things that Simon communicates as important in taking the business forward are understandably the drivers of the bonus scheme in the U.K. Thank you. Okay, thanks very much for that. Thanks, Alexia. I'm gonna go on the line to Andy, and then after that I'll take a couple of questions that have come in on the webcast. Andy, if you wanna go ahead first. Thanks very much. Good morning, everyone, and 3 questions from me. First one's around the sort of, the parcel network and the hopes in the U.K. to build that out 24/7. What could that mean for CapEx, please? Does that mean that CapEx basically sort of stays high for longer? Secondly, around the wage deal, maybe is it possible to just give us a sort of quick rule of thumb, such that when the agreement's struck, could you give us maybe a sensitivity in terms of a 1% movement in wages? What would that mean absolutely in terms of cost inflation and wage inflation? Then in terms of the balance sheet and the sort of targets there, is it simply the aim to keep the balance sheet going forward at sort of net nil cash, going forward? Thank you. I'll let Mick talk to wages and what it means. As he's already said, we know that the National Insurance increase of 1.25% is sort of locked in. Yeah, we can cover that. I mean, 1% is about GBP 40 million, so every percent is about GBP 40 million. That answers that one. On balance sheet and net nil is what we said is we're happy with the cash going towards a net zero balance. Clearly there'll be some flex around that depending on acquisition or whatever. That's the intention, is to keep it around net zero. The other one was parcels network 24/7 CapEx. I mean, I think the CapEx is, as we communicated, back in May. Yeah. You know, there's two parcel hubs in the plan, both under construction, one opening early in the new calendar year. We are continuing to invest in other automation equipment, small parcel automation equipment that we install in our mail centers, and that program continues. In fact, we approved some more money just yesterday. Yeah. I think one other thing to add just in terms of the parcel network, and I mentioned in the presentation is that we went from more or less 30% to 40% automation with what we have, with actually changing our ways of working and changing how we operate these machines. We did have one extra parcel sort machine which within that period, but that only came on stream literally the other day. I think we have opportunity to use the network that we have in a better way and also use the equipment we have in a better way as well, and that's what we're seeing. Last thing, Andy. If you go back to May, I think there's a slide in the May presentation that looks at the CapEx of both companies. Yeah Looking forward. Maybe, you know, refer back to that if you want an idea of the CapEx. Yeah. Super. Great. Thank you very much. Thanks, Andy. As I said, just briefly going to some of the questions that have come through on the web. There's two which are related to each other. It's around peak. Peter D'Souza's asked how difficult has it been to employ the required number of temporary staff over Christmas? And then Andy Wilson has a similar question, but then also was asking specifically around drivers, whether the driver academy that you mentioned, Simon, has helped with the pipeline of new HGV drivers. And the third one is from Sebastian Cancelliere, which is a slightly different question, which was, have we seen a pull forward of Christmas this year as some of the retailers have been talking about that? All right. Sounds like they might be all for. Might be you. I think these are all for me, John. Thanks, John. In terms of peak, I think last year we had 33,000 temporary workers. This year it's around about 20,000, and actually less, and a significant proportion that stepped down is actually within delivery. The reason for that is that now that we've done our revisions activity and we've really equalized our workload and become more fair for our team, it means that our actual base level of requirement is higher than it has been before. I think that sort of covers off the peak thing. In terms of the driver academy, I think the answer is yes. You know, we've made some really good progress here. You know, we have been out to our team, and we found out there was a number of our team actually in different parts of the organization that had, you know, part of a license or actually had a license. We've been helping people get those licenses and actually join us. We had a few people who had actually, you know, retired from the organization very recently that actually came back and helped us as well. I think that our self-help activity there is great. In terms of the apprenticeship scheme that I mentioned, which will be in place from early next year, again, that's us taking control of the situation, putting it in our own hands, giving people an apprenticeship opportunity and a guaranteed job at the end of that apprenticeship, of course, if they've met the criteria. In terms of general Christmas and pull forward, it's a hot topic of conversation. I think that what we saw in October is what we expected to see in October, which was an October that looked quite normal to us. What we've seen so far in our discussion with our customers, in an overall aggregate perspective, is I don't think we've seen a pull forward as yet, and we are now starting to see the volume step up in a way that we would have expected. GLS. Martin to talk to GLS, because obviously GLS has peak as well, and it's in a different European environment if you're following the news at the minute with COVID. Would you just talk about GLS? Yeah, of course. Thank you. So overall, the volumes are in line with our expectation, and we expect the same to happen in the coming weeks. It's a good development. Of course, they're higher than in previous weeks, and we see them now also rising quite steeply, but that is expected. We are well prepared for that. As I've said earlier on in my presentation, we have invested quite intensely into our network to maintain our quality of service during the peak. Which I'm very confident we will, as we did last year during the COVID peak period. Now, in Continental Europe, the COVID situation is such that we do see some lockdowns or lockdown-like situations again, and we are monitoring closely what will happen in the next couple of weeks. We're well prepared for that. If that comes through more strongly, of course, this will have another impact in terms of parcel volumes being shipped, i.e. the parcel volumes will increase even further. We also expect it to be more peaky also in a certain period of a couple of days and weeks. In terms of pull forward of volumes, we haven't also not really seen that yet, but it's also a function of probably what we see in the world and also throughout Europe in terms of the disruption of the global supply chain. Which is, the goods have to be there and be in the warehouse in order to be shipped and in order to be offered to the consumers. With the global disruption of the supply chain, in some industries and areas, we see that there's a bit of a challenge to really provide what the customers would like to order. Hence, we will now have to see how much of those goods will come into the warehouses in the coming days, and they will then add also, in terms of parcel volumes to our volumes. Thanks, Martin. Great. We've got three questions left on the line. Achal from HSBC is next. Morning, Achal. If we could try and limit to two questions now, please, so we could just get through everybody in time, that would be great. Morning, Achal, please go ahead. Morning, John. Thank you again for taking my question. I have three. On the one, going back on the pricing, I mean, it sounds great that the pricing is improving. I mean, definitely different from what we previously mentioned, that the pricing could remain under pressure. Now do you see that positive movement in pricing because of the wage inflation, or is there anything else? If that is the case, then what is the possibility to pass on the whole burden in terms of better pricing, if that is the case? That is my first question. What sort of opportunity do you see in terms of pricing? Secondly, I also wanted to understand. You mentioned on the capital reallocation, you said you have better insight now. What exactly does that mean? I mean, do you mean you have a better insight into the parcel volume across U.K.? And if that is the case, how far you have this insight into? You know, what sort of insight you're talking about? And thirdly, I also wanted to understand. You talked about the acquisition opportunities for GLS and the growth. Do you have similar kind of opportunities for Royal Mail in the U.K.? I mean, have you tried them, and do you think you can have some opportunity for inorganic growth in the U.K.? Thank you so much. Yeah. Shall I cover the last one? Yes, we talk a lot about accelerating and GLS. As I pointed out in my opening remarks is if you look at the markets that GLS operates in, they're double-digit growth markets. Looking at acquisition is a sensible thing to do, and Martin can maybe add something when he looks at pricing. Yeah, your point on the U.K. is a good one, which is if we had the right acquisitions in the U.K., clearly we would benefit from them, then clearly we're looking at them. To some degree, that's why we're retaining what I'd call a flexible capital structure to give us the ability to acquire where that's appropriate. Where it's not appropriate, not to sit on funding that we don't need and give that back to our shareholders, in addition to the progressive dividend that we've announced. That actually was our capital allocation policy from May, and what we're doing is implementing that as we come out of the COVID pandemic, where we hadn't paid a dividend during the pandemic. It was an opportunity actually to address the surplus cash that we had. The timing of that was really dictated by, you know, what we see in the market today. COVID obviously clearing up, and as I mentioned at the beginning is both the new management team getting their feet under the table and knowing exactly what they wanted for their respective companies. Do you wanna go to pricing? Is there anything you wanna say more on pricing? I think we broadly covered it. I think look, on letters, like I say, you know, we've already announced some price increases that are above inflation in many streams. We're comfortable that we've balanced that appropriately in terms of value and service. We also need to be cognizant of course, you know, the more you put your prices up, the less people use what is an already declining item in terms of the letter. In terms of parcels, you know, there's actually less pricing opportunities. Clearly, incredibly competitive everywhere, but probably particularly in the U.K. We have to be much more measured in how we think about pricing in that space because, you know, customers have many options. Okay. All right. Thanks, Aanchal. There's a third question about the. Invite answer shortly. I think Sam is next. Morning, Sam. Sam? Hi, Sam from J.P. Morgan. Hi. Hi, Sam. Hi. I've got two questions, please. The first one is on, you know, within your U.K. parcel revenue, is there much within there that's sort of COVID-related items, whether that's PPE or testing equipment? There's some proportion of revenue which is left to come out at some future date. The second question is, can you talk about tracked parcels within the U.K.? See the volume up 21%. Where's the penetration of tracked parcels today to where you think it can get to? And is there much of a price mix benefit that comes with those parcels versus untracked items? Thank you. Thanks, Sam. Do you wanna cover where we are on tracks, Simon, or? Yeah, I mean, Sam, in terms of, you know, tracked services, I think it's clear that the consumer likes the tracked services and the retailers like the tracked services. I think for us, there's still more potential. I think what we've seen in terms of these changes is that that demand is there. I think the trends that we're seeing. I think there's more opportunity there. I think as I said as well, it'd be quite nice for us to ultimately have everything tracked in our network because it'd give us much better ability to protect our revenues and understand how better to know where parcels are in our network for both sending, receiving customers and for us to manage the operation more efficiently. I think as a direction of travel, it's something that's gonna carry on. I think on revenues related to COVID, yeah, there absolutely are PPE and test kit related revenues in the parcel number. We don't disclose what it is, and it's quite material. Yeah. Yeah, Jemina? Sorry, Sam, I forgot one thing. Apologies. Sam, we also have barcoding of stamps now that we're rolling out as well. I think the fact that we have a barcode on a stamp. I think that there's some good potential, product innovations there using those barcodes. I'd say watch this space. Okay. Thank you very much. Great. Thanks, Sam. There's one question left in the queue. Before we go to that, I will just look at what's come in on the web. There was a question from earlier which we didn't cover, which was just asking around hedges and the hedges we have rolling off next year. I mean, I can answer that one. I mean, effectively, we have a hedging program for our commodity exposure, which is up to sort of 36 months into the future. It's diesel, jet fuel, gas, electric. And if you look across those, we still have hedges in place for about sort of 65%-80% of our predicted volume on those commodities for next year. That's just quickly covering off that one. Apologies if we didn't get round to your question, but this is gonna be the last one on the line from Sumit at Société Générale. Morning, Sumit. Hi. Very quickly, for Martin, GLS, I noticed strong comments for year-end volumes. I'm wondering why are you not more optimistic about next year's top line growth than what I hear from you. What are your thoughts about your top line growth there? Secondly, if you could highlight just one or two top problems or challenges with integrating your Rosenau acquisition in GLS. Good to hear your view on those things. Thank you very much. I will start maybe with the last question with regards to integration of Rosenau. We're still awaiting the official clearance from the Canadian authorities by the end of this month. Once we got that, as of December, of course, we're working closely with Rosenau how to best leverage the synergies. I personally have been over there and met and visited the sites and also the management team of Rosenau together with our Canadian team. I have no doubt whatsoever that we can integrate that company very well into GLS Canada. Why is that? Because first and foremost, there are no really geographical overlaps of the business models because Rosenau covers the west of Canada whilst our existing footprint covers the east, and it's mainly a 100% match so that we now cover the whole of Canada. Plus, the management mindset of the Rosenau company is very much in line with the GLS mindset, which is very agile, very much can-do, and very solutions-oriented. They are providing similar services with regards to freight. As we have seen also their facilities and the way they operate, I think it will be very feasible to drive synergies forward in terms of generating for more sales together, but also in terms of rolling out the hybrid parcel and freight model across Canada, which will be a massive and distinctive advantage of us in the market. I'm quite positive that the integration will run very smoothly and deliver the synergies that we envisage to come. On the other question, in terms of top-line growth. The thing is we have to see what is happening in the market currently. Traditionally, we have always enjoyed good growth rates, and I'm positive we will continue to grow, because as I said earlier, our customer base is a very loyal customer base. With the Accelerate GLS program, we are increasingly also gaining also large to C customers, and not just domestically, but also in terms of cross-border traffic. That complements our portfolio quite well and also drives the growth forward. We are benefiting from the market growth. On the other side, of course, we have to be careful what happens with the economies in the markets which we are in. There is still to be seen what happens. We've talked a lot about inflation today, we've talked a lot about wage increases, labor shortage, and also the supply chain disruption. That cannot be underestimated because if you look at what is happening in terms of the harbors, there's hundreds of ships still waiting to be offloaded and the goods being brought into the warehouses. Naturally, that we are part of that supply chain, we also rely on that supply chain eventually being fully functional again. Our revenue estimation for next year is a function of not just of our excellent quality and our great service, but it's also a function about the total supply chain and total market development. That's what can probably impact not just us, but also us in terms of the top-line growth. Yeah. You gave a great example yesterday of supply chain on tires, if you remember. Yeah. One example probably, which is quite striking, is in some of our countries. In the autumn and in the spring season, we transport tires for vehicles. Winter tires, summer tires. Normally what happens in this time of the year, we normally transport, of course, quite a number of winter tires. This year has been very different because of the changes in the global supply chain. Because this time, we suddenly haven't seen just winter tires, we have now seen summer tires being shipped. Why? Because the customers have become quite careful, and they're now pre-ordering, so to say, their set of summer tires because they don't know what's happening to the supply chain and with the supply in the months to come. I think that's a great signal that the predictability of the top-line growth and of what will happen in the market is somewhat different in terms of predictability quality than it was probably a year or two years ago. Okay. Okay. Yeah. Last comment on hedging. As I learned in treasury days, behind every hedge, there's a ditch. Thanks, Keith. Thank you everyone. We'll draw that to a close. Apologies if we didn't get around to your question. Obviously myself, John, and Anna in the IR team will look to follow up and answer questions if you wanna get in touch with us. Otherwise, have a good day and we'll speak to you again soon. Thank you. Thank you very much. Thank you.