Good morning, everyone, and welcome to Royal Mail's Full Year Results Presentation for 2021-2022. I'm John Crosse, Director of Investor Relations. And 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 was set out in today's release, and they'll also be included in the annual report, which will be published next month. 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 Chair, Keith Williams. Keith, over to you. Yes, good morning, everybody, and welcome. I don't need to say what a challenging year it's been for us all. You know that already. I would like to thank colleagues across the business who have worked to get us through a difficult time operationally in both our companies. Today, however, is largely about looking forward and focusing on two issues. Firstly, what we've learned during the pandemic, and secondly, what we need to do as a consequence. Simon and Martin will look at that in more detail in a minute, but just to set the scene, we have two exceptional businesses which are well-placed, and the pandemic has demonstrated the opportunities that we have. We've also been a beneficiary during the pandemic. People, businesses, and government have all wanted more parcels, which has increased traffic in both our companies. That benefit has now started to dissipate. The bubble in parcel volumes that the pandemic created has slowed in some of our markets. Not everywhere. Remember, today, we are present in many countries, but we do see a definite slowdown. The pandemic, however, has also brought into stark focus what we already knew, that both our businesses needed to invest in change to meet customer demand. For GLS, a greater focus on digital solutions, and for Royal Mail, changes to the way in which we operate to meet greater demand for parcels and to ensure that we are delivering both parcels and letters safely and efficiently to meet customer expectations. Despite spending almost half a billion pounds on additional support to the operation, the pandemic demonstrated that changes to the way in which we operate are fundamental to being a successful business going forward. Both businesses now face into additional headwinds of high inflation with all our markets. Not that it's easy, but Martin at GLS has the easier task. Here, we've seen good performance in B2B and freight, and the business has a good mix of B2B and B2C. We've also made a great acquisition with Rosenau in Canada, which is performing well. GLS is well-positioned not only to weather the short term, but also to deliver on its Accelerate target, and Martin is already halfway towards that target that he set last year. Royal Mail, however, is at a crossroads. Simon has invested in a number of areas which will better enable change to his business, people and management structures, an improved trade union dialogue, and he is delivering the infrastructure which supports that change. For example, we've now achieved more than 50% automation for parcels and have the first hub in Warrington coming on stream in a few weeks' time. However, we now need to face into the change itself and what it means to customer needs, particularly in delivery. That means broadening the scope of change to better match the ways in which we work to meet the requirements of all our customers. Finally, two other items. Mick will talk to capital allocation in a moment, but just to context that, we've completed the special dividend buyback, but I think quite rightly, the board has decided to retain a strong and prudent balance sheet in the light of current circumstances. We're now, however, recommending a final dividend of GBP 13.3 per share. Lastly, I'd like to mention the addition of Jourik Hooghe to the board. Jourik Hooghe is a serving VP and CFO at Wizz Air and brings great international, strategic, operational, and financial experience from his time at P&G. With the addition of Jourik Hooghe and Shashi Verma from TfL, who we added in September last year, we've brought in some very valuable experience to the board during the year that I'm confident will set us up well for the future. Now over to Mick for the results. Thanks, Keith, and good morning, everyone. I'd also like to start by thanking all our colleagues in all of our businesses across Europe and North America for their contributions in what has been another really tough year for everyone. I'm gonna start by taking you through some of the details behind what I think overall has been a fairly solid set of results for FY 22, albeit in a year where clearly we benefited from a number of temporary tailwinds from the impacts of COVID-19. I'll say more about the outlook in both of our businesses. Moving to the group headlines, group revenues are up 0.6% to GBP 12.7 billion. That's up by more than 17% over two years. Adjusted operating profit increased to GBP 758 million at a margin of 6%. That's up 40 basis points as profits in Royal Mail improved in the year. Basic EPS was GBP 0.60. Trading cash flow was GBP 353 million on a pre-IFRS 16 basis. This was a reduction YoY as capital investment in both Royal Mail and GLS was stepped up in support of transformation and growth. The pre-IFRS 16 net cash position, so excluding operating lease debt, is now GBP 307 million. As Keith mentioned, the board is recommending a final dividend of GBP 0.133 per share. Moving to Royal Mail, revenue was GBP 8.5 billion, down 1.6% YoY, but up 10% over two years. Our cost control measures meant that operating costs reduced by 2.5% to GBP 8.1 billion, with operating profit increasing as a result to GBP 416 million at a margin of 4.9%. Pre-IFRS 16 year trading cash flow was GBP 178 million. That was a reduction YoY, but includes a material step-up in CapEx, more than doubling to GBP 441 million as our investment in transformation peaked in the year. A few more facts and figures on the revenue and volume performance. Total parcel volumes were down 13% to 1.5 billion items as the extended lockdown related peak periods from the prior year didn't repeat, with parcel revenues down 6.5% to GBP 4.8 billion. Within this, COVID test kits accounted for around 7% of volume. Domestic parcel revenues were down 2.4% to GBP 4 billion. International revenues down 23%. On letters, addressed letter volumes, excluding elections, were up 3% as the market recovered from the negative impacts of COVID, and revenues further benefited from price increases. I provided the monthly volume charts in order to illustrate the trends over two years, so versus the pre-pandemic period, starting with domestic parcels, where volumes were up 31% across the year. This is clearly an acceleration in growth from the pre-COVID trends, but I would highlight two concerns for the year to come. Firstly, as I've already said, test kits made up around 7% of parcel volumes, and that was at, actually 13% in quarter four as the Omicron wave peaked. Clearly, we expect much lower volumes of test kits this coming year. Secondly, I think you can see in spite of the boost from test kits in Q4, the exit trend in Q4 was weakening into March, and that trend has continued into the early part of the new year. Letter volumes were down 18% over two years, exiting the year with a slightly stronger Q4 trend, and this in spite of significant price increases that we introduced in January of this year. Again, this trend has continued into early trading for this current year. International volumes have remained weak across the year, down 44% over two years. Revenue performance, though, is better than this, down just over 10% over the same period, given price and mix changes. Clearly this is a real point of focus for us for the coming period. It's certainly true that this business has been hit by something of a perfect storm of issues over the last couple of years. With rising conveyance and international settlement costs, new cross-border friction surrounding Brexit and the removal of the Low Value Consignment Relief all contributing to issues. We now need to make sure our customer proposition matches and beats other offers in the market. The reason for that is that cross-border is generally a margin accretive part of the mix in our industry. We need to make sure we capture any recovery in this market in the coming period. The operating profit bridge summarizes how we outturned against the various drivers of profit for the year. I won't cover the items to the left where the outcome was fairly much as previously guided. Our Pathway to Change savings outturned at the lower end of the range we communicated in January at GBP 59 million, and Simon will speak to this in more detail in a short while. The impacts of COVID-19 on the operation continued into the year, so that meant significant COVID-related costs as well, linked to absence in particular, but also social distancing. We'll target to remove the majority of these costs as we move through the coming year. Other costs were assisted by a large number of non-sustainable improvements in the second half of the year. That included, for example, general redundancy charges were lower given higher natural levels of attrition in the workforce. A reduction in our bad debt provision. Lower depreciation as some of our assets came on stream later than was anticipated. There was also a lower accrual for management bonuses. Moving on to GLS, where top line trading has been really positive in the year with revenue in EUR up around 10%. That's almost EUR 5 billion in the year. Revenue progression in GBP, slightly less at 4.4% as a negative FX impact masks the real scale of top line progress being made in that business. Volumes were up 4% with the revenue line further assisted by price increases. We saw some growth in B2C in the year, but also a strong recovery of B2B, with our B2C share of volume now representing around 55%. Operating profit margin for the year was 8.1%. That is worth highlighting that second half margins were below 8% as rising inflation across all markets started to become a drag across the period. A particular issue in that respect was in the U.S., where high inflation coupled with the impact of driver shortages has more than eroded the progress we've made there on the top line. The waterfall shows the main YoY movements at the operating profit level in GLS. A small impact from acquisitions, as Keith mentioned, principally the acquisition of Rosenau Transport in Canada at the beginning of December. Revenue growth we saw in almost all countries, and that contributed to really strong top-line progress, though operating costs, of course, impacted by increasing levels of inflation in all of our markets. You can see also that the FX movement was the key driver of the profit reduction in sterling, with profits being flat in euro terms. Cash flow in GLS remained really robust in the year with pre-IFRS 16 trading cash flow of EUR 207 million. This was down on prior year, as in GLS we also stepped up the level of investment in growth and also tax payments were slightly higher in the year. On the GLS two-year volume trends, volumes were up 30%, and that was a really excellent sustained progression right across the period. Moving on to outlook, where once again, we face a significant degree of uncertainty in the months to come. Clearly, we have issues specific to each business, but first to mention the common themes. The economic outlook is clearly challenging, with question marks over the level of inflation and GDP. Of particular concern for our industry will be the extent to which the cost of living crisis impacts the level of online consumer spending, and therefore the volume of parcels in our networks. H1 comps are particularly tough. Last year included a lockdown period at the start of the year. What does this mean for Royal Mail? Well, the combination of both revenue and cost headwinds mean that the need to transform is now increasingly urgent. As Keith said, we're at a crossroads. There's a need both to accelerate but also to extend the scope of the transformation in that business. We've discussed the headwinds previously with inflationary pressures on pay and other costs, now exacerbated by the worsening macro-economic outlook and the implications that may have for parcel volumes in the top line. In the coming year, we expect revenue to decline. There'll be an impact of our handling fewer test kits, but we also expect the UK domestic parcel market to decline. On address letters, our current modeling suggests a high single-digit percent decline in volumes. Now, as you'd expect, we've already started with our mitigation plans, including some significant price increases to both letters and parcel services already introduced in quarter four of last year. We've identified cost-saving initiatives of over GBP 350 million, including initiatives across all areas of the business. These changes are either already in deployment or associated with agreements already made with CWU. In addition, as a part of the ongoing dialogue on pay with CWU, we've identified a number of incremental change areas to also discuss. Assuming a pay deal is agreed broadly in line with our current offer and without material industrial disruption, current analyst consensus of around GBP 300 million for Adjusted operating profits fits well within our range of potential outcomes for the year, though the level of headwinds must present some risk to the downside at that level. On GLS, we're seeing similar macroeconomic headwinds. In particular, I should highlight the increase in minimum wage in Germany during 2022 and the implications that has, along with rising fuel costs for subcontractor rates in that business. We're taking a proactive approach to protect margins, taking price wherever we can, and also implementing efficiency initiatives, including digital tools to help improve final mile efficiency. We'll also continue to look for opportunities to improve the margin performance in the U.S. and France. For the coming year, we're anticipating high single-digit% revenue growth in euro terms, with operating profit in the region of EUR 370 million-EUR 410 million. Moving to capital allocation. This slide shows the outcomes for the year against each of the priority themes for capital allocation I highlighted last year. You can see both businesses generated cash and also that they both stepped up their organic investment initiatives in transformation and growth. The board's proposing a final dividend of GBP 0.133 per share, as I mentioned. Now, we took the decision in November to improve the efficiency of our balance sheet by commencing the move back towards our historic level of leverage, so towards a net nil cash position, excluding operating lease debt. We ended the year with a net cash position on that base of GBP 307 million, compared to a similar position of over GBP 600 million 12 months ago. That's having acquired Rosenau Transport in Canada and having returned GBP 400 million of excess cash to shareholders in the year. Now we remain committed to that direction, though given the elevated risk environment currently, we plan to maintain the level of prudence that we currently have for now. To summarize, solid performance in the year from both businesses, assisted by COVID tailwinds, but there's no doubt the waters are becoming increasingly choppy. Some of the top-line tailwinds from COVID are unwinding alongside the impacts of increasing inflation and weakening economy. We do have opportunities, though, and the next year is one in which we need to make some material steps forward in transforming Royal Mail and confirming the profitable growth prospects in GLS. With that, I'll hand over to Martin to provide some more information on that business. Thank you, Mick. I would now like to give you more detailed information on our performance and progress as well as on our strategic outlook. As Mick mentioned, we've continued on our growth path with a revenue increase of 9.6% and a margin of 8.1%. In our countries, we've seen that B2C volumes were largely secured and remained on a high level since lockdowns have been lifted. Revenue growth was also supported by recovery in B2B volumes and favorable pricing. Margin was 0.8 percentage points below the prior year. This was due to a combination of factors, but predominantly no longer having the strong effects from lockdowns that we experienced in the prior year and rising inflation in all our markets. Nevertheless, our margin of 8.1% remains significantly ahead of our pre-COVID performance. I'm very pleased with the strong performance of the GLS Group. This once again proves that our business model is resilient and flexible. How are we doing in specific markets? Overall, we have seen positive development in most GLS markets. Today, I would like to give you more details on some of our countries. I'm pleased with the progress we've made in France. The focus has been on strengthening the management team, investing in automation to increase efficiencies, solving operational bottlenecks, and improving our last mile delivery options. Investments we made are paying off as GLS France delivered good revenue growth and secured the customers and volumes gained throughout the last year. Operating losses were narrowed further, which represents a huge step change on the pre-COVID era. As a result, we are increasingly confident about the prospects for GLS France, and we are indeed accelerating our investments into the business, including a commitment to develop a new central hub in the Paris area. In Germany and Italy, two of our key countries, we've seen sustainable and steady revenue growth. In both countries, we've also benefited from the recovery in B2B. This balanced portfolio makes us less sensitive for a downturn in a specific segment. In Germany and Italy, investments will be focused on further growth, quality, and customer experience. In Europe East, we are leveraging our leading position in the B2C segment. We showed strong growth and have invested in solutions such as parcel lockers to improve the final mile offering. We will continue to invest into Europe East, manifesting our strong market position. Also, in our other European markets that I didn't mention explicitly here, we made good progress. Overall, it's fair to mention that our diverse portfolio of businesses in Europe is an important and balancing strength during these times of economic challenges. We've also made some important steps forward in North America. I'm very satisfied with our Canadian business. GLS Canada remained highly profitable with strong revenue growth and margins above the group average. Rosenau is performing in line with expectations, and our integration plans are on track. To remind you, with the Rosenau acquisition, we have strengthened our position in the Canadian market, and this helped us to further enhance our North American offering. With regard to our other North American business, GLS U.S., there's still room for improvement. Despite being profitable in year 2020-2021 and a strong and positive revenue growth of 11% in the year 2021-2022, we are in an overall loss position. This was mainly caused by high inflation and labor shortages impacting our cost base. Initiatives are underway to further increase pricing and surcharges as well as to improve our operating costs. For example, our more automated hubs in the San Francisco and Los Angeles area will support our efforts to increase efficiency. We've also improved our customer mix and delivery footprint to increase profitability and move the U.S. business back into profits again. I would like to now briefly reflect on the current economic environment. What are the current economic challenges and volatilities that are impacting us, and what are we doing about it? We expect a negative impact from the uncertainty brought about by the war. This is expected to lead to a reduction in GDP growth, lower consumer spending, and further impact on our cost base due to rising inflation. As a result, we expect margin to come under pressure. We've seen a slowdown in volume growth since the start of 2022, which is also a result of ending COVID-19 restrictions. However, we observe variations across our countries with between flat and high single digit volume declines in recent weeks. The higher volume declines being in those countries with a stronger B2C focus and which benefited more from the COVID restrictions in the prior year. We've implemented a broad range of measures to address these short-term challenges and to mitigate the impact. On pricing, various pricing initiatives are being rolled out to address inflationary pressure and other cost increases throughout the year. For example, we have tightened our fuel surcharges and focus on yield improvements, such as reinforcing our pricing structure for bulky parcels and general rate increases. Price increases are expected to be around mid-single-digit percent, and we are not necessarily limiting our rate increases to just one pricing round in the coming months. On our cost base, to avoid and reduce costs, we accelerate automation and we continue the development and rollout of our digital tools to optimize efficiency and to achieve further standardization. Our local management is executing on tight cost controls. I think it's worth highlighting that GLS flexible cost-based model, working with transport partners, is an advantage for us to contain cost increases as much as possible. Naturally, we also tightly control our discretionary spending, our hiring, as well as our staff levels. We are making good progress on executing these measures. Thus, our adjusted operating profit outlook, as Mick mentioned, for the year 2022-2023, is in the range of EUR 370 million-EUR 410 million with a high single-digit revenue growth. Looking further ahead, we believe that our Accelerate target of EUR 500 million operating profit by the year 2024-25 remains achievable, provided that there is an economic rebound in the year 2023-2024. Now, while we address short-term developments, we also remain focused on our long-term development and our growth ambitions, and the strengthening of our positioning as a quality leader. Therefore, we have taken various actions to unlock growth and maintain high quality. Our network capacity and footprint has been significantly upscaled in the last year. We have been investing in our infrastructure and quality by extending and upgrading over 100 hubs and depots. A good example of our investment strategy is our new state-of-the-art hub in Madrid, going live end of this year. This new hub, with a capacity of 64,000 parcels per hour, will provide new growth opportunities and increase efficiency through, for example, a fully automated small parcel sorter to further support and strengthen our position as a quality leader. To enhance customer convenience, we continue to invest in our parcel shop and parcel locker network. We grew our alternative pickup point significantly during the year, which strengthens our omni-channel mix of last mile delivery solutions. Finally, digital tools are being implemented across our operations to improve process efficiency. All our investments will help us to strengthen our position and stand out in a fast and challenging market. We are planning to invest around 4% of revenue in the year 2022-2023. We believe these investments are important to sustain our growth path in the coming years. Going forward, we will continue our growth trajectory and strengthen our position through enhanced digitalization, increased brand recognition, and a sustainable delivery model. We've made some important steps already. We've continued to launch new app-driven solutions to improve our customer connection, for example, by providing real-time tracking and live customer feedback management. In Denmark, for instance, we launched a new customer app that was number one on App Store's hit list within 48 hours of release. With the implementation of our new, fresh, and modern brand, we have quickly managed to increase brand awareness. Based on recent research reports, in GLS Germany, GLS in Germany is considered now the logistics brand number one with the best reputation in the German parcel market. Additionally, we are further developing our sustainable delivery model through emission avoidance, reduction, and compensation. For example, we've implemented a carbon-neutral European delivery service and are growing our zero and low emission fleet. Recognizing our sustainability efforts, we've been awarded the EcoVadis Gold certificate. There are headwinds currently in the parcel market, and we will tackle them as I outlined earlier. Since we believe these challenges will not be permanent, we continue investing into the longer term future of our business. Looking ahead, we want to continue building on our success and use the momentum to push GLS further. We will transform GLS to a digital, sustainable, and truly global player to further diversify, capture growth in various markets, and offset margin pressure. This will include expanding our global presence and capturing growth in markets close to GLS' parcel core. Our track record of entering new geographies has generated value for many years and has been supported by the GLS asset-light and scalable business model. Growth and diversification will also be supported by our digital transformation. We will accelerate our digital change to strengthen our position in the market, capture new revenue streams, and become a tech-enabled parcel provider. While growing GLS, we are aiming to reduce our emissions to zero by the year 2045. We are on an exciting journey to transform GLS more global, more digital and sustainable. In summary, a strong GLS performance despite the loss of COVID-19 effects and escalating inflation. Measures are in place to mitigate temporary macroeconomic headwinds. We are positioning GLS for long-term growth and transforming GLS to a digital, sustainable, and truly global player. Thank you very much. Now over to Simon. Thank you, Martin, and good morning. Unlike many businesses, we've coped very well with COVID over the last two years. Coped with larger parcel volumes than expected, and coped because the bigger the challenge, the harder our team tried. The world is now normalizing and COVID is behind us. We have a ton of economic uncertainty ahead of us. The online retail market is cooling, and we no longer have the benefit of delivering test kits. It's clear our customers' behavior has changed. Our future is as a parcels business. Over the last 12 months, we have made many changes to our management capability and structures, and we have many useful learnings we can turn into action. We must change how we work today and specifically how we work in delivery today. We need to make sure we reflect the needs of the customers and align our workload with our labor. This is what our pay and change discussions are all about. Change at this pace and at this scale is very difficult. It's rarely a straight line. Our change agenda is now even more urgent and important than it was a year ago. We need to change to make sure we can offer our team the job security they deserve for tomorrow and not just for today. A quick reminder. We will own trust to the doorstep, thanks to our trusted team, and we will continue to build trusted relationships across the business, so we can work together on reinventing Royal Mail for the next generations and grow our business as well as our market share. We can compete, improve our productivity, specifically in delivery. By doing this, we can compete on quality and cost, win with our people, be the lowest CO₂ delivery company in the market. Once we have transformed and completed our new pay deal with the union over the medium term, we will be able to enjoy sustainable +5% margins. There's no doubt that COVID gave us a tailwind that we have embraced, and it's a tailwind that brought us a significant step up in parcel volumes. This year, we successfully managed through the pingdemic and Omicron that meant over 15,000 of our team could not come to work on the fourth of January, and also one of the worst storms the country has experienced in February. Numerous lockdowns came and went, and just before peak, truck drivers were hard to come by. Throughout all of this, and bolstered by online parcel sales and test kits, we delivered GBP 8.5 billion of revenue, a little down on last year, but 10% up on pre-pandemic. Domestic parcel volumes are down 7% on last year. Based on our internal models, we believe we grew our revenue market share. We are profitably competing in the market. Letters performed better than we expected as U.K. business opened up, and we delivered a GBP 416 million profit, just under 5%, thanks to our commercial and cost initiatives. We invested GBP 441 million in our future. The world around us has changed. COVID is no longer a tailwind. The online shopping market is not as buoyant as it was, and we are no longer delivering test kits anywhere near the volume of before. Our letter volumes, excluding elections, have also declined by 18% during the pandemic, and we now need to change to reflect our new normal. By changing now, as I believe we will, there are great opportunities for us to capture to give our customers what they want and provide job security for our team. As a reminder, this is what we said 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 together. Our ticket to play, improving our productivity and managing our costs. This is where we landed. Against an ambitious and necessary plan of change for our customers, we remain number one at the doorstep, thanks to our team. Parcel quality was good, letters quality better than last year, but there is more to do. A positive leap forward with our trust agenda, very hard to do at this scale, and participation from 16% in February last year to 69% now, and a trust score from the high 50s - 68, and a major achievement in any size of business. DILO is executed, releasing our managers from 1.6 million hours of pointless administration. Our pilot office was 695 out of more than 1,200 offices, and they're now 111. In automation, above 50%, just as we promised. On the CWU agreement, record productivity and processing, but delivery benefits were below our expectation, which is very disappointing, particularly after all the activity we executed. Non-staff cost savings on plan, over GBP 200 million saved over the last two years. We've just completed our delivery operational restructure. We've reduced the leadership layers from eight to five to remove bureaucracy and push decision-making close to the customer, so we can act with speed. Our research was clear. Smaller teams perform better. Better for safety, better for quality, productivity, and trust. We have reduced the maximum team size from 56 - 44. Two-thirds of our delivery offices have an average team size of under 35. Up from 51%, 100% of our managers now have a scorecard. We hadn't changed our delivery operational structure for 30 years. It's been a dramatic change and has caused disruption. I'd like to thank the team that were brave enough to lead this positive step change. I know it has not been easy, and I know it has not been easy for us. In addition, we've changed 51% of senior managers and 29% of middle managers, and a significant proportion of the executive board. We have a new chief people officer who joined in October, a new chief operating officer who joined in March this year, and a new chief financial officer who also joined in March. Our internal talent assessment was clear. Our leaders have a great sense of purpose. They are great at collaboration and can run the daily operation brilliantly. There was definitely scope to improve how we approach performance management and transformation. Our new recruits are great at performance management and transformation. We now have the right mix of the current and new leaders. We've achieved our promise of more than 50% parcels automated on our journey to 90% by the end of fiscal year 2023/2024. Last week, we achieved 54.3%. Every week, we are improving. We have 14 more parcel sort machines to commission this year, and the Northwest Hub is on budget and on time and will be operational in the coming month. The Midlands hub is on plan to open in summer next year. Not everything has gone perfectly. On quality, we continue to perform well with parcels, but our overall USO quality is better than last year, there is more to do. Our area of disappointment, we identified +GBP 100 million of benefits from the CWU agreement and have delivered GBP 59 million. It was the lower end of our guidance of GBP 55 million-GBP 80 million. However, processing enjoyed record productivity of 8%, but processing is a relatively small proportion of our cost base. Even though we did the activity, which I am grateful for, the results in delivery were below our expectation and is very disappointing. We've delivered 87% of the Pathway to Change actions, and for processing and line haul, we have record productivity of 8%. For delivery, we did not improve productivity YoY. There were two reasons. Following a pilot, the delivery resourcing technology was not as user-friendly as planned, so we're now improving it, and we plan to trial again at the end of the year. A new version of scan-in, scan-out technology for delivery is already in trial. On revisions, although 1,000 went well, the 200 that did not go so well resulted in a neutral impact. We have learned some invaluable lessons. This year we can go again and strive to recover what we have lost, plus deliver what we agreed with the CWU for this year's productivity flight path. On revisions, we now know what good looks like. We implemented 1,800 revisions overall, of which 1,270 were in delivery. That means we changed 50,000 routes on the working practices of 100,000 people over a five-month period. It was an enormous change. 1,000 revisions went very well with our best productivity improvement of 16.6% and 166 structural or major change revisions went very well. We did experience 200 structural revisions that did not go well. Our structural revisions were targeted at those units with the largest productivity opportunity. As you can see, the 203 that did not go well had a negative productivity impact of -7.2%. Some were closer to -20%. The impact of these 200 negated the positive impact of the 1,000. It's a team game. We need fairness for all of our people and equal performance everywhere. We have learned, and there are three things that need to be in place to ensure revisions go well. The operation must be stable before deployment. We now have a checklist for that, and the leaders must be skilled at a revision and must involve the front line in all of the change. The computer does not have all of the answers. The postie's local knowledge is really important. Finally, we need a sense of camaraderie. It's important that everyone is embracing the change and is committed to making it work from day one. On this point, we do need to acknowledge that a good proportion of walks or routes have not changed for over 10 years. Some walks that were two and a half hours long are now four and a half hours long. Changing from a two and a half hour walk that you have done for 10 years one day to a four and a half hour walk the next day, it's a shock to the system. It takes time to adjust to this amount of change. We must equalize workload across our team because that is fair, and it's fair to everyone. Everyone needs to make an equal contribution. We are going to go again, and we need to deliver the agreed productivity benefits in full. Thanks to our data science team, we can see that there is a direct correlation to increasing parcel volumes and letter quality. As parcel volumes increase in a delivery office, letter quality decreases, and the quality impact is greater on first class than second class. That is because we haven't changed our sortation process in our delivery offices to accommodate the volume of parcels that we now handle. As you can see, parcels are sorted on top of a letter frame. It's no longer fit for purpose. We always give letters and parcels the same priority. Operationally, at times, it's impossible to do, because if you do not clear your parcels every day, you cannot even get to the letters in the sorting frame. This is an unfortunate practical reality. Thanks to our new hubs, we are able to deploy dedicated parcel depots for large parcels, a new pipeline capability. There's an opportunity for these depots to deliver 9% of our total parcel volumes this year. The parcel depots are designed to focus on larger parcels and later acceptance time next day deliveries. We've invested GBP 900 million of CapEx in our future over the last three years, and now is the time to unlock the potential of these investments. We have brilliant new infrastructure coming on stream. Our new parcel hubs will arrive on time. The North West hub opens in the coming weeks. Parcel automation is accelerating, and the team are hungry to go even faster. We've invested in a new app for our customers, later acceptance times for our retailers and our customers, and we now have new management, new management structures, and new ways of working in place. Thanks to our new hubs and the progress we've made in automation, we can compete in parcels, quality, and price. We urgently need to change our ways of working in delivery to reflect the needs of the customers and align our labor to workload. We want to compete in the market so we can offer job security for tomorrow as well as today. With our new Northwest Hub coming on stream in the coming weeks, we can now implement dedicated parcel depots, and this means that we are reducing the steps from retailer to customer by 50%, from 4 to 2. We will focus on large parcels and later acceptance times for next day deliveries. As part of our pipeline review with the union, we agreed that up to 15% of our parcels can be delivered through dedicated parcel routes. Over the next twelve months, we have an opportunity to deliver around about 9% of our parcels through this new pipeline capability. By removing these larger parcels from our walks, we expect letter quality to improve. This also means that over the next twelve months, 91% of our parcel deliveries and predominantly smaller parcels will continue to be delivered with letters. The combined delivery of letters and smaller parcels remains very cost competitive, and we will continue to leverage this competitive advantage as well. To fully utilize the infrastructure that's coming on stream and to meet the customer needs, we also need additional change in our ways of working. Our working practices and delivery are optimized for letters. They now need to reflect the needs of the parcel customers as well. We have a plan of change that we started discussing with the CWU back in February last year, and it's focused on creating flexibility, so we can meet the customer need by aligning our resources to our busy times, allowing us to deliver later in the day, delivering a competitive and reliable Sunday service, and equalizing performance across members of the team, and equalizing performance across delivery offices around the country. We are aligned on what ultimately needs to be done. We now want to discuss how these principles can be put into practice. What we would like is a roadmap of implementation. We need a more flexible approach to working that reflects the seasonal nature of our business while providing a regular income for our team, so they can budget and plan ahead. Allows us to accept parcels later in the day for next-day delivery. This will also help us utilize our assets, which means lowering CO₂ per parcel. Thirdly, allows us to profitably grow our Sunday deliveries. We're confident these are feasible because we've either done something similar in the past or are currently doing it in parts of our operation today. As you know, we are currently in pay discussions with the CWU. Implementation of the change I have described will allow us to improve the rewards for our people. We know they are impacted by the inflationary environment. We have offered up to 5.5% increase, but made it clear we can only fund this if we have the support to implement change. This proposal also includes a brand-new above and beyond productivity frontline bonus scheme, so everyone can take accountability for and share in our success. I'll say it again, I'm pleased and grateful for the change the team delivered over the last 12 months. Over the next three weeks, we will be entering a period of intensive discussions with the CWU under our dispute resolution process, or DRP for short. There'll be parallel discussions on pay under a DRP raised by the CWU and change under a DRP raised by Royal Mail. As I've always said, we would like a pay deal as soon as possible. We're in a very competitive parcels market, and our team are living in an inflationary environment, so we need to give our team certainty and put all of our collective energy into seizing the opportunity that's in front of us as soon as is possible. I'm sure you understand this is a sensitive time, and we don't negotiate in public, so please be mindful of this point during the Q&A. Let's now talk about growth, and I am disappointed today that we don't have enough time to cover off our growth initiatives in detail. We're doing well, but here are some highlights. Gaining our fair share of both import and export volumes. As Mick mentioned, we know international is margin accretive. We are now in the middle of a detailed review, and we'll update you with our findings in due course. We are determined to lead in the next battle, battleground. Our CO₂ per parcel is a fraction of the competition, thanks to our feet on the street model. We now merchandise the CO₂ per parcel for every delivery in the app, so the consumer understands the impact of their order on the planet. Over the last six months, our first fully electric delivery office in Bristol has shown operational fleet cost savings of 37% for maintenance and 73% for fuel. We are now investigating a capital-light way of accelerating our electric final mile rollout. It's good for the planet, it's good for the team, it's good for our customers, and it's also good for cost. We want a step change increase of the use of rail, and our Midlands Hub development includes a railhead. We want to review our operational timings so we can have less flights. We now buy all our electricity from renewable sources, and our next parcel target is 50 g of CO₂ or the equivalent of making a cup of tea. All of this means we can pull forward our net zero target by 10 years to 2040. We've just completed a roadshow up and down the country to see what the consumer wants from Royal Mail, and we asked them not only about the USO, but about all of our services. They've been very clear that a seven day parcel service taking things to and from their doors with low impact on the planet is a winning proposition. The young and the old see us as a trusted brand that delivers a reliable and secure service. They felt that a five day letter service was fine in line with the Ofcom user needs review. Tracking, Safeplace, and delivery at neighbor options are a must do, and low CO₂ is very important. Digital services they can access wherever they are as well, and subscriptions giving them everything they need for a set monthly fee. They are open to weekend priority letter services, which we could deliver using our bar-coded stamp if we wish. They do not want to have to drive to pick up a parcel, a trend that is likely to stay as increased home working becomes the societal norm. It's now time to reflect on these findings and define the next steps with our key stakeholders. We must dedicate our investments to our future, not our past. For the coming year, we need to continue to focus on our customers, maintain our number one position at the doorstep, and deliver good letter and parcel quality. Realize the benefits of a new management team and new operating structure. Continue the success of this year and strive to grow our domestic parcel share in a profitable way. Achieve our next promise of 70% of parcels automated. Change our delivery model for large parcels, and change our ways of working in delivery to reflect the needs of our customers while aligning workload and labor. Get the CWU agreement benefits back on track, which means get the CWU agreements and delivery back on track. Mick's already covered these topics in his presentation, but as a useful summary, we plan to secure GBP 350 million of benefits this year. Benefits from our Pathway to Change agreement, both the flow through from last year and more from in-year activity. Parcel automation will grow, and our Northwest Hub is coming on stream. We'll see benefits from less COVID absence and less COVID costs, such as lower rental van usage, now we can share vehicles. We'll secure more savings from non-staff cost savings. We'll benefit from our operational management simplification. We see further potential benefits from our Pathway to Change discussions with the CWU. In summary, we will keep improving our ease of use and continue to provide a quality service delivered by someone the consumer trusts. We'll continue to improve the trust with our people and realize the benefits of our new team, our new operating structure. We'll strive to profitably grow domestic parcels and keep scaling our new propositions. For productivity, we need to implement a new parcel delivery model, change our ways of working in delivery, increase our automation, and catch back on our lost CWU agreement benefits, specifically in delivery. For the last two years, COVID has helped us, and unlike many businesses, we've coped very well. The world is now normalizing and COVID is behind us, and a ton of economic uncertainty is ahead of us. The online retail market is cooling, and we no longer have the benefit of delivering test kits, and it's clear our future is as a parcels business. The parcels business is hypercompetitive, but we must change how we work today to make sure we reflect the needs of the customers and align workload and labor. This is what our pay and change discussions are all about. The change agenda is now urgent and important, and it cannot happen fast enough. We want to give our team the job security that they deserve for tomorrow and not just for today. Having delivered our transformation and completed our pay deal, we will be able to compete and win in parcels while delivering a sustainable 5% plus margin. We will be able to enjoy sustainable +5% margins in the midterm so we can keep investing in our team and our business. Royal Mail is a great business. I am very proud to lead it. We can win, and I'm certain of that, but only if we change, and we have to change now. Thank you. Great. Thanks, Simon. We'll now move into the Q&A. I think Natalie is our operator for today. Natalie, I'll hand over to you, and we'll start the Q&A on the line, if we could, please. Ladies and gentlemen, if you would like to ask a question, please press star followed by one on your telephone. 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's star followed by one to ask a question. One moment for the first question, please. I think we've got Clementine from Bernstein as the first one. Should we go to that, Natalie? Yes. Hi. Good morning. I don't know if you can hear me. Yeah. Morning, Clementine. Hi. Good morning. Perfect. Three for me, please. First, something you've talked about before is the area of cross-subsidy between the Royal Mail and GLS businesses being over. Can you please confirm that this is truly over, that it's not coming back, even in the event of losses in one of the other businesses, so that GLS cash flow will either be used to grow GLS or to be returned to shareholders? Second question is related. Given where the shares are at the moment, how are you thinking about the merits of spinning off, separating the Royal Mail and GLS businesses into two separate companies? Third, you mentioned the tight labor market and inflation growing. You've already had better parcel pricing in H2 as a consequence. How do you see parcel pricing evolving this year versus the competition? Where's your pricing power for the year ahead? Thank you very much. Okay, thanks, Clementine. I'll cover the first two, and then I will ask Martin to comment on GLS because I think it's a question for both companies, and then Simon to talk to Royal Mail. On the issue of the two companies, we've always said is that we're comfortable with the structure that we've put in place, and we've made it clear that there is no cross subsidy that will happen between the two companies. A word on GLS in that context and a word on Royal Mail. On GLS, Martin outlined his plans to continue to look at M&A. We're confident that that can be funded by cash flows from GLS or, if necessary, if there's a sizable acquisition that meets, if you like, the investment criteria for the board, that that can be funded at a group level. No change there. If you look at Martin's cash flow, it's actually in the presentation, and you can see there's a strong cash flow anyway. Equally, if you look at Simon's business is again, there is a positive cash flow. If you look at during the COVID period, we've been able to effectively reinstate the dividend because there was one period where we canceled the final dividend and do the share buyback. We have, as we said at the beginning, we've got a prudent balance sheet and a good balance sheet and two exceptional companies. I you know don't think anything has changed from what we've said previously, which is we're comfortable with where we are. There are no short-term synergies between the two companies. We've acknowledged that. We're comfortable with where we are. On the pricing, yes, indeed, the tight labor market and inflation is also very high. The question was around the pricing power now and going forward. I think it is fair to say that from a GLS perspective, we have already moved on pricing quite a bit. As I outlined earlier, also on the surcharging, for example, on fuel surcharging, which is very important for us because due to inflation and the rising fuel prices, we need to cover for that. One measure is the pricing. Of course, the other measure is also to work on our own operational efficiency and the cost position. Well, what does it mean from a market perspective? The competition is basically in the same boat, so they are also challenged by the increasing costs. There is a natural tendency in the market. I would expect also for the competitors and us to try to manage the cost increases via further price increases and putting the prices up for our services. However, as we might also see in terms of volume a slowdown in growth, and there will be capacities in the market, and there are capacities that have also been built up during the COVID period in the last two years, there is a risk that prices come under pressure because competitors will try to fill the network. The jury is still out on how this will pan out, but that is, of course, a certain challenge with regards to putting the prices up further. With GLS in that game, I think we have a competitive advantage there because one, we are playing always on quality. We are a player where the customers stick with us for quite a long time because we provide a very high level of quality, and quality has got its price, but also, therefore, the customer gets a very good return. We see not many customers shifting just because of price currently. The second advantage we have is, in terms of maintaining a good pricing level, is our mix of B2B and B2C. Those segments traditionally have a different exposure to pressure on price because it also again driven quite nicely on terms of quality, service delivery and international network coverage, which we provide and some of our other market players do not necessarily do in the way we do. It's a mixed picture, but I see some challenges there. In terms of our pricing power, I think we are well positioned. Yes, I think I'll add from Royal Mail perspective. I'll not repeat what it is that Martin said, but some of the same dynamics are definitely at play. We have done a parcel pricing increase this year as well and also surcharging, and we will keep reviewing it as we go through the year. Back to Martin's point on quality, we remain number one Net Promoter Score on the doorstep, and we also have a look at the Net Promoter Score for our sending customers as well or our retailers, and we perform very well there as well. We have our quality, and as we go through the year, we'll just be keeping very, very close contact with what happens in the market. I don't see any irrational pricing behavior in the market as well. I'm sure as the year goes through, we'll be having a look again. Great. Thanks for that. Thanks, Clementine. Next on the line, I think it's Christian from UBS. Morning, Christian. Yeah. Hi. Good morning. Thank you for taking my questions. The first one on UK domestic parcel volumes, market decline in volumes we expect for UK domestic parcels this year. Secondly, could you tell us, in the year that just ended, what's left in the system in terms of COVID costs, you know, excess conveyance costs as well as excess absenteeism costs. Could you give us an overall figure? From that number, you know, what sort of cost savings you expecting in the year that just started and going forward. The last one, if I may, your guidance is predicated on your current pay deal offer. I guess what gives you confidence that you can reach consensus around your current offer, considering the strong pushback we have seen from the union some of the last week? Thank you. I'll ask Mick to do the first two, and then Simon. As Simon put in his Q&A, we're not gonna negotiate industrial relations in public, but I'll maybe ask him to make a comment. Okay, so maybe to start with the domestic parcel volumes, as you kind of rightly highlight and I like highlighted in my presentation, I think we certainly saw a softening in that space as we exited the final quarter of last year. As I think we said, quarter four bolstered by 13% of test kits and a deteriorating trend exiting the year. That's certainly true. What we do see in the year to come, we've said, look, we do expect revenue declines, and we do expect a decrease in the domestic parcel market. We've not given a number, and so I'm not going to kind of elaborate. It, you know, yes, we see a YoY decline in that market. Of course, we're doing lots of things to seek to mitigate against that. We've already put 4% on average price rises into the parcel market, with in addition some fuel surcharges, and we'll continue to monitor pricing from others in that market as we go through the balance of this year. So yeah. I mean, the other thing I should say as well is if we look at the YoYs into this year, we have some really strong comps at the start of last year, in particular, when the country was in lockdown. Of course, that has an impact on the YoY progression as well. I think we're still confident that when we get through this, you know, we will have seen a step up in online shopping and a step up in the market. Of course, some of that acceleration that we saw, you know, a year, 18 months ago is certainly starting to kind of fall away and trend, you know, not entirely, but, you know, towards what the underlying trend might have been kind of three, four years ago. I think so. I think on the question around the union situation, the first thing just to set a little bit of context is we have had 75% less disputes this year versus last year, just as a bit of context for you. In terms of what the current situation is, that we are using our dispute resolution process that we put in place. It lasts 30 days. I would imagine over the next two weeks that there will be some intense discussions on both pay and the change element. What I would say is that we do need the change to pay for the pay, and we want to compete in the parcels market, and these changes will allow us to do so. By doing that will mean that we can give our team, which they deserve, the job security that they absolutely want. Sorry, Christian, I'll come back on as well. You asked about COVID-related costs. I think in the last year, we originally, at the start of the year, targeted removing around 100 of what was more than 100 costs in the original year. I think we got about half of that out in last year. There's +50 costs of COVID still kind of baked into the baseline. That's things like absence running at higher levels than the pre-COVID level of absence that we saw. It's costs of social distancing. In part of last year, we were still hiring thousands of vans so that we didn't have to have colleagues sharing vans and keeping good distance between them. There is significant cost to remove. As we move into next year, what we're saying essentially is the costs that we expect to remove are a part of the GBP 350 million cost reduction that we are challenging ourselves to deliver in the course of the current year. We've stopped trying to be quite as precise as to what the different elements of that reduction is, and that's because increasingly, as we see changes in the mix of our traffic, as we have different initiatives targeting, for example, reducing absence, as we have different initiatives targeting the operation to hit certain targets. Actually, it becomes kind of less relevant to us internally about what happened to have been a cost of COVID, two years ago, and it becomes more important about are we managing the operation efficiently this year. The extent to which we believe we can improve on absence, the extent to which we can remove costs of van hire and so on are an integral part of the GBP 350 million program. Thanks, Mick. Thanks, Christian. Just before we go to the next one on the phones, Hannah from Credit Suisse has come in on the webcast to ask a question, Simon, on net zero. Hannah's question is, on the 2040 net zero target in the U.K., how often will this be reviewed? Do you think it's ambitious enough given some peers have moved to a 2030 target? I think you said you were investigating a capital light option. What might that look like? I think the thing that's very clear is if we look through the eye of the consumer, the next battleground appears to be CO₂. We are absolutely determined to lead on that. I think the fact that we have our feet on the street model gives us a competitive advantage that we are determined to double down on. We actually haven't set Hannah a target of when we'll get to our 50 g or the equivalent of making a cup of tea, but it would be great if we could get there as soon as is practical. I think on the electric vehicles, what's been very interesting to us is that we did our first delivery office of electrification. We had that, great 37% saving in maintenance and 70% in fuel costs, and I imagine that saving might actually increase over time. Now what we're really investigating, and we'll share it in due course, is there another way of purchasing and servicing vehicles that will actually allow us to accelerate towards the targets that we've set? I think we'll definitely keep everyone up updated on that as we progress along the journey. Again, it's interesting now that we're starting to merchandise in real time the CO₂ per parcel for the customers so that they understand the impact of deliveries. I think watching how consumer behavior grabs hold of this particular reality, I think is gonna be very interesting, John. Great. Just add one to that. Hannah, just to put it, we will later in the year have an ESG day to outline some of our plans going forward. Just to put that up on record for you. If you're not getting everything today, you'll get it later in the year. Just to emphasize Simon's point is that, 'cause I've seen stuff that says we need to invest a heck of a lot of money in terms of ESG. Simon rightly pointed out, actually, it also creates a lot of opportunity in reengineering the business, which will actually be an efficiency saving. I think that's right, Keith, and sorry, you've reminded me. Sorry, Hannah. It's part of it's not just electrification of the final mile, it's also how can we use more rail? How can we, you know, use less flights? How can we really remodel what we do every day, you know, to give the consumer what it is that they want? Great. Thank you. We go back to the phones now. I think next in the queue is Sam from JP Morgan. Morning, Sam. Yeah, morning and thanks for taking the questions. I've got three if I can please. First one, I think touching on something you've already said, but where you've done the 4% parcel price increase, is that it? Or could maybe there be another price increase later in the year, or could there be some mix effects on top? Second question is the GBP 350 million of cost savings, to what extent is that contingent on sort of trade union cooperation? Or are you a bit insulated from that on the 350? And then the last one is where there's been some sort of efficiency problems in delivery. Specifically, I was trying to work out what the cause of those is. In particular, like some of it sounds in particular with the revisions, some of it sounds like it was a software issue. Some of it sounds like there were these structural revisions that didn't go well, which might as much be a planning issue as much as anything. Wanted to know whether that was sort of because of sort of poor CWU cooperation or more actually sort of internal planning and things that weren't attributable to the employees or the union. Thank you. Well, Sam, I'll try and do my best to remember the questions there. If I get any of this wrong, Sam, then please, just come back on. I think in terms of pricing, is there any more opportunity? I think we'll keep watching. I think let's just see as the year progresses. Of course, there's pricing for letters as well as parcels. Without repeating what we've said before, I don't think 4% is it, but let's see what comes as the year comes through. I think in terms of GBP 350 million worth of cost savings, of course, we've got the path through from last year. We also have the activity that we'd already agreed as part of the Pathway to Change agreement because we agreed a productivity flight path, that is already agreed and is within that plan already. We have to catch back what we had, you know, as flow through, and also catch back what we didn't get last year. Also on top of that, which is already within our agreement, deliver our promises for this year as well. I think in terms of the revisions and their impact on deliveries, and really just to repeat of what I set up, I mean, I think that changing 50,000 routes and 100,000 walks over a five month period of time is an extraordinary, enormous effort. I'm absolutely grateful for that. I think that our previous best was around about 134, and I think the year before we'd done eight. The fact we did 1,800 and nearly, you know, 1,300 in delivery was amazing. We do have those three key learnings, and the learnings are that we need operational stability before we execute these changes. If we don't have operational stability before we execute the changes, we're not gonna get good quality and we're not gonna get good cost. I also think the involvement of the managers in that revision and making sure that the posties are involved in that change is really, really important. It's not about the computer says yes. I think local knowledge is really, really important. The final one, which we really shouldn't underestimate, and I'll put it under the title of, camaraderie, but it is the collective determination to make everything that we do, work extremely well, acknowledging the fact that some of these changes haven't been done for 10 years. Sam, I hope that gives you the answers to your questions in some useful context. That's great. Thank you very much. Thanks, Sam. We'll move on to the next call, which is from Sean at Bank of America. Morning, Sean. Good morning. Hi, thanks for taking my questions. Just firstly, on the 7% letter price increase implemented earlier this year, is this an average across all letter types, or does it just refer to the stamp price increases? Secondly, just on GLS, what is your guidance on the contribution of the Canadian acquisition to revenue growth and EBIT? Thank you. Simon, do you want to start first? Hi, Sean. I'll start on the 7% letter prices. That's a kind of blended average across all letter services. The range was quite wide. For example, on advertising mail services, there was hardly any increase in price. That obviously is a service that competes with other media. On some of our business mail, transactional mail services, there was a range of increases, kind of, you know, high single digit increases on the kind of mainline products. We introduced a new economy service, which gives us five days to deliver the letter, which gives us an opportunity to make operational efficiencies, and that had a much smaller increase. Obviously, we're trying to migrate customers over to that service. People have options to not suffer the higher price rises, if you like, if they move to the services we would like them to move towards. That 7% represents kind of an average on what we might expect the blended or overall to be, if that makes sense. Just on the work. Stamp prices, I think, first class went from 85p - 95p. It's still actually the cheapest across Europe. Europe, yep. I think Martin can attest. Yes. On the Rosenau? Yeah. Yeah. The Accelerate plan, as it was originally designed, is on organic initiatives only, just to make that clear. Any M&A activity is incremental. We do not give specific guidance for an individual business here. Just maybe to give you an idea, we set out that Rosenau delivered revenue of CAD 176 million and EBITDA of CAD 41 million in the 12 months to August 2021. That might give you an indication of the impact the acquisition will have on further performance. Okay. Thanks a lot, Martin. Thank you. Next in the queue is Alexia from Barclays. Morning, Alexia. Good morning. Thank you for taking my questions. I also have about three. If I just start firstly on the UK parcel market. I think in the statement you talk about having gained market share. Could you just clarify whether this includes or excludes the testing kit activity, please? Then if you can give us an update on any large commercial accounts that perhaps you have made progress with because you now have the parcel hub capability that is coming online. That's the first one for Simon. The second one, also for Simon, is with regards to the Pathway to Change efficiency. Obviously, there was a range in terms of the success of the delivery route revisions. I mean, you very helpfully talk about that some were very successful in delivering productivities, whereas there was a share of kind of having a significant drag. Can you talk to us a little bit about the ones that were unsuccessful to deliver the initiatives, whether there is any kind of type of geographic characteristic or any kind of color that can help us assess how that improves going forward? If you wouldn't mind also just giving a bit of your view on the potential of the Sunday collect opportunity. I think your exit rate is 1% of parcel volumes. What kind of growth rates are you seeing? Finally, one for Mick, if possible, in terms of the split between first half profitability and second half profitability for the U.K. business. Clearly, last year, the first half delivered around GBP 235 million of EBIT. Are we potentially seeing a situation where there is minimal profitability in the first half or even losses with a swing in the second half? Anything you can give us in terms of the mix of first half, second half would be great. Okay. I'll leave it there. Thank you. Thanks, Alexia. Well done. I think you said you had three questions, and then I counted at least five. Let's Have a go, John. Simon, do you wanna start with the sort of market share and the Yeah. The Sunday potential and Pathway to Change? Alexia, I'll do my best on answering them, but hopefully I'll get these in the right sequence. In terms of, you asked the question around our revenue share gain. Yes, we do actually believe, based on our internal modeling, that we have grown our revenue share of the market, which is really important because, of course, it means that we're getting that share in a profitable way. Even without test kits, we still believe that we've made some positive movements in that direction. I think it's a really positive sign that we can compete in the parcels market, and we feel good about that. I think in terms of winning business without breaking any confidentiality around a lot of the contracts that we have, you know, our approach is very clear that we can see the categories in the market of companies that are growing, and that is where we definitely spend our time. In terms of our account wins, we feel that we are definitely holding our own. I mentioned it a little bit before, is that we look at Net Promoter Score on the doorstep, so that's what the receiving consumer sees our service, but we also look at Net Promoter Score for the retailers as well, and I'm pleased to say that both of them are at the right level. Because of course, what the retailer wants is a happy customer and also a happy relationship with us. I think, you know, things such as the hubs coming on board and later acceptance times are really important to them, as well as quality, so we feel good about that. I think on the Pathway to Change agreement, without going over too much of the ground that I covered off earlier on, Alexia, I mean, I mentioned it when I talked, is that our best is 16.6% and our least best is -20%. It's an enormous spread. It is about the consistency of execution that we have. We executed them all, but we really need to get that consistency up. You asked a question around, was there any particular trend. What I would say is that the structural revisions we did, or the major changes we did, were in those units where they hadn't been changed for a significant period of time and therefore they required the greatest amount of change. I think the common element around them all was these were the places where we put in a really large scale of change. In terms of the Sundays, our research that we have is that in retail that Sunday is the biggest day of the week. That's not the case for online deliveries and online retail. Our research that we have, based on what a consumer propensity is today, is that they believe that a Sunday should be worth around about half of a weekday. That's why I said that I think that there's plenty of potential there, maybe 10x what we are currently experiencing. To really realize that potential of a Sunday, we do need the working practices to go with it so we can have consistent quality and cost. Hopefully, John, I covered off most of the points there, I think. I think so. Well done, Simon. Okay. Thank you. Let's just come back on the first half, second half profitability. Look, I think there's no doubt, when we look at prior year, the comps are really tough to match. You know, we're not seeing anything like the revenues we saw in April, 12 months ago. Look, definitely I would say a decline from GBP 235 million, half one of last year. You know, particularly when you're seeing a number of our initiatives, particularly on the cost reduction side are kind of loaded towards the second half of the year. You know, a lot of these programs take time to get up and running. You know, absolutely I think the half-yearly splits will be, you know, profits will be weighted to the second half. Yep. Okay. Thanks, Alexia. Thanks, Mick. Next, we've got Sumit from SocGen. Morning, Sumit. Morning, guys. Mick and Simon, please help us with the earnings boost from the test kits. I know you said 7% volumes and high drop through I can imagine. Any indication in the calculation would be helpful for me. Mick, secondly, walk us please through the logic that you can maintain this year's dividends next year. Already see the dividend yield now going above 7%. Thirdly, Martin, slide 34, very interesting. What related services do you have in mind for your related expansions, you say for GLS? And what are the interesting spaces that you have in mind and the potential margin contributions or, you know, why do you think they would earn you better margins? Thank you so much. Sure. I'll start on test kits. Yeah, 7% of volume. We're, you know, not expecting that, and we're not seeing that disappear to zero. Obviously, we're seeing a fairly material step down in the volume of test kits that we're handling. We have previously said that, you know, they do enjoy a slightly better than average AUR, but they also have a slightly higher than average unit cost to service. We've always given test kits a kind of white glove service within our operation. You know, that's the information I'll give you on that. In terms of the logic for maintaining dividends, well, look, you know, if we're able to agree a change deal at a reasonable cost as part of the negotiations, then there's every reason to believe that, you know, we make money in both of our businesses again, and the capital allocation model and policy that we've communicated is clearly intact. I'm not, you know, at the moment concerning myself about that. Thanks, Mick. Martin, do you wanna take the GLS expansion question? Yeah, of course. Yeah. Indeed, well observed, Sumit. We are looking at expansion, of course, particularly in and around our core activities in the parcel logistics. Mind you, we already have some freight business in our portfolio which is performing well. If we can create further synergies in that space, I think we are open to that sort of part of the market. Of course, other parts of the market are also interesting, where we can leverage our parcel business into adjacent businesses and create further synergies there. Be it around, for example, the obvious ones like e-fulfillment services to just basically enlarge our supply chain value chain. Be it services to provide also services for by mobile care items like two-man handling, for example. Normally those services we look at them when they are synergetic, i.e., when they also add positively in terms of profit and also margin to our business. Secondly, not to forget, I also talk quite a bit about the digitalization that we want to push forward. Naturally, we're also looking into that space, but those acquisitions will be more centered around, let's say, younger companies or startup companies where we can get an inflow of talents and then where we basically try to improve the growth in the future and the margin in the future. That will be a more longer term pace. It will be a mixture of those things, primarily. Thanks, Martin. Thanks, Sumit. We'll move on to next question from Achal at HSBC. Morning, Achal. Yeah. Morning, John. Thanks for taking my question. I had three if I may. First of all, I want to understand the potential risk to your guidance at GLS for FY 2023 and even the long-term guidance. You said that, of course, if the economy rebounds in FY 2024, you should be able to achieve your long-term targets. But what if not? What sort of risks do you see to your long-term targets at GLS? And linked to that, of course I understand the lot of labor challenges and all, but what holds you back in terms of giving long-term targets for Royal Mail UK? I mean, you know, that is my first question. Secondly, your unions have been crying and condemning heavy dividend payments to the shareholders, ignoring the labor, which are definitely in need of money, especially in the current challenging times. Do you see any potential change in your capital allocation policy? Do you think, you know, especially to sort of reach an agreement with the unions, you could look at the dividend policy and you could actually see switching some money to your unions rather than paying dividends? That is my second question. Finally, so the parcel volumes, which are up now 16% versus pre-COVID levels, which is actually, you know, initially to remember when we had the COVID and the parcel volumes, we saw accelerated growth in parcel volumes and everybody, including Deutsche Post, including Royal Mail, everybody was of the opinion that we will be able to sustain some of the accelerated gains due to COVID, since there is some structural changes in the consumer behavior. Now, how do you see that? I mean, do you think the overall gains will be reversed and we will back to square one? Or do you still think that the 16%, which is still high versus pre-COVID levels, you would be able to sustain some of the gains? How do you see the parcel volumes economics going ahead? Thank you. Martin, do you wanna go first and take the GLS Accelerate target question? Sure. We'll do the Royal Mail ones. Yeah. Happy to do so. Yeah. The on the Accelerate target, first of all, I think it's important to underline is that I'm really happy with the progress we are making on the Accelerate strategy. I think without that program, we would not have seen the progression and results that we are currently seeing. We have a really good underlying and positive trajectory. That will basically underlying will not stop, we will continue. Of course, naturally when we set the targets, we didn't foresee the impact, for example, of the challenges in the Ukraine, which naturally have a short-term impact. As I laid out before, we see this as an issue that is not basically impacting us and our growth path in the long term. If the economy will go back to what I would call, let's say, normal levels in the next year, I still see a good chance for us, whilst we have this good underlying trajectory, to meet our targets 2024, 2025. To be very clear, I'm really confident that we will continue on our Accelerate trajectory because we have a clear vision, we have clear measures in place. By all means, at the end of the day, if the economic recovery is a bit slower than we would need for achieving the targets for 2024/2025, then we will achieve the targets maybe a couple of months later. The direction is clear, and I'm very confident that we will continue to head in that direction. Thanks, Martin. Do you wanna pick up the? Oh, dividend. Yeah, there was a question around capital allocation and yeah. Yes, it's interesting because obviously, Achal, you're picking up a line from the union. But let me just sort of put it into perspective, which is half of our profits actually come from GLS and half from Royal Mail. Yeah. When people look at the group and a GBP 700 million profit, need to realize that half of that comes from GLS on half the volume of sales, which in itself tells you a lot. If you look at the last couple of years actually, don't forget, is that we actually did pay all colleagues in the business a bonus, except for very senior management. They have participated in COVID in terms of return, when actually the shareholders didn't get a dividend for part of the period. I think it was right that we reinstated the dividend. You know, I think it's right that we look at all stakeholders going forward and treat all fairly, and that's what the board aims to do. Great. Thanks, Keith. I think there's final question Achal had around parcel volumes, kind of pre the levels we were seeing during COVID versus now. Are we seeing a permanent change or are we a reversion to mean? Yeah. I think that's the question. Yeah, I mean, look, we certainly saw some hugely elevated peaks of parcel volumes and that have certainly started to abate, you know, both as society gets back to some level of new normality, but also now I think exacerbated by the cost of living crisis and maybe a weakening in consumer spending. Yeah, I mean, look, I think the trend is certainly, you know, moving back towards that kind of long-term underlying trend that we had pre-COVID. But I think, you know, on the volume side, we would still expect it to, you know, stabilize at a level above that trend in due course. I think it's also worthwhile to note that the revenue performance has been slightly better than the volume performance as well. You know, we look at revenue share and revenue movements just as much as we look at volume trajectory. Thanks, Mick. Thanks, Achal. As I say, conscious of time, so I think we'll move on. This will be the last question. Satish from Citi. Morning, Satish, thanks for bearing with us and waiting on the line. Go ahead with your question. No problem. Yeah, John, thanks. Thanks for taking my questions. I got three. On the parcel, right? You said about 90% is like, yeah, related to small parcels. Also if I see your like latest price revisions, there is no longer 0-1 kilo, like less than one kilo category. If you can actually give the traffic mix within your network, like how much is actually 0-1, 1-2 kilos, that would be, helpful actually. What is the rationale behind in terms of consolidating the product category there? Secondly, you said that April exit rate, is like, yeah, following a similar trend to what we have seen in March. How much of that April exit is actually still impacted by international volume? Because your comps starts to lapse at the end of June, right? Because that's when you start to see YoY it should get easier because of the Brexit related impact. Third one, any color on GLS pricing? How does it work? Because you've given some color on Royal Mail UK, that parcel pricing will be up +4%. Any color on GLS would be helpful. Yeah. Those are my three questions. Thank you. Parcels. Nought to one, one to two. Yeah, Mick, I don't think we give the volume mixes between these sizes. No, I mean, the product changes that we've made are all about simplification. Yeah. Directed towards targeting the market more in line with how the market sees different formats and sizes of parcels. I don't think we currently give the splits on the basis that you're asking, so I won't elaborate on that. On international volumes, you recall correctly that we do indeed start to lap the comps in kind of June, July time. Yeah, international carried on a similar trend, but the comp should get slightly easier as we get to the end of the first quarter. Okay. GLS pricing. GLS pricing. Yeah, GLS pricing. Sorry, Martin. On GLS pricing, look, this is very country specific, because we're operating in so many different countries, we always have to acknowledge local specifics in terms of competition and which market segments we play in. As I said, we play in some countries in the parcels and in the freight. In other sector, in others, we just play in the parcel sector. Within that we have a B2B and a B2C tier, which also differ by country, and that then has different implications on the pricing. There is no general answer for it. It is just that I can refer to what we said, that we put the price up by the mid single digit number. We are very much closely watching that, how we can complement that with regards to covering the inflationary and the cost increases with regards to surcharging on fuel, and so on. It's very country specific. Okay. Thanks, Martin. Thanks, Satish. Thank you everyone for joining us this morning. As ever, I'm here with the rest of the investor relations team, if there's any other follow-ups or other questions we didn't get to put you on the line, apologies for that. But do get in touch with the IR team, we'll try and help you out. Otherwise, do have a very good morning and goodbye from us. Thank you. This presentation has now ended.