Fastned B.V. (FAST.AS) Earnings Call Transcript

Hello, and welcome to the Fastned Quarter 4 Trading Update. My name is Caroline, and I will be your coordinator for today's event. Please note this call is being recorded. [Operator Instructions] However, you will have an opportunity to ask questions at the end of the call. [Operator Instructions] I will now hand over the call to your host, Michiel Langezaal, the CEO, to begin today's conference. Thank you.

Thank you, operator, and welcome to everyone on this call as well as to our webcast viewers. The presentation used during this call is available at our Investor Relations website, which is ir.fastnedcharging.com. The cover page shows you 2 of our stations that we commissioned in the last week since 2023. These are Pertit Lac and Pertit Montagne situated on the north phase of Lake Geneva above the city of Montreux. This is a place where many car drivers stop for a quick break with a beautiful view on the lake and mountain range. With the skiing season just getting started, I'm very happy to have these 2 sites coming online. These stations support the key routes for many people to get to their ski resorts in the coming months. This brings me to Slide 2. With reference to the information provided in these slides and discussed during this call, please take note of the disclaimer. Bringing me to Slide 3. My name is Michiel Langezaal, I'm the CEO and one of the founders of Fastned. Victor Van Dijk, our CFO, is also present in this call. Together, we will present this webcast. Today, I will elaborate on the highlights of the last quarter of 2023. Also, we will give you an update on the developments in the car and charging markets. Furthermore, we'll give an overview of our network development achievements over the past year as well as taking a look at the results from our construction team in terms of new stations built in the fourth quarter. After that, Victor will take over and take you through our station economics. For the sake of clarity, this is a trading update, so we will not discuss the full P&L for 2023, but as always, top line only. The publication of the annual report will be on the 28th of March. After our presentations, we will answer your questions. Please limit them to 2 questions per analyst to give everybody the opportunity. We intend to end this call at 12 noon. It brings me to Slide 4. Let's start with the highlights of the quarter. Revenue and kilowatt hour delivered grew rapidly and in line with our expectations. Revenue related to charging reached EUR 19.2 million in the fourth quarter of 2023, up 44% versus the same quarter last year. And to give a glimpse towards 2024, our run rate revenue of this quarter is an annualized EUR 76.8 million, close to EUR 80 million. This shows the growth path that we are on. Energy delivered reached 32 gigawatt hour, up 79% versus the same quarter last year. So energy sales increased much more than revenue. That is because last year, energy prices were higher than normal as a consequence of the -- of the energy prices, and we adjusted our prices accordingly. After electricity prices came down early 2023, we in turn adjusted our prices downwards as well and kept them stable for the rest of the year. The growth in energy delivery also shows that Fastned continues to outgrow the battery electric vehicle market. And I think this continues to be something important to mention. There's not many charging companies do that. Let's look at 2 examples. In the Netherlands, where most of our stations are, we also sell the largest amount of kilowatt hours. Here, the battery electric vehicle fleet grew by 37%, while at the same time, Fastned sold 58% more electricity. In Belgium, battery electric vehicle fleet is growing faster than in any other country we're present in. Also in this market, we significantly outgrew the BEV fleet. While the number of fully electric vehicles on the road grew by 101% in this country, our electricity sales increased by 164%. This shows the scalability of our business and the quality of our locations and concept. In fact, we see that in every country, our volume growth outpaces the growth of the fleet of battery electric vehicles. Not only is this a very strong performance indicator, it is an important ingredient to our ambition of being a leader in all markets we enter. I picked the Netherlands and Belgium as examples because the fact that we are outpacing the market is especially impressive in these 2 countries for the following reasons. As we already have such an extensive network in the Netherlands, the relative impact of adding new stations is smaller. And therefore, it is more difficult to outpace the market, especially in light of grid congestion. One needs to be able to cater for growth in all of its locations, even those that lack pace or grid capacity. Despite these difficulties, we still did it. Historically, Belgium's electric car fleet developed much slower than in other countries. And Fastned and other charging networks are, as a consequence, also less developed. Today, the electric vehicle fleet in this country is growing very, very fast, leading to rapidly growing charging demand on a broad geographical scale as well as rapidly growing demand at existing stations. Capturing this growth ain't easy, but again, we did it. Which brings me to utilization. During the fourth quarter of 2023, the average utilization of our network was 14.4% versus 13.2% in the same quarter of the previous year. This number logically goes up as a consequence of more people charging with us, but at the same time going down as a consequence of Fastned adding new stations and more chargers to existing stations, even more so as many new stations are in countries with lower EV penetration than the Fastned average. Therefore, it is maybe more interesting to take a look on the like-for-like utilization. In Q4 2023, this was 18.4% compared to 13.2% of Q4 2022. This metric better shows the massive growth in a number of customers visiting our stations. Going to the next slide and talking about electric vehicle sales. Across the Board, the share of newly sold fully electric cars remains very solid. As a consequence, the battery electric vehicle fleet continues to grow rapidly in all countries we operate in as expected. That said, there are some differences that are worth discussing. In Belgium, battery electric vehicle sales jumped from 8% to 24%. Let's talk about why this is happening. It all has to do with company cars. In Belgium, Belgium in comparison to other EU countries historically has a taxation regime that is very friendly to company cars. Roughly 20% of the entire car park are company cars and these cars are generally more high end than the same company car fleet in neighboring countries. Recently, Belgium has decided on a gradual build down of these fiscal advantages for company cars in case they have internal combustion engines, while they continue to apply for battery electric drivetrains. This is causing a massive shift in buying behavior towards electric cars. It is this fiscal regime that makes automotive analysts project continued high battery electric vehicle sales percentages for Belgium. Next, let's discuss Germany. In the fourth quarter of 2022, BEVs represented 25% of new car sales. The third quarter of this year even had 26% BEVs. Last quarter, BEV sales represented only a mere 18% of new car sales. This up and down swing has to do with the government's decision to very suddenly stop the subsidies for EVs in Q4, which initially they planned to prolong. This was a consequence of the verdict by higher courts that their budget was not lawful, and the government has to decide to cut down on many expenses and find new sources of revenue, something which is still ongoing. Without the subsidy, buying a BEV became less attractive and as a result, EV sales declined. Also, people can be expected to await their decision until the announcement of a new incentive scheme in line with their earlier intentions to prolong support. Both effects pushed German electric car sales down to the levels of less advanced markets. Taxation and subsidies are important tools for the governments to steer the behavior of people and making them choose the sustainable option. Just like how we do this with taxes on cigarettes or alcohol, steer people to the healthy option. Some people say we cannot subsidize electric cars in the long run. I think this is a somewhat shortsighted view. As on all drinks you buy, there is value-added tax to pay the government bills, but on beer, we add additional tax and on spirits even more to incentivize people to buy differently. The same logic applies to polluting versus nonpolluting cars. Going to Slide 6. Next to the German subsidy [ intermezzo ], there is also the news around Chinese subsidies to accelerate electrification. This state support would unlevel the playing field for European carmakers. We therefore thought it would be interesting to discuss the 2 topics with the use of the generic price parity graph. The graph has often been used by Transport and Environment and Bloomberg New Energy Finance. The logic in short, as with many new technologies, electric cars started expensive, only available to the more fortunate, but like many technologies, the price is declining over time. Meanwhile, as a consequence of step-by-step more stringent emission regulation, the price of fossil cars rises. This leads to an inflection point where electric and fossil prices are becoming equal. The graph and industry driver, which I have been talking about for close to a decade. But this graph also deceives as it is not great in showing the consequences of going beyond the inflection points, which brings me to today. Many automotive analysts are mentioning the years 2024 to 2026 as the moment. And I agree. We can see that this price parity point is approaching. Look at these significant price cuts with basically all the carmakers in 2023 and the numerous entry-level EVs that have been announced for this year. When electric vehicles simply become the better alternative, it is not a step-by-step growing share of car sales anymore. BEVs very quickly will take the lion's share of sales. This effect we've seen in Norway, where recently VW stopped the sale of cars with internal combustion engines altogether as there is no demand for such cars anymore in the country. Incentives pull the shift forward by 12 months, 24 months like we see in Belgium, and have seen the premature effect of in Germany before the intermezzo EV subsidies started there. I know the price parity story is not new to many of our investors in this call. That said, again and again, history teaches us we overestimate the initial market development for new technologies and we underestimate market development when price parity is achieved. The reason our brain linearizes such things. Therefore, I find it important to talk about my personal views on this topic. What I think is that many automotive analysts are too cautious when it comes to modeling what will happen in the coming 24 months and thereafter. To this end, there are 3 things, which, in my view, are important. First thing is repeating what will happen when an EV is the better alternative. My answer, the lion's share demand for cars will be electric. Two, if that is the case, can we produce these cars? Well, the legacy carmakers with currently uncompetitive products such as VW are telling the media that their factories are not running at full capacity and that the subsidies are needed. Carmakers with great offerings are shipping at scale, and the Chinese carmakers are entering our markets with very large factories backing their supply chains. In Europe, we think the Chinese are subsidizing their production. In reality, the Chinese are simply already manufacturing at a scale magnitude larger, providing them economies of scale. So yes, the productive capacity is there and the heat for lower prices is on. Three, is there something to choose for everyone? Are EVs available in all price segments? Well, if we look at the news recently, this is the key thing for 2024. European carmakers catering to the lower end of the market are for the first time forced to move electric as a consequence of the Chinese competition. It's the EUR 18,000 EV that is the battle for French carmakers such as Stellantis and Renault, first is BYD and MG. Moving to Slide 7. Enough about EV markets, let's discuss the development of our network and how we've progressed on this in the last quarter. In 2022, we signed on track with 20 private landowners. In 2023, we did more than double that and have signed a whopping 45 sites on private land. With public landowners, we signed 14 new sites last year. This is a somewhat lower acquisition pace than in previous years. As mentioned before, the deal flow with public authorities is more erratic. This is a consequence of batches of locations being tendered at once. As you know, we expect quite a bit from them for the implementation of AFIR in the coming years as well as from tenders such as [ Autobahn GmbH ] and the first tenders in Italy that are already in the air for some time now. That said, the news is there when it is there. Summation of the 2 groups brings us to a total of 59 additional locations signed in 2023 versus 50 in 2022. The results we are presenting here today are the early signs of the benefits we're expecting to see from the expansion plan we initiated after the accelerated book build of 2021. Since then, we have been hiring and training a much and much larger team of expansion managers that reaches out to landowners and tells our story. Let's go to Slide 8 to understand the drivers behind this result in more detail. The scaling of our expansion team happens in conjunction with 2 other key things, one external development and one internal. Institutional investors in 2022 -- in 2021 were not alone in their thinking of the pivoting moment for the automotive industry to be very near. In markets such as the Netherlands and more recently, Belgium, the U.K. and Germany, general public sees this on the street. They talk about it with friends and family at social gatherings. Over the last couple of years, many people have come to the conclusion that battery electric cars are the future of the car industry. And for people owning land at strategic locations, that vision becoming mainstream has also not gone unnoticed. This change helps us in our conversations with landowners. More of them are now receptive to the idea of banking their lands on the growth of the electric car in the recent years. So all the talks of our team members -- so all the talks that our team members have, which is landowners now more easily lead to a charging station being built on their lands. Then the internal development. This is about our concept and financials. In the past, we believe an average charging station will do EUR 1 million in revenue annually by 2030. Today, we have great performing stations that sell EUR 1 million annually. We now have a proven track record and realize the best station economics in the market, which Victor will elaborate on shortly. These financials allow us to offer competitive rent conditions for private landowners or maybe more importantly, in the context of accelerating the pipeline, think about the following. When you're trying to rent the apartments in London for GBP 1,000 a month, choices are slim. When your financials start to make you feel comfortable paying a rent of about GBP 3,000 a month, many and many more options become available and the difference is not linear. This is how a great concept and station metrics are helping us to scale our access to private lands. This development is also the answer to the question we still frequently get. But what if big oil or the large carmakers want to get in and simply buy the market. Several times this year, we got this test and we won. Our station economics are simply much better than those of competitors. And because of that, it becomes very difficult to outbid us. To illustrate this, in the appendix of our investor presentation, there's an overview of some locations where our stations are co-located with competitors. An example of one of these sites is one close to Amsterdam in the A1 motorway. We have 6 chargers there and the petrol station also had 6 chargers. Our results, roughly EUR 750,000 in revenue, while the petrol station makes around EUR 150,000 or so on charging. With these numbers, the ability to pay EUR 50,000 or EUR 100,000 in rents for a charging site differs dramatically. So yes, you might be able to buy a single or several sites, but it is virtually impossible to continue to do that at scale when you don't have a concept that allows you to make such rent offers. On that note, I would like to move to Slide 9. I already mentioned us having the best concept in the market. We talked about it often. So I only just wanted to reiterate this. We continue to have the best Google reviews of any charging company. As in previous years, we again this year were voted by the public as the preferred charging network with winning prizes in the Netherlands and the U.K. It might start to feel normal, but it isn't. It is the consequence of hard work by a very talented team. This brings me to Slide 10. An update from our construction team. Last quarter, we built a total of 19 stations. I just wanted to show you some picture to again delivering the message. Fastned builds very visible large charging stations. And yes, the permissions to do that take time. The construction takes time. But having a big station along high-traffic roads that can charge hundreds of cars a day and draws more traffic because people can see it is very, very valuable. Let's move to Slide 11. This is why I want to show you, again, the pictures of all the stations we have built this quarter. And yes, sometimes we have to be pragmatic and build the station without its canopy and lose out on some of the marketing potential. But as you can see, the far majority of them are big stations with that EUR 1 million revenue potential. Something I'm also very proud of is our first charging station in Denmark. Despite all the work that was ongoing to build all these stations, our team has been able to start construction in another market. A big achievement as the first requires all the initial initiation works such as contracting local electricians, creating a relationship with a local grid operator and so on. And we did all of that in only 5 months. This brings me to my last slide, Slide 12. In the third quarter of 2023, we won 2 prime lots in the Deutschlandnetz tender, providing us a pipeline of 92 search areas in Germany, for which Fastned is the appointed concessionaire to realize the charging stations. As you can imagine, being able to only months later open the first location of Deutschlandnetz made us very proud, which brings me to the end of my story and handing you over to Victor Van Dijk for a look at the station metrics. Go ahead, Victor.

Yes. Thank you, Michiel, and good morning, all. Going to station economics indeed, we see, again, strong year-on-year sales growth, which drives station returns as you can see. Again, we see we outgrow the market. BEV fleet penetration grew by 17% year-on-year, growing the number of electric vehicles passing by our stations by the same amount. Sales per station grew by 40% year-on-year. So we outgrew BEV fleet growth by more than 2x. We expect that stations on high-traffic locations with a great concept can do more than EUR 1 million in annual revenue and more than 2 gigawatt hours in annual sales per station by 2030. Knowing that EV fleet penetration was six-fold between now and 2030, we can see we are definitely tracking towards that. Even if we only six-fold the sales per station we did on average last year, so not factoring in any outgrowth of the market, we get to more than 2 gigawatt hours of sales per station already. We expect that if your concept is from high-traffic locations, draws outsized customer demand and is efficient, you can do 40% operational EBITDA margins, a number we achieved already today. Note that you can get to these station metrics when you have everything right. You need to have a strategy to secure the high-traffic locations, which we demonstrate and Michiel talked about it. You need to have a great customer concept that gives outsized sales per station. Hence, you need an efficient concept that keeps operating costs and capital expenditure very efficient. Take for instance, sales per station. Having high-traffic locations and having a great charging concept gives outsized demand and sales, as Michiel already talked about. And we can see that from station usage of our competition. In the last 6 months, we had close to 50 sessions per station per day. Our next 2 competitors at around 40 sessions and around 30 sessions, respectively, considerably less already. But the parties below that had less than 15 sessions or less than 10 sessions per station per day. So many of these parties will have station economics that look very, very different from ours. That also means importantly, that they have far less flexibility on pricing. And coming back to an efficient concept. By that, we mean a relatively low CapEx, and we think we are more efficient on that than others, optimized for high utilization while maintaining a great customer experience, like we do with our drive-through layouts, and thirdly, relatively low operating costs per charger. That gives a great business case and great investor returns. Then looking more closely at this quarter's average station performance. We increased station capacity year-on-year by increasing the number of charge per station by 16%. This is important to cater for demand increase with BEV fleet penetration expected to double by 2026, only 2 years from now and six-fold by 2030 in our markets. We are preparing for that growth, so that we can welcome all these new EV drivers to our stations, which will drive strong sales growth in the next few years and beyond. Like-for-like utilization, meaning utilization if we would not have enlarged our stations or build out our network with large stations was 18.4%. And thus the increase obviously also leads to operating costs and investments per station to increase, as you can see. All of this leads to operational EBITDA per station increasing by more than 30% year-over-year to EUR 120,000 -- EUR 122,000 annualized in the last quarter. And it leads to an operational EBITDA margin of more than 40%, that as already at our 2025 targets. Slide 14, please.

Yes. To conclude our presentation for today, we wanted to show again the guidance we provided for 2023 and discuss the results as presented earlier in this context. In relation to the development of our network, I'm very happy with the results on a macro level. The acquisition pace for new sites is in the right ballpark and direction to deliver on our missions. Also, the setup of our supply chains to build stations and the setup of our construction teams in the countries is where it should be, with the building of our first station in Denmark providing proof of that. In that context, I find it unfortunate that we have to postpone the construction and commissioning of the first few locations -- of the last few locations that made up the target for 2023 to the first weeks of this year. Today, we are at 299 locations and expect to open #300 by the end of this week, a delay that will have virtually no impact. Victor has just gone through the background to our guidance on the financials. What I would like to add is that I'm very happy that we were able to pass the milestone of underlying company EBITDA positive already in H1 of this year. As always, we expect to update our guidance for the new year with the publication of our Q1 results. So no news on that yet. That said, I can promise you it will be a very interesting year with the automotive industry moving beyond its tipping points. And on that note, I would like to thank you all for listening. And I'll hand the word now back to the operator for questions.

Sure. [Operator Instructions] We will take the first question from line, David Kerstens from Jefferies.

I've got 2 questions, please. First of all, can you elaborate on the weaker volume momentum in the fourth quarter with volume growth of [ 79% ] versus [ 114% ] in the first 9 months. Has that to do with the slowdown in EV penetration with lower penetration of new sales in Germany and in the U.K. against tough comparatives? And this brings me to the second question. Interesting slide just showing on the parity being pushed back by 3 years in Germany after the reduction in incentives in December. What's your view on the outlook for the EV market this year? I think some automotive analysts are expecting that the German market could be down 20% to 40% in terms of BEV sales. What's your view, if that is a risk that, that could spread to other markets in Europe as well? I heard you say that 2024 could be very interesting and mark the tipping point, but some people think that Germany could be potentially weaker. What's your view on the market outlook for this year, please?

Thanks. So maybe I'll start with the price parity discussion in Germany. I think what is very important to note here, you're talking about the risk of that spreading. And I think it starts with the idea that it's a consequence of a budget, which was decided by judges to be unlawful. So hence, yes, the intention by the government in Germany was to keep support for electric cars in their, let's say, in their policies. And across the board in Europe, that's the thinking. The thinking is we want to support electric cars, albeit that here and there, there will be debates on the level and how. So I would actually turn it the other way around and saying it's probably more like an intermezzo of the German government trying to find a solution given this verdict on how they are implementing a new incentive scheme for electric cars. When they will be able and to what extent they will be able to do that coming year, that's, of course, to be seen. But I think it's in a much more positive daylight than the risk of a verdict by European court -- sorry, by German courts, let's say, spreading to other nations. I don't see that. And then maybe, Victor, you wanted to comment on the volume growth?

Yes. Yes, I think that's simply a natural consequence of how the market develops. So our sales are driven by electric vehicles in the fleet that drive around and have charging a month. And of course, that fleet is growing, but the growth rate of that fleet will naturally go down. So in Belgium, we saw a growth rate of close to 100%, because the fleet is still small, and that reflects in our sales growth of 164% in Belgium, like Michiel explained. And in the Netherlands, the fleet is bigger, and that grew at 37%, and that resulted in 58% more sales growth for us. So it's simply mathematically, the BEV fleet is growing, but it can't grow the same percentage as when the fleet was still relatively small. So it's natural, and I think that's -- and it also -- if you look forward, we see, like I said, BEV fleet here and sort of the key drivers, again, BEV fleet here doubling by 2026 and then six-folding from now to 2030. And that is -- yes, that is pretty much I think unchanged and will drive our growth. And maybe adding to your other question is, yes, what we see is added growth in this year may or may not be a bit less than expected, but there's still vast amounts of electric vehicles hitting the road. So, Bloomberg New Energy Finance, they see a growth of 8% from last year to this year. So it's -- they're still coming to the market.

We will take the next question from line, Nikita Lal from Deutsche Bank.

The first one would be a follow-up. So do you expect to see some negative impact on your utilization rate in 2024 due to the sluggish BEV sales in Europe? I mean, utilization rate for Q4 increased due to also gaining some market shares, but I mean this is for sure, somewhat kept. So yes, this would be my first question.

I don't know whether I fully understand your question, Nikita. So you're saying -- you're -- yes, you're looking at utilization rate of the network and whether there would be an impact in 2024 due to the lower BEV sales?

Yes, exactly. Yes. Because I mean your utilization rate over the course of last year increased somehow. The question is, will it increase further or will it be more -- yes, more stable at this level.

Yes. So I think, first of all, I think in the majority of markets, BEV sales will increase. That's I think the outlook. So that's one. Two is, there might be -- depending on how the situation evolves in Germany, there might be a slowdown there. But that will, in that sense, let's say, lead to a slower growth of the number of electric cars on the road. So the electric cars are there, they won't go away. So I would not expect, let's say, utilization to go down but more maybe develop less fast in Germany, depending on like, yes, let's say, how the government decides on the EV support. But I think it's also important to mention that while EV support is interesting, the main drivers for this market to shift to electric is simply the electric car becoming a better car in the coming [ 1 year to 2 years ]. Does that give you a bit of, let's say, ingredients to the answer? It's maybe not a -- yes.

No, I understood. Yes. And my second question is regarding your network. I learned that you have closed 2 stations during Q4. Just wanted to get some color on why this happened and if we can expect further shutdowns of older stations?

Yes. Very short answer, it was 2 locations that were part of a pilot project in the city of The Hague, short contracts, something we practically never do. But we wanted to pilot, sometimes you pilot things, right, because you want to learn. And that pilot wasn't super successful. So in the end, we decided to not continue that.

And to add on that, these were supermarket locations, so outside our core strategy. And basically also the pilot confirms our views on those locations -- on those type of locations. And your question was also do we expect more? There's one other station like that and that will close in Q1, and that's it.

Okay. So one more location [Technical Difficulty] in Q1?

Yes.

We will take the next question from line, Hans Pluijgers from Kepler Cheuvreux.

Yes. Two questions from my side. On your expansion strategy, this year, let's say, again, about 55 locations opened at the same on average over the last 3 years. And looking at your longer-term target of over 1,000 locations in 2030, you really need an acceleration. You were already talking about acceleration in the expansion of the last few years. How do you see that? How are you now going to really accelerate the expansion of your network in the coming, let's say, 2 years to maintain on the track for the 1,000 locations? Could you give maybe some, yes, insights on that, how you're going to manage that? And maybe combined with that second question on your cost -- operating cost but also on your expansion cost. Of course, you have been, let's say, increasing your cost and your development team quite significantly. Again, plus 75% this year in your development team. When could we expect, let's say, that the growth in the cost will start to come down somewhat and really see leverage really starting to kick in? Could you give maybe some ideas on that?

Maybe I'll start a bit on the expansion plan. I think if you look at it, so the development of location before it ends up in our pipeline and before it's actually realized, that trajectory often is, let's say, somewhere between, well, the fastest would probably be 18 months and the longer periods are around 3 years. So the -- I think you're rightfully said that we're talking about this already for some time, and that's true. So we basically started investments in scaling up that team in 2021 after the ABB. And I think if you look at our pipeline and the results that we're achieving there, I think we're basically seeing 2 key results. One is that the number of sites realized out of the private pipeline is going up. We see initial tender results, although they don't end up with a pipeline yet, that is the Deutschlandnetz tender. We see them also coming in. That is leading to sites that we can build in the years thereafter. So that is really good news that, that is scaling up and that base is going, let's say from 40 to 50 a year to 100 per year. And two is, is that we are starting to have a construction team and a supply chain in many more countries. And that in every country takes us -- that requires us to go through the initial phase of doing that. That's a slow thing. So basically, you need to go through all the work to be able to build a single site in Denmark, and that is something we've done this year. France, we did last year. That is the work that we're doing at the moment. And based on that work in 2024, 2025, we can start to build all of that scale that we created in our pipeline. So that's how -- yes, how the 2 images together leads to an acceleration in the years to come.

Yes. And may be on costs. So that's basically the network expansion cost per station. That's basically 2 things to say. One is that there is a delay in getting results like Michiel explained. So we hire the network developers, the design people, the construction people and they're getting location, and once they're built, that's 1 year to 3 years down the line. And the second thing is that -- and that's more structural is that if you look at these commercial locations, they are much more one by one than the tenders we do. So structurally, these commercial locations also lead to more network development -- network expansion costs per station than the tender locations. I think overall, if you look at the business cases and compare the network expansion cost per station to the whole business case, I think the whole business case of a station that can do EUR 1 million in revenues by 2030, yes, can quite easily bear that, I would say.

Maybe a nice sort of anecdote to this end would be -- we used [ DocuSign ] already for a couple of years, to sign our, yes, all basically to be signed contracts. And that has a counter of number of contracts that are signed for 6 months. I think you could almost say that we probably should start to report where that counter sits not knowing actually what it is. But I can tell you that has gone up massively. And I think that is all the prerequisites that are required to build these locations in the end. So that is really what drives it. Does that give you a bit of color on that topic?

Well, on the first one, not yet, I must admit. I hear what you're saying we expect, let's say, that, of course, especially with Deutschlandnetz more in the pipeline. At the same time, you go more to commercial side. So which, first of all, takes more time also, I think, and individual efforts to really expand the total number of potential locations. So at the same time, you see also issues with the grids, especially in Netherlands and the potential risk there, of course, that also will come up in other countries. So -- and looking at your guidance, which over 350 locations year-end 2024 and 400 locations operational 2025. That still implies that -- or you can conclude today, you only go for about 50 locations to 60 locations for this and for next year. So not really an acceleration. So -- and so yes, what really, let's say, the issues you could take out to really accelerate the growth.

Maybe it's good to clarify that 400 locations target is not year-end 2025. So we do expect an acceleration and it's happening step-by-step year-over-year. But it's definitely not -- yes, not aimed to say 400 locations year-end 2025.

No, no, that's -- initially, it was midyear. Is this still the case then?

And I think if you look at it, I think you're saying that base of 50, I know there's a logic of coming back to what we said, the development of the site takes, let's say, 2 years, 3 years on average. So the sites that we're currently building that is all developments from before scaling up that team. So the scale-up of that team will result to scaling up of construction starting probably 2025. Any other questions?

We will take the next question from line, Joren Van Aken from Degroof Petercam.

Yes. Just 2 questions. First one, do you have any visibility on timing for the public tenders in Italy, Spain and maybe for Part 2 of the Deutschlandnetz? And then a bit same question, a bit timing-wise for your court case in Germany versus Tank and Rast.

Yes. I think Italy, the regulation is out there. There is a first tender published, so that consultation is ongoing. Yes. We expect many more tenders to be out there in the coming year. I find it difficult to say like when actually we really would expect some results. So I don't think that, that is, let's say, at least in a -- not -- yes, I wouldn't expect sort of significant results this year, but more the year thereafter. I think on Spain, it's really to be foreseen if and when we're going to see serious standards there. We are very much in favor of the government moving to that sort of policy. At the moment, we still see them supporting the idea of mandating petrol stations to put down chargers, which is uncompetitive and not accelerating the market. So there is a very, yes, let's say, fruitful grounds to have that discussion. We are currently working on private lands in Spain. That is moving well. That development is moving well. And I think if we're looking at Germany, that situation, I think it's very difficult to say what the timing of that will be. What we can at least say is that a response for the -- from the European Court of Justice is often lengthy for talking, years. And what we see in response is that the government actually has a very clear goal, what I earlier said, they actually want to support the transition to EVs. And that also accounts for the infrastructure that is why Deutschlandnetz is there. So they are currently trying to ask themselves, so, okay, so this verdict is not going to be there most likely this year, maybe not even next year. So what do we do to actually move the needle. So I think there could be several outcomes to, let's say, yes, the court case around Tank and Rast. And then lastly, there is a tender by Autobahn GmbH for the -- for 200 additional motorway locations. Yes, the question there as well, yes, let's say, there have been some rumors that there's a reason for the government to rethink their approach there given that verdict by courts on their budget. We haven't seen any news on that yet. So that's to be awaited. But the tender is out. There is no conclusion on that tender. Logically, we hope it to be concluded as planned for, but there are some rumors, so that could lead to a prolongation of that tender or any other outcome.