koç holding fy09 earnings presentation - koc.com.tr · nav breakdown by sector domestic market...
TRANSCRIPT
8 November 2018
Koç Holding 9M18 Earnings Presentation
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Auto
(PC & CV Mfg)
28%
Auto
(Other)
9%Energy
31%
Cons. Durables8%
Finance12%
Other11%
22%
30% 30%
2009 2017 9M18
2
Strong Positioning via Diversified Structure
1,228 1,291
2,484
2016 2017 9M18
Dividend Income (TL mn)Consolidated Net Income (TL mn)
(1) Excluding Ford Otosan’s second dividend payment of TL 155 mn, which will be reflected in 4Q18
1
Combined Int’l Revenues / Revenues
3,832 3,827
9M17 9M18
Sustainable performance leveraging on diversified structureSolid dividend flow supported by ~TL 35 bn of investments over the last 5 years
Largest exporting group in Turkey covering 10% of Turkey’s total exports
#1 in total automotive
#1 in light commercial vehicles
#1 in tractors
#1 in automotive retailing
#1 in white goods
#1 in air conditioners
Sole operational refinery
#1 in LPG distribution
NAV Breakdown by Sector Domestic Market Positioning
Resilient against sectoral cyclicality Strong pricing power via leading positions
~55% incl. Tüpraş
1
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2 eurobonds totaling US$ 1.5 bn → Mar’16: US$ 750 mn, 7yrs, 5.25% coupon; Apr’13: US$ 750, 7 yrs, 3.5% couponNo repayment requirements until 2020Proceeds generating positive carry
Stable Funding
(Solo)
3
Disciplined Approach
US$ 1.8 bn gross cash → 83% in US$, 17% in TLUS$ 1.5 bn total debt
US$ +330 mn net cash
Strong Cash Position
(Solo)
Notes: All data as of 9M18(1) Net FX short position at 104 mn US$ (excluding US$ 1.3 bn of loans designating as hedging instruments (mainly Tüpraş) and US$ 1.4 bn of natural hedge due to FX linked pricing
of Tüpraş and Aygaz inventory)
NoFX Position
US$ +14 mn solo long FX position
US$ -104 mn consolidated short FX position after natural hedge1
US$ -20 mn consolidated short FX position after natural hedge weighted by effective ownership
SustainableLeverage
1.8x net financial debt / EBITDA on a combined basis
Solid Liquidity 1.4x current ratio on a combined basis
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Diesel Jet Fuel Gasoline LPG
Aug'17 15.7 3.0 1.5 2.7
Aug'18 16.9 3.4 1.6 2.8
+8%
+12%
+4%+4%
4
Energy
Tüpraş Opet
Aygaz (000 tons)
Capacity Utilisation White Product YieldRefining Margins ($/bbl)
Tüpraş (net) Med ComplexWhite Product Market Share
Ranking: #2
Sales Volume, Domestic Market (mn tons)
Energy Segment
(+) Inventory gains
(-) Impact of planned shutdowns on CUR and volumes
(-) Impact of sudden TL depreciation
Share in Consolidated Net Income
Share in Combined
Operating Profit 2
Notes: Energy Market Regulatory Authority data used for sectoral indicators(1) Clean net refining margin excludes inventory effect(2) Excluding FX gains/losses and credit finance income/charges on trade receivables and payables
Ranking: #1
Sales Volume
258 243
591 571
27 38
764 701
9M17 9M18
Cylinder Autogas Bulk Other
-5%1,640
1,553
8.5
5.8
10.7
4.5
9M17 9M18 9M17 9M18
105.3%86.5%
7.2%8.5%
9M17 9M18
Crude Others
112.6%95.0%
77.0% 77.2%
9M17 9M18
17.9% 17.9%
Aug'17 Aug'18
45% 23%
TL mn, combined 9M18 y/y
Revenues 111,704 57%
Operating Profit 2 8,119 63%
Profit Before Tax 2,827 -35%
Cons. Net Income 875 -41%YE18 FC 95-100%
YE18 FC 4.25-4.75
(YE17: 5.3)
YE18 FC 9.5-10.5
(YE17: 8.1)
8.38.3Clean1
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Koç Share 15% 13% 54% 53% 21% 22% 24% 22%
5
AutomotiveSales Units, Domestic Market (‘000) Export Units, Turkey (‘000)
Notes: Automotive Manufacturing Association data used for sectoral indicators. HCV data based on restated AMA figures.(1) Excluding FX gains/losses and credit finance income/charges on trade receivables and payables (2) Excluding bargain purchase gain (negative goodwill) of Otokoç on acquisition of car rental business in Greece in 2Q18 (PBT impact TL 142 mn, cons. net income impact TL 109 mn)
Tofaş Revenues Ford Otosan Revenues TürkTraktör Revenues
Total Revenues: TL 13.8 bn, +11% y/y
Automotive Segment
(+) Solid international revenues
(+) Higher €/TL
(+) Pricing focus in domestic market
(+) Cost discipline
(-) Significant decline in domestic market volumes
Total Revenues: TL 23.2 bn, +36% y/y Total Revenues: TL 3.0 bn, -2% y/y
Share in Consolidated Net Income
Share in Combined
Operating Profit 1
22% 30%
TL mn, combined 9M18 y/y
Revenues 46,355 21%
Operating Profit 1 3,954 46%
Profit Before Tax 2,944 33%
Cons. Net Income 1,160 28%
PassengerCars
LightCommercial
HeavyCommercial
TOTAL
9M17 477 151 20 647
9M18 362 101 16 480
-24%
-33%
-26%
-17%
984 972
9M17 9M18
-1%
Domestic
21%
Int'l
79%(+25% y/y)
(-22% y/y)
Domestic19%
Int'l
81%
(-6% y/y)
(+51% y/y)
Domestic
56%Int'l44%
(+57% y/y) (-24% y/y)
Koç Share 42% 44%
27%2
16%2
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Domestic34%
(+6% y/y)Int'l
66%(+45% y/y)
6
Consumer Durables
Arçelik Revenues Arçelik Regional Breakdown of Revenues
Organic Growth: +10% FX Impact: +35%
Sales Units, Market (mn)
Consumer Durables Segment
(+) Solid international revenues
(+) Pricing focus
(-) Financial expenses
(-) Contraction in domestic market also including high base impact
Total Revenues: TL 19.5 bn, +29% y/y
Export Units, Turkey (mn)
Notes: White Goods Manufacturing Association data used for Turkish market; GfK indicative data used for international markets(1) Excluding FX gains/losses and credit finance income/charges on trade receivables and payables
Share in Consolidated Net Income
Share in Combined
Operating Profit 1
TurkeyWesternEurope
EasternEurope
S. Africa
9M17 6.9 34.8 11.9 1.3
9M18 5.9 34.3 12.9 1.3
-15%
-2%
+8%
+5%
14.915.7
9M17 9M18
+6%
41%
28%
12%
6%3% 5% 5%
34%31%
15%
7%2%
5% 6%
Turkey WesternEurope
CIS &EasternEurope
Africa MiddleEast
Pakistan Other
9M17 9M18
8% 6%
TL mn, combined 9M18 y/y
Revenues 22,126 30%
Operating Profit 1 1,484 26%
Profit Before Tax 733 5%
Cons. Net Income 246 -20%
Arçelik Market Share 9.3% 12.3% 40.1%Change y/y +0.8 pp +0.5 pp -0.7 pp
∆ Chg. y/y +6% +43% +57% +39% +10% +29% +69%
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1.08%
2.09%
9M17 9M18
41%
33%
9M17 9M18
10.0% 9.8%
2017 9M18
13.4% 13.3%
2,735
3,586
9M17 9M18
31%
114% 112%
2017 9M18
7
Finance
Net Income (TL mn) ROATE Cost/Income2 CoR
Capital Ratios4 LDR
CAR
CET1
Revenues +44%Costs +13%
(vs. 25% CPI)
YKB Profitability YKB Operational Performance
YKB Balance Sheet YKB Fundamentals
Finance Segment
Improving cost / income
Conservative CoR approach
Controlled volumes and focus on liquidity
Share in Consolidated Net Income
Share in Combined
Operating Profit
14.0% 14.3%
9M17 9M18
23 bps
25% 34%
TL mn, combined 9M18 y/y
Operating Profit 4,578 34%
Profit Before Tax 4,656 34%
Cons. Net Income 1,309 31%
15.4%Excluding
IRS m-t-m1
(1) TL 4.1bn IRS m-t-m valuation gain that is booked under equity but not considered in capital calculations (2017: TL 838mn) (2) 9M18 Income adjusted for trading income to hedge FC ECL(3) Loans indicate performing loans excluding factoring and leasing receivables and TL and FC loans are adjusted for FX indexed loans(4) Capital ratios are presented without forbearance actions (with forbearance: CET-1: 12.1%, CAR: 16.1%)
1.88%
TL bn, consolidated 9M18 q/q y/y
Loans3 249.4 12% 31%
TL 124.8 1% 8%
FC ($) 20.8 -4% -2%
Deposits 221.0 15% 34%
TL 88.6 11% 25%
FC ($) 22.1 -11% -16%
NPL Ratio 3.7% -0.1pp -0.5pp
Provisions / Gross Loans 4.6% 0.2pp -0.1pp
Notes:ROATE indicates Return on Average Tangible Equity CoR= Total specific + generic provisions net of collections. 9M18 adjusted for provision reversals related to cheques due to regulation change in 2Q18CET1= Common Equity Tier-1LDR= Performing Loans / (Deposits + TL Bonds)
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Group’s Overall Financial Performance
(1) Before revenue eliminations(2) Excluding FX gains/losses and credit finance income/charges on trade receivables and payables (Combined operating profit reported in 9M18 financial report is TL 14,521 mn)(3) Koç Holding’s consolidated net income after the share of JV partners and non-controlling interests
TL mn, 9M18 Energy AutomotiveConsumer
DurablesFinance Other
Combined Revenues1 111,704 46,355 22,126 30,424 9,555
y/y 57% 21% 30% 41% 21% 41%
Combined Operating Profit2 8,119 3,954 1,484 4,578 4
y/y 63% 46% 26% 34% -96% 46%
Combined Profit Before Tax 2,827 2,944 733 4,656 419
y/y -35% 33% 5% 34% 60% 5%
Combined Net Income 2,498 2,702 620 3,636 334
y/y -34% 22% -17% 31% 52% 0%
Consolidated Net Income3 875 1,160 246 1,309 236
y/y -41% 28% -20% 31% 81% 0%
3,827
9,789
Total
220,164
18,138
11,579
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Energy38.8%
Auto23.6%
Cons. Durables8.0%
Finance26.2%
Other3.4%
Energy
22.9%
Auto
30.3%
Cons. Durables6.4%
Finance34.2%
Other
6.2%
9
Consolidated Net Income
-41% +28% -20% +31% +81% 0%y/y
Consolidated Net Income (TL mn)
Note: Consolidated net income indicates Koç Holding share after the share of JV partners and non-controlling interests(1) Excluding (i) bargain purchase gain (negative goodwill) of Otokoç on acquisition of car rental business in Greece (cons. net income impact TL 109 mn) in 2018; (ii) fair value gain of Koç Holding’s asset exchange transaction in 2017 (cons. net income impact TL 26 mn)
Normalized1
-2%
3,832
- 611
255
- 60
306 106 3,827
9M17 Energy Auto Cons. Durables Finance Other 9M18
9M17 9M18
Normalized1
+16%
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Wrap-Up
Disciplined management approach and balance sheet strength ensuring resilience
against volatility
Sustainable performance and solid net cash position
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Disclaimer
This presentation does contain forward-looking statements that reflect the Company
management’s current views with respect to certain future events based on the base-case
assumptions. Although it is believed that the expectations reflected in these statements are
reasonable, they may be affected by a variety of variables and changes in underlying assumptions
that could cause actual results to differ materially.
Neither Koç Holding nor any of its directors, managers or employees nor any other person shall
have any liability whatsoever for any loss arising from the use of this presentation.
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ANNEX
12
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Consolidated Main Financial Indicators
Note:End of period €/TL = 6.9505 and US$/TL = 5.9902 used for balance sheet indicatorsAverage €/TL = 5.4401 and US$/TL = 4.5679 used for P&L indicators
TL mn 9M17 9M18 € mn $ mn
Revenues 71,348 103,414 45% 19,010 22,639
Gross Profit 12,120 16,604 37% 3,052 3,635
Operating Profit 8,159 8,433 3% 1,550 1,846
Profit Before Tax 6,801 5,915 -13% 1,087 1,295
Taxes (net) -428 -406 -5% -75 -89
Net Income Before Non-controlling Interest 6,373 5,509 -14% 1,013 1,206
Non-controlling Interest 2,542 1,683 -34% 309 368
Net Income After Non-controlling Interest 3,832 3,827 0% 703 838
YE17 9M18 € mn $ mn
Total Assets 104,064 138,791 33% 19,969 23,170
Total Equity 42,931 45,166 5% 6,498 7,540
YTD
9M18
Y/Y
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Combined Net Income – Consolidated Net Income
-41% +28% -20% +31% +81% 0%y/y
-34% +22% -17% +31% +52% 0%y/y
Consolidated Net Income (TL mn)
Combined Net Income (TL mn)
3,813
2,211
746
2,786
219
9,774
2,498 2,702
620
3,636
334
9,789
Energy Auto Cons. Durables Finance Other Total
1,486
905
306
1,003
130
3,832
8751,160
246
1,309
236
3,827
Energy Auto Cons. Durables Finance Other Total
Normalized1
+16%
Normalized1
-2%
Normalized1
+16%
Normalized1
-1%
Note: Consolidated net income indicates Koç Holding share after the share of JV partners and non-controlling interests(1) Excluding (i) bargain purchase gain (negative goodwill) of Otokoç on acquisition of car rental business in Greece (cons. net income impact TL 109 mn) in 2018; (ii) fair value gain of Koç Holding’s asset exchange transaction in 2017 (cons. net income impact TL 26 mn)
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Unlisted Companies
Notes: Financials for unlisted companies disclosed semi-annually (1) Excluding FX gains/losses and credit finance income/charges on trade receivables and payables
2017 2018 2017 2018 2017 2018 2017 2018
Arçel ik LG Kl ima 5.00% 415 670 15 50 19 57 263 296
Bi lkom 69.94% 790 1,271 29 37 29 38 72 86
Düzey 31.15% 796 869 5 -5 6 -3 64 18
Entek 49.62% 166 193 21 22 27 38 658 1,037
Koç Finansman 44.50% 273 356 47 60 47 61 241 297
KoçSis tem 41.11% 453 589 1 -2 11 10 79 77
Koçtaş 37.13% 675 729 27 15 41 30 112 88
Marina / Ayval ık 7.72% 2 3 1 1 1 1 10 12
Marina / Tek-Art Ka lamış 75.92% 16 18 4 4 4 4 172 193
Opet -- 12,866 19,065 369 573 418 624 1,916 2,416
Otokoç Otomotiv 96.32% 2,481 3,165 183 311 236 464 513 885
Ram Dış Ticaret 39.74% 611 701 7 1 7 1 28 14
RMK Marine 40.53% 88 135 4 12 6 14 10 2
Setur 24.11% 576 721 43 30 49 37 168 168
Zer 39.00% 1,135 1,342 43 53 44 55 211 227
1H18
TL mn
Koç Holding
Direct Share
Revenues Operating Profi t1 Book Value (SHE)EBITDA
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Shareholding Structures
Koç Holding
Koç Family: 64.3%1
Free Float: 26.5%Vehbi Koç Foundation: 7.3%
Koç Pension Fund: 2%
Energy
AygazKH: 41%
Other Koç: 10.5%Liquid Pet. Co.: 24.5%
Free float: 24%
OpetTüpraş: 40%
Other Koç: 10%Öztürk Group: 50%
KH: 18%2
Automotive
Ford OtosanKH: 38%
Ford: 41%Other Koç: 3%Free float: 18%
TofaşKH: 38%FCA: 38%
Free float: 24%
TürkTraktörKH: 37.5%
CNH : 37.5%Free float: 25%
OtokarKH: 45%
Ünver Hold.: 25%Other Koç: 3%Free float: 27%
Consumer Durables
ArçelikKH: 41%
Other Koç: 17%Burla Group: 18%
Free float: 25%
Finance
Koç Financial ServicesKH: 42%
Other Koç: 8%UniCredit: 50%
Other
Tat GıdaKH: 44%
Other Koç: 10%Sumitomo & Kagome: 5%
Free float: 41%
TüpraşSPV: 51%
Free float: 49%
KH: 43.7%2
SPVKH : 77%
Aygaz: 20%Opet: 3%
Yapı Kredi BankKFS: 82%
Free float: 18%
KH: 35%2
SeturKH: 24%
Other Koç: 76%
KoçtaşKH: 37%
Kingfisher: 50%Other Koç: 13%
ZerKH: 39%
Other Koç: 60%Other: 1%
Notes: Updated as of Sep’18(1) Temel Ticaret (family-owned investment vehicle) 43.65%, Koç Family Members 20.64%(2) Effective stake indirectly through subsidiaries
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For Further Questions, Please Contact :
Gülsevin Tuncay, Coordinator
Investor Relations
+90 216 531 0428
Gizem Poyraz, Manager
Investor Relations
+90 216 531 0533
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Neslihan Aycıl, Manager
Investor Relations
+90 216 531 0516