Koc Holding A.s. · BIST:KCHOL

Koc Holding A.s — Investor Presentation (May 2010)

42 slides from Koc Holding A.s's investor presentation, May 2010

  1. Slide 1: Koç Holding Investor Presentation

    Koç Holding Investor Presentation May 2010

  2. Slide 2: Sustainable Track Record in Overperforming the Turkish Economic Growth Rates

    Sustainable Track Record in Overperforming the Turkish Economic Growth Rates Leading Conglomerate in Turkey Strong Standing in Global Rankings Ranking  2008 : 172 Total Sales / GDP  2007 : 186 7%*  2006 : 190 Global 500 Total Exports / Turkey’s Exports 8%*  2005 : 358  2004 : 389 Total Share in

  3. Slide 3: Unrivaled Competitive Advantages

    Unrivaled Competitive Advantages  ~11,000 dealers and after-sales services Largest distribution network  ~ 850 bank branches Largest customer database  Large customer database of over 17 million in different business segments together with strong CRM capabilities, enabling efficient up & cross-se

  4. Slide 4: Strategic Targeting Geared Towards Efficiency, Leadership, Innovation & Reputation

    Strategic Targeting Geared Towards Efficiency, Leadership, Innovation & Reputation Strategic Principles  Focus on those sectors where we can create a differential competitive advantage  Grow in sectors where we can leverage our strong brands & technological prowess  Derive maximum benefits from e

  5. Slide 5: Focused Growth Strategy

    Focused Growth Strategy Energy Automotive Consumer Durables Finance Automotive Main Companies Main companies Main Companies Main Companies Tüpraş* / Aygaz* / Opet / Entek Ford Otosan* / Tofaş* / Türk Traktör* / Arçelik* Yapı Kredi Bankası* Otokar* Share in Consolidated Revenues International Allianc

  6. Slide 6: Koç Holding in the Energy Sector

    Koç Holding in the Energy Sector Vision & Strategies  Maximize efficiency and increase profitability through – new investments in existing business units such as residuum upgrade project – new technology, product and service offerings – operational efficiencies and profit enhancement programs – opt

  7. Slide 7: Energy Companies – Competitive Advantages

    Energy Companies – Competitive Advantages  Turkey’s sole refiner and largest industrial company  4 refineries (İzmit, İzmir, Kırıkkale, Batman)  Supplying 70% of the total domestic demand  8th largest in Europe with 28 million tons/year total capacity  The largest in Emerging Europe  Highest E

  8. Slide 8: Koç Holding in the Automotive Sector

    Koç Holding in the Automotive Sector Vision & Strategies  To become a “Regional Production Base”  Assume full product development responsibility  Grow as a multi-brand dealership chain in retailing  Maximize efficiency through economies of scale and high capacity utilization rate Leader in Turke

  9. Slide 9: Automotive Companies – Competitive Advantages

    Automotive Companies – Competitive Advantages  Turkey’s largest manufacturer and exporter of commercial vehicles  50-50 JV with Ford  Turkey’s market leader in total automotive  7th consecutive year as the best assembly plant in Ford Europe  4th consecutive year as the best powerplant manufactu

  10. Slide 10: Koç Holding in the Consumer Durables Sector

    Koç Holding in the Consumer Durables Sector Vision & Strategies  Grow globally by acquisitions and organic growth  Maintain domestic market leadership  Leverage technology development capabilities to improve  Increase R&D capabilities, focus on brand positioning product development  Improve ope

  11. Slide 11: Consumer Durables Companies – Competitive Advantages

    Consumer Durables Companies – Competitive Advantages  Turkey’s market leader  Domestic network of 3,500 dealers and 600 after sales service stations  370 exclusive dealers in 30 countries  19.5 million units/year manufacturing capacity in Turkey, Romania, Russia and China  3rd largest household

  12. Slide 12: Koç Holding in the Finance Sector

    Koç Holding in the Finance Sector Vision & Strategies  Consolidate leadership in credit cards and become leader in consumer finance  Become leader in Asset Gathering and first choice bank for High Net Worth Individuals  Selective growth on Commercial and Corporate segments  Growth in SME through

  13. Slide 13: Finance Companies – Competitive Advantages

    Finance Companies – Competitive Advantages  Turkey’s 4th largest private bank (in terms of total assets)  50-50 JV with UniCredit  ~ 850 Branches  #1 in credit cards (issuing volume)  Leading companies in asset management, insurance, leasing & factoring #1 in Leasing #1 in Factoring #1 in Healt

  14. Slide 14: Portfolio Restructuring ahead of the Crisis in line with Changing Economic Dynamics

    Portfolio Restructuring ahead of the Crisis in line with Changing Economic Dynamics US$ 6.6 billion Acquisitions in core sectors US$ 3.0 billion Proceeds through proactive disposals www.koc.com.tr 14

  15. Slide 15: Strongest Beneficiary of the High Growth Environment with Leading Positions in Underpenetrated Markets

    Strongest Beneficiary of the High Growth Environment with Leading Positions in Underpenetrated Markets Revenues – Consolidated-US$bn 43.0 34.5 36.0 29.0 16.6 18.2 11.1 6.9 2002 2003 2004 2005 2006 2007 2008 2009 Further strong growth potential due to leading positions in low-penetrated business line

  16. Slide 16: Strong Margins Despite Global Turmoil

    Strong Margins Despite Global Turmoil EBITDA – Consolidated-US$bn Operating Profit – Consolidated-US$bn 3.1 3.2 2.6 2.6 2.8 2.7 2.2 2.1 1.6 1.5 1.2 1.0 0.9 0.7 0.6 0.2 2002 2003 2004 2005 2006 2007* 2008* 2009 2002 2003 2004 2005 2006 2007* 2008* 2009 Operating Margin – % 7.7 7.2 6.1 6.0 6.1 5.3 5.0

  17. Slide 17: Optimal Portfolio Allocation with High Resilience Against Market Volatility

    Optimal Portfolio Allocation with High Resilience Against Market Volatility Revenues – % 2003 2009 FX-denominated & FX-denominated & FX-linked * FX-linked 56% 44% 39% 61% TL TL * FX-linked revenues: Domestic revenues of the energy segment Operating Profit – % 2003 2009 Sectors with Sectors with Less

  18. Slide 18: Strong Global Reach

    Strong Global Reach US$6,913mn 75% share in US$218mn Int’l Sales 2% share in US$1,336mn Int’l Sales 15% share in Int’l Sales US$660mn 7% share in US$49mn Int’l Sales 1% share in Int’l Sales Exports – Combined-US$bn International Sales* – Combined-US$bn 15.0 14.2 12.6 13.3 11.8 9.9 9.2 8.6 8.5 7.5 5.

  19. Slide 19: Leader in R&D and Technology Investments

    Leader in R&D and Technology Investments 16% 8% of private sector of all patent applications filed R&D investments with the Turkish Patent Institute Koç Group Total R&D Investments – TLmn Koç Group Companies’ Patent Portfolio * 1,829 486 67 193 2002 2003 2004 2005 2006 2007 2008 2009 2002 2003 2004

  20. Slide 20: Strong Liquidity & Balance Sheet Management Offering Opportunistic Buyouts in the M&A Market

    Strong Liquidity & Balance Sheet Management Offering Opportunistic Buyouts in the M&A Market Koç Holding Stand-Alone 31.03.2010 Net Cash Position Total Debt: ~US$ 0.2 bn Total Cash: ~US$ 1.07 bn Net Cash: ~US$ 840 mn 2011-2013 Redemption Schedule US$ 225 mn – to be paid in equal annual installments

  21. Slide 21: High Resilience Against FX Volatility due to Tight Risk Management Measures

    High Resilience Against FX Volatility due to Tight Risk Management Measures Koç Holding Stand-Alone FX Position 1Q09 1Q10 US$ + 290mn US$ + 280mn Koç Holding Consolidated FX Position Weighted by Effective FX Position Ownership 9M08 2008 1Q09 1Q10 1Q09 1Q10 US$ - 4.2bn US$ - 2.2bn US$ - 2.3bn US$ - 2

  22. Slide 22: Continuous Focus on Risk Management & Efficiency Gains

    Continous Focus on Risk Management & Efficiency Gains Area of focus in 2010  Strict cost cutting measures and efficiency gains  Stringent risk management measures  Strong balance sheet and liquidity management  Further streamlining of management processes  Optimum capacity utilization rates  E

  23. Slide 23: Potential Investment Areas

    Potential Investment Areas • Residuum upgrade project - Tüpraş • Opportunities in different fields • New manufacturing including electricity projects for export generation and markets with our JV Automotive renewable energy partners  Focus on higher ROI generating businesses Consumer Energy  Enhan

  24. Slide 24: Main Goal: Maximizing Shareholder Value

    Main Goal: Maximizing Shareholder Value One of the few Turkish Companies which Links Executive Compensation to Share Performance Shareholder Value L-T Strategic Targets Economic Profit Market Cap to Maximize Future Shareholder Value Customer Technology Satisfaction Development Aggressive Sustainable

  25. Slide 25: Value Proposition to Investors

    Value Proposition to Investors www.koc.com.tr 25

  26. Slide 26: Commitment to Corporate Governance

    Commitment to Corporate Governance A Pioneer in Corporate Citizenship  Voluntary commitment and proactive approach to principles of good corporate governance  Executive compensation based on economic profit and share performance  One of the first local companies in Turkey to have independent memb

  27. Slide 27: Corporate Social Responsibility

    Corporate Social Responsibility One of the first Turkish companies to sign the UN Global Compact which confirms Koç Group’s commitment to Corporate Citizenship Supporting vocational secondary schools; Project developed to create awareness among public. Koç Holding has pledged to grant 8,000 students

  28. Slide 28: Corporate Social Responsibility

    Corporate Social Responsibility Contributing to Turkey’s Development through Philantropic Activities Vehbi Koç Foundation  Assets: $1.2 billion Education  The Koç Schools  Koç University (over $190 Million investment)  Turkish Education Foundation (TEV)  TEGV Health Care  The American Hospital

  29. Slide 29: Appendix

    Appendix www.koc.com.tr 29

  30. Slide 30: Table of Contents

    Table of Contents Page 1. 1Q10 Earnings Review 31 2. Shareholder Structures 39 3. Contacts and Disclaimer 40 www.koc.com.tr 30

  31. Slide 31: Robust Financial Performance

    Robust Financial Performance Revenues  TL11,104mn (US$7,396mn)  27% YoY increase in TL terms and 40% in US$ terms Operating Profit  TL867mn (US$578mn)  30% YoY increase in TL terms and 43% in US$ terms EBITDA  TL1,102mn (US$734mn)  25% YoY increase in TL terms and 38% in US$ terms Profit Befor

  32. Slide 32: Main Financial Indicators

    Main Financial Indicators € Mn* US$ Mn* TL Mn TL Mn Change Change 31.Mar.10 31.Mar.10 31.Mar.10 31.Mar.09 %, TL %, US$ Revenues 5,342 7,396 11,104 8,731 p 27 p 40 Gross Profit 951 1,317 1,978 1,818 p 9 p 20 EBITDA 530 734 1,102 880 p 25 p 38 Operating Profit 417 578 867 667 p 30 p 43 FX Gain/(Loss)

  33. Slide 33: Solid Performance in Revenues due to Low Base Year & Better Operating Environment

    Solid Performance in Revenues due to Low Base Year & Better Operating Environment Revenues – TLmn Share of Segment Revenues – % 27% 11,104 8,731 Automotive Energy 14% 57% Durables 14% 1Q09 1Q10 Other Finance 5% 10% Segment Contribution to Revenues – TLmn 43% 6,303 4,421 57% 10% 21% 20% 1,549 1,402 1

  34. Slide 34: 25% Increase in EBITDA

    25% Increase in EBITDA EBITDA Consumer Energy Automotive Finance Other Consolidated Total TL mn Durables 1Q10 316 149 199 387 51 1,102 EBITDA – TLmn Segmental EBITDA Breakdown – % 25% 1,102 Automotive 14% 880 Durables 18% Energy 29% Other 1Q09 1Q10 5% Finance 35% www.koc.com.tr 34

  35. Slide 35: Strong Improvement in Consumer Durables & Finance

    Strong Improvement in Consumer Durables & Finance Segment Contribution to EBITDA – TLmn 24% 2% 387 322 316 312 126% 28% 199 149 116 23% 88 42 51 Energy Automotive Durables Finance Other 1Q09 1Q10 EBITDA Margin by Segment – % 33.2 21.3 11.8 12.9 9.6 9.2 9.4 7.3 6.3 5.0 Energy Automotive Durables Fina

  36. Slide 36: 30% Increase in Operating Profit

    30% Increase in Operating Profit Operating Profit Consumer Energy Automotive Finance Other Consolidated Total TL mn Durables 1Q10 225 92 152 365 33 867 Operating Profit – TLmn Segmental Operating Profit Breakdown – % 30% Automotive 867 11% Durables 667 Energy 17% 26% Other 4% Finance 1Q09 1Q10 42% w

  37. Slide 37: Improving Profitability

    Improving Profitability Operating Profit Margin – % Profit Before Tax Margin – % 7.8 7.2 7.3 7.6 2.0 1.8 1Q08 1Q09 1Q10 1Q08 1Q09 1Q10 www.koc.com.tr 37

  38. Slide 38: Continuing Improvement in Profit Before Tax

    Continuing Improvement in Profit Before Tax Profit before tax increased by 417% YoY  TL376mn FX loss in 1Q09 vs TL62mn FX loss in 1Q10  Decline in net interest expense from TL192mn in 1Q09 to TL10 million in 1Q10 Profit Before Tax – TLmn 417% 796 154 1Q09 1Q10 www.koc.com.tr 38

  39. Slide 39: Shareholder Structures as of March 2010

    Shareholder Structures as of March 2010 Koç Holding Koç Family: 69.36% Free Float: 21.49% Vehbi Koç Foundation: 7.15% Koç Pension Fund: 1.99% Consumer Energy Automotive Finance Other Durables Tüpraş Ford Otosan Arçelik Tat Konserve SPV share: 51.00% KH share: 38.46% Koç Financial Services KH share:

  40. Slide 40: For Further Questions, Please Contact :

    For Further Questions, Please Contact : investorrelations@koc.com.tr Funda Güngör, Coordinator Investor Relations Strategic Planning Group fundag@koc.com.tr +90 216 531 0535 Aslı Selçuk, Manager Investor Relations Strategic Planning Group aslii@koc.com.tr +90 216 531 0537 Neslihan Aycıl, Associate I

  41. Slide 41: Main Group Companies’ Contacts

    Main Group Companies’ Contacts Arçelik Otokar Tüpraş Fatih Ebiçlioğlu, CFO Hüseyin Odabaş, AGM Finance Tuncay Önbilgin, Head of IR fatih.ebiclioglu@arcelik.com hodabas@otokar.com.tr tuncay.onbilgin@tupras.com.tr +90 212 314 3434 +90 264 229 2244 Ext. 451 +90 262 316 3085 M. Türkay Tatar, EVP Yasemin

  42. Slide 42: Disclaimer

    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 a

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