Koc Holding A.s. · BIST:KCHOL

Koc Holding A.s — Investor Presentation (November 2011)

47 slides from Koc Holding A.s's investor presentation, November 2011

  1. Slide 1: Koç Holding - Being One

    Koç Holding BEING ONE creating one common legacy for 85 years Investor Presentation – November 2011

  2. Slide 2: Why Koç Holding?

    Why Koç Holding? Slide # 3 Best Proxy to the Turkish Market Winning Through Continuous Growth 4 Continuous Leadership Setting the Benchmarks in Core Sectors 5 High Resilience Against Risks Well Diversified & Defensive Portfolio 6 High Flexibility & Execution Power Adaptability to Changing Market Con

  3. Slide 3: Best Proxy to the Turkish Market - Winning Through Continuous Growth

    Best Proxy to the Turkish Market - Winning Through Continuous Growth We have the right size to benefit from We are the best proxy to the growing Turkish economies of scale… market… 17 15 11 9 Total Sales / GDP 7% 6 5 6 5 5 Total Exports / Turkey’s Exports 10% 3 4 3 Total Share in ISE Market Cap. 15%

  4. Slide 4: Continuous Leadership - Setting the Benchmarks in Core Sectors

    Continuous Leadership - Setting the Benchmarks in Core Sectors Energy Automotive Consumer Durables Finance Automotive Main Companies Main companies Main Companies Main Companies Tüpraş* / Aygaz* / Opet / Entek Ford Otosan* / Tofaş* / Türk Arçelik* Yapı Kredi Bankası* Traktör* / Otokar* International

  5. Slide 5: High Resilience Against Risks – Well Diversified & Defensive Portfolio

    High Resilience Against Risks – Well Diversified & Defensive Portfolio Our diversified portfolio enables us to balance Our net cash position enables us to be proactive out cyclicalities in new M&As EBITDA Breakdown - 2010 Koç Holding Stand-Alone Automotive Net Cash Position 16% Energy Durables 33% 1

  6. Slide 6: High Flexibility & Execution Power – Adaptability to Changing Market Conditions

    High Flexibility & Execution Power – Adaptability to Changing Market Conditions Acquisitions: US$ 6.6 billion Opportunistic M&A strategy to strengthen (Merged with Migros and divested) our market leadership in core sectors Disposals: US$ 3.0 billion Proactive disposals ahead of the 2008 crisis when

  7. Slide 7: Focus on Shareholder Value Creation – Performance Culture

    Focus on Shareholder Value Creation – Performance Culture We are committed to principles of good corporate We endeavor to maximize the value we create for governance our shareholders  Separate CEO and Chairman roles  Executive compensation based on economic profit and share performance  1/3 of th

  8. Slide 8: 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

  9. Slide 9: Leader in R&D and Technology Investments

    Leader in R&D and Technology Investments Koç Group makes the highest Koç Group’s share in R&D investments in Turkey private sector R&D compared to any other investments in Turkey is corporation 12-15% each year with around TL450 million Ratio of annual R&D spent in 2010 With over 250 filings, Koç sp

  10. Slide 10: Operational Excellence and Leadership in Core Business Segments

    Operational Excellence and Leadership in Core Business Segments Slide # 11 Energy Sector Strongest Player in the Turkish Energy Sector 16 Automotive Sector Undisputable Leaders of Turkish Automotive Industry 22 Consumer Durables Sector Strong Global Network 24 Finance Sector Focus on Lucrative Busin

  11. Slide 11: Why Energy Sector?

    Why Energy Sector? High growth potential Strong demand dynamics Per Capita Energy Consumption – Toe  Among the fastest growing energy markets in the 3.7 world parallel to its economic growth  Demand for electricity is estimated to grow at an annual rate of 6% between 2009-2023 1.4  Total installe

  12. Slide 12: Tüpraş – Turkey's Sole Refining Company

    Tüpraş – Turkey’s Sole Refining Company  4 refineries with 28.1 MT total capacity 7th largest refinery in  One of the most complex refineries in the Europe and Mediterranean. Nelson Complexity: 7.25 30th largest in the world  Among the most profitable refineries in Europe and the U.S. : Integrate

  13. Slide 13: Aygaz – Turkey's Undisputable Market Leader in LPG for 50 years

    Aygaz – Turkey’s Undisputable Market Leader in LPG for 50 years  Fully integrated LPG services Europe’s 5th largest  Highest efficiency per station in Turkey LPG distributor  Best inventory turnover globally  Serves 100,000 homes with cylinder LPG everyday Unmatched Turkey’s largest brand LPG st

  14. Slide 14: Opet – Turkey's Fastest Growing Fuel Distribution Company

    Opet – Turkey’s Fastest Growing Fuel Distribution Company  Unrivaled leader in customer satisfaction in its sector for 5 consecutive years 3rd in white products with 17%  Retail and wholesale activities in fuel distribution  Production and marketing of lubricants Turkey’s highest  Aviation fuel

  15. Slide 15: Entek – Ambitious Investment Plans in Electricity Generation

    Entek – Ambitious Investment Plans in Electricity Generation ENTEK  Power generation company 6th largest private sector electricity producer  302MW installed capacity  2 natural gas combined cycle plants 50-50% JV established  Gas turbine based cogeneration facility with AES in 2010, targeting A

  16. Slide 16: Why Automotive Sector?

    Why Automotive Sector? Dynamic market with high growth potential Well-supplied manufacturing hub Car Ownership per ‘000 473  5th largest labor force compared with the EU  Over 24.7 million young and well-educated professionals  High growth in labor productivity 99  Strong local supply base  Low

  17. Slide 17: Koç Group in the Automotive Sector

    Koç Group in the Automotive Sector  Largest distribution network High profitability  Highly skilled and experienced workforce vis-a-vis global peers  Strong R&D focus Highest quality and Spread of best  Long-standing JV partnerships safety of production practices and among the  Benefits of larg

  18. Slide 18: Ford Otosan – Leader in Total Automotive Sales for 9 Consecutive Years

    Ford Otosan – Leader in Total Automotive Sales for 9 Consecutive Years  50-50% JV with Ford Highest market share of  Strong distribution network Ford in Europe in total automotive and  Best Ford assembly plant in Europe since 2002 commercial vehicle market  Best Ford powertrain manufacturer worl

  19. Slide 19: Tofaş – Leader in Automotive Production with 312,000 units

    Tofaş – Leader in Automotive Production with 312,000 units  50-50% JV with Fiat  The only domestic manufacturer of both PCs and LCVs  Extensive dealer and after-sales network Leader in LCV segment  The first Fiat company among 170 companies to reach silver status in WCM with the highest score Ta

  20. Slide 20: Other Automotive Companies

    Other Automotive Companies TÜRK TRAKTÖR – Turkey’s Largest Farm Tractor Manufacturer Undisputable market  50-50% JV with Case New Holland leader  First in Turkey to use “flexible manufacturing system” in tractors, with 51% share providing a high degree of flexibility Profitability level  Strong d

  21. Slide 21: Why Consumer Durables Sector?

    Why Consumer Durables Sector? Underpenetrated segments and renewals drive Strong value proposition growth White Goods Penetration – % 92  Strong R&D focus and innovative products 70  Efficient and cost-effective outlet to multiple markets with over 1.5 billion customers  Competitive labor cost 

  22. Slide 22: Arçelik – Provides Products and Services to Over 100 Countries Worldwide

    Arçelik – Provides Products and Services to Over 100 Countries Worldwide  Most extensive sales and after-sales network in Turkey Turkey’s market leader in white goods (50%),  3rd largest white goods company in Europe TVs and  Unsurpassed brand recognition for 12 consecutive air-conditioners years

  23. Slide 23: Why Finance Sector?

    Why Finance Sector? Low penetration levels providing an opportunity for rapid growth Loans + Deposits / GDP – % Branches per million inhabitants Mortgage loans / GDP – % 459 305 39.6 17.0 90 125 4.5 Eurozone Turkey Eurozone Turkey MU16 Poland Turkey Source : ECB,BRSA - 2009 Strong economic recovery

  24. Slide 24: Yapı Kredi Bank – Balanced Growth and Sustained Profitability

    Yapı Kredi Bank – Balanced Growth and Sustained Profitability  Committed and strong shareholders: 50-50% JV 4th among private sector with UniCredit banks in asset size  Widespread network with 894 branches, 2,595 Continuation of ATMs and award winning internet bank and call customer business focus

  25. Slide 25: Yapı Kredi Subsidiaries and Other Finance Companies

    Yapı Kredi Subsidiaries and Other Finance Companies YAPI KREDİ YAPI KREDİ YAPI KREDİ YAPI KREDİ LEASING FACTORING ASSET MANAGEMENT PENSION  Leader with 18.9%  Leader with 17.3%  2nd in the market with  4th in private pension share share 17.7% share funds with 16% share  20% RoE  52% RoE  117%

  26. Slide 26: Koç Holding: Strongest Beneficiary of the High Growth Environment

    Koç Holding : Strongest Beneficiary of the High Growth Environment and Strong Margins Despite Global Turmoil Revenues – Consolidated-US$bn EBITDA – Consolidated-US$bn 43.0 3.6 3.4 3.1 3.2 34.5 36.0 35.9 36.5 2.8 2.7 29.0 18.2 1.6 1.5 16.6 1.2 11.1 6.9 0.7 2002 2003 2004 2005 2006 2007 2008 2009 2010

  27. Slide 27: Strong Global Reach

    Strong Global Reach International Sales 2010 Regional Breakdown Exports –US$bn 8.6 7.6 US$7,422mn 64% 5.9 US$874mn US$2,366mn 7% 20% US$937mn 8% US$84mn 1% 2009 2010 2011F www.koc.com.tr 27

  28. Slide 28: Focus on Large Investments with High Returns

    Focus on Large Investments with High Returns Ongoing investments to increase efficiency Opportunistic M&A activities in core business lines Investments – US$bn  New manufacturing projects  Opportunistic for export markets with our buyouts in 1.7 JV partners international markets as a consolidator

  29. Slide 29: Strong Balance Sheet with Solid Cash Position

    Strong Balance Sheet with Solid Cash Position Koç Holding Stand-Alone 30.09.2011 Net Cash Position Total Debt: ~US$ 0.15 bn Total Cash: ~US$ 0.76 bn Net Cash: ~US$ 609 mn 2012-2013 Redemption Schedule US$ 150 mn – to be paid in equal annual installments of US$ 75 mn each January Consolidated Net Deb

  30. Slide 30: Well-Managed Risk

    Well-Managed Risk Koç Holding Stand-Alone FX Position 2010 1H11 9M11 US$ + 323mn US$ + 339mn US$ + 338mn Koç Holding Consolidated FX Position FX Position Weighted by Effective Ownership 2010 1H11 9M11 2010 1H11 9M11 US$ - 2.9bn US$ - 3.2bn US$ - 3.0bn* US$ - 1.7bn US$ - 1.8bn US$ - 1.6bn * The natur

  31. Slide 31: Key Takeaways: Value Proposition to Investors

    Key Takeaways : Value Proposition to Investors Strong top-line growth enabling the benefits of Best proxy to Leading positions in economies of scale the Turkish core sectors and new Economy investment and M&A opportunities Strong commitment to Corporate Governance and Corporate Social Superior and s

  32. Slide 32: Corporate Social Responsibility

    Corporate Social Responsibility Slide # 33 Vehbi Koç Foundation Contribution to Turkey’s Development through Sustainable and Replicable Models 34 Social Responsibility Projects Leveraging Koç Group Synergies to Address Social Issues 35 Environmental Policies Safeguarding the Environment for Future G

  33. Slide 33: Our Country's Future is Our Future – Koç Holding as a Leading Corporate Citizen

    Our Country’s Future is Our Future – Koç Holding as a Leading Corporate Citizen Vehbi Koç Foundation : Institutionalization for social development  Established in 1969 as Turkey’s first private foundation;  to make philanthropic endowments for the public good  to create sustainable and replicable

  34. Slide 34: Corporate Solutions for Social Advancement

    Corporate Solutions for Social Advancement Our projects’ commonalities are unity, synergy and leadership established through our companies, employees and dealers Vocational Education: A Crucial Matter “For My Country” project for the Nation  Grassroots initiative organized annually  Supporting voc

  35. Slide 35: Commitment to the Environment

    Commitment to the Environment Koç Group endeavors to preserve national and natural resources in the most efficient way and minimize or recycle waste at the source Koç Group made water savings of close to 14 million m3 - equivalent to the annual Koç Group companies water consumption of 100,000 people

  36. Slide 36: Appendix

    Appendix www.koc.com.tr 36

  37. Slide 37: Table of Contents

    Table of Contents Page 1. 9M11 Earnings Review 38 2. Shareholder Structures 44 3. Macro Assumptions and Disclaimer 45 4. Contacts 46 www.koc.com.tr 37

  38. Slide 38: Financial Performance

    Financial Performance Revenues  TL54,930mn (US$33,956mn)  43% YoY increase in TL terms and 34% in US$ terms Operating Profit  TL4,372mn (US$2,703mn)  35% YoY increase in TL terms and 26% in US$ terms EBITDA  TL5,139mn (US$3,177mn)  29% YoY increase in TL terms and 21% in US$ terms Profit Befor

  39. Slide 39: Main Financial Indicators

    Main Financial Indicators € Mn* US$ Mn* TL Mn TL Mn Change Change 30.Sep.2011 30.Sep.2011 30.Sep.2011 30.Sep.2010 %, TL %, US$ Revenues 24,138 33,956 54,930 38,475 p 43 p 34 Gross Profit 3,651 5,136 8,308 6,695 p 24 p 16 EBITDA 2,258 3,177 5,139 3,973 p 29 p 21 Operating Profit 1,921 2,703 4,372 3,2

  40. Slide 40: Strong Growth in Top Line

    Strong Growth in Top Line Revenues – TLmn Share of Segment Revenues – % 43% 54,930 38,475 Energy 63% Automotive 13% Durables 12% 9M10 9M11 Finance Other 4% 8% Segment Contribution to Revenues – TLmn 54% 34,723 22,478 41% 21% 19% 15% 7,296 6,364 5,170 5,248 3,633 4,316 1,946 2,232 Energy Automotive D

  41. Slide 41: Energy & Finance Provide the Highest Contribution to EBITDA

    Energy & Finance Provide the Highest Contribution to EBITDA EBITDA – TLmn Segmental EBITDA Breakdown – % 29% 5,139 Energy Automotive 3,973 44% 15% Durables 14% Other 9M10 9M11 3% Finance 24% Segment Contribution to EBITDA – TLmn EBITDA Margin by Segment – % 70% 2,258 34.0 1% 28.9 1,330 1,236 1,249 4

  42. Slide 42: 35% Increase in Operating Profit

    35% Increase in Operating Profit Operating Profit Consumer Energy Automotive Finance Other TOTAL TL mn Durables 9M11 1,975 589 548 1,169 91 4,372 Operating Profit – TLmn Segmental Operating Profit Breakdown – % 35% 4,372 Energy 45% 3,250 Automotive 13% Other 2% Durables 13% 9M10 9M11 Finance 27% www

  43. Slide 43: High Margins Despite Volatility in FX Rates

    High Margins Despite Volatility in FX Rates EBITDA Margin – % Operating Margin – % 9.5 9.4 8.0 8.0 1H11 9M11 1H11 9M11 Net Income Margin – % 3.4 3.0 1H11 9M11 www.koc.com.tr 43

  44. Slide 44: Shareholder Structures as of September 2011

    Shareholder Structures as of September 2011 Koç Holding Koç Family: 68.51% Free Float: 22.35% 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 sha

  45. Slide 45: Main Macro Assumptions and Disclaimer

    Main Macro Assumptions and Disclaimer 2011 2011 2012 2012 This presentation does contain forward- Koç Holding Government Koç Holding Government looking statements that reflect the Company management’s current views with respect to certain future events GDP ($billion) 753 766 789 822 based on the bas

  46. Slide 46: For Further Questions, Please Contact:

    For Further Questions, Please Contact : Winner 2010 Best IR Website Award investorrelations@koc.com.tr Funda Güngör Akpınar, Coordinator Investor Relations fundag@koc.com.tr +90 216 531 0535 Neslihan Aycıl, Associate Investor Relations neslihana@koc.com.tr +90 216 531 0516 www.koc.com.tr 46

  47. Slide 47: 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. 6000 +90 262 316 3085 M. Türkay Tatar, EVP Yasemi

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