Turk Traktor Ve Ziraat Makineleri A.s. · BIST:TTRAK
Turk Traktor Ve Ziraat Makineleri A.s — H1 2020 Earnings Presentation
36 slides from Turk Traktor Ve Ziraat Makineleri A.s's earnings presentation, Jul 28, 2020
Slide 1: Evaluation of 2020 6M
TiirkTraktér | Pevdipe EVALUATION OF 2020 6M
Slide 2: When Starting 2020
When Starting 2020 Growth in Cost Other Business "Continue" Management, Strong "Leader" in Domestic Lines to Invest in Productivity Cash Export Market -Equipment New and Position -Construction Products Profitability Equipment 1
Slide 3: Before Covid-19
22,745 10.791 Before Covid-19 Tractor Manufacturing Units Local Tractor Sales Units 55% Increase 82% Increase 4,266 6,953 4,482 2,345 2019 2019 1Q 2020 1Q 2019 2019 1Q 2020 1Q Strong start to the year Increase in production and sales numbers Strong cash position Cash Position (million TL) Establishm
Slide 4: Covid-19 Precautions
Covid-19 Precautions Customers and Dealers Personnel Production and Financing Social Responsibility -Taking measures at sales and -Working in shifts and Supply Chain -Strengthen the -Intubation and biological service facilities working from home -Gradual production pace increase Cash level sampling
Slide 5: Covid-19 Precautions for Employees
Covid-19 Precautions for Employees TSE Covid-19 Certificate Social Disinfection Density Mitigation Protection of the Reduction of Continuous Distancing -Hand disinfectants of the Working Employees Health Contact Density Communication - Warning signs -Disinfection of the Enviroment -Mask at the Commo
Slide 6: Local Market Sector Dynamics
Local Market Sector Dynamics Agricultural Input Costs Goverment Consumer Precipitation Production and Product Support Financing Trend Prices 5
Slide 7: Precipitation Trend
In 2020, rains were below last year. Precipitation Trend Although the yield was not adversely affected by it. Comparison with the Last Year's Rainfall (October 2019 - June 2020) Cumulative Rainfall (mm) 619 522 Seasonal Normal -16% -1% 517 KM Difference (%) October 2018 October 2019 Hydrometallurgy
Slide 8: Agricultural Production
Agricultural Production According to the first estimate of 2020, it is predicted that yield will be better than next year. Crop Production 2019-2020 1st Estimation (million TL) 68.5 63.8 7% Increase 31.1 31.3 22.3 23.5 5% Increase Grain and other Vegetables Fruit, beverage and crops spice plants Sou
Slide 9: Input Costs and Product Prices
Agricultural input prices are Input Costs and Product Prices below the CPI index. After the fluctuations in agricultural input prices in 2018, rebalancing was observed in 2020. Input Costs Product Prices Annual Average (2015=100) Annual Average (2015=100) 250 2015 2020(5) 250 2015 2020(5) 230 CPI 10
Slide 10: Government Support
Goverment support that has been given in Goverment Support 2020 increased more than the inflation. As of July 2020, 75% of the supports were paid. Breakdown of Agricultural Support Budget (million TL) 29% Increase 22.0 Agricultural Supports 2018 2019 2020 Change 2019 - 2020 17.0 Area Based Agricultu
Slide 11: Consumer Financing continued
Consumer Financing continued Ziraat Bank to stand TürkTraktör Finance's share in total sales by the farmer in increased to 15.8%. 2020 with favorable interest rates. Loan Interest Rates 18% 17.4% Financing Distribution of TürkTraktör's Sales 12% 12% 9% 57.7% 55.9% 55.6% Feb. 2018 May 2019 Aug 2019 N
Slide 12: Local Market Sector Dynamics
Local Market Sector Dynamics Agricultural Input Costs Goverment Consumer Precipitation Production and Product Support Financing Trend Prices 11
Slide 13: Market Evaluation
Market Evaluation Turkey Tractors Markets grew by 62% in 2019. Despite this, it remained 40% behind 2018. 72,949 70,205 66,775 60,341 59,449 24,116 52,286 48% 50,318 46% 48,044 14,576 46,000 42% 41,000 9,012 50% 50% 48% 49% 49% 48% 47% 45% 43% 25,839 11,154 3,798 6,942 2018 2019 2020 5M 5M 5M 30,365
Slide 14: Global Tractor Market
According to 2020 5-month tractor sales Turkey Global Tractor Market was the world's 4th largest tractor market. Pakistan -45% Total Global Market (Thousand Units) China 10% 2018 2019 2019/5 2020/5 Change North India 777 699 267 210 -21% America North America 262 270 112 117 4% 4% China 145 160 92 1
Slide 15: Export
Export TürkTraktör is an international player which exports to more than 130 countries. 80% of our exports are goes to North America and European markets. 40% 40% EU NAFTA Our tractor export (Unit) 15,207 AMEA 14,122 14,502 12,625 12,023 23% Decrease 7,562 5,786 ANZ LATAM 2015 2016 2017 2018 2019 20
Slide 16: Domestic Production in Construction Equipment
An Important Player of the Market with 2013: Turkey distributor of Case and New "Domestic Production" in Construction Holland brand construction equipment. Equipment! We started to produceconstruction equipment locally in January 2020. #YERLİYERİNDE 54 CE Production in the First Half! 15
Slide 17: Growth in Agricultural Equipment Sales
In the first six months of 2020, combine sales Growth in Agricultural Equipment Sales increased by 286% compared to the same period of the previous year, exceeding the number of sales in 2019. Combine Sales (Units) 302 286% Increase 81 66 21 2018 2019 2019 1H 2020 1H 16
Slide 18: We Continue to Launch New Products
Equipment and R&D We Continue to Launch New Products Tier IV Transition in Turkey Tier V Transition in Europe New Product Launches Legislation Affected Products Effective Date 2020 2021 1 2 3 4 1 2 3 4 TMR* All Models 01.04.2021 37kW<P<56kW 01.04.2021 Emisyon Seviyesi 56kW<P<130kW 01.10.2021 : 6 Mon
Slide 19: Financial and Operational Results
@vekoe TuirkTraktor | /o/ sni
Slide 20: Operational Results – Production: Tractor
Operational Results – Production (Units) Tractor 23,221 23% 7,050 6,953 5,574 5,639 12,357 5,404 10,056 4,482 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H 19
Slide 21: Operational Results – Production: Engine
Operational Results – Production (Units) Engine 19,733 52% 5,105 4,423 3,988 3,020 3,311 9,093 2,965 5,985 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H 20
Slide 22: Breakdown of Tractor Sales
Breakdown of Tractor Sales Total Sales in 1H2020 13,112 tractors Locally Manufactured Tractors Tractors sold to Tractors sold to Export Market Local Market 99.6% 44% 56% 5,786 Units 7,326 Units Imported Tractors 0.4% 21
Slide 23: Total Sales Units (tractors)
Total Sales Units (tractors) 19,421 6,298 10% 13,112 11,912 -23% 7,312 7,683 5,786 6,886 7,562 5,898 6,014 5,429 3,302 3,417 13,123 4,343 2,369 68% 3,553 4,009 7,326 4,010 4,266 4,350 2,345 2,005 2,543 3,060 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H Local Export Local E
Slide 24: Total Sales Revenue (mio TL)
Total Sales Revenue (mio TL) 2,125 25% 2,179 1,740 736 948 -11% 1,191 1,068 1,083 922 983 988 83% 818 529 494 419 1,389 596 1,231 477 591 672 589 662 569 341 331 387 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H Local Export Local Export 23
Slide 25: Profitability – Gross Profit (mio TL)
Profitability – Gross Profit (mio TL) 17.6% 17.4% 18.0% 17.2% 16.9% 13.8% 14.2% 12.8% 11.7% 70% -12% 374 380 186 201 179 127 140 223 96 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H Gross Profit Gross Profit Margin Gross Profit Gross Profit Margin 24
Slide 26: Profitability – Operating Profit (mio TL)
Profitability – Operating Profit (mio TL) 9.7% 9.7% 10.2% 9.1% 9.3% 7.2% 6.5% 166% -9% 4.6% 206 211 2.3% 98 110 101 71 79 60 19 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H Operating Profit Operating Profit Margin Operating Profit Operating Profit Margin 25
Slide 27: Profitability – EBITDA (mio TL)
Profitability – EBITDA (mio TL) 12.8% 13.6% 11.6% 11.8% 12.1% 10.4% 8.2% 10.0% -7% 278 246 6.2% 145 95% 129 133 143 92 102 51 2018 1H 2019 1H 2020 1H 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q EBITDA EBITDA Margin EBITDA EBITDA Margin 26
Slide 28: Profitability – Profit Before Tax (mio TL)
Profitability – Profit Before Tax (mio TL) 7.5% 8.3% 6.6% 6.1% 6.9% 2.5% 1.5% 0,4% 1.1% 0.6% 164 82 82 141 66 768% 24 14 19 5 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H PBT PBT Margin PBT PBT Margin 27
Slide 29: Profitability – Net Profit (mio TL)
Profitability – Net Profit (mio TL) 7.7% 7.4% 7.1% 6.3% 6.4% -9% 1.5% 0.9% 2.3% 1.2% 161 84 77 137 68 652% 22 8 14 21 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 2018 1H 2019 1H 2020 1H Net Profit Net Profit Margin Net Profit Net Profit Margin 28
Slide 30: Working Capital (mio TL)
Working Capital (mio TL) 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q 1,077 820 28.4% 28.8% 645 24.8% 490 238 483 920 823 20.0% 549 672 554 632 14.0% 637 538 487 467 500 561 10.9% -480 -541 -514 -609 -632 -811 Trade Receivables (net)** Inventories Trade Payables (net) Net Working Capital*/Revenue
Slide 31: Net Financial Position (mio TL)
Net Financial Position (mio TL) 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q -395 -1,155 -649 -476 -1,465 -899 1,120 828 617 747 857 599 28% -397 26% -351 49% -745 43% -648 52% -1,068 62% -1,226 72% -999 74% -982 51% -771 57% -867 48% -996 38% -757 Cash and Cash Equivalents Short Term Borrowings
Slide 32: Net Financial Position / EBITDA
Net Financial Position / EBITDA 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2020 2Q -395 -476 -649 -899 -1,155 -0.85 -0.94 -1,465 -1.74 -2.53 -2.92 -3.28 NFP NFP / EBITDA 31
Slide 33: Financial Debt and Repayment Schedule
Financial Debt and Repayment Schedule • Existing loans are refinanced with loans with more favorable maturities and lower interest rates and the average interest rate reduced to 9.4% • Re-financing efforts continued in July and this rate was further lowered. 32
Slide 34: Dividend
Dividend Total TL 2.5 billion was distributed as dividend to the shareholders between 2004 – 2020. Dividend (mio TL) Dividend / Net Profit Dividend Yield (%) 33
Slide 35: Expectations
Expectations Our expectations for the year 2020 are as follows.* Turkish Tractor Industry Volume 41,000 – 46,000 units TürkTraktör Local Tractor Sales** 19,000 – 21,500 units Tractor Exports 11,000 – 12,500 units CAPEX 150 – 200 million TL *The market recovered faster than our expectations after Cov
Slide 36: 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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