Aselsan Elektronik Sanayi Ve Ticaret A.s. Class B · BIST:ASELS

Aselsan Elektronik Sanayi Ve Ticaret A.s. Class B — Investor Presentation (October 2018)

28 slides from Aselsan Elektronik Sanayi Ve Ticaret A.s. Class B's investor presentation, October 2018

  1. Slide 1: Investor Presentation October 2018

    Investor Presentation October 2018 1

  2. Slide 2: Global Military Spending 2017

    GLOBAL MILITARY SPENDING 2017 (BILLION $) EUROPE $327 1,6% of GDP AMERICAS $676 1,2% of GDP ASIA & OCEANIA $469 1,7% of GDP AFRICA $39 1,8% of GDP (Billion $) 2017 Top 10 Spenders vs. Turkey 0 50 100 150 200 250 300 350 400 450 500 550 600 650 USA 597,2 CHİNA 228,2 SAUDİ ARABİA 69,5 2017 TOTAL SPEND

  3. Slide 3: Balanced Growth of Turkish Military Spending

    BALANCED GROWTH OF TURKISH MILITARY SPENDING As being the 2nd biggest army in NATO, Turkey has healthy growth rate of defense budget. MILITARY SPENDING Military spending of Turkey as % of GDP (TURKEY) (5-year averages, USD bio) 18,0 3,00% 1.400 2,7% 16,0 2,5% Military Spending as % of GDP 2,4% 2,3%

  4. Slide 4: ASELSAN Continuing to Climb Up

    ASELSAN CONTINUING TO CLIMB UP ASELSAN Global Defense Ranking 50. 57. 55. 58. 62. 67. 74. 76. 80. 86. … 20XX 2017 93. 2016 90. 2014 2015 2013 97. 2012 2011 2010 2009 2008 2007 2006 Source: Defense News Top 100 Worldwide List 4

  5. Slide 5: Shareholders Structure

    SHAREHOLDERS STRUCTURE Aselsan is the only defense company listed on BIST. Turkish Armed Forces Foundation 74,20% Free Float 25,70% Other 0,10% 5

  6. Slide 6: Main Shareholder – Turkish Armed Forces Foundation (TAFF)

    MAIN SHAREHOLDER – TURKISH ARMED FORCES FOUNDATION (TAFF) TAFF BOARD OF TRUSTEES -President (Chairman) -Vice President - Minister of National Defense - Chief of General Staff - Undersecretary of Defense Industry TAFF’s objective is to enhance TAFF was established by the the warfare capability of mer

  7. Slide 7: Facilities

    FACILITIES Macunköy Facilities (1979) Total Area 186.000 m2 Closed Area 110.000 m2 Akyurt Facilities (1991) Total Area 231.000 m2 Closed Area 54.000 m2 Gölbaşı Facilities (2014) Total Area 350.000 m2 Closed Area 75.000 m2 Teknokent Facilities (2004) Total Area 4.500 m2 Closed Area 4.000 m2 7

  8. Slide 8: Field of Activities

    FIELD OF ACTIVITIES MICROELECTRONICS TRANSPORTATION, COMMUNICATION INFORMATION RADAR, ELECTRONIC DEFENSE SYSTEMS GUIDANCE & ELECTRO-OPTICS SECURITY, ENERGY & TECHNOLOGIES WARFARE TECHNOLOGIES AUTOMATION COMMUNICATION AVIONIC RADAR SYSTEMS AIR & MISSILE DEFENSE SECURITY SATELLITE SYSTEMS ELECTRO-OPTI

  9. Slide 9: Affiliates – Local

    AFFILIATES – Local MİKROELEKTRONİK Ownership : 85% Partner: İTÜ ETA Participation: 2010 (Founded in 2006) ASELSAN PRECISION OPTICS Assets: $1,4 M Ownership: 50% Partner: Sivas Optik MİKROELEKTRONİK Malzemeleri İSTANBUL Foundation: 2014 GEBZE/KOCAELİ Assets: $18,1 M YİTAL YİTAL ANKARA SİVAS Ownership

  10. Slide 10: Affiliates – International

    AFFILIATES – International KAZAKHSTAN ASELSAN ENGINEERING (KAZAKHSTAN) Ownership: 49% ASELSAN-BAKU (AZERBAIJAN) Partner: Kazakhstan Engineering Ownership: 100% Foundation: 2011 Foundation: 1998 Assets: $43 M Assets: $2,1 M KAZAKHSTAN ASELSAN ENGINEERING ASELSAN BAKÜ BARQ QSTP LLC. (KATAR) ASELSAN MI

  11. Slide 11: Sustainable and Innovative Human Capital

    SUSTAINABLE AND INNOVATIVE HUMAN CAPITAL Technicians 29% Total Employees : 6.239 Engineers Engineers : 3.634 59% Support 5% Administrative Staff • Projects carried out with 7% universities • Internship and co-op University-industry cooperation opportunities for high school and university students •

  12. Slide 12: An R&D Company

    AN R&D COMPANY ASELSAN will not pay any corporate taxes till 2023 due to tax incentives on R&D activities. R&D Spending Million TL 1800 1.675 1600 312 1400 1.312 1.243 1200 1.100 198 249 1000 912 218 800 200 1.363 600 1.114 994 882 400 712 200 0 2015 2016 2017 2017 3Q 2018 3Q Client Financed Self Fi

  13. Slide 13: 2018 3rd Quarter Achievements

    2018 3rd QUARTER ACHIEVEMENTS New Contracts Awarded: 2,9 Billion USD Backlog: 8,6 Billion USD Net Sales (Jan-Sep):+51% (TL) EBITDA increase (Jan-Sep): +60% EBITDA margin: 20,8% 13

  14. Slide 14: Financial Highlights

    FINANCIAL HIGHLIGHTS (Million TL) Sep'17 Sep'18 ∆% Net Sales 3.451 5.214 51 Gross Profit 843 1.273 51 Operating Profit (EBIT) 582 958 65 EBITDA 677 1.083 60 Net Profit 752 1.736 131 Gross Profit Margin 24,4% 24,4% ↔ Operating Profit (EBIT) Margin 16,9% 18,4% ↑ EBITDA Margin 19,6% 20,8% ↑ Net Profit

  15. Slide 15: Increasing Trend in Net Sales

    INCREASING TREND IN NET SALES Million TL 6.000 5.412* 5.214 5.000 784 423 + 51% CAGR 3.850* 4.000 25% 485 3.452 492 3.000 2.535 2.739* 2.171 547 4.791 460 4.628 2.000 1.502 1.633 398 1.212 3.365 83 272 2.960 1.038 77 2.192 1.000 706 103 1.773 2.075 87 1.419 1.361 935 1.135 619 0 2008 2009 2010 2011

  16. Slide 16: Strong Backlog and New Contract Awards

    STRONG BACKLOG AND NEW CONTRACT AWARDS Backlog History (Billion USD) New Contract Awards (Million USD) 3.500 2.881 2.942 3.000 + %26 $8,6 + %217 2.500 $6,8 1.148 2.070 1.271 $6,2 2.000 411 1.500 1.305 $4,3 701 1.154 928 1.000 1.432 954 497 500 958 579 431 351 239 0 2015 2016 2017 2017 3Q 2018 3Q 201

  17. Slide 17: Backlog

    BACKLOG BACKLOG DISTRIBUTION STM Savunma Teknolojileri Müh. Ministry of National Nurol Makina ve Sanayi (CLIENT) Defense ROKETSAN BMC Otomotiv Sanayi ve Ticaret 11% TAI 8% Other Caspian 17% Americas and Region Europe 1,1% 1,4% Exports 5% Undersecretariat for Middle East Defense Industries 2,5% 59% B

  18. Slide 18: Liquidity Position

    Liquidity position Key liquidity ratios Net cash/debt position (TL mn) 3,00 2,72 3.500 3.083 2,50 2,26 3.000 1,97 2,00 2.500 1,64 2.197 1,47 1,50 1,50 2.000 1,15 1,00 0,80 1.500 1.169 1.263 886 0,50 1.000 729 603 681 675 534 494 0,00 500 78 2015 2016 2017 2018 3Q 0 Current Ratio Cash Ratio 2015 2016

  19. Slide 19: Prospective Projects

    PROSPECTIVE PROJECTS HAVASOJ Identification of Friend or Foe Laser Guidance Kit (Stand-off Jammer) System Serial Production Aselsan as main contractor Turkish Fighter Aircraft ALTAY Tank Serial Production MILGEM I-Class Frigate Development (TF-X) Aselsan as sub- contractor 19

  20. Slide 20: Sustainable Margins and Optimized Capex

    SUSTAINABLE MARGINS AND OPTIMIZED CAPEX Gross Profit Margin EBITDA Margin %24,4 %24,4 %19,6 %20,8 2017 3Q 2018 3Q 2017 3Q 2018 3Q CAPEX (Tangible + Intangible) (Million TL) 435 361 205 243 230 118 2017 3Q 2018 3Q Tangible Assets Intangible Assets 20

  21. Slide 21: Guidance

    GUIDANCE ASELSAN’s guidance on 2018 year-end results 2017 2018 3Q 2018 Guidance Net Sales 5.412 Million TL 5.214 Million TL ≥ 40% growth (*) EBITDA Margin 21,4% 20,8% 19-21% (*) CAPEX 561 Million TL 435 Million TL 650 Million TL (*) Revised as of 14.08.2018 21

  22. Slide 22: Remarkable Share Performance

    REMARKABLE SHARE PERFORMANCE ASELSAN reached a market value of 5,25 Billion USD as of 28.09.2018. Earnings Per Share (per 100 shares) 138,8 + 75% COMPARISON OF ASELSAN - BIST 100* 79,5 110,00 + 273% 101,71 101,21 97,79 100,00 88,73 87,92 82,50 90,00 100,91 82,13 94,60 93,87 78,90 85,05 21,3 80,00 76

  23. Slide 23: Contact

    CONTACT Contact Persons Address Okan TURAN ASELSAN Elektronik Sanayi ve Ticaret A.Ş. Chief Financial Officer Mehmet Akif Ersoy Mah. 296. Cad. No:16 06370 Yenimahalle, Ankara, TURKEY Pınar ÇELEBİ Tel: +90 312 592 10 00 Investor Relations Manager Web Gülru SELÇUK FİLİZ www.aselsan.com.tr Investor Rela

  24. Slide 24: Appendix

    APPENDIX 24

  25. Slide 25: Consolidated Balance Sheet (Million TL)

    CONSOLIDATED BALANCE SHEET (MILLION TL) ASSETS 30.09.2018 31.12.2017 LIABILITIES 30.09.2018 31.12.2017 CURRENT ASSETS 11.004,0 6.058,3 CURRENT LIABILITIES 4.042,9 3.691,7 Cash and Cash Equivalents 3.082,8 1.262,8 Trade Receivables 2.868,5 1.581,2 Short-term Financial Liabilities 773,9 404,3 Other Re

  26. Slide 26: Consolidated Income Statement (Million TL)

    CONSOLIDATED INCOME STATEMENT (MILLION TL) 01.01.2018- 01.01.2017- 30.09.2018 30.09.2017 PROFIT OR LOSS Revenue 5.213,9 3.451,2 Cost of sales (-) (3.940,7) (2.608,6) GROSS PROFIT 1.273,2 842,6 General administrative expenses (-) (158,9) (127,7) Marketing expenses (-) (98,8) (82,7) Research and devel

  27. Slide 27: Forward Looking Statements

    FORWARD LOOKING STATEMENTS The information contained herein has been prepared by ASELSAN (the Company). The opinions presented herein are based on general information gathered at the time of writing and are subject to change without notice. These materials contain statements about future events and

  28. Slide 28: ASELSAN – Proven Technology

    aselsan www.aselsan.com.tr ASELSAN is a Turkish Armed Forces Foundation company. 8 PROVEN TECHNOLOGY

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