Koc Holding A.s. · BIST:KCHOL

Koc Holding A.s — Investor Presentation (July 2009)

42 slides from Koc Holding A.s's investor presentation, July 2009

  1. Slide 1: Koc Holding Investor Presentation July 2009

    CY Koc Holding Investor Presentation July 2009

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

    Sustainable Track Record in Overperforming the Turkish Growth Rates Leading conglomerate in Turkey Ranking ƒ 2008 : 172 ƒ 2007 : 186 Total Sales / GDP 9%* ƒ 2006 : 190 Global 500 ƒ 2005 : 358 Total Exports / Turkey’s Exports 11%* ƒ 2004 : 389 Total Share in ISE Market Cap. 13%* ƒ 2007 : 46 ƒ 2006 :

  3. Slide 3: Strongest Beneficiary of the High Growth and Low Inflation Environment

    Strongest Beneficiary of the High Growth and Low Inflation Environment ƒ 12,000 dealers and after-sales services Largest distribution network ƒ Over 850 bank branches ƒ Customer database of around 15.6 million with strong CRM capabilities, Largest customer database enabling efficient up & cross-sell

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

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

  5. Slide 5: Focused Growth Strategy

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

  6. Slide 6: Koç Holding in the Energy Sector

    Koç Holding in the Energy Sector Vision & Strategies Key Indicators ƒ Maximize efficiency and increase profitability through Annual Annual 2008 2008 1Q09 – new investments such as residium upgrade project Chg. Chg. US$mn TL mn TL mn (TL) (TL) – new technology, product and service offerings – operati

  7. Slide 7: Energy Companies – Competitive Advantages

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

  8. Slide 8: Koç Holding in the Automotive Sector

    Koç Holding in the Automotive Sector Vision & Strategies Key Indicators ƒ To become a “Regional Production Base” Annual Annual 2008 2008 1Q09 Chg. Chg. ƒ Grow as a multi-brand dealership chain in retailing US$mn TL mn TL mn (TL) (TL) ƒ Assume full product development responsibility Total ƒ Maximize

  9. Slide 9: Automotive Companies – Competitive Advantages

    Automotive Companies – Competitive Advantages ƒ Turkey’s largest manufacturer and exporter of commercial vehicles ƒ 50-50 JV with Ford ƒ Turkey’s market leader ƒ Passenger car and LCV manufacturer ƒ 50-50 JV with Fiat ƒ 3rd in Turkish market ƒ Manufacturer of farm tractors ƒ 50-50 JV with Case New H

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

    Koç Holding in the Consumer Durables Sector Vision & Strategies Key Indicators ƒ Grow globally by acquisitions and organic growth Annual Annual 2008 2008 1Q09 Chg. Chg. ƒ Leverage technology development capabilities to US$mn TL mn TL mn (TL) (TL) improve brand positioning ƒ Maintain domestic market

  11. Slide 11: Consumer Durables Companies – Competitive Advantages

    Consumer Durables Companies – Competitive Advantages ƒ Turkey’s market leader ƒ Domestic network of 4,500 dealers and 600 after sales service stations ƒ 3rd largest household appliance manufacturer in Europe ƒ 19 million units/year manufacturing capacity in Turkey, Romania, Russia and China ƒ 360 ex

  12. Slide 12: Koç Holding in the Finance Sector

    Koç Holding in the Finance Sector Vision & Strategies Key Indicators ƒ Consolidate leadership in credit cards and become Annual Annual 2008 2008 1Q09 leader in consumer finance US$mn TL mn Chg. TL mn Chg. (TL) (TL) ƒ Become leader in Asset Gathering and first choice bank for High Net Worth Individua

  13. Slide 13: Finance Companies – Competitive Advantages

    Finance Companies – Competitive Advantages ƒ Turkey’s 4th largest bank (in terms of total assets) ƒ 50-50 JV with UniCredit ƒ Over 850 Branches ƒ #1 in credit cards ƒ Leading companies in asset management, insurance, leasing & brokerage #2 in Leasing #1 in Factoring #2 in Asset #1 in Health #3 in Pe

  14. Slide 14: M&A Strategy

    M&A Strategy Strong Turnaround in Acquired Companies Acquired companies Terms Improvements Under New Management Higher focus on efficiency, profitability and new investment opportunities: Profit enhancement programs, increased product yields, increased nelson complexity, increased export premiums, a

  15. Slide 15: Proactive Divestitures

    Proactive Divestitures 2004 – 2008 Sector Buyer Terms Timeline Implied Value: US$ 299mn St.Gobain Insulation Total Proceeds: US$ 179mn Isover & Closed on 29 November 06 Materials Koç Holding Share: 17.4% Alamana Ind. Other Koç Share: 43.8% Implied Value: US$ 202 mn Componenta Total Proceeds: US$ 111

  16. Slide 16: Proven Track Record in Revenue Growth with Further Strong Potential

    Proven Track Record in Revenue Growth with Further Strong Potential due to Low Penetrated Markets Revenues Consolidated-US$bn : 31% 8 C AGR 43.0 -200 2003 36.0 34.5 16.6 18.2 11.1 2003 2004 2005 2006 2007 2008 Further strong growth potential due to leading positions in low-penetrated business lines

  17. Slide 17: Strong Margins Despite Global Turmoil

    Strong Margins Despite Global Turmoil EBITDA Consolidated-US$bn Operating Profit Consolidated-US$bn 4.5 3.9 1% : 46% G R:3 GR 8 CA 8 CA -200 -200 2003 3.3 2003 2.8 2.7 Normalized* 3.2 2.1 Normalized* 2.6 1.6 1.5 1.2 1.0 0.9 0.6 2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008 Operating Ma

  18. Slide 18: Optimal Portfolio Allocation

    Optimal Portfolio Allocation Higher Resilience Against Market Volatility Revenues % Operating Profit % FX-denominated & FX-linked Less Sensitivty to Interest & 65 Growth Rates ** 35 82 18 YTL High Sensitivty to Interest & Growth Rates ** 2003 : 56% 2003 : 44% 2003 : 69% 2003 : 31% 2008 : 35% 2008 :

  19. Slide 19: Global Reach

    Global Reach Double digit growth in all regions 10,601 12% US$ mn 9,500 740 552 34% 2,635 US$ mn 1,459 US$ mn 2007 2008 81% 2007 2008 2007 2008 928 11% 111 US$ mn 832 US$ mn 247% 32 2007 2008 2007 2008 Exports Combined-US$bn International Sales* Combined-US$bn 31% 25% GR : C AGR : 15.0 8 CA -200 8 1

  20. Slide 20: Leader in R&D and Technology Investments

    Leader in R&D and Technology Investments 11% 11% of private sector of all patent applications filed R&D investments with the Turkish Patent Institute Koç Group Total R&D Investments (Million TL) Koç Group Companies’ Patent Portfolio 412 1,620 575% 739% 2002 2003 2004 2005 2006 2007 2008 2002 2003 20

  21. Slide 21: Strong Liquidity and Balance Sheet Management

    Strong Liquidity and Balance Sheet Management Koç Holding Stand-Alone 31.03.2009 Net Cash Position Total Debt: ~US$ 0.3 bn Total Cash: ~US$ 1.1 bn Net Cash: ~US$ 800 mn 2010-2013 Redemption Schedule US$ 300 mn – to be paid in equal annual installments of US$ 75 mn each January Consolidated Net Debt

  22. Slide 22: Stronger Resilience Against FX Volatility

    Stronger Resilience Against FX Volatility Koç Holding Stand-Alone FX Position YE08 1Q09 + US$ 334mn + US$ 290mn Koç Holding Consolidated FX Position Weighted by FX Position Effective Ownership 3Q08 YE08 1Q09 1Q09 - US$ 4.2bn - US$ 2.2bn - US$ 2.3bn* - US$ 1.4bn * The natural hedging mechanisms due t

  23. Slide 23: Focus on Risk & Crisis Management

    Focus on Risk & Crisis Management Areas of focus in 2009 ƒ Further cost cutting measures and efficiency gains ƒ Strong balance sheet and liquidity management ƒ Further streamlining of management processes ƒ Monitoring of potential opportunities and risks 23

  24. Slide 24: Potential Investment Areas

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

  25. Slide 25: 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

  26. Slide 26: Value Proposition to Investors

    Value Proposition to Investors 26

  27. Slide 27: Commitment to Corporate Governance

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

  28. Slide 28: 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

  29. Slide 29: Corporate Social Responsibility

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

  30. Slide 30: Appendix

    ll ii APPENDIX

  31. Slide 31: Table of Contents

    Table of Contents Page 1. 1Q09 Earnings Release 33 2. Shareholder Structures 40 3. Contacts and Disclaimer 41 31

  32. Slide 32: Satisfactory Performance Despite a Very Challenging Macro Environment

    Satisfactory Performance Despite a Very Challenging Macro Environment Revenues ƒ TL8,731mn (US$5,293mn) ƒ 29% YoY decline in TL terms and 48% in US$ terms Operating Profit ƒ TL667mn (US$404mn) ƒ 26% YoY decline in TL terms and 46% in US$ terms EBITDA ƒ TL880mn (US$533mn) ƒ 21% decline in TL terms an

  33. Slide 33: Main Financial Indicators

    Main Financial Indicators € Mn* US$ Mn* YTL Mn YTL Mn Change Change 31.Mar.09 31.Mar.09 31.Mar.09 31.Mar.08 %, YTL %, US$ Revenues 4,058 5,293 8,731 12,280 T -29 T -48 Gross Profit 833 1,087 1,793 1,854 T -3 T -30 EBITDA 409 533 880 1,107 T -21 T -42 Operating Profit 310 404 667 901 T -26 T -46 FX G

  34. Slide 34: Revenues Stood at TL 8.7 billion with the Largest Contribution Coming From the Energy Segment

    Revenues Stood at TL 8.7 billion with the Largest Contribution Coming From the Energy Segment Total Revenues TLmn Share of Segment Revenues % Automotive 29% 12,280 11% Energy Durables 8,731 51% 16% Finance Other 17% 5% 1Q08 1Q09 Segment Contribution to Total Revenues TLmn 37% 7,036 4,421 45% 8% 0.3%

  35. Slide 35: Energy and Finance had the Highest Contribution to EBITDA

    Energy and Finance had the Highest Contribution to EBITDA EBITDA Consumer Energy Automotive Finance Other Consolidated Total TL mn Durables 1Q09 325 117 84 311 43 880 Total EBITDA TLmn Segmental EBITDA Breakdown % Automotive 21% 1,107 13% 880 Energy Durables 37% 10% Other Finance 1Q08 1Q09 5% 35% 35

  36. Slide 36: Improved Margins in Energy, Automotive and Finance Segments

    Improved Margins in Energy, Automotive and Finance Segments Segment Contribution to EBITDA TLmn 24% 424 3% 325 311 301 42% 41% 202 13% 142 117 84 38 43 Energy Autom otive Durables Finance Other 1Q08 1Q09 EBITDA Margin by Segment % 20.6 21.2 11.3 11.9 9.3 9.5 7.3 8.1 6.0 6.0 Energy Autom otive Durabl

  37. Slide 37: Best Performance was Registered in the Finance Sector in Operating Profit

    Best Performance was Registered in the Finance Sector in Operating Profit Operating Profit Consumer Consolidated Energy Automotive Finance Other TL mn Durables Total 1Q09 242 71 37 288 28 667 Total Operating Profit TLmn Segmental Operating Profit Breakdown % Automotive Energy 11% 26% 901 36% Durable

  38. Slide 38: Continous Margin Growth Despite the Difficult Operating Environment

    Continous Margin Growth Despite the Difficult Operating Environment EBITDA Margin % EBITDA Margin excl. Finance % 10.1 7.8 7.3 7.5 9.0 8.2 1Q07 1Q08 1Q09 1Q07 1Q08 1Q09 Operating Profit Margin % 7.6 7.3 6.3 1Q07 1Q08 1Q09 38

  39. Slide 39: Shareholder Structures as of March 2009

    Shareholder Structures as of March 2009 Koç Holding Koç Family: 70.52% Free Float: 20.34% Vehbi Koç Foundation: 7.15% Koç Pension Fund: 1.99% Consumer Energy Automotive Finance Other Durables Tüpraş Ford Otosan Arçelik Tat Konserve KH share: 38.25%(*) KH share: 38.46% KH share: 39.14% Koç Financial

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

    For Further Questions, Please Contact: Funda Güngör, Coordinator Investor Relations Strategic Planning Group fundag@koc.com.tr +90 216 531 0535 Asli Selçuk, Manager Investor Relations Strategic Planning Group aslii@koc.com.tr +90 216 531 0537 Neslihan Aycil, Specialist Investor Relations Strategic P

  41. Slide 41: Major Group Companies’ Contacts

    Major 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 Yasemi

  42. Slide 42: Disclaimer

    Disclaimer This presentation contains 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 affec

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