Kordsa Teknik Tekstil A.s. · BIST:KORDS

Kordsa Teknik Tekstil A.s — H1 2023 Earnings Presentation

16 slides from Kordsa Teknik Tekstil A.s's earnings presentation, Aug 8, 2023

  1. Slide 1: 1H'23 Financial Results

    Kordsa.com 1H’23 Financial Results Earnings Release Aug 8 2023

  2. Slide 2: Disclaimer

    Disclaimer The information and opinions contained in this document have been compiled by KORDSA Teknik Tekstil Anonim Şirketi (the “Company”) from sources believed to be reliable and in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or

  3. Slide 3: Agenda

    AGENDA 01. 02. 03. 1H’23 Highlights Market Dynamics Key Financials 04. What’s Next 3

  4. Slide 4: 1H'23 Highlights

    4 1H’23 Highlights REVENUE EBITDA MARGIN TIRE REINFORCEMENT * Ongoing decline in global demand 531 * Strong price competition by APAC competitors in MUSD 7.9% EMEA and US markets All Hard- * Inventory impact (High-priced inventory) Currency 42 MUSD COMPOSITE REINFORCEMENT * Strong performance with g

  5. Slide 5: Ongoing Decline in Global Tire Reinforcement Market

    5 Ongoing Decline in Global Tire Reinforcement Market Global Automotive Market (million units) Global Tire Market (million units) 89 94 75 85 77 82 3.0 1,679 1,613 1,669 1,709 3.0 1,507 1,690 3.0 3.0 2.0 3.0 16.0 17.0 6,5% 14.0 15.0 4,7% 63 62 61 65 66 13.0 13.0 5,6% 54 3,5% 2,7% 3,7% 23.0 185 -0,7%

  6. Slide 6: Positive Outlook for the Composite Market 2023 and Beyond

    6 Positive Outlook for the Composite Market 2023 and Beyond Global Prepreg Market (MUSD) 3,834 4,024 4,313 4,663 4,988 3,349 5,082 1,486 2,311 2,165 1,901 2,028 433 32,9% 14,5% 1,798 5,0% 7,2% 8,1% 9,0% 1,377 322 252 284 2,454 261 225 231 1,306 1,470 1,008 1,031 1,140 1,220 333 463 465 447 424 462 2

  7. Slide 7: Ongoing challenging externalities impact financial performance

    7 Ongoing challenging externalities impact financial performance Financials (MUSD) 1H‘22 1H’23 D 3Q'22 4Q'22 1Q’23 2Q’23 Sales 599 531 -11.4% 286 269 276 255 Gross Profit 129 78 -39.6% 46 39 41 37 Gross Margin (%) 21.5% 14.6% -6 pts' 16.0% 14.5% 14.8% 14.4% OPEX (%) 9.2% 10.5% 1 pts' 9.4% 11.5% 10.2

  8. Slide 8: Slight decline in revenues

    8 Slight decline in revenues Sales Bridge (MUSD) %22 decline in tire %70 growth in composite Composite Sales 19 Composite Sales 10 reinforcement demand due to Microtex 11 Microtex 11 segment revenues with tough competition Tire Volume (50) Tire Volume (61) Microtex acquisition Tire Price/Mix 7 Tire

  9. Slide 9: Growth in NA contribution thanks to strong composite results

    9 Growth in NA contribution thanks to strong composite results Segment Reporting Results Jun, 23 Revenue Split Jun, 22 Revenue Split By Region By Product By Region By Product Other; Other; 2% 5% Asia; Composite; Composite; 22% Asia; EMEA; 20% 27% EMEA; 9% 33% 34% SA; 10% SA; 12% TCF & TCF & Yarn; Ya

  10. Slide 10: Hard Currency Revenue

    10 Hard Currency Revenue Other Depreciation FX exposure 3% 1% Distribution & 8% 3% 4% 4% Packaging 2% 23% 11% 8% Costs Energy Jun’23 Revenue (Jun’23) Expenses Expenses by (Jun’23) 15% Nature Raw Materials 79% 63% 77% Personel Expenses US $ EUR US $ TL EUR IDR BRL Baht • Ability to pass through raw m

  11. Slide 11: Difficulties in profitability margins coming from high competition in tire reinforcement market

    11 Difficulties in profitability margins coming from high competition in tire reinforcement market EBIT Bridge (MUSD) * Inventory effect Sales (23) Sales (45) * Cost pressure from TR inflation Raw Material 1 Raw Material 35 * Imbalance between USDTRY and Energy (2) Energy 1 inflation Personnel (6) P

  12. Slide 12: Higher interest rates in new loans

    12 Higher interest rates in new loans Net Income Bridge (MUSD) * Higher interest rates EBIT (31) EBIT (17) Fin. Inc. / Exp (3) Fin. Inc. / Exp (7) FX Gains/Losses (5) FX Gains/Losses (5) Tax 9 Tax 1

  13. Slide 13: Balance Sheet

    13 Balance Sheet TL Financials (MTL) USD Financials (MUSD) YE 2022 1H 2023 D YE 2022 1H 2023 D Cash and Cash Equivalents 799 1,298 499 43 50 8 Account Receivables 3,860 4,822 962 206 187 -20 Inventories 5,497 6,880 1,383 294 266 -28 Other Current Assets 989 1,511 522 53 59 6 PPE & Intangibles 8,131

  14. Slide 14: Through stock optimization and production planning

    14 Through stock optimization and production planning Average Working Capital Turnover Net Debt / EBITDA +1 pp 4.7 31.9% 32.1% 31.9% 32.3% 3.8 2.8 2.5 2.0 29.6% 2Q'22 3Q'22 4Q'22 1Q'23 2Q'23 2Q'22 3Q'22 4Q'22 1Q'23 2Q'23 Amount Avg. Int. Rates INVENTORIES DOWN 9% Y-O-Y M$ 31.12.2022 30.06.2023 % Dri

  15. Slide 15: What's Next

    15 What’s Next GROWTH PLANS Investments such as Polyester Line, construction, SEC in Turkey and Dipping in the USA continue and they are expected to be in production from 2024 which accelerate Kordsa’s organic growth ONGOING COST MANAGEMENT FOCUS WC IMPROVEMENT PROJECT

  16. Slide 16: Thank You

    Thank You THE REINFORCER

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