Haci Omer Sabanci Holding A.s. · BIST:SAHOL
Haci Omer Sabanci Holding A.s — Hacı Ömer Sabancı Holding A.Ş. — Investor Presentation (October 2023)
52 slides from Haci Omer Sabanci Holding A.s's investor presentation, October 2023
Slide 1: Investor Presentation Group Strategy
OCTOBER 2023 INVESTOR PRESENTATION GROUP STRATEGY
Slide 2: Disclaimer
INVESTOR PRESENTATION GROUP STRATEGY Disclaimer The information and opinions contained in this document have been compiled by Hacı Ömer Sabancı Holding A.Ş. (“Holding”) from sources believed to be reliable and in good faith, but no representation or warranty, expressed or implied, is made as to thei
Slide 3: Financial Track Record
01 /07 Financial Track Record
Slide 4: Strong set of results with improved earnings quality
FINANCIAL TRACK RECORD Strong set of results achieved with an improvement in earnings quality driven by both bank and non- bank businesses… Combined Revenue(1) (TL Bn) Combined EBITDA(1) (TL Bn) Consolidated Net Income(1) (TL Bn) Non-bank Bank Non-bank Bank Non-bank Bank CAGR: Y/Y: CAGR: Y/Y: CAGR:
Slide 5: Continuous ROE improvement and strong operating cash generation
FINANCIAL TRACK RECORD …coupled with a continuous improvement in ROE & exceptionally strong cash generation at operating level… Return on Equity (ROE) (1) Operational Cash Flow, Combined for Non-Bank (2) (TL bn) Bank ROE Consolidated ROE Non-Bank ROE 28.7 13.7% 13.1% 17.1% 23.9% 31.1% 26.6% 27.2% 50
Slide 6: Healthy balance sheet at ≤ 2x
FINANCIAL TRACK RECORD …& by maintaining a healthy balance sheet Holding Only - Net cash position (TL bn) Combined Net Financial Debt to Non-Bank EBITDA (1) 2.3x 2.2x 5.5 Midterm Guidance: 4.5 ≤ 2x 1.5x 1.3x 3.1 1.2x 2.6 2.5 1.7 0.5x 1.1 0.4x 2018 2019 2020 2021 2022 H1 2022 H1 2023 2018 2019 2020 2
Slide 7: Sustainable dividend growth and effective capital allocation
FINANCIAL TRACK RECORD Sustainable dividend growth and effective capital allocation DPS (TL) Share Buy-Back Program (TL bn) Non-bank Capex/Sales(2) Dividend Yield (%) (1) 4.41 4.27 4.42 3.82 3.79 +86% 2.87 ~14.0% 1.75 >2x 3.25 10.3% +42% 8.6% 7.3% 7.4% 6.6% 0.75 1.75 0.33 0.35 0.30 0.30 2018 2019 20
Slide 8: Capital Allocation
02 /07 Capital Allocation
Slide 9: Doubling CAPEX to accelerate organic and inorganic growth
CAPITAL ALLOCATION Doubling CAPEX to accelerate both organic and inorganic growth… DOUBLING CAPEX | 25/75 SPLIT BETWEEN CORE & NEW INVESTMENTS Invest in New Platforms Grow and Protect the Core Increasing share of new economy in nonbank CT INV combined revenue : T E ES Strengthen our market leading p
Slide 10: Coherent strategic plan on core and new platforms
CAPITAL ALLOCATION …with a coherent strategic plan on core and new platforms We unite Türkiye and the World Purpose for a sustainable life with leading enterprises Strategic Agile global / local footprint Future-ready Digital & AI transformation Innovation for growth Sustainability for a better life
Slide 11: Delivering strategic initiatives: 76% of investments to new economy
CAPITAL ALLOCATION Continuing to deliver on our strategic initiatives: 76% of investments to new economy Dynamic Portfolio Management Turkey’s 1st Green Hydrogen: Digital Investment: Production and use of green hydrogen at Acquisition of 100% of SEM(1), a Climate Tech & Renewable Energy in the USA:
Slide 12: Sustainability
03 /07 Sustainability
Slide 13: Prioritizing ESG to transform our portfolio
SUSTAINABILITY Prioritizing ESG to transform our portfolio for the future… Foster Sustainable Act on Climate Business Models Emergency 11% Reduction in Scope 1 and 2 GHG emissions(1) 3.3x Renewable 31% Total water reused (1) electricity usage (1) Green hydrogen pilot More renewable electricity 1st p
Slide 14: Improving our ESG performance further
SUSTAINABILITY ...while improving our ESG performance further MSCI Rating A 2023 2022 2022 MSCI 13.9 BBB Bloomberg GEI Sustainalytics 3 notches increase in BB First and Only Low ESG Risk 3 years B Conglomerate from Low Risk In Diversified Financials Category Türkiye to be included twice in a row A J
Slide 15: Improving Corporate Governance Framework
SUSTAINABILITY Improving Corporate Governance Framework Shareholder Structure 9 BoD members (3 Independent) Board Members 56% non-family, 44% women Sabancı Family 49.6% Early Detection of Risk Assumes some of the roles of the Portfolio Committee Corporate Management Committee, terminated in Governan
Slide 16: NAV & Stock Performance
04 /07 NAV & Stock Performance
Slide 17: Improving NAV discount despite solid growth in asset value
NAV & STOCK PERFORMANCE Improving NAV discount in the long-run despite solid growth in asset value in USD terms NAV (USD mn) (1) & NAV (1) Discount NAV (1) Bridge 43% 6,703 5,706 5,095 3,987 3,567 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 -26.6% -26.1% -28.8% -28.6% -35.1% +6pp Average NAV Discount: L
Slide 18: Shifting towards more balanced portfolio
NAV & STOCK PERFORMANCE Shifting towards more balanced portfolio NAV Breakdown Based on Book Value NAV Breakdown Based on Independent Valuation(2) Cash Cash Other(1) Other(2) 3% 3% 6% Digital 6% Digital Technologies Technologies 3% Banking & Financial Banking & Financial 4% Services Services 36% 27%
Slide 19: SAHOL trades at discount to historical P/E averages
NAV & STOCK PERFORMANCE Despite rerating SAHOL shares continue to trade at a material discount to its historical P/E averages Stock Relative-Performance (USD basis) Earnings Per Share vs. Price/Earnings(1) SAHOL BIST 30 EPS P/E 250 5.1 4.9 4.0 2.2 2.1 2.0 200 1.5 164 21.5 158 150 100 9.5 8.1 5.9 1.9
Slide 20: Recent Acquisitions
05 /07 Recent Acquisitions
Slide 21: Investing in new economy for major transformation
RECENT ACQUISITIONS Investing in new economy for a major transformation in Sabancı Group Energy & Climate Technologies Advanced Material Technologies Digital Technologies Renewables Electrification Sustainable Telematics Chemicals loT 4.0 Cybersecurity Digital Marketing E-mobility Digitalization Lig
Slide 22: Leveraging core capabilities in Energy SBU and expanding
RECENT ACQUISITIONS It is time to leverage core capabilities in the Energy SBU & expand the business to create higher value for all stakeholders We lead energy and climate transition by bridging the gap between emerging and developed markets Sabancı Climate Technologies, wholly owned subsidiary of S
Slide 23: USA: 2nd largest renewable market and largest venture ecosystem
RECENT ACQUISITIONS USA came to the fore with the attraction of being world’s 2nd largest renewable energy market & the largest corporate venture ecosystem Facts on Renewable Energy Investments USA is the 2nd largest renewable energy market following China. Solar Resource Potential Wind Resource Pot
Slide 24: Further on-shore wind and solar investments to reach 1000 MW
RECENT ACQUISITIONS Further investments are ongoing in on-shore wind and utility-scale solar projects to reach 1000 MW of portfolio size by 2025 under Sabanci Renewables Sabancı Renewables Deal Flow in the Last 6-Months Focused Investment Target Technologies Target Geographies Approach On-shore wind
Slide 25: First solar investment in Texas: 272 MW Cutlass II
RECENT ACQUISITIONS The first solar investment in Texas has been initiated, which offers a variety of opportunities for the future growth… 272 MW Cutlass II Solar Power Plant Project Project Acquisition: October’22 EPC Agreement with Bechtel: October’22 Construction Start (FNTP(1) to Bechtel): Janua
Slide 26: Second solar investment in Texas
RECENT ACQUISITIONS …and the second solar investment has also initiated in Texas, leveraging the know-how acquired during the initial solar project Market potential for Close to the major load centers of proxy businesses in 232 MW Houston and Corpus Christi, anticipated Texas West Solar Power center
Slide 27: Sabancı Climate Ventures extended innovation ecosystem
RECENT ACQUISITIONS Sabancı Climate Ventures will create extended innovation ecosystem & enable early access to disrupting technologies… Sabancı Climate Ventures is a necessity to Value Proposition to Start-Ups position for the future and not competing with Acceleration, piloting, and commercializat
Slide 28: Investments in climate technologies fund and start-ups
RECENT ACQUISITIONS ….via the investments in climate technologies fund & investments directly to start-up companies Invested in a venture fund with a Coming out of MIT's Plasma Coming out of MIT and reached a Founded in San Francisco in 2021 portfolio of start-ups from seed to Science and Fusion Cen
Slide 29: Step toward +5,000 MW installed capacity target
RECENT ACQUISITIONS A significant step towards +5,000 MW installed capacity target has been taken Installed Generation Capacity Mix(1) 1000 MW YEKA-2 Wind Power Plant Investment (USD 1.2 bn) ÇANAKKALE Currently 2026 250 MW BALIKESİR Renewables Natural Gas 250 MW 45% 43% 32% AYDIN 1.000MW Total Wind
Slide 30: Creation of a global digital business with acquisitions
RECENT ACQUISITIONS Creation of a global digital business with acquisitions Dx Technology Services and BV (DxBV), a wholly owned subsidiary of Sabancı Holding and established in the Netherlands, will undertake Investment Sabancı Group’s investments in digital businesses. Cyber Security Digital Marke
Slide 31: Global Players in Mobility Market
RECENT ACQUISITIONS Global Players in Mobility Market Expansion in Composites Growth in New Mobility Solutions Microtex: Arvento: CT INV T E ES O PLA T PR ORE T Acquired by Kordsa Acquired by Brisa IN RMS TH & FO EC W NE GRO Deal Size: EUR24.6mn Deal Size: ~EUR22mn (1) W Product and geographic diver
Slide 32: Investing in Tech-based Start-ups via Sabancı Ventures
RECENT ACQUISITIONS Investing in Tech-based Start-ups via Sabancı Ventures 2022 & 2023 Q2 2022 & 2023 Q2 Performance Investments # of Companies #1 local public and private cloud services company in Türkiye USD30Mn Initial Fund Size Preliminary Leading AI-powered virtual screening assistants for e-co
Slide 33: Strategic Business Units
06 /07 Strategic Business Units
Slide 34: Energy SBU's Strategy House: Beyond Power
STRATEGIC BUSINESS UNITS Energy SBU’s Strategy House Beyond Power Green, Sustainable and Digital 01 PROTECT AND GROW THE CORE 02 TRANSFORM Renewable Generation Growth New Energy Technologies Exploring New Fuel Additional Wind and Solar Projects Hybrid Projects Investment - Abroad Economics (Hydrogen
Slide 35: Energy SBU's Strategy House: Preparing For a Sustainable Future
STRATEGIC BUSINESS UNITS Energy SBU’s Strategy House Preparing For a Sustainable Future With Valuable Competencies CURRENT FUTURE Well-positioned energy portfolio in a vertical way (generation, Sustained market leadership position through aggressive growth trading, distribution and retail) in core b
Slide 36: Industrials SBU's Strategy House
STRATEGIC BUSINESS UNITS Industrials SBU’s Strategy House We unite Turkey and the World for a sustainable life Grow into an Integrated Advanced Materials and Mobility Business PROTECT AND GROW THE CORE TRANSFORM Protect the core with Advanced Materials Delivering Profitable Growth with Global Busine
Slide 37: Industrials SBU's Future Vision
STRATEGIC BUSINESS UNITS Industrials SBU’s Future Vision We unite Turkey and the World for a sustainable life Grow into an Integrated Advanced Materials and Mobility Business CURRENT FUTURE Established, integrated mobility group from materials to digital services Equipment for Climate Technologies b
Slide 38: Building Materials SBU's Strategy House
STRATEGIC BUSINESS UNITS Building Materials SBU’s Strategy House From Pure Cement to Building Materials From Local to Glocal, From Grey to Green TRANSFORM PROTECT AND GROW THE CORE New Growth and Diversification Network Optimization and Integration Expand in calcium aluminate Strengthen White Cement
Slide 39: Building Materials SBU's Future Vision
STRATEGIC BUSINESS UNITS Building Materials SBU’s Future Vision Transformation into a Global Building Materials Group CURRENT FUTURE 40% FX based revenue generation Higher FX based revenue generation 20% Revenue from international operations Higher revenue share from international operations Growth
Slide 40: Financial Services SBU's Strategy House
STRATEGIC BUSINESS UNITS Financial Services SBU’s Strategy House To become the leading new generation financial services provider PROTECT AND GROW THE CORE GROW INTO ADJACENCIES Act as a multi-line insurer with Aksigorta & AgeSA Develop distribution Greenfield health insurance company investment and
Slide 41: Financial Services SBU's Future Vision
STRATEGIC BUSINESS UNITS Financial Services SBU’s Future Vision Smart and Sustainable Growth in Financial Services Q2 2023 FUTURE Competitive Market Positioning; Maintain leading position in Pension AUM with a mindful presence Leading position in Pension AUM among private companies since 2015 Leadin
Slide 42: Akbank's bifocal strategy
STRATEGIC BUSINESS UNITS Akbank’s bifocal strategy Run the bank Crafting the future Strong customer acquisition Superior customer experience Effective asset liability management Advanced analytics & excellence in digital Risk & return focused sustainable sound growth ‘Open Banking’ initiatives Robus
Slide 43: ESG Strategy: Mitigate footprint while increasing positive impact
STRATEGIC BUSINESS UNITS ESG Strategy: Mitigate environmental footprint while increasing positive impact Sustainable Finance Ecosystems Management Responsible Products & Services Digitalization Impact Investing Financial Inclusion To be the leading bank that drives Türkiye into the People & Communit
Slide 44: Digital Investments to Untapped Potential
STRATEGIC BUSINESS UNITS Digital Investments to Untapped Potential Digital Accelerators Sabancı Digital Business Invest in rapidly growing digital businesses A Digital Ce Retail Platform With Physical and expand beyond Turkey Presence & Human Touch Consumer MarTech Cyber Security Cloud & Digital Bus
Slide 45: Mid-Term Guidance
07 /07 Mid-Term Guidance
Slide 46: Mid-Term Guidance Maintained
MIDTERM GUIDANCE Mid-Term Guidance Maintained Growth Capital Return Sustainability Mid-term targets(1) CPI + 8% 30%+ Dividend 5%-20% 42% Reduction in policy Revenue growth FX revenue as % of of net income Scope 1 & 2 emissions combined revenue (3) by 2030 Up to 5% of paid-in capital: Share 102mn sha
Slide 47: Appendix
APPENDIX
Slide 48: Dividend Performance
APPENDIX Dividend Performance TLmn 2018 2019 2020 2021 2022 2023 Akbank 652 - - 255 494 3,666 Akçansa 51 61 18 42 36 99 Aksigorta 40 73 73 110 - - Agesa 19 40 64 64 - 60 Brisa - - 12 107 270 479 Carrefoursa - - - - - - Çimsa 33 - - - 109 218 Kordsa 48 48 35 - 114 41 Teknosa - - - - - - Yünsa - 3 - -
Slide 49: Financials in detail
APPENDIX Financials in detail Combined Revenue(1) Combined EBITDA (2) Consolidated Net Income (3) MILLION TL Q2 2022 Q2 2023 Change H1 2022 H1 2023 Change Q2 2022 Q2 2023 Change H1 2022 H1 2023 Change Q2 2022 Q2 2023 Change H1 2022 H1 2023 Change TOTAL 92,215 134,115 45% 162,867 258,563 59% 26,039 3
Slide 50: Sabancı Holding Current NAV & Cash Breakdown
APPENDIX Sabancı Holding Current NAV & Cash Breakdown USDmn June 2023 December 2022 NAV Discount Valuation Value to Sabancı % of Value to Sabancı Companies Free Float Direct Stake Mcap % of NAV Method Holding NAV Holding Akbank 52% 41% Market value 4,068 1,658 32.5% 2,216 33.1% June 2023 December 20
Slide 51: Sabancı Holding NAV After EY Valuation Report
APPENDIX Sabancı Holding NAV After EY Valuation Report USDmn June 2023 Companies Free Float Direct Stake Valuation Method Mcap Value to Sabancı Holding % of NAV Akbank 52% 41% Market value 4,068 1,658 24.5% Enerjisa Enerji 20% 40% Market value 1,601 640 9.5% Aksigorta 28% 36% Market value 223 80 1.2
Slide 52: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Kerem TEZCAN Investor Relations Director Meet SirA, Sabancı Holding's digital Şule GENÇTÜRK KARDIÇALIOĞLU Investor Relations Manager investor relations assistant ! Emine DALAN Turkey’s First Investor Relations Investor Relations Specialist Dedicated Assistant ! Hamza SÜME
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