Turk Traktor Ve Ziraat Makineleri A.s. · BIST:TTRAK
Turk Traktor Ve Ziraat Makineleri A.s — Q3 2019 Earnings Presentation
35 slides from Turk Traktor Ve Ziraat Makineleri A.s's earnings presentation, Feb 5, 2020
Slide 1: Investor Presentation February 2020
Investor Presentation February 2020 Date of Last Update: 05.02.2020
Slide 2: Corporate Structure
Corporate Structure Established in 50,000 The oldest continuously manufacturing company of tractors Turkish automotive industry 1954 annual production capacity* Shareholder Structure Plants & Facilities Koç Holding A,Ş, Founded in 1926, Koç Holding has become not only one of the largest and most suc
Slide 3: TürkTraktör: Where Aren't We Yet
TürkTraktör WHERE AREN’T WE YET… Continuously increasing export penetration. POSITION within CNH INDUSTRIAL Turkey’s biggest and the most diversified The only design and main production center of tractor exporter New Holland TD and Case IH JX series tractors in the world The only production center o
Slide 4: Investment Highlights
Investment Highlights Leading tractor manufacturer with diversified product range Good shareholder returns • The largest tractor producer in • Given priority to maintain Turkey with 50K tractor capacity Sustainable growth and to grow profitability • Tractor market leader for the last • Vertically in
Slide 5: TürkTraktör at a Glance
TürkTraktör at a Glance Tractor Manufacturing Units Local Tractor Sales Units* 45,823 47,536 46,031 48,302 34,114 22,745 29,550 32,535 33,053 36,648 17,315 10,791 2,385 1,243 2014 2015 2016 2017 2018 2019 2020/1 2014 2015 2016 2017 2018 2019 2020/1 Total Revenue (mio TL) Gross Profit (mio TL) 2,175
Slide 6: Growth of Shareholder Value
Growth of Shareholder Value Dividend Yield Earnings per Share 115% 117% 107% 94% 75% 68% 7% 10% 8% 7% 6% 8% 0.82 4.89 4.81 6.93 4.50 6.01 2013 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2019/9 Dividend / Net Profit Dividend Yield (%) Foreign Ownership in Free Float (%) Commitment to Corporate
Slide 7: Brands & Products
Brands & Products Tractors (43HP-380HP) Construction Equipment Compact Line Agricultural Equipment Tractors (55HP-380HP) Construction Equipment Compact Line Agricultural Equipment Heavy Line Tractors (55HP-65HP) Agricultural Equipment 7
Slide 8: Market Positioning of the Brands
Market Positioning of the Brands *Market leader for 13 years in a row *Targeting professional *Having ~40%* market share farmers *The largest dealer network *Having ~5%* market share *Full territory coverage *Wide customer portfolio *Utilizing New Holland AG network capability in NH compact line pro
Slide 9: Network at a Glance
Network Network at a Glance KIRKLARELİ BARTIN İSTANBUL SİNOP EDİRNE KASTAMONU TEKİRDAĞ ZONGULDAK ARTVİN ARDAHAN KARABÜK SAMSUN KOCAELİ RİZE DÜZCE TRABZON YALOVA ORDU SAKARYA AMASYA GİRESUN KARS BOLU ÇANKIRI ÇORUM TOKAT ÇANAKKALE BURSA BİLECİK GÜMÜŞHANE BAYBURT IĞDIR KIRIKKALE ERZURUM AĞRI BALIKESİR
Slide 10: Turkey - Agriculture Sector
Turkey - Agriculture Sector *High agricultural population *Low productivity *Stabilized government support to the sector *Higher inputs costs *Giving rise to professional farming *One of the lowest mechanization levels in Europe Turkey - Agricultural Equipment Sector Transformation of agriculture Al
Slide 11: Turkey - Agriculture Sector
Turkey - Agriculture Sector (source : World Bank & TURKSTAT) Turkey’s Agriculture Sector with Numbers Turkey’s agricultural economy in the world (2018 numbers) Turkey’s agricultural economy in Europe (2018 numbers) share of the agricultural industry over the GDP (2019 9M numbers) share in the total
Slide 12: Turkey - Agriculture Sector: Government Support
Turkey - Agriculture Sector (source : www.sbb.gov.tr) Government Support in Turkey (billion TL) 22.0 17.0 14.6 12.7 9.1 10.0 11.5 2014 2015 2016 2017 2018 2019 2020 Budget It has been announced that the government has allocated budget for agriculture support in 2020. 12
Slide 13: Supports Provided within the scope of Agricultural Policies
Supports Provided within the scope of Agricultural Policies (source: www.sbb.gov.tr) Breakdown of resources allocated to agriculture in 2020 budget has been announced as 22.0 billion TL for agricultural support, 5.1 billion TL for investment loans and 6.3 billion TL for agricultural loans. Breakdown
Slide 14: Ziraat Bank Agricultural Loans
Ziraat Bank Agricultural Loans Tractor Loan - Credit limit 250,000 TL FEB Interests are Subsided at 50% up to Interests are Subsided at 25% for the 2018 75,000 TL Loan remaining amount above 75,000 TL Loan (was 50,000 TL before Feb 2018 ) (was 50,000 TL before Feb 2018 ) • Ziraat Bank increased its
Slide 15: TürkTraktör Finance - All Financial Solutions Under a Single Roof
TürkTraktör Finance - All Financial Solutions Under a Single Roof • First in Turkish agriculture sector • Aimed to enable farmers to have new tractors through the alternative financial solution and to support the increase of mechanization and modernization of agriculture • Covers tractor, equipment
Slide 16: My Tractor is Safe
My Tractor is Safe • Traffic and insurance operations of our tractors sold through our branches will be carried out under this roof. 16
Slide 17: R&D and Innovation Activities
R&D and Innovation Activities • New Holland T4S and Case IH Farmall A model tractors • As a result of our R&D activities, 6 products were equipped with the Tier 4 engines have been exported. presented to the domestic market. The T450 series T4S Farmall A were launched in 2018 but sales started in 20
Slide 18: Highlights of Tractor Market
Highlights of Tractor Market (source : TARMAKBİR) Average working time of Mechanical life Ratio of the a tractor of a tractor Tractors older tractors >24 (hours/year) (hours) than 35 years years Average Tractor Average Farm Size(Ha) Power (HP) Turkey EU Turkey EU 7.6 16.6 60+ 100+ 18
Slide 19: Global Tractor Market
Global Tractor Market (thousand unit) (Source: Systematics) North America South America** Europe Turkey is the 3rd* 246 262 242 249 163 147 128 138 66 62 biggest market in 65 53 2017 2018 2018/11 2019/11 2017 2018 2018/11 2019/11 2017 2018 2018/11 2019/11 the Europe in terms of annually sold tractor
Slide 20: Turkish Tractor Market
Turkish Tractor Market Tractor Production (units) Market Share of TürkTraktör Source : Tarmakbir Source : TURKSTAT 72,032 66,615 66,915 64,342 48% 49% 49% 56,407 48% 47% 48,302 47,689 45% 46,031 43% 45,823 47,536 38,530 2013 2014 2015 2016 2017 2018 2019 34,114 29,539 22,745 17,877 18,519 19,079 20,
Slide 21: Turkish Tractor Market
Turkish Tractor Market Turkish Tractor Market (units) Tractor Park in Turkey (mio units) Source : TURKSTAT Source : TURKSTAT 66,775 72,949 48,044 25,839 1.57 1.63 1.69 1.76 1.84 1.88 1.91 52,286 59,449 70,205 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 Turkish Tractor Marke
Slide 22: Sales of TürkTraktör
Sales of TürkTraktör Tractor Sales (units) 49,613 12,023 32,157 *Domestic tractor sales decreased by 54% in 2019/9 YoY. 25,458 14,502 *In 2019/9 export tractor sales increased by 15% 18,798 37,590 10,322 comparing to 2018/9. 11,905 17,655 15,136 6,893 2017 2018 2018/9 2019/9 Combine Sales (units) Lo
Slide 23: Operational Results
TiirkTraktor CH oe Operational Results
Slide 24: Income Statement
Income Statement (mio TL) 2017 2018 ∆ 2018/9 2019/9 ∆ - Domestic Sales 3,086 2,016 -35% 1,687 1,059 -37% - Export Sales 1,129 1,893 68% 1,314 1,664 27% Total Sales Revenue 4,215 3,909 -7% 3,001 2,723 -9% Gross Profit 731 717 -2% 559 363 -35% Net Operating Income 423 411 -3% 326 150 -54% Profit Befor
Slide 25: Profitability
Profitability 21.1% 18.8% 17.4% 16.4% 13.8% 14.2% 11.7% 202 172 185 158 127 140 96 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q Gross Profit Gross Profit Margin 25
Slide 26: Profitability
Profitability 16.2% 13.5% 12.1% 10.0% 10.4% 9.7% 6.2% 144 142 102 110 102 92 51 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q EBITDA EBITDA Margin 26
Slide 27: Profitability
Profitability 8.2% 7.5% 5.4% 2.3% 3.3% 81 1.5% 74 0.9% 56 29 22.2 13.8 7.6 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q Net Profit Net Profit Margin 27
Slide 28: Profitability
Profitability (%) 2017 2018 ∆ 2018/9 2019/9 ∆ Gross Profit Margin 17.3 18.3 1.0 pp 18.6 13.3 -5.3 pp Operating Profit Margin 10.0 10.5 0.5 pp 10.9 5.5 -5.4 pp Net Profit Margin 7.6 6.1 -1.5 pp 5.5 1.6 -3.9 pp EBITDA Margin 11.7 12.7 1.0 pp 12.9 9.0 -3.9 pp Gross Operating EBITDA Gross Net Net EBITDA
Slide 29: Gross Profit to EBITDA Flow
Gross Profit to EBITDA Flow (mio TL) as of 30.09.2019 213 363 155 95 245 32 107 21 150 43 -1 44 Gross Opex Operating Other & Profit Taxation Net Income Depreciation EBITDA Profit Income Financial Before Expenses Tax 29
Slide 30: Debt Profile & Financial Ratios
Debt Profile & Financial Ratios (mio TL) 2017 2018 ∆ 2018/9 2019/9 ∆ - Cash & Cash Equivalents 442 413 -7% 327 617 89% - Total Financial Debt 1,127 1,773 57% 1,878 1,516 -19% Net Financial Position -685 -1,360 98% (1,551) (899) -42% Current Ratio 1.8 2.0 0.2 pp 2.4 1.4 -1.0 pp Quick Ratio 1.3 1.0 -0
Slide 31: Net Debt/EBITDA
Net Debt/ EBITDA 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q -899 -1,153 -1,155 -1,400 -1,360 -1,550 -1,465 -2.77 -2.39 -2.53 -2.95 -2.75 -2.92 -3.28 Net Financial Position NFP / EBITDA 31
Slide 32: Working Capital
Working Capital (mio TL) 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2000 842 1,106 1,194 1,077 1,021 28.4% 28.8% 1500 24.8% 955 820 820 25.0% 645 1,122 920 1000 1,085 823 20.6% 672 16.9% 500 15.1% 832 832 593 637 538 487 449 0 -521 -513 -480 -541 -514 -810 -681 -500 -1000 Trade Receivab
Slide 33: Dividend Payments
Dividend Payments Total TL 2.4 billion was distributed as dividend to the shareholders between 2004 – 2019. Dividend (mio TL) Dividend / Net Profit Dividend Yield (%) 300 300 300 300 117% 107% 250 100% 101% 115% 94% 94% 87% 200 200 83% 150 75% 72% 68% 107 54% 94 94 40% 50 47 26% 13% 15% 14% 17 10% 1
Slide 34: Expectations
Expectations Our expectations for the year 2019 are as follows.* Turkish Tractor Industry Volume 23,500 – 25,500 units TürkTraktör Local Tractor Sales** 10,500 – 11,500 units Tractor Exports 14,750 – 15,250 units CAPEX 140 – 160 million TL ** Sales to the dealers included imported tractors *Accordin
Slide 35: Investor Relations Contact
Investor Relations Contact Ahmet CANBEYLİ Ahmet DİNÇ Sıla AKÇAY CFO Investor Relations Team Leader Investor Relations Senior Spe. +90 312 2332003 +90 312 2332502 +90 312 2332504 Ahmet.Canbeyli@turktraktor.com.tr Ahmet.Dinc@turktraktor.com.tr Sila.Akcay@turktraktor.com.tr investorrelations@turktrakto
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