Turk Traktor Ve Ziraat Makineleri A.s. · BIST:TTRAK
Turk Traktor Ve Ziraat Makineleri A.s — H1 2013 Earnings Presentation
48 slides from Turk Traktor Ve Ziraat Makineleri A.s's earnings presentation, June 2013
Slide 1: Investor Presentation June 2013
INVESTOR PRESENTATION JUNE 2013
Slide 2: Company Profile
1 COMPANY PROFILE Factory Güvercin Yolu No: 111-112 Gazi Ankara Turkey Spare Part Warehouse & Logistic Büğdüz Mahallesi No: 286 Akyurt Ankara Turkey Annual Production Capacity 35.000 units of tractors & 25.000 units of engines (In case of working in double shifts for 5 days a week as per the Chamber
Slide 3: Agenda: Agricultural Sector, Tractor Market, Competitive Advantages, Products, Operational Results
2 In the World and in Turkey Agricultural Sector Tractor Market Competitive Advantages Products Operational Results
Slide 4: Main Factors Affecting the World Agricultural Industry
3 MAIN FACTORS AFFECTING THE WORLD AGRICULTURAL INDUSTRY Major impact of drought and climate changes on the industry due to global warming Increase in food prices in parallel to the increase in the world’s population Decrease in available water supply in the world Worldwide agricultural comm
Slide 5: Agriculture Sector in Turkey
4 AGRICULTURE SECTOR IN TURKEY 3 million Rich soil structure, agricultural Turkey's total holdings, arable lands and land area 78 million favorable climate the average land hectare size 6 hectares conditions per farm Agricultural Share of the Land Size agricultural 24,4 million industry over hectare
Slide 6: Land Consolidation
5 LAND CONSOLIDATION The land consolidation studies have gained importance against the problem of small scale agricultural holdings which is the leading problem within the structural problems in the agricultural sector in Turkey. While 450 thousand hectare land in total was consolidated in Turke
Slide 7: Agriculture Sector in Turkey
6 AGRICULTURE SECTOR IN TURKEY 70,0 10,0% 8,8% Turkish agricultural sector 8,0% 60,0 7,2% 61,7 62,7 6,0% has grown in 7 out of last 8 4,0% years becoming the 50,0 56,4 51,0 5,3% 2,0% locomotive sector for 49,5 40,0 2,8% 45,0 4,3% 43,5 0,0% Turkish economy. 3,6% 37,0 2,4% 30,0 1,4% 30,2-2,0% -2,0%
Slide 8: Agriculture Sector in Turkey: Agricultural Export
7 AGRICULTURE SECTOR IN TURKEY Agricultural Export (Billion $) 15,3 12,7 11,5 11,2 9,8 8,3 8,6 6,5 5,3 4,0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 In 2011, Turkey is a net exporter on foreign trade for live animals and food products with surplus of 5.4 billion dollars.(*) Turkey has ta
Slide 9: Agriculture Sector in Turkey
8 AGRICULTURE SECTOR IN TURKEY Turkey, located at the most favorable climate zone in geographical terms, has adequate natural NUT resources. Turkey has the capacity to support the SOUR CHERRY agricultural industry with her increasing population APRICOT and purchasing power. Turkey, in particular tha
Slide 10: Agricultural Crop Map of Turkey
9 AGRICULTURE SECTOR IN TURKEY AGRICULTURAL CROP MAP OF TURKEY 1 2 3 4 Fruits - vegetables , sunflower, olive, Cereal, legume, sugar beet tobacco, creal, nut, sugar beet 5 Tea, nut, corn, tobacco, hemp, rice, Fruits - vegetables, tobacco, olive, cotton, fruits - vegetables citrus, rice, opium poppy
Slide 11: Agriculture Sector in Turkey
10 AGRICULTURE SECTOR IN TURKEY Favorable ecological conditions and climate for agricultural production ￫Tarımsal üretim için uygun ekolojik koşullar ve iklim Government incentives granted for agricultural investments ￫Tarım sektöründeki yatırımlar için sağlanan devlet destekleri Increased rec
Slide 12: Turkish Tractor Park & Renewal Potential
11 TURKISH TRACTOR PARK & RENEWAL POTENTIAL Use of obsolete tractors in the Turkish market not only increases the cost of the enterprises but also results in productivity loss by 25%. More than half million tractors are required to be renewed due to invalid specifications. Use of high capacity
Slide 13: Turkish Tractor Park & Renewal Potential
12 TURKISH TRACTOR PARK & RENEWAL POTENTIAL Reference to TURKSTAT data, there are 1.466.208 units of tractors in Turkish tractor App. park. The average of the park is 23. Mechanical Life 20-22 There are 735.487 tractors over 25 years. The Years average of those is 35. Total Average 1.466.208 Age
Slide 14: Agricultural Mechanization
13 AGRICULTURAL MECHANIZATION The rate of equipment use in Turkish agriculture is lower than the tractor use rate; the number of equipment per tractor and also the qualities of such equipment are far behind the levels of the developed countries. Capital requirement for the OPERATING acquisition and
Slide 15: Resources Allocated to Agriculture in Turkey
14 RESOURCES ALLOCATED TO AGRICULTURE IN TURKEY 2013 Agricultural Support Payment 8,9 billion TL BUDGET* Resources Allocated to Agriculture 13,6 billion TL 2012 Agricultural Support Payment 7,2 billion TL Resources Allocated to Agriculture 11 billion TL Agricultural Support Payment 7,8 billion TL 20
Slide 16: Resources Allocated to Agriculture in Turkey
15 RESOURCES ALLOCATED TO AGRICULTURE IN TURKEY Resources Allocated to Agriculture (million TL) GDP (million TL) 2011 9. 600 2011 1.294.893 2010 8. 429 2010 1.105.101 2008 7. 180 2008 950.098 2002 2. 772 2002 350.476 Ratio in GDP 0, 791% 0, 763% 0, 756% 0, 741% 2002 2008 2010 2011 Source : General D
Slide 17: Resources Allocated to Agriculture in Turkey
16 RESOURCES ALLOCATED TO AGRICULTURE IN TURKEY SU PPORT PAYMENTS in 2010 (thousand TL) SU PPORT PAYMENTS in 2011 (thousand TL) Livestock Support Livestock Support 1.727.529 Deficiency 1.192.617 26% Payment Support 22% Deficiency 2.071.451 Payment Support 38% 2.503.427 Other Other 37% 474.583 286.15
Slide 18: Consumer Finance
17 CONSUMER FINANCE In Turkey, 90% of the farmers buy the tractors through bank loans. TRACTOR SALES The dealer, should TÜRK TRAKTÖR DEALER have the current payment details of all banks and follow ~ 25% OF THE VALUE OF THE TRACTOR IS the interest rates, PAID IN CASH OR TRADE-IN DEAL IS help the farm
Slide 19: Agenda: Tractor Market
18 In the World and in Turkey Agricultural Sector Tractor Market Competitive Advantages Products Operational Results
Slide 20: Turkey in Worldwide Tractor Market
19 TURKEY in WORLDWIDE TRACTOR MARKET WORL D TRACTOR MARKET Units in Thousand 2006 2007 2008 2009 2010 2011 2012 North America 239 242 226 179 188 188 219 Europe 178 186 198 164 151 174 173 Latin America 44 61 83 69 83 80 75 China 202 178 180 271 295 340 324 India 318 310 308 361 457 537 524 Pakista
Slide 21: Tractor Market in Turkey: Fierce Competition
20 TRACTOR MARKET in TURKEY Ihlas Kubota Farmtrac Mahindra McCormick Claas SuperStar Deutz Fendt LS Kioti Ferrari In the Turkish Branson market under Foton Erkunt NH fierce competition (Harman) Landini In 2001 four brands circumstances, were competing in the TürkTraktör is the Uzel Yağmur market, wh
Slide 22: Tractor Market in Turkey
21 TRACTOR MARKET in TURKEY 70.000 60.341 60.000 50.318 50.000 42.033 39.571 40.000 36.036 33.989 34.525 34.541 unit 30.000 27.022 26.114 21.935 20.000 18.639 13.758 10.587 10.000 8.127 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012/6 2012 2013/6 Source : TURKSTAT
Slide 23: Tractor Market in Turkey
22 TRACTOR MARKET in TURKEY 35.000 60% 52,0% 51,5% 50,3% 50,4% 50,3% 30.000 49,9% 48,6% 50% 46,0% 25.000 37,7% 40% 33, 6% 20.000 30,0% Unit 28,5% 28,0% 30% 27,0% 25,8% 24,9% 15.000 21,1% 22,7% 21,7% 21,4% 23,5% 22,2% 20% 16,5% 10.000 16,3% 10% 13.144 5.000 10.660 7.304 5.666 6.583 13.011 15.886 13.4
Slide 24: Tractor Market in Turkey
23 TRACTOR MARKET in TURKEY Tractor Sales @ 2012/6 Tractor Sales @ 2013/6 Import Import Products Products NH + CIH NH + CIH 5.666 4.692 10.660 13.144 Other Local Other Local Manufacturers Manufacturers 7.304 6.583 Market Share @ 2012/6 Market Share @ 2013/6 Market Share @ Last 12 Months NH + CIH NH
Slide 25: Market & TürkTraktör
24 MARKET & TÜRKTRAKTÖR For the last 6 years one out of every two tractors have been manufactured by TürkTraktör. In the tractor market, New Holland brand is the leader with a market share of 43,7%*. Case IH brand, launched in the domestic market in 2007, has a market share of 4,9%*. The widest pr
Slide 26: Agenda: Competitive Advantages
25 In the World and in Turkey Agricultural Sector Tractor Market Competitive Advantages Products Operational Results
Slide 27: Competitive Advantages: Strong Shareholder
26 COMPETITIVE ADVANTAGES CNH Koç Holding 59 37,50% 37,50% Public Quotation Other 24,93% 0,07% TürkTraktör, manufactured KOÇ HOLDİNG A.Ş. Strong distribution and exported tractors for the WIDEST DEALER NETWORK One of the strongest network throughout EXPERIENCE OF 59 YEARS first time in Turkey an
Slide 28: Competitive Advantages: Manufacturing
27 COMPETITIVE ADVANTAGES Being the first in Turkey R&D center accredited Export to over 90 concerning flexible by the Ministry of countries all over the manufacturing lines that Industry on 03 world via global network enables co-use of September 2009 of CNH, such as, US, LARGE SCALE EXPORT au
Slide 29: Management Strategy
28 MANAGEMENT STRATEGY TürkTraktör tries to go head to head with international manufacturers from the same segment. TürkTraktör follows the developments in the world market and keeps track of innovations in the sector. TürkTraktör has an objective on a preferential basis to protect its cost-favo
Slide 30: Agenda: Products
29 In the World and in Turkey Agricultural Sector Tractor Market Competitive Advantages Products Operational Results
Slide 31: Manufactured Products (Tractor)
30 MANUFACTURED PRODUCTS (TRACTOR) Series T480 T480 2WD T480 4WD 48 HP 48 HP TT 50 55 65 75 50 HP 55 HP 65 HP 72HP 56s 55 65 75 55 HP 65 HP 75 HP TDS 65 75 80 65 HP 72 HP 80 HP TDD 65 75 80 90 100 110 65 HP 75 HP 83 HP 88 HP 98 HP 110 HP TTB 50 55 65 50 HP 55 HP 65 HP TDB 65 75 80 65 HP 72 HP 80 HP
Slide 32: Imported Products (Tractor)
31 IMPORTED PRODUCTS (TRACTOR) Series T3000 T3010 T3040 38 HP 55 HP T4000 T4030 De. F-N-V T4040F T4050F 78 HP 88 HP 97 HP T5000 T5050 T5060 T5070 96 HP 106 HP 113 HP T6000 T6020 T6050 T6060 T6070 T6080 T6090 112 HP 127 HP 132 HP 141 HP 155 HP 165 HP T7000 T7040 T7060 T7070 182 HP 213 HP 225 HP T8 T8
Slide 33: Products (Tractor)
32 PRODUCTS (TRACTOR) Series JXC 55 65 75 Manufactured 55 HP 65 HP 75 HP Utility * 55 65 75 Manufactured 55 HP 65 HP 75 HP JX 70 75 80 90 100 110 Manufactured 65 HP 75 HP 80 HP 88 HP 98 HP 110 HP JXU 95 105 115 Imported 96 HP 106 HP 113 HP MAXXUM 110 130 140 Imported 112 HP 132 HP 141 HP PUMA CVX PU
Slide 34: Imported Agricultural Equipment
33 IMPORTED AGRICULTURAL EQUIPMENT COMBINES COMBINES SQUARE BALERS COTTON PICKERS SELF PROPELLED FORAGE HARVESTERS SELF PROPELLED SPRAYERS PLANTERS PNEUMATIC PLANTERS ROUND BALERS SPRAYERS
Slide 35: Agenda: Operational Results
34 In the World and in Turkey Agricultural Sector Tractor Market Competitive Advantages Products Operational Results
Slide 36: Operational Results: Tractor Sales Units
35 OPERATIONAL RESULTS Tractor Sales Units 50.000 40.000 9. 601 14. 565 30.000 20.000 3. 311 7. 873 7. 079 31. 152 25. 597 10.000 16. 982 15. 935 11. 968 0 2011/6 2012/6 2013/6 2011/FY 2012/FY Local Sales Export Sales 2013/6 Local Sales (units) 2013/6 Export Sales (units) NH Local Case IH Export 10.
Slide 37: Operational Results: Manufacturing Units
36 OPERATIONAL RESULTS MANUFACTURING UNITS TRANSMISSION EXPORT UNITS 5.346 5.211 2011/6 2013/6 20. 802 2012/6 19. 252 3.143 90% 24. 734 89% 89% 2011/6 2.409 2.391 2. 422 2012/6 10% 3. 048 2013/6 11% 2. 312 11% 2011/6 2012/6 2013/6 2011 2012 Tractor Transmission
Slide 38: Operational Results: Combine Sales Units
37 OPERATIONAL RESULTS MARKET LEADER IN AGRICULTURAL EQUIPMENT SECTOR C ombine Sales Units 2013/6 615 2012/6 341 2011/6 305
Slide 39: Financial & Operational Performance
38 FINANCIAL & OPERATIONAL PERFORMANCE million EUR 2011/6 2012/6 2013/6 2011/FY 2012/FY Revenue 381 523 439 737 839 Gross Profit 107 112 94 174 180 Operating Profit 86 82 66 127 125 Profit Before Tax 89 88 64 140 135 Net Profit 72 74 54 114 114 EBITDA 88 85 71 132 133 Revenue @ 2012/6 (million Eur)
Slide 40: Financial & Operational Performance: Profitability Ratios
39 FINANCIAL & OPERATIONAL PERFORMANCE Profitability Ratios 28% 23% 24% 23% 21% 21% 21% 19% 17% 18% 16% 16% 16% 16% 15% 15% 15% 14% 14% 12% 2011/6 2012/6 2013/6 2011/FY 2012/FY Gross Margin Operating Margin EBITDA Margin Net Margin Re turn o n Equity & Return o n Asset 47% 40% 35% 30% 23% 22% 20% 17
Slide 41: Financial & Operational Performance
40 FINANCIAL & OPERATIONAL PERFORMANCE million EUR 2011/6 2012/6 2013/6 2011/FY 2012/FY Total Assets 410 617 554 507 561 Current Assets 343 535 447 437 470 Non-Current Assets 67 82 108 70 92 Total Liabilities 410 617 554 507 561 Short Term Liabilities 190 300 231 204 186 Long Term Liabilities 13 69
Slide 42: Financial & Operational Performance: Liquidity Ratios
41 FINANCIAL & OPERATIONAL PERFORMANCE Liquidity Ratios 2,52 2,14 1,93 1,81 1,86 1,79 1,52 1,37 1,39 1,33 2011/6 2012/6 2013/6 2011/FY 2012/FY Current Ratio Quick Ratio *The dividend distributed on March in 2013 and on April in 2012.
Slide 43: Financial & Operational Performance: Working Capital and CAPEX
42 FINANCIAL & OPERATIONAL PERFORMANCE Ne t Working Capital 215 mln € 168 172 153 139 2011/6 2012/6 2013/6 2011/F Y 2012/F Y C APEX 32 , 02 30, 32 mln € 19, 10 9, 64 4, 45 2011/6 2012/6 2013/6 2011/F Y 2012/F Y
Slide 44: Dividend
43 DIVIDEND * Share closing price as of dividend payment date have been used to calculate the dividend yield. ** Share closing price as of 16.02.2012 has been used to calculate the dividend yield of 2012. According to the agreement between Koç Holding and CNH Global NV dated 22 April 1998, the Parti
Slide 45: Borsa Istanbul & TTRAK Index
31.12.2011 31.01.2012 44 29.02.2012 31.03.2012 30.04.2012 BIST-100 31.05.2012 30.06.2012 BIST 100 31.07.2012 TTRAK 31.08.2012 30.09.2012 31.10.2012 31.12.2011 =100 30.11.2012 31.12.2012 TTF Values 31.01.2013 28.02.2013 BORSA ISTANBUL & TTRAK INDEX 31.03.2013 30.04.2013 31.05.2013 30.06.2013 %49 % 10
Slide 46: Contact
45 CONTACT Marco VOTTA Memet KAMBER İlkiz KARAGULLU CEO CFO Investor Relations +90 312 2332001 +90 312 2332003 +90 312 2332502 marcov@turktraktor.com.tr memetk@turktraktor.com.tr ilkizk@turktraktor.com.tr
Slide 47: Disclaimer
46 DISCLAIMER This presentation contains forward-looking statements that reflect the Company management’s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by a variety of variables an
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