Haci Omer Sabanci Holding A.s. · BIST:SAHOL

Haci Omer Sabanci Holding A.s — Q1 2019 Earnings Presentation

22 slides from Haci Omer Sabanci Holding A.s's earnings presentation, 2019

  1. Slide 1: Sabancı Holding Q1 2019 Earnings Presentation

    Sabancı Holding Q1 2019 Earnings Presentation

  2. Slide 2: Disclaimer

    2 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 their accuracy, completeness or correct

  3. Slide 3: Key developments in Q1 2019

    3 2019 Key developments in Q1 2019 Robust operational and financial performance; Non- bank EBITDA* and Net Income* grew 51% and 104% yoy, respectively Kordsa’s acquisition of Axiom Materials and Çimsa’s acquisition of Cemex’s White cement business Deleveraging is on track, on the back strong cash fl

  4. Slide 4: Strong cash generation sustained the leverage ratio

    4 2019 Strong cash generation sustained the leverage ratio Free Cash Flow, Combined for Non Bank** OPERATIONAL CASH FLOW (MTL)* 5.000 Q1 2018 Q1 2019 % Change Energy 293 1.411 382% 3.000 Cement -7 -65 -829% 1.000 Retail -382 42 111% Retail - Adjusted for Comparison** -382 -70 82% -1.000 Industrials

  5. Slide 5: A solid start to the year

    5 2019 A solid start to the year Combined Net Sales MILLION TL Q1 2018 Q1 2019 % Change TOTAL* 18.719 23.294 24% Driven by Industrials and Energy BANK 7.962 10.698 34% Higher renewable volumes in Energy NON-BANK* 10.757 12.596 17% Stronger exports and FX linked businesses Combined EBITDA MILLION TL

  6. Slide 6: Revenues: Energy and Industrials continue to be the growth drivers

    6 Revenues Energy and Industrials continue to be the growth drivers TOTAL BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change TOTAL* 18.719 23.294 24% BANK 7.962 10.698 34% NON-BANK* 10.757 12.596 17% Higher renewable sales volumes and FX linked revenue stream at Generati

  7. Slide 7: EBITDA: Energy and Insurance drove the EBITDA growth

    7 EBITDA Energy and Insurance drove the EBITDA growth TOTAL BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change TOTAL* 3.704 4.250 15% Higher volumes from hydros, availability and BANK 2.257 2.071 -8% dispatch contribution from the overall asset NON-BANK* 1.447 2.179 51%

  8. Slide 8: Consolidated Net Income: Energy profitability led bottom line growth

    8 Consolidated Net Income Energy profitability led bottom line growth MILLION TL Q1 2018 Q1 2019 % Change CONSOLIDATED NET INCOME* 894 1.028 15% BANK 691 616 -11% Energy segment bottom-line boosted by NON-BANK 202 412 104% strong operating profitability and ENERGY 30 321 958% hedged FX position CEME

  9. Slide 9: Energy: Spectacular performance in both businesses

    9 Energy Spectacular performance in both businesses BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change SALES 5.158 5.831 13% EBITDA* 895 1.503 68% NET INCOME* 99 701 607% EBITDA* MARGIN 17,4% 25,8% *Excludes non-operational one off items Current Assessment Factors to Wat

  10. Slide 10: Generation Sector: Normalization in spot prices & lower demand in Q1

    10 Generation Normalization in spot prices & Lower demand in Q1 Sector Electricity consumption (GWh) Electricity generation by source in Q1 (TWh) 85 Natural Gas 2017 2018 2019 80 Hydro -0,8% 75 Coal 70 Lignite Geothermal+wind 65 Q1'18 Q1'19 Other 60 1Q 2Q 3Q 4Q 0 5 10 15 20 25 30 35 Spot Electricty

  11. Slide 11: Enerjisa Üretim Santralleri: Benefiting from optimal portfolio

    11 Enerjisa Üretim Santralleri A.Ş. Benefiting from optimal portfolio MILLION TL Q1 2018 Q1 2019 % Change  In Q1 19, hydro generation volume jumped by 123% yoy Net sales 1.092 1.348 23% EBITDA* 283 655 131%  Positive impact of FX based feed-in-tariff revenues EBITDA* margin (%) 26% 49% 22,7pp  Ef

  12. Slide 12: Outstanding free cash flow generation; Deleveraging on track

    12 Enerjisa Üretim Outstanding free cash flow generation; Santralleri A.Ş. Deleveraging on track Free Cash Flow Generation (MTL) Net Debt (MEUR Equivalent) 1.500 1.700 1.000 1.400 500 1.100 1.678 0 800 1.042 975 2014 2015 2016 2017 2018 Q1 2018 Q1 2019 -500 500 2017 2018 Q1 2019 -1.000 Net Debt / EB

  13. Slide 13: Cement: Weak domestic demand partly offset by exports

    13 Cement Weak domestic demand partly offset by exports BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) Current Assessment MILLION TL Q1 2018 Q1 2019 % Change  A weak start to the year; domestic volumes SALES 748 744 -1% declined (Jan & Feb) by 47% yoy EBITDA* 161 94 -42%  Turkey Q1 export volume up b

  14. Slide 14: Retail: Recovery in Food Retail continued in Q1

    14 Retail Recovery in Food Retail continued in Q1 BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change SALES 1.957 2.217 13% Current Assessment EBITDA* 8 130 1512% − Strong LFL revenue growth in food retailing EBITDA** - Adjusted for comparison 8 19 130% − Weak performance

  15. Slide 15: Insurance: Strong financial income boosted net income

    15 Insurance Strong financial income boosted net income BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change Current Assessment SALES 1.073 1.236 15% − 14% growth in total non-life insurance premiums EBITDA 104 161 55% − Pension maintains #1 position in terms of Assets und

  16. Slide 16: Industrials: Outstanding operating cash flow generation

    16 Industrials Outstanding operating cash flow generation BEFORE CONSOLIDATION ADJUSTMENTS (COMBINED) MILLION TL Q1 2018 Q1 2019 % Change SALES 1.761 2.482 41% Current Assessment EBITDA* 291 310 7% BRİSA 106 122 16% − All business lines focused on export markets KORDSA 122 197 61% to utilize weaker

  17. Slide 17: FX Position: Long FX

    17 FX Position Long FX MILLION EURO CONSOLIDATED NET FX POSITION (excl. Bank) Dec 31, 2018 Mar 31, 2019 ENERGY -43 -1 INDUSTRIALS 16 11 CEMENT 0 -1 RETAIL 1 -4 INSURANCE 20 26 HOLDING & OTHER 284 254 TOTAL CONSOLIDATED FX POSITION AFFECTING PL 278 286 Holding Only Cash Position by the end of 1Q 2019

  18. Slide 18: Keeping the 2019 Guidance intact

    18 2019 Keeping the 2019 Guidance intact Growth Guidance SABANCI HOLDING SALES 10-20% COMBINED NON-BANK * EBITDA 10-20% * Excludes one off items ** Sabanci Group plans to invest approximately 6 Billion TL in 2019, excluding any strategic M&A opportunities that may arise within the year

  19. Slide 19: Wrap-up

    19 2019 Wrap-up Solid operational and financial performances posted in Q1 2019 Inorganic growth at the Composite and White Cement businesses Focus will continue to be on selective growth, cash generation, and maintaining quality of earnings

  20. Slide 20: Q&A

    Q&A OQBANc!

  21. Slide 21: Net Income: Non-operational and Non-recurring items

    21 2019 Net Income: Non-operational and Non-recurring items Non-Operational and Non-Recurring Items Q1 2018 Q1 2019 CONSOLIDATED NET INCOME EXCLUDING NON OPERATIONAL & NON RECURRING ITEMS 894 1.028 Gain on sales of Enerjisa Enerji shares (IPO proceeds) 123 0 Carrefoursa one-offs 30 10 Other 20 19 CO

  22. Slide 22: Sabancı Holding Discount to NAV

    22 2019 Sabancı Holding Discount to NAV* USDmn Mar-2019 Dec-2018 Direct Value of Value of NAV* Discount Companies Stakes (%)* Mcap Stake % of NAV Stake % of NAV Mar-2019 Dec-2018 Dec-2017 Akbank 40,8% 5.834 2.377 44,9% 2.117 39,6% Enerjisa Enerji 40,0% 1.082 433 8,2% 456 8,5% Aksigorta 36,0% 234 84

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