Turk Traktor Ve Ziraat Makineleri A.s. · BIST:TTRAK
Turk Traktor Ve Ziraat Makineleri A.s — H1 2019 Earnings Presentation
37 slides from Turk Traktor Ve Ziraat Makineleri A.s's earnings presentation, Jul 31, 2019
Slide 1: Evaluation of 2019 6M
GKog Evaluation of 2019 6M
Slide 2: TurkTraktor at a Glance
TurkTraktor at a Glance GKog Financial Services ¢ First in Turkish agriculture sector © Covers tractor, equipment and construction equipment businesses TiirkTraktor mas Finans Construction Equipment ¢ Represented by 2 brands case gene ease Tractors and Agricultural Equipment Leader for the last 12 y
Slide 3: Corporate Structure
Corporate Structure Wide Product Range for Every Type of Need © CNH Industrial NV We offer innovative and technological solutions in many different CNH Industrial is a global leader in the investment goods segments with our orchard and field-type tractors, technological industry with its production
Slide 4: Plants & Facilities
Plants & Facilities Ankara Plant Ostim - Ankara CE Facility Akyurt - Ankara Warehouse Engine and transmission manufacturing center Opening : 30.10.2014 Opening : 01.04.2010 Opening : 25.06.1954 . z Total Area : 257,325 m2 Total Area : 6,200 m2 Total Area : 20,820 m2 Erenler Plant izmir CE Facility i
Slide 5: Our Agenda
Our Agenda @Koc (sD |e “Growth” e “Leader” in Export in Domestic Market & “Continue” LY Other to invest in Important new products Priorities
Slide 6: Tractor and Transmission Production
Tractor 14,250 -15,250 15,866 14,565 14,402 14,122 14,502 12,625 12,023 8,938 9,600 7,562 6,298 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2018 6M 2019 6M Transmission 6,772 5,585 4,575 4,318 2,596 3,346 2,923 2,989 3,069 1,610 1,597 2010 2011 2012 2013 2014 2015 2016 2017 2018 2018 6M 2019 6
Slide 7: North America and Europe are our main markets
49.5% 29.5% 2,430 3,376 2,261 2,731 974 1,194 NAFTA 246 262 EU 106 110 AMEA 2017 2018 2018/5 2019/5 297 116 336 145 163 147 56 62 LATAM ANZ 2017 2018 2018/5 2019/5 2018 (6M) Total: 6,298 With a share of 80%, North America and Europe are our main markets and 1,515 1,562 2019 (6M) Total: 7,562 we cont
Slide 8: Leader in Domestic Market
Leader in Domestic Market Overall assessment of Turkish agriculture Turkish Market @pakKog TiirkTraktér CS
Slide 9: Precipitation Trend and Crop Production
• In the first estimate of 2019, the production amounts of grain and other crops, vegetables and fruits are expected (Mio ton) to increase by 5.4%, 2.7% and 5.8% compared Production 2018 2019 F to the previous year. 67.9 • Production volumes in 2019 were estimated 64.4 as follows; 67.9 million tons
Slide 10: Input prices started to be parallel to foreign exchange and PPI
Input prices, which were extremely volatile in the second half of 2018, started to be parallel to foreign exchange and PPI.
Slide 11: Government agriculture support budget for 2019
11 • It has been announced that the government has allocated 17.0 Billion TL budget for agriculture support in 2019. • In the first six month of 2019, a total of 12,1 billion were paid to farmers. • The 12.3% of the budget allocated for diesel fuel and 3.3% for fertilizer.
Slide 12: Loan utilization rate
• In 2018, the loan utilization rate was 63%, and in 2019 it continued to be similar (60%). • There was no change in supply and demand after the May interest rate decisions.
Slide 13: Market Positioning of the Brands
Market Positioning of the Brands e Market leader for 12 years in a row ¢ Having ~37%* market share © The largest dealer network with full territory coverage e Wide customer portfolio new Houand CASE CONSTRUCTION. @vakor TiirkTraktér CS © Targeting professional farmers ® Having ~5%* market share © Co
Slide 14: Leader in the shrinking market with 42% market share
New Holland 5M Case IH 72,949 48,044 24,000- 29,000 29,569 24,116 9,034 2017 2018 2019 • Leader in the shrinking market with 42% market share
Slide 15: Turkish tractor market vs. 24 year average
72,949 Period Market 24 Years Avg. 39,721 20 Years Avg. 39,083 5 Year Average 10 Years Avg. 53,016 60,341 5 Years Avg. 63,484 10 Year Average 48,264 50,318 48,044 2012 39,707 Drought 2018 24 Year Average Financial uncertainty 29,365 26,318 21,110 1999 Eartquake 11,457 13,758 2001 2009 6,812 Devaluat
Slide 16: Product Investments
@pokog Product Investments
Slide 17: We continue to launch new products
We continue to launch new products We began to export our first domestic made tractor with semi-automatic gearbox which was launched in the Konya fair. @akor TiirkTraktir CO en
Slide 18: We continue to launch new products
We continue to launch new products July, 2019 . @)\ " a \ecugs @Koc
Slide 19: Strengthening in the Equipment and Construction Equipment Market
We are Strengthening in the Equipment and Construction Equipment Market! ugrom Ti11age every EQUI PIs eke TiirkTraktér CS
Slide 20: - Tartai Eepte
- Tartai Eepte TiirkTraktér CO cni
Slide 21: Other Important Priorities
4 Other Important Priorities Continuation of product Position investments Reducing expense items according to the current business size and adjusting operational costs to new conditions ekg TiirkTraktir CO cNi
Slide 22: Operational Results
@akKog Operational Results TiirkTraktér CS
Slide 23: Tractor
Tractor 2018 2Q-2019 2Q Yurt Dışı -47% 12,777 2019 1Q-2019 2Q 23,221 Toplam 24% 10,444 -57% 6,252 5,574 4,482 4,641 10,056 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H
Slide 24: Engine
Engine 2019 1Q-2019 2Q Yurt Dışı -62% 10,953 2019 1Q-2019 2Q 19.733 Toplam 14% 8,780 5,664 5,517 -68% 3,373 2,965 6.338 2018 1Q 2018 2Q 2018 3Q 2019 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H
Slide 25: Breakdown of Tractor Sales
Breakdown of Tractor Sales Total Sales in 2019 1H Imported Locally 11,912 Manufactured Tractors (99 HP – 380 HP) tractors Tractors (43 HP – 141 HP) 1% 99% Locally Manufactured Tractors Tractors sold to Export Market Tractors sold to (48 HP – 114 HP) Local Market (43 HP – 141 HP) 63% 37%
Slide 26: Tractor Sales Local and Export
2018 2Q-2019 2Q 2019 1Q-2019 2Q Yurt Dışı 16% Yurt Dışı 13% 19,421 Yurt İçi -62% Yurt İçi -14% Toplam -31% Toplam 2% 6,298 10,648 11,912 2,828 8,773 -39% 3,470 6,699 6,037 5,898 6,014 20% 7,562 13,123 4,180 4,009 7,820 4,024 3,553 5,303 2,519 -67% 4,350 2,013 2,345 2,005 2018 1Q 2018 2Q 2018 3Q 2018
Slide 27: Engine Sales Local and Export
2018 2Q-2019 2Q 2019 1Q-2019 2Q 2,125 Yurt Dışı 39% Yurt Dışı 24% Yurt İçi -49% Yurt İçi -3% 1,740 Toplam -14% Toplam 13% 736 -18% 1,048 1,077 1,06 876 908 922 45% 8 310 426 818 578 579 477 591 1,389 738 651 -52% 672 298 329 341 331 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H Loc
Slide 28: Gross Profit
21.1% 17.6% 18.8% 17.4% 374 16.4% 12.8% 13.8% -40% 11.7% 223 202 185 32% 172 158 127 96 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H Gross Profit Gross Profit Margin Gross Profit Gross Profit Margin
Slide 29: Operating Profit
13.7% 9.7% 11.5% 9.4% 7.9% 206 6.5% 4.6% -62% 124 120 2.3% 216% 82 85 60 79 19 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H Operating Profit Operating Profit Margin Operating Profit Operating Profit Margin
Slide 30: EBITDA
16.2% 11.6% 13.5% 12.1% 10.0% 8.2% 9.7% 246 6.2% 80% -42% 144 142 102 110 143 92 51 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H EBITDA EBITDA Margin EBITDA EBITDA Margin
Slide 31: Profit Before Tax
9.1% 6.6% 7.9% 5.2% 3.7% 1.5% 1.1% 0.6% 86 83 141 55 32 180% -87% 14 19 5 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H Profit Before Tax Profit Before Tax Margin Profit Before Tax Profit Before Tax Margin
Slide 32: Net Profit
8.2% 6.4% 7.5% 5.4% 1.2% 3.3% 81 1.5% 74 0.9% 137 56 81% -85% 29 13.8 21.4 7.6 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2018 1H 2019 1H Net Profit Net Profit Margin Net Profit Net Profit Margin
Slide 33: Net Working Capital
2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 1,106 1,194 1,077 820 842 28.8% 1,021 28.4% 25.0% 955 1,122 820 920 1,085 823 20.6% 16.9% 15.1% 832 832 593 637 538 449 -521 -513 -480 -541 -810 -681 Trade Receivables (net)** Inventories Trade Payables (net) Net Working Capital*/Revenue *12 Month Aver
Slide 34: Cash and Borrowings
2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q -1,155 -1,465 -1,550 -1,360 828 -1,153 -1,400 413 599 155 327 92 15% -182 -350 -328 23% 17% 26% -470 52% -1,068 62% -1,226 85% -1,063 77% -1,205 83% -1,549 74% -1,303 48% -996 38% -757 Cash and Cash Equivalents Short Term Borrowings Long Term Borrowing
Slide 35: Net Financial Position and NFP/EBITDA
2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q -1,153 -1,155 -1,400 -1,360 -1,465 -1,550 -2.77 -2.39 -2.95 -2.75 -2.92 -3.28 Net Financial Position NFP / EBITDA
Slide 36: Our expectations for the year 2019
Our expectations for the year 2019 are as follows.* Turkish Tractor Industry Volume 24,000 – 29,000 units TürkTraktör Local Tractor Sales** 11,500 – 14,000 units Tractor Exports 14,250 – 15,250 units CAPEX 150 – 200 million TL ** Sales to the dealers included imported tractors *In the first 6 months
Slide 37: Thank you!
Thank you!
Türk Traktör ve Ziraat Makineleri A.Ş. — H1 2019 Earnings Presentation on 6ix