Haci Omer Sabanci Holding A.s. · BIST:SAHOL
Haci Omer Sabanci Holding A.s — Hacı Ömer Sabancı Holding A.Ş. — Investor Presentation (March 2019)
34 slides from Haci Omer Sabanci Holding A.s's investor presentation, March 2019
Slide 1: Sabancı Holding Investor Presentation
Sabancı Holding Investor Presentation
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
Slide 3: Speaking today
3 Introduction Speaking today Mehmet Göçmen Barış Oran Board Member and CEO Chief Financial Officer Appointed as the CEO of Sabancı Holding in March 2017 Appointed as the CFO of Sabancı Holding in 2016 Joined the Sabancı Group in 2003 Joined the Sabancı Group in 2006 Since joining the Group, Mr Göçm
Slide 4: Sabancı, Turkey's leading group
4 Introduction Sabancı, Turkey’s leading group • 90+ years of creating market leaders in large and growing business areas, evolving through dynamic portfolio management and leveraging our industrial heritage and the experience of our JV partners • Strong financial track record of real growth and r
Slide 5: In continuous evolution
5 Introduction In continuous evolution 1940s – 1960s 1970s-2000s 2000-2010s Present and future Early Growth Phase - Proliferation of Global “New Generation’s Refocus Portfolio Initial Diversification Partnerships-Conglomeration Sabancı” JVs formed with JVs formed with, Aviva Bridgestone and and Agea
Slide 6: Creating market leaders in large and growing business areas
6 Introduction Creating market leaders in large and growing business areas Our companies are market leaders in critical areas within their respective sectors • Banking - the best bank in Turkey in 2018 (Banker, Euromoney, and Global Finance) • Cement - the leading Turkish cement supplier with strate
Slide 7: Consistently delivering over time
7 Introduction Consistently delivering over time Sabancı’s 2013-2018 financial performance, TL bn Double digit combined revenue growth 20% 18% Double digit combined EBITDA1 growth CAGR CAGR 88,1 15,5 14,2 65,6 10,8 47,9 53,8 44,1 7,2 8,0 36,1 6,8 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 201
Slide 8: Improved capital allocation has led to favourable Return on Equity trend
8 Improved capital allocation and focus on performance has led Introduction to a favourable trend in Return on Equity Return on Equity Sabancı Holding consolidated ROE 14-18 Equity Segment ROE1 2014 2015 2016 2017 2018 ∆ ppts Share2 14,5% Energy n.m. 0.4% 3.0% 4.6% 11.4% +13.5% 17.5% 13,7% 12,7% Cem
Slide 9: Committed to driving value for all of our stakeholders
9 Our value add Committed to driving value for all of our stakeholders What makes Sabancı different? How Sabancı drives value • Active owner focused on long-term value creation • Focusing on long-term value creation as an active owner • Best-in-class domestic reputation, brand image and • Fostering
Slide 10: An effective corporate and governance structure
10 An effective corporate and governance structure, tailored to drive Our value add value creation Shareholder base Corporate structure and division of responsibilities • Evolved from a family owned group to a corporation with an effective governance structure, accelerated by our JV partners • Saban
Slide 11: Turkey - an attractive foundation and platform for global growth
11 Our value add Turkey - an attractive foundation and platform for global growth Turkey is one of the world’s fastest growing economies Sabancı, able to efficiently leverage the Turkish opportunity Real GDP growth, y-o-y 16% • One of the highest growth economies in the world with real GDP growth co
Slide 12: Driving "New Generation's" Sabancı
12 New Generation Driving “New Generation’s” Sabancı New Generation’s Sabancı Continue to invest to drive sustainable growth by investing into new geographies, new products, adjacent industries and in asset light areas such as digital and data analytics Capital allocation Technology and data Talent
Slide 13: Linking value creation to performance targets
13 Talent New Generation Linking value creation to performance targets Management Fostering performance Previous vs New Total Cash Model • Targets to implement ownership culture 300 Long term • Set of short term KPIs determined for each year at the end of (max) 50 budget process, the targets set at
Slide 14: Capital allocation framework
14 New Generation Capital allocation framework Capital allocation Growth (~50% of NAV) • Strategically attractive markets where Sabancı can add value • Build a sustainable competitive advantage (organically / inorganically) • New product development (R&D) Cash generators (~35% of NAV) • Strong cash
Slide 15: Implementation of new capital allocation policy
15 New Generation Implementation of new capital allocation policy Capital allocation Overview New policy for capital allocation • Revised capital allocation strategy to ensure disciplined use of capital • Dynamic portfolio management, an important pillar of the capital allocation strategy Value crea
Slide 16: More transparent dividend policy benefiting shareholders
16 More transparent dividend policy benefiting Refreshed capital allocation Capital allocation New Generation shareholders framework Dividend policy – overview Dividend policy to benefit all shareholders Before Today • Sabancı’s revised dividend policy was announced in 2018 Based on Distributable Ne
Slide 17: Kordsa: growth opportunities with Composites
17 New Generation Kordsa: growth opportunities with Composites Capital allocation Overview of the Composites Value Chain Current Status • Composite Technologies Center of Excellence opened in 2016 with ~USD30m of investment. Raw materials Intermediates Composite Parts • Ongoing development programs
Slide 18: Kordsa: growth opportunities with Composites
18 New Generation Kordsa: growth opportunities with Composites Capital allocation Advanced Composite Market to grow by 8% CAGR until 2023 6,0 CAGR: 8% Composite Market Segmental breakdown of Advanced Composite Market 5,0 4,0 Metal; 4% CAGR: 10% Ceramic; Hybrid&Others 3,0 Carbon; 13% 9% ; 6% 2,0 CAGR
Slide 19: Driving Digital Transformation
19 Technology and New Generation Driving Digital Transformation data Advance Analytics - AA Verticals Output 1 Capitalize Sabancı Holding Data Assets into Existing SaaS Products Value and Products thru • E-Auction Center of Excellence and AA programs 3.2 billion USD volume per Catalyzing digital tra
Slide 20: Advanced and Predictive Analytics
20 Technology and New Generation Advanced and Predictive Analytics data • Embed advanced predictive analytics across functions of Sabancı Holding in all decision making processes by the end of 2022 to Vision create competitive advantage supporting both the development of topline and bottomline Scale
Slide 21: Sabancı, driving value as a strategic investor
21 Enerjisa example Sabancı, driving value as a strategic investor 2009 2013 2016 Baskent distribution Partnership with EON New February 2018 region acquisition Regulatory Enerjisa Enerji IPO Ayedas and Toroslar Period valued at 1.9 bn USD distribution region acquisitions (Downstream) 2006 2017 Ener
Slide 22: Turnaround in Energy between 2014 and 2017
22 Enerjisa example Turnaround in Energy between 2014 and 2017 2014 2017 Decision to defer Separation of generation downstream investment Operational initiatives and upstream Upstream Downstream • Capacity target reduced from 7.5 GW to 3.5 GW • Implementation of existing operational excellency to th
Slide 23: Robust Holding Company and Group balance sheet
23 Performance Robust Holding Company and Group balance sheet Combined net financial debt / EBITDA1 Commentary 5,3x • Effective management of Sabancı’s balance sheet linked 4,6x to capital allocation approach 4,0x 3,7x 3,1x • Strong de-leveraging profile for the group 2,3x • Lean Holding Company cos
Slide 24: 2018 performance delivered
24 Performance 2018 performance delivered 2018 performance against guidance 2019 financial performance guidance Commentary Combined1 Combined1 • Majority of Sabancı’s growth targets set for 2018 were exceeded with sizeable outperformance of the initial 45% guidance. 20% 20% 35% High • Combined non-b
Slide 25: 2018 - Outstanding Non-Bank Performance
25 Performance 2018 - Outstanding Non-Bank Performance Combined Net Sales2 Combined EBITDA1 Consolidated Net Income TLm TLm TLm +34% +6% 86.868 +8% 15.403 3.831 14.201 3.615 64.711 38.166 +40% -14% 7.338 -13% 2.269 27.352 8.427 Bank Bank 2.643 Bank 48.702 +30% +40% 37.359 8.065 +61% Non-bank Non-ban
Slide 26: Portfolio performance: Energy and Cement
26 Performance Portfolio performance Business unit financial performance, TL bn1 Combined Revenue Combined EBITDA & EBITDA margin Dividends paid to Sabancı Holding (TL m) 142,0 23,6 23% Energy 16,5 21% 20% 11,8 12,6 11,0 13% 6,7 10% 5,3 8% 3,5 2,5 0,7 0,8 1,5 - - - - - 2013 2014 2015 2016 2017 2018
Slide 27: Portfolio performance: Industrials and Insurance
27 Performance Portfolio performance Business unit financial performance, TL bn1 Combined Revenue Combined EBITDA & EBITDA margin Dividends paid to Sabancı Holding (TL m)2 Industrials 8,4 8,4 6,3 8,8 6,3 346 298 315 4,6 4,5 4,5 6,6 4,6 18% 4,5 20% 4,5 19% 288 275 17% 243 4,6 4,8 5,1 5,2 16% 15% 1,4
Slide 28: Portfolio performance: Retail and Banking
28 Performance Portfolio performance Business unit financial performance, TL bn1 Combined Revenue Combined EBITDA & EBITDA margin 8,7 7,6 8,08,4 8,4 7,1 3% Retail 6,1 3% 5,6 6,3 6,3 3% 4,6 4,6 2% 4,5 4,5 4,5 4,5 0,2 2% 0,2 0,2 0,2 1% 0,1 0,1 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 2013 201
Slide 29: Increasing dividend payments from portfolio companies
29 Performance Increasing dividend payments from portfolio companies Sabancı Holding dividends paid and received (MTL) TLm Segment 2013 2014 2015 2016 2017 2018 Outflows / 32% 32% 25% 41% 46% 50% Inflows Akbank Banking 232 190 232 245 367 652 Akçansa Cement 44 57 90 102 94 51 1.212 Aksigorta Insuran
Slide 30: Sabancı, Turkey's leading group
30 Wrap-up Sabancı, Turkey’s leading group • 90+ years of creating market leaders in large and growing business areas, evolving through dynamic portfolio management and leveraging our industrial heritage and the experience of our JV partners • Strong financial track record of real growth and retur
Slide 31: Appendix
Sabancı Holding Appendix
Slide 32: Overview of corporate structure
32 Appendix Overview of corporate structure Banking / Energy Retail Cement Industrial Other Insurance Enerjisa Enerji Carrefoursa Çimsa Cement1 Akbank Kordsa Philsa SAHOL: 40.0% SAHOL: 50.6% SAHOL: 49.4% SAHOL: 48.9% SAHOL: 71.1% SAHOL: 25.0% E.ON: 40.0% Carrefour: 46.0% Akçansa Çimento: 9.0% Free f
Slide 33: Earnings Reporting - Combined and Consolidated Numbers
33 Sabancı Holding Earnings Reporting - Combined and Appendix Consolidated Numbers Combined Net Sales EBITDA Net income Subsidiaries (1) line by line line by line line by line Joint Ventures (2) line by line line by line line by line Associates (3) Not included Proportion of ownership interest * Net
Slide 34: Investor relations key contacts
34 Appendix Investor relations key contacts investor.relations@sabanci.com Erol Danış, PhD, CFA Senior Finance Manager Investor Relations edanis@sabanci.com +90 212 385 81 20 Şermin Mutlu Finance Director Investor Relations smutlu@sabanci.com +90 212 385 81 50
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