Kordsa Teknik Tekstil A.s. · BIST:KORDS
Kordsa Teknik Tekstil A.s — H1 2018 Earnings Presentation
21 slides from Kordsa Teknik Tekstil A.s's earnings presentation, Aug 9, 2018
Slide 1: 2018 1H – Earnings Release
2018 1H – Earnings Release August 9, 2018
Slide 2: Disclaimer
Disclaimer The information and opinions contained in this document The Company does not undertake any obligation, and have been compiled by KORDSA Teknik Tekstil Anonim disclaims any duty to update or revise any forward Şirketi (the “Company”) from sources believed to be reliable looking statements,
Slide 3: Agenda
Agenda 1 Global Footprint 1 2 1H 2018 Highlight 1 3 Market Dynamics 4 RM Price Drivers 5 Segment Reporting 6 New Products 7 Update on 1H 2018 Results 8 Dividend Distribution 9 Operating Bridge 10 Guidance Confidential
Slide 4: Global Footprint
Global Footprint 717 patent application 4 continents ~4,200 2 R&D 218 patents 10* facilities employees Centers 174 inventions WE REINFORCE LIFE *The acquisition process of Fabric Development Inc and Textile Products Inc was finalized in Jul 16, 2018 Confidential
Slide 5: 1H 2018 Highlights
1H 2018 Highlights T L F i n anc ials ( M T L ) 1H 2017 1H 2018 D Sales 1,239 1,538 + 24.1% EBITDA* 193 263 + 35.9% EBITDA* margin (%) 15.6% 17.1% + 1.5 bp Tire cord fabrics (“TCF”) Composite Construction • Strong market position, • Finalized the acquisition process of • Completed Kratos Polypropyle
Slide 6: Market Dynamics
Market Dynamics Gl o b al Au t o mo tive Market Global LV Assembly – M Units / Year 2017-2023E CAGR: 2,5% • AP Exc. China: +2.5% ASEAN region expected to 100 102 105 107 109 grow 97 95 • China: +6.4% Demand expected to grow parallel with GDP increase, effects of tariff wars • EMEA: +4.5% Middle East
Slide 7: Market Dynamics
Market Dynamics T i re R e i n f o rc ement Market (NY 6 . 6) 2017-2023 CAGR: +2.5% Supply Demand 525 530 492 508 481 479 446 404,00 414,00 Nylon 6.6 384,00 394,00 366,00 375,00 357,00 kton • High capacity utilisation rates • Increasing demand for another market, Enginering Plastics 2017 2018E 2019E
Slide 8: RM Price Drivers
RM Price Drivers N Y R aw M at e ri al T re n d ( I n d e x e d ) NY Raw Material Trend (Indexed) 250 Forecast 200 150 100 50 0 BZ BD PP OIL Source: Company Estimates BZ: Benzene BD: Butadiene PP: Propylene Confidential
Slide 9: RM Price Drivers
RM Price Drivers P ET F eed s t ock As ia 140,00 Current Date Crude Oil MEG Asia Contract Px Asia Contract PTA Asia Contract 100,00 • Crude oil WTI (based on IHS) price is the major driver 120,00 for PET price, 80,00 • MEG prices decrease in 2019 due to new capacity 100,00 becoming online, 60,00 80,
Slide 10: Capitalize on Global Footprint and Entrenched Supplier Status with All Key Tire Manufacturers
Capitalize on Global Footprint and Entrenched Supplier Status with All Key Tire Manufacturers - Segmental Progress Global Players Regional Players Emerging Players Others 21% 22% 20% 23% 27% 32% 4% 4% 5% 5% 4% 9% 9% 9% 4% 7% 9% 8% 66% 65% 67% 65% 57% 60% 2014 2015 2016 2017 1H 2017 1H 2018 Confident
Slide 11: Global Footprint
Global Footprint 2014 2015 2016 2017 1H 2017 1H 2018 36% 39% 36% 37% 37% 38% 32% 32% 30% 28% 30% 31% 22% 17% 18% 17% 17% 19% 14% 14% 15% 14% 14% 13% EMEA NA SA APAC TURKEY Headquarters Istanbul, Factory Izmit, Technology Center Izmit Tire (NY6.6, PET, SEC, TCF), Composite, Construction Regional foot
Slide 12: 2018 1H Revenue Split Progress by Products
2018 1H Revenue Split Progress by Products TCF NY Yarn Other 6% 4% 4% 4% 5% 8% 19% 20% 19% 19% 23% 18% 74% 76% 76% 77% 76% 71% 2014 2015 2016 2017 1H 2017 1H 2018 Confidential
Slide 13: Technology Leadership at The Cutting Edge of Reinforcement
Technology Leadership at The Cutting Edge of Reinforcement S t ro n g f o c u s o n R & D Cu t t i ng e d g e n e w p ro d u c ts 61.0* *2018 expected Rolling resistance improvements through 52 higher modulus for high performance tires 45 Sales from new products 41 42 Protection layer for truck &
Slide 14: Update on 1H 2018 Results
Update on 1H 2018 Results Ke y F i n an ci als (in TL million, unless otherwise stated) 1H 2017 1H 2018 D Sales 1,239 1,538 24% Gross profit 242 328 35% Gross profit margin (%) 19.6% 21.3% 1 pts' OPEX (%) 8.1% 8.2% 0 pts' Operating Profit 151.7 243.6 61% Operating Profit Margin (%) 12.2% 15.8% 4 pts
Slide 15: Update on 1H 2018 Results
Update on 1H 2018 Results Ke y B al an c e S h e e t I t e m s (in TL million, unless otherwise stated) 2017 1H 2018 D Cash and Cash Equivalents 16 34 18 Account Receivables 483 613 129 Inventories 585 957 371 Other Current Assets 113 139 26 PPE & Intangible & Investment Property 1,556 1,820 263 Acc
Slide 16: Update on 1H 2018 Results
Update on 1H 2018 Results F re e Cas h F l o w (in TL million, unless otherwise stated) 1H 2017 1H 2018 D EBIT * (1-t) 135 202 67 Depreciation & Amortization 50 62 11 Change in Working Capital -153 -347 -195 Cash Used in Investing Activities -61 -94 -33 Free Cash Flow* -28 -178 -150 * FCF: EBIT(1-Ta
Slide 17: Dividend Distribution (MTL)
Dividend Distribution (MTL) Distribution of all the distributable profits • which is lower of Kordsa Turkey solo tax books (VUK) or Kordsa consolidated TFRS (IFRS) net income, • in the form of cash and/or bonus shares subject to 68 67 General Assembly approval. 61 58 The distribution decision is agr
Slide 18: Operating Profit Bridge - MTL
Operating Profit Bridge - MTL M TL -54 122 27 244 -13 5 29 -21 -3 152 2017 YTD Sales Price Feedstock Prices Conversion Cost Volume Mix & Others Opex FX Gain/Loss on Others 2018 YTD (Inc. FX) (Inc. FX) Related to Sales (Inc. FPDE) AR/AP Confidential
Slide 19: Kordsa's Guidance
Kordsa's Guidance Revenue Growth 25%-35% (TRY) 30%-40% with FDI & TPI figures EBITDA 30%-40% Growth (TRY) 35%-45% with FDI & TPI figures Reoccurring Creep Capex 23 million USD Confidential
Slide 20: Appendix
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Slide 21: 2014 – 2018 Financial Trend (MTL)
2014 – 2018 Financial Trend (MTL) 2014 2015 2016 2017 1H 2017 1H 2018 339 300 263 240 182 165,10 193 143,08 Revenue 99,25 135,75 77,16 88,10 EBITDA Net Income (parent) 2.485 1.908 1.735 1.569 1.538 1.239 Confidential
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