Koc Holding A.s. · BIST:KCHOL

Koc Holding A.s — Investor Presentation (March 2010)

48 slides from Koc Holding A.s's investor presentation, March 2010

  1. Slide 1: Koç Holding Investor Presentation

    Koç Holding Investor Presentation March 2010

  2. Slide 2: Sustainable Track Record in Overperforming the Turkish Economic Growth Rates

    Sustainable Track Record in Overperforming the Turkish Economic Growth Rates Leading Conglomerate in Turkey Strong Standing in Global Rankings Ranking  2008 : 172 Total Sales / GDP  2007 : 186 7%*  2006 : 190 Global 500 Total Exports / Turkey’s Exports 8%*  2005 : 358  2004 : 389 Total Share in

  3. Slide 3: Unrivaled Competitive Advantages

    Unrivaled Competitive Advantages  ~11,000 dealers and after-sales services Largest distribution network  ~ 850 bank branches Largest customer database  Large customer database of over 17 million in different business segments together with strong CRM capabilities, enabling efficient up & cross-se

  4. Slide 4: Strategic Targeting Geared Towards Efficiency, Leadership, Innovation & Reputation

    Strategic Targeting Geared Towards Efficiency, Leadership, Innovation & Reputation Strategic Principles  Focus on those sectors where we can create a differential competitive advantage  Grow in sectors where we can leverage our strong brands & technological prowess  Derive maximum benefits from e

  5. Slide 5: Focused Growth Strategy

    Focused Growth Strategy Energy Automotive Consumer Durables Finance Automotive Main Companies Main companies Main Companies Main Companies Tüpraş* / Aygaz* / Opet / Entek Ford Otosan* / Tofaş* / Türk Traktör* / Arçelik* Yapı Kredi Bankası* Otokar* Share in Consolidated Revenues International Allianc

  6. Slide 6: Koç Holding in the Energy Sector

    Koç Holding in the Energy Sector Vision & Strategies  Maximize efficiency and increase profitability through – new investments in existing business units such as residuum upgrade project – new technology, product and service offerings – operational efficiencies and profit enhancement programs – opt

  7. Slide 7: Energy Companies – Competitive Advantages

    Energy Companies – Competitive Advantages  Turkey’s sole refiner and largest industrial company  4 refineries (İzmit, İzmir, Kırıkkale, Batman)  Supplying 70% of the total domestic demand  8th largest in Europe with 28 million tons/year total capacity  The largest in Emerging Europe  Highest E

  8. Slide 8: Koç Holding in the Automotive Sector

    Koç Holding in the Automotive Sector Vision & Strategies  To become a “Regional Production Base”  Assume full product development responsibility  Grow as a multi-brand dealership chain in retailing  Maximize efficiency through economies of scale and high capacity utilization rate Leader in Turke

  9. Slide 9: Automotive Companies – Competitive Advantages

    Automotive Companies – Competitive Advantages  Turkey’s largest manufacturer and exporter of commercial vehicles  50-50 JV with Ford  Turkey’s market leader in total automotive  7th consecutive year as the best assembly plant in Ford Europe  4th consecutive year as the best powerplant manufactu

  10. Slide 10: Koç Holding in the Consumer Durables Sector

    Koç Holding in the Consumer Durables Sector Vision & Strategies  Grow globally by acquisitions and organic growth  Maintain domestic market leadership  Leverage technology development capabilities to improve  Increase R&D capabilities, focus on brand positioning product development  Improve ope

  11. Slide 11: Consumer Durables Companies – Competitive Advantages

    Consumer Durables Companies – Competitive Advantages  Turkey’s market leader  Domestic network of 3,500 dealers and 600 after sales service stations  370 exclusive dealers in 30 countries  19.5 million units/year manufacturing capacity in Turkey, Romania, Russia and China  3rd largest household

  12. Slide 12: Koç Holding in the Finance Sector

    Koç Holding in the Finance Sector Vision & Strategies  Consolidate leadership in credit cards and become leader in consumer finance  Become leader in Asset Gathering and first choice bank for High Net Worth Individuals  Selective growth on Commercial and Corporate segments  Growth in SME through

  13. Slide 13: Finance Companies – Competitive Advantages

    Finance Companies – Competitive Advantages  Turkey’s 4th largest private bank (in terms of total assets)  50-50 JV with UniCredit  ~ 850 Branches  #1 in credit cards (issuing volume)  Leading companies in asset management, insurance, leasing & factoring #1 in Leasing #1 in Factoring #1 in Healt

  14. Slide 14: Portfolio Restructuring ahead of the Crisis in line with Changing Economic Dynamics

    Portfolio Restructuring ahead of the Crisis in line with Changing Economic Dynamics US$ 6.6 billion Acquisitions in core sectors US$ 3.0 billion Proceeds through proactive disposals www.koc.com.tr 14

  15. Slide 15: Strongest Beneficiary of the High Growth Environment with Leading Positions in Underpenetrated Markets

    Strongest Beneficiary of the High Growth Environment with Leading Positions in Underpenetrated Markets Revenues – Consolidated-US$bn 43.0 34.5 36.0 29.0 16.6 18.2 11.1 6.9 2002 2003 2004 2005 2006 2007 2008 2009 Further strong growth potential due to leading positions in low-penetrated business line

  16. Slide 16: Strong Margins Despite Global Turmoil

    Strong Margins Despite Global Turmoil EBITDA – Consolidated-US$bn Operating Profit – Consolidated-US$bn 3.1 3.2 2.6 2.6 2.8 2.7 2.2 2.1 1.6 1.5 1.2 1.0 0.9 0.7 0.6 0.2 2002 2003 2004 2005 2006 2007* 2008* 2009 2002 2003 2004 2005 2006 2007* 2008* 2009 Operating Margin – % 7.7 7.2 6.1 6.0 6.1 5.3 5.0

  17. Slide 17: Optimal Portfolio Allocation with High Resilience Against Market Volatility

    Optimal Portfolio Allocation with High Resilience Against Market Volatility Revenues – % 2003 2009 FX-denominated & FX-denominated & FX-linked * FX-linked 56% 44% 39% 61% TL TL * FX-linked revenues: Domestic revenues of the energy segment Operating Profit – % 2003 2009 Sectors with Sectors with Less

  18. Slide 18: Strong Global Reach

    Strong Global Reach US$6,913mn 75% share in US$218mn Int’l Sales 2% share in US$1,336mn Int’l Sales 15% share in Int’l Sales US$660mn 7% share in US$49mn Int’l Sales 1% share in Int’l Sales Exports – Combined-US$bn International Sales* – Combined-US$bn 15.0 14.2 12.6 13.3 11.8 9.9 9.2 8.6 8.5 7.5 5.

  19. Slide 19: Leader in R&D and Technology Investments

    Leader in R&D and Technology Investments 16% 8% of private sector of all patent applications filed R&D investments with the Turkish Patent Institute Koç Group Total R&D Investments – TLmn Koç Group Companies’ Patent Portfolio * 1,829 486 67 193 2002 2003 2004 2005 2006 2007 2008 2009 2002 2003 2004

  20. Slide 20: Strong Liquidity & Balance Sheet Management Offering Opportunistic Buyouts in the M&A Market

    Strong Liquidity & Balance Sheet Management Offering Opportunistic Buyouts in the M&A Market Koç Holding Stand-Alone 31.12.2009 Net Cash Position Total Debt: ~US$ 0.3 bn Total Cash: ~US$ 1.12 bn Net Cash: ~US$ 810 mn 2010-2013 Redemption Schedule US$ 300 mn – to be paid in equal annual installments

  21. Slide 21: High Resilience Against FX Volatility due to Tight Risk Management Measures

    High Resilience Against FX Volatility due to Tight Risk Management Measures Koç Holding Stand-Alone FX Position YE08 9M09 YE09 US$ + 334mn US$ + 285mn US$ + 327 mn Koç Holding Consolidated FX Position Weighted by Effective FX Position Ownership 9M08 YE08 9M09 YE09 9M09 YE09 US$ - 4.2bn US$ - 2.2bn U

  22. Slide 22: Continous Focus on Risk Management & Efficiency Gains

    Continous Focus on Risk Management & Efficiency Gains Area of focus in 2010  Strict cost cutting measures and efficiency gains  Stringent risk management measures  Strong balance sheet and liquidity management  Further streamlining of management processes  Optimum capacity utilization rates  E

  23. Slide 23: Potential Investment Areas

    Potential Investment Areas • Residuum upgrade project - Tüpraş • Opportunities in different fields • New manufacturing including electricity projects for export generation and markets with our JV Automotive renewable energy partners  Focus on higher ROI generating businesses Consumer Energy  Enhan

  24. Slide 24: Main Goal: Maximizing Shareholder Value

    Main Goal: Maximizing Shareholder Value One of the few Turkish Companies which Links Executive Compensation to Share Performance Shareholder Value L-T Strategic Targets Economic Profit Market Cap to Maximize Future Shareholder Value Customer Technology Satisfaction Development Aggressive Sustainable

  25. Slide 25: Value Proposition to Investors

    Value Proposition to Investors www.koc.com.tr 25

  26. Slide 26: Commitment to Corporate Governance

    Commitment to Corporate Governance A Pioneer in Corporate Citizenship  Voluntary commitment and proactive approach to principles of good corporate governance  Executive compensation based on economic profit and share performance  One of the first local companies in Turkey to have independent memb

  27. Slide 27: Corporate Social Responsibility

    Corporate Social Responsibility One of the first Turkish companies to sign the UN Global Compact which confirms Koç Group’s commitment to Corporate Citizenship Supporting vocational secondary schools; Project developed to create awareness among public. Koç Holding has pledged to grant 8,000 students

  28. Slide 28: Corporate Social Responsibility

    Corporate Social Responsibility Contributing to Turkey’s Development through Philantropic Activities Vehbi Koç Foundation  Assets: $1.2 billion Education  The Koç Schools  Koç University (over $190 Million investment)  Turkish Education Foundation (TEV)  TEGV Health Care  The American Hospital

  29. Slide 29: Appendix

    Appendix www.koc.com.tr 29

  30. Slide 30: Table of Contents

    Table of Contents Page 1. 2009 Earnings Review 31 2. 2010 Targets 39 3. Shareholder Structures 45 4. Contacts and Disclaimer 46 www.koc.com.tr 30

  31. Slide 31: Robust Financial and Operational Performance Despite the Global Crisis

    Robust Financial and Operational Performance Despite the Global Crisis Revenues  TL44,832mn (US$28,978mn)  19% YoY decline in TL terms and 33% in US$ terms mainly due to declining oil prices Operating Profit  TL3,471mn (US$2,244mn)  When normalized for the one-off items 3% YoY increase in TL ter

  32. Slide 32: Main Financial Indicators

    Main Financial Indicators € Mn* US$ Mn* TL Mn TL Mn Change Change 31.Dec.09 31.Dec.09 31.Dec.09 31.Dec.08 %, TL %, US$ Revenues 20,847 28,978 44,832 55,548 q -19 q -33 Gross Profit 4,131 5,743 8,884 8,302 p 7 q -11 EBITDA 2,044 2,841 4,396 5,853 q -25 q -37 Operating Profit 1,614 2,244 3,471 5,038 q

  33. Slide 33: The Contraction in Revenues was Mainly Triggered by the Energy Sector

    The Contraction in Revenues was Mainly Triggered by the Energy Sector in line with Declining Oil Prices Revenues – TLmn Share of Segment Revenues – % 55,548 44,832 Automotive 13% Energy 55% Durables 15% FY08 FY09 Finance Other 12% 5% Segment Contribution to Revenues – TLmn 29% 34,370 24,488 8% 2% 8%

  34. Slide 34: Excluding the One-off Capital Gains of 2008, EBITDA Registered 5% Annual Increase

    Excluding the One-off Capital Gains of 2008, EBITDA Registered 5% Annual Increase EBITDA Consumer Energy Automotive Finance Other Consolidated Total TL mn Durables FY09 1,701 597 826 1,046 226 4,396 EBITDA – TLmn Segmental EBITDA Breakdown – % Automotive 5,853 Energy 14% 39% 4,396 +5% 4,178 Normaliz

  35. Slide 35: Margins Improved in All Segments; Flat in Automotive

    Margins Improved in All Segments; Flat in Automotive Segment Contribution to EBITDA– TLmn 9% 1,872 1,701 10% 8% 33% 952 1,046 826 650 597 621 169% 226 84 * Energy Automotive Durables Finance Other FY08 FY09 EBITDA Margin by Segment – % 19.4 16.2 12.1 10.1 10.0 10.2 8.9 6.9 5.4 4.4 * Energy Automotiv

  36. Slide 36: 3% Increase in Operating Profit on a Normalized Basis

    3% Increase in Operating Profit on a Normalized Basis Operating Profit Consumer Energy Automotive Finance Other Consolidated Total TL mn Durables FY09 1,348 401 635 954 134 3,471 Operating Profit – TLmn Segmental Operating Profit Breakdown – % Energy Automotive 5,038 39% 12% 3,471 +3% 3,363 Normaliz

  37. Slide 37: Strong Margin Performance Despite the Challenging Operating Environment

    Strong Margin Performance Despite the Challenging Operating Environment EBITDA Margin – % EBITDA Margin excl. Finance – % 9.8 8.5 8.5 9.3 7.5 * 6.5 * FY07 FY08 FY09 FY07 FY08 FY09 Operating Profit Margin – % Profit Before Tax Margin – % 8.7 7.7 7.7 7.0 6.1 * 2.5 * FY07 FY08 FY09 FY07 FY08 FY09 * Nor

  38. Slide 38: Significant Increase in Profit Before Tax

    Significant Increase in Profit Before Tax Normalized profit before tax increased by 125% YoY  TL1,609mn FX loss in 2008 vs TL65mn FX loss in 2009  TL212mn decline in net interest expense YoY Profit Before Tax – TLmn 3,081 3,159 +125% 1,406 Normalized FY08 FY09 www.koc.com.tr 38

  39. Slide 39: 2010 Targets

    2010 Targets www.koc.com.tr 39

  40. Slide 40: Total Assets & Revenues

    Total Assets & Revenues Total Assets – TLbn Revenues – TLbn +12% 74.5 +18% 52.7 66.4 44.8 2009 2010 2009 2010 www.koc.com.tr 40

  41. Slide 41: Operating Profit & EBITDA

    Operating Profit & EBITDA Operating Profit – TLbn EBITDA – TLbn +34% 4.7 +29% 5.7 3.5 4.4 2009 2010 2009 2010 www.koc.com.tr 41

  42. Slide 42: Exports & International Sales

    Exports & International Sales Combined Exports – US$bn Combined International Sales – US$bn +28% 11.0 +28% 11.8 8.6 9.2 2009 2010 2009 2010 www.koc.com.tr 42

  43. Slide 43: Total Investments

    Total Investments Combined Total Investments – TLbn +31% 2.2 1.7 2009 2010 www.koc.com.tr 43

  44. Slide 44: Macroeconomic Assumptions

    Macroeconomic Assumptions 2010 Koç 2009 Budget Forecast Gross Domestic Product (US$ bn) 618 681 Growth (%) -4.7 4.0 Inflation (CPI, %, end of period) 6.5 5.5 TL / $ (end of period) 1.49 1.58 Exports (US$ bn) 102.1 107 Imports (US$ bn) 140.9 150 Current Account Balance (US$ bn) -13.9 -18 www.koc.com.

  45. Slide 45: Shareholder Structures as of December 2009

    Shareholder Structures as of December 2009 Koç Holding Koç Family: 69.36% Free Float: 21.49% Vehbi Koç Foundation: 7.15% Koç Pension Fund: 1.99% Consumer Energy Automotive Finance Other Durables Tüpraş Ford Otosan Arçelik Tat Konserve SPV share: 51.00% KH share: 38.46% Koç Financial Services KH shar

  46. Slide 46: For Further Questions, Please Contact

    For Further Questions, Please Contact : investorrelations@koc.com.tr Funda Güngör, Coordinator Investor Relations Strategic Planning Group fundag@koc.com.tr +90 216 531 0535 Aslı Selçuk, Manager Investor Relations Strategic Planning Group aslii@koc.com.tr +90 216 531 0537 Neslihan Aycıl, Associate I

  47. Slide 47: Main Group Companies’ Contacts

    Main Group Companies’ Contacts Arçelik Otokar Tüpraş Fatih Ebiçlioğlu, CFO Hüseyin Odabaş, AGM Finance Tuncay Önbilgin, Head of IR fatih.ebiclioglu@arcelik.com hodabas@otokar.com.tr tuncay.onbilgin@tupras.com.tr +90 212 314 3434 +90 264 229 2244 Ext. 451 +90 262 316 3085 M. Türkay Tatar, EVP Yasemin

  48. Slide 48: Disclaimer

    Disclaimer This presentation does contain forward-looking statements that reflect the Company management’s current views with respect to certain future events based on the base-case assumptions. Although it is believed that the expectations reflected in these statements are reasonable, they may be a

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