Turk Traktor Ve Ziraat Makineleri A.s. · BIST:TTRAK
Turk Traktor Ve Ziraat Makineleri A.s — Q1 2020 Earnings Presentation
34 slides from Turk Traktor Ve Ziraat Makineleri A.s's earnings presentation, Jul 3, 2020
Slide 1: Investor Presentation July 2020
Investor Presentation July 2020 Date of Last Update: 03.07.2020
Slide 2: Corporate Structure
Corporate Structure Established in 50,000 The oldest continuously manufacturing company of tractors Turkish automotive industry 1954 annual production capacity* Shareholder Structure Plants & Facilities Koç Holding A,Ş, Founded in 1926, Koç Holding has become not only one of the largest and most suc
Slide 3: TürkTraktör
TürkTraktör Continuously increasing export penetration. POSITION within CNH INDUSTRIAL Turkey’s biggest and the most diversified The only design and main production center of tractor exporter New Holland TD and Case IH JX series tractors in the world The only production center of Utility Light serie
Slide 4: Investment Highlights
Investment Highlights Leading tractor manufacturer with diversified product range Good shareholder returns • The largest tractor producer in • Given priority to maintain Turkey with 50K tractor capacity Sustainable growth and to grow profitability • Tractor market leader for the last • Vertically in
Slide 5: TürkTraktör at a Glance
TürkTraktör at a Glance Tractor Manufacturing Units Local Tractor Sales Units* 45,823 47,536 46,031 48,302 34,114 22,745 29,550 32,535 33,053 36,648 17,315 10,791 12,357 7,298 2014 2015 2016 2017 2018 2019 2020/6 2014 2015 2016 2017 2018 2019 2020/6 Total Revenue (mio TL) Gross Profit (mio TL) 2,723
Slide 6: Growth of Shareholder Value
Growth of Shareholder Value Dividend Yield Earnings per Share 4.81 6.93 4.50 6.01 2.10 1.57 2014 2015 2016 2017 2018 2020 2015 2016 2017 2018 2019 2020/3 Dividend / Net Profit Dividend Yield (%) Foreign Ownership in Free Float (%) Commitment to Corporate Governance 75.91% 73.85% 74.80% 59.12% *Separ
Slide 7: Brands & Products
Brands & Products Tractors (43HP-380HP) Construction Equipment Compact Line Agricultural Equipment Tractors (55HP-380HP) Construction Equipment Compact Line Agricultural Equipment Heavy Line Tractors (55HP-65HP) Agricultural Equipment 7
Slide 8: Market Positioning of the Brands
Market Positioning of the Brands *Market leader for 13 years in a row *Targeting professional *Having ~42%* market share farmers *The largest dealer network *Having ~6%* market share *Full territory coverage *Wide customer portfolio *Utilizing New Holland AG network capability in NH compact line pro
Slide 9: Network
Network Network at a Glance KIRKLARELİ BARTIN İSTANBUL SİNOP EDİRNE KASTAMONU TEKİRDAĞ ZONGULDAK ARTVİN ARDAHAN KARABÜK SAMSUN KOCAELİ RİZE DÜZCE TRABZON YALOVA ORDU SAKARYA AMASYA GİRESUN KARS BOLU ÇANKIRI ÇORUM TOKAT ÇANAKKALE BURSA BİLECİK GÜMÜŞHANE BAYBURT IĞDIR KIRIKKALE ERZURUM AĞRI BALIKESİR
Slide 10: Turkey - Agriculture Sector
Turkey - Agriculture Sector *High agricultural population *Low productivity *Stabilized government support to the sector *Higher inputs costs *Giving rise to professional farming *One of the lowest mechanization levels in Europe Turkey - Agricultural Equipment Sector Transformation of agriculture Al
Slide 11: Turkey - Agriculture Sector (source: World Bank & TURKSTAT)
Turkey - Agriculture Sector (source : World Bank & TURKSTAT) Turkey’s Agriculture Sector with Numbers Turkey’s agricultural economy in the world (2018 numbers) Turkey’s agricultural economy in Europe (2018 numbers) share of the agricultural industry over the GDP (2020 1Q)* share in the total employm
Slide 12: Turkey - Agriculture Sector (source: www.sbb.gov.tr)
Turkey - Agriculture Sector (source : www.sbb.gov.tr) Government Support in Turkey (billion TL) 22.0 17.0 14.6 12.7 9.1 10.0 11.5 2014 2015 2016 2017 2018 2019 2020 Budget It has been announced that the government has allocated budget for agriculture support in 2020. 12
Slide 13: Supports Provided within the scope of Agricultural Policies
Supports Provided within the scope of Agricultural Policies (source: www.sbb.gov.tr) Breakdown of resources allocated to agriculture in 2020 budget has been announced as 22.0 billion TL for agricultural support, 5.1 billion TL for investment loans and 6.3 billion TL for agricultural loans. Breakdown
Slide 14: Ziraat Bank Agricultural Loans
Ziraat Bank Agricultural Loans Tractor Loan - Credit limit 250,000 TL FEB Interests are Subsided at 50% up to Interests are Subsided at 25% for the 2018 75,000 TL Loan remaining amount above 75,000 TL Loan (was 50,000 TL before Feb 2018 ) (was 50,000 TL before Feb 2018 ) • Ziraat Bank increased its
Slide 15: TürkTraktör Finance - All Financial Solutions Under a Single Roof
TürkTraktör Finance - All Financial Solutions Under a Single Roof • First in Turkish agriculture sector • Aimed to enable farmers to have new tractors through the alternative financial solution and to support the increase of mechanization and modernization of agriculture • Covers tractor, equipment
Slide 16: R&D and Innovation Activities
R&D and Innovation Activities • New Holland T4S and Case IH Farmall A model tractors • As a result of our R&D activities, 6 new products equipped with the Tier 4 engines have been exported. were presented to the domestic market. The T450 T4S Farmall A series were launched in 2018 but sales started i
Slide 17: Highlights of Tractor Market
Highlights of Tractor Market (source : TARMAKBİR) Average working time of Mechanical life Ratio of the a tractor of a tractor Tractors older tractors >24 (hours/year) (hours) than 35 years years Average Tractor Average Farm Size(Ha) Power (HP) Turkey EU Turkey EU 7.6 16.6 60+ 100+ 17
Slide 18: Global Tractor Market
Global Tractor Market (thousand unit) (Source: Systematics) North America South America* Europe Turkey was the 4th biggest tractor market in 262 270 147 153 the world in the 80 79 68 57 17 14 49 43 first four months of 2018 2019 2019/4 2020/4 2018 2019 2019/4 2020/4 2018 2019 2019/4 2020/4 2020 Aust
Slide 19: Turkish Tractor Market
Turkish Tractor Market Tractor Production (units) Market Share of TürkTraktör Source : Tarmakbir Source : TURKSTAT 72,032 66,615 66,915 64,342 49% 49% 48% 48% 47% 45% 48,302 47,689 47,536 46,031 43% 45,823 34,114 34.114 29,539 2014 2015 2016 2017 2018 2019 2020/5 13,325 22,745 9,456 18,519 19,079 20
Slide 20: Turkish Tractor Market
Turkish Tractor Market Turkish Tractor Market (units) Tractor Park in Turkey (mio units) Source : TURKSTAT Source : TURKSTAT 1.63 1.69 1.76 1.84 1.88 1.91 1.93 59,449 66,775 70,205 72,949 48,044 25,839 14,576 2014 2015 2016 2017 2018 2019 2020/5 2014 2015 2016 2017 2018 2019 2020/5 Turkish Tractor M
Slide 21: Sales of TürkTraktör
Sales of TürkTraktör 32,157 Tractor Sales (units) 26,110 14,502 *Domestic tractor sales increased by 82% in 3M2020. 15,207 *In 3M 2020 export tractor sales decreased by 4% comparing to 3M2019. 17,655 7,683 5,898 10,903 3,417 3,553 2,345 4,266 2018 2019 2019/3 2020/3 Combine Sales (units) Local Expor
Slide 22: Operational Results
TiirkTraktor 66 Se, Operational Results
Slide 23: Income Statement
Income Statement (mio TL) 2018 2019 ∆ 2019/3 2020/3 ∆ - Domestic Sales 2,016 1,648 -18% 341 662 94% - Export Sales 1,893 2,158 -14% 477 529 11% Total Sales Revenue 3,909 3,806 -3% 818 1,191 46% Gross Profit 717 549 -23% 96 201 109% Net Operating Income 411 248 -40% 19 110 479% Profit Before Tax 256
Slide 24: Profitability
Profitability 21.1% 18.8% 17.4% 17.2% 16.9% 16.4% 13.8% 14.2% 11.7% 202 201 172 185 186 158 127 140 96 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q Gross Profit Gross Profit Margin 24
Slide 25: Profitability
Profitability 16.2% 13.5% 12.1% 11.9% 12.1% 10.0% 10.4% 9.7% 6.2% 144 142 145 129 102 110 102 92 51 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q EBITDA EBITDA Margin 25
Slide 26: Profitability
Profitability 8.2% 7.5% 7.1% 6.3% 5.4% 2.3% 3.3% 81 1.5% 74 0.9% 84 68 56 29 22 14 8 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q Net Profit Net Profit Margin 26
Slide 27: Profitability
Profitability (%) 2018 2019 ∆ 2019/3 2020/3 ∆ Gross Profit Margin 18.3 14.4 -3.9 pp 11.7 16.9 5.2 pp Operating Profit Margin 10.5 6.5 -4.0 pp 2.3 9.3 7.0 pp Net Profit Margin 6.1 2.9 -3.2 pp 0.9 7.1 6.2 pp EBITDA Margin 12.7 9.8 -2.9 pp 6.2 12.1 5.9 pp Gross Operating EBITDA Gross Margin Net Operati
Slide 28: Gross Profit to EBITDA Flow
Gross Profit to EBITDA Flow (mio TL) as of 31.03.2020 201 91 35 145 28 110 -139 32 82 84 2 Gross Opex Operating Other & Profit Taxation Income Net Income Depreciation EBITDA Profit Income Financial Before Expenses Tax 28
Slide 29: Debt Profile & Financial Ratios
Debt Profile & Financial Ratios (mio TL) 2018 2019 ∆ 2019/3 2020/3 ∆ - Cash & Cash Equivalents 413 747 81% 599 1,120 87% - Total Financial Debt 1,773 1,396 -21% 2,064 1,515 -27% Net Financial Position (1,360) (649) -52% (1,465) (395) -73% Current Ratio 2.0 1.8 -2 pp 1.4 1.5 1 pp Quick Ratio 1.0 1.2
Slide 30: Net Debt/EBITDA
Net Debt/ EBITDA 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q -395 -649 -899 -1,153 -1,155 -1,400 -1,360 -0.85 -1,550 -1,465 -1.74 -2.77 -2.39 -2.53 -2.95 -2.73 -2.92 -3.28 Net Financial Position NFP / EBITDA 30
Slide 31: Working Capital
Working Capital (mio TL) 2018 1Q 2018 2Q 2018 3Q 2018 4Q 2019 1Q 2019 2Q 2019 3Q 2019 4Q 2020 1Q 2000 1,106 1,194 842 1,077 1,021 28.4% 28.8% 1500 24.8% 955 820 820 25.0% 645 490 1,122 920 238 1000 1,085 20.6% 823 20.0% 672 632 549 16.9% 14.0% 500 15.1% 832 832 593 637 538 487 500 449 467 0 -521 -51
Slide 32: Dividend Payments
Dividend Payments Total TL 2.5 billion was distributed as dividend to the shareholders between 2004 – 2020. Dividend (mio TL) Dividend / Net Profit Dividend Yield (%) 32
Slide 33: Expectations
Expectations Our expectations for the year 2020 are as follows.* Turkish Tractor Industry Volume 28,000 – 33,000 units TürkTraktör Local Tractor Sales** 12,500 – 15,500 units Tractor Exports 10,000 – 12,500 units CAPEX 150 – 200 million TL ** Sales to the dealers included imported tractors *Due to t
Slide 34: Investor Relations Contact
Investor Relations Contact Ahmet CANBEYLİ Ahmet DİNÇ Sıla AKÇAY CFO Investor Relations Team Leader Investor Relations Senior Spe. +90 312 2332003 +90 312 2332502 +90 312 2332504 Ahmet.Canbeyli@turktraktor.com.tr Ahmet.Dinc@turktraktor.com.tr Sila.Akcay@turktraktor.com.tr investorrelations@turktrakto
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