Haci Omer Sabanci Holding A.s. · BIST:SAHOL
Haci Omer Sabanci Holding A.s — Hacı Ömer Sabancı Holding A.Ş. — Investor Day (June 2020)
38 slides from Haci Omer Sabanci Holding A.s's investor day presentation, June 2020
Slide 1: June 2020
JUNE 2020 Genele Açık
Slide 2: Disclaimer
The information and opinions contained in this document have been compiled by Hacı Ömer Sabancı Holding A.Ş. Disclaimer (“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 correctne
Slide 3: On Stage Today
On Stage Today Barış Oran Kıvanç Zaimler Kerem Tezcan CFO Energy SBU President Investor Relations Director Sabancı Holding Sabancı Holding Sabancı Holding İhsan Erbil Bayçöl Murat Pınar CEO CEO Enerjisa Üretim Enerjisa Enerji Fulya Banu Sürücü Michael Moser CFO CFO Enerjisa Üretim Enerjisa Enerji Ge
Slide 4: Today's Agenda
Today’s Agenda Turkish Energy During Energy Markets COVID Portfolio Genele Açık
Slide 5: Genele Açık
Genele Açık
Slide 6: Creating Market Leaders in Large and Growing Business Areas
Creating Market Leaders in Large and Growing Business Areas Our companies are market leaders in critical Diversified Portfolio (Mar-2020) areas within their respective sectors. Other 12% Financial Services 5% Banking 41% NAV Building Materials 3% TL 31bn Retail 9% Energy 21% Banking & Financial Serv
Slide 7: Non-bank Growth Driven by Energy
Non-bank Growth Driven by Energy Combined EBITDA1 (TL mn) Combined EBITDA1 Breakdown (Q1 2020) 65 Bank 176 45 94 389 169 Energy 19 Retail2 1% 319 Fin.Serv. 4% Build.Mat. 1% Industrial2 1.768 Industrial2 8% 1.503 Retail2 Fin.Serv. Energy 38% Bank 47% Build.Mat. Other 2.071 2.180 -21 -12 Q1 2019 Q1 20
Slide 8: Share of Energy Increases
Share of Energy Increases Share of Energy Increasing in Non-bank Combined EBITDA Significant Share Dividend Stream Energy SBU Combined EBITDA (MTL) Energy SBU Dividend Share in Group’s Dividend Income (%) 5.735 58% 47% CAGR 31% 834 12% 2014 2019 2018 2019 Mar.20 8 Genele Açık
Slide 9: Energy Has Been the Major Driver of Deleveraging & ROE Improvement
Energy Has Been the Major Driver of Deleveraging & ROE Improvement A Sharp Increase in OCF A Major Driver of Deleveraging Leading the Group’s ROE4 Improvement Combined OCF1 (MTL) Net Debt2 / EBITDA3 ROE (%) Other* Energy Total Energy Non-bank Energy 10.000 14 20% 12 8.000 15% 10 6.000 10% 8 6 5% 4.0
Slide 10: Turkey
Turkey A Mosaic Country of Intersections Genele Açık
Slide 11: Turkish Energy Markets: A Very Large Energy Market
Turkish Energy Markets A Very Large Energy Market 155 mtoe 66 bUSD 90 GW 45 bcm 5th Energy Market 5th Installed 4th Gas Consumption Transaction Capacity Consumption in Europe in Europe in Europe 11 Genele Açık
Slide 12: Significant Historical Growth and Additional Growth Potential
Turkish Energy Markets Significant Historical Growth and Additional Growth Potential Strong Domestic Growth Strong Energy Consumption Growth (TWh) 82 m Population CAGR %4,6 304 TWh Electricity Consumption 75% Urbanization 2009 2018 2009 2019 Multiple Consumption Growth Potential Electricity Consumpt
Slide 13: Solid Policies and Transparent Regulation on the Way to Liberalization
Turkish Energy Markets Solid Policies and Transparent Regulation on the Way to Liberalization Liberalized Customers Liberalized Market Regulated Market 2019 MENR EMRA 2017 2018 Strategy and Policies Independent and set by Ministry of very professional Energy and Natural Energy Markets 2012 Resources
Slide 14: Various Opportunities with Untapped Potential of Global Energy Trends
Turkish Energy Markets Various Opportunities with Untapped Potential of Global Energy Trends Renewable potential Distributed generation in wind and solar especially in solar E-mobility Efficiency Customer solutions through new technologies 14 Genele Açık
Slide 15: Covid
Covid Accelerating the Change in the World and in the Energy Sectors Genele Açık
Slide 16: Crisis Governance: Policy Makers, Regulators and Sector Players
During COVID Crisis Governance: Policy Makers, Regulators and Sector Players Health and Operations Supply Chain Market and Customers Operations Continuity Security Financial Impacts and Communications 16 Genele Açık
Slide 17: Electricity Demand
During COVID Electricity Demand Power Demand is 11% Lower Than Last Year Since 22nd of March (70TWh vs 62 TWh) 2019 2020 March y/y: -0,2% April y/y: -14,0% May y/y: -16,7% June MtD y/y: -0.3% 01 08 15 22 29 05 12 19 26 03 10 17 24 31 7 14 21 28 Source: EPİAŞ Transparency Platform, RealTime Consumpti
Slide 18: Decreasing Prices
During COVID Decreasing Prices Combined with seasonal characteristics i.e. high inflow and low demand 2019 2020 due to COVID measures; prices declined. Recovery started from May. 370 TL/MWh 55 USD/MWh 320 50 270 45 220 40 170 35 120 30 70 25 20 20 Jan Feb Mar Apr May Jan Feb Mar Apr May Source: EPİA
Slide 19: Our Energy Companies Have Positively Differentiated from the Sector
During COVID Our Energy Companies Have Positively Differentiated from the Sector Balance and Resilience Effective Risk Management Operational of the Portfolio with a Solid Balance Sheet Excellence 19 Genele Açık
Slide 20: Energy is an attractive sector for Sabancı and getting more important
Energy is an attractive sector for Sabancı and getting more important Genele Açık
Slide 21: Energy is an Important Pillar of Our Strategy
Energy Portfolio Energy is an Important Pillar of Our Strategy Energy and Utilities Industrials Financial Services Digital Businesses Growing the Core Organic Regulated Asset Base (RAB) Growth in Composites Continued organic growth Digital Transformation in expansion Core (Teknosa, Carrefour
Slide 22: Turkish Electricity Market Framework Replicates the Tested Electricity Market Structures
Energy Portfolio Turkish Electricity Market Framework Replicates the Tested Electricity Market Structures Physical Flow Generation Transmission Distribution ~20% State Controlled 100% State 21 Private Regions (TOR ~80% Private 26% of Turkey - Enerjia E. 5% of Turkey - Enerjisa Ü. Commercial Flow Tra
Slide 23: Well Positioned & Strong Leader in Turkish Energy Industry
Energy Portfolio Well Positioned & Strong Leader in Turkish Energy Industry 4 3 Generation Capacity (GW) 2 1 0 0 2 4 6 8 10 12 Customer Connections (Million) 23 Genele Açık
Slide 24: Well Focused to Adapt to Market by Splitting Business Lines
Energy Portfolio Well Focused to Adapt to Market by Splitting Business Lines 3rd Regulatory Distribution & Retail Partnership Partnership Period with Verbund with E.ON 2016-20 February 2018 IPO valued at ~2 bn USD 2006 2007 2009 2013 2016 2017-18 Energy SBU Acquisition of Acquisition of Split Founde
Slide 25: Well Positioned & Strong Leader in Turkish Energy Industry
Energy Portfolio Well Positioned & Strong Leader in Turkish Energy Industry Generation & Trading Distribution & Retail 1st private player 14 cities, 6 metropoles 21 power plants 21+ m population 3,607 MW capacity 9.9 m customers 15 TWh generation 232,000 km network 44% renewables 11.2 m connections
Slide 26: Generation and Trading Unique Position via Visible Growth and Dividend
Energy Portfolio Generation and Trading Unique Position via Visible Growth and Dividend Market leader position Proven track record across a diversified portfolio Strongest balance sheet in the sector Secured renewable growth plan via recent wind tenders Attractive dividend potential via capital redu
Slide 27: Electricity Generation Mix in Line with Country Mix
Energy Portfolio Electricity Generation Mix in Line with Country Mix Balanced and Well Positioned Portfolio Further Growth in Renewables Wind 9% Wind 6% Two wind tenders (YEKA) with 500 MW capacity won Hydro 31% Hydro 38% ÇANAKKALE 250 MW Lignite 11% AYDIN Lignite 12% 250 MW Import Coal 11% Natural
Slide 28: EBITDA Breakdown by Technology
Energy Portfolio EBITDA Breakdown by Technology Breakdown of Generation EBITDA 2019 Hydro CCGT Lignite Wind & Solar Renewables: 62% 7% 22% 9% USD indexed feed-in tariff 73-133 USD/MWh + local content support Natural Gas: Merchant play (~42 USD/MWh) Capacity mechanism (from 2018) Lignite: 2/3 State P
Slide 29: Cost of Generation
Energy Portfolio Competitive Position in 2020 Merit Order Minimum Demand Average Demand 24 GW 35 GW Cost of Generation 5% 17& 14% 14% 25% 7% 19% ROR Reservoir Wind & Solar Lignite Imported Coal EUAS Private CCGTs HEPP HEPP & Other CCGTs 29 Genele Açık
Slide 30: Prompt Measures to Transform Negative Developments into Opportunities During COVID-19 Crises
Energy Portfolio Prompt Measures to Transform Negative Developments into Opportunities During COVID-19 Crises Portfolio Capabilities In addition to “no demand impact on Feed-in-tariff, capacity and contracted sales earnings” Better plant operations and plant availability Better hydrology crowned thi
Slide 31: Strong Position in Distribution and Retail an Inflation Linked Business with Real Return
Energy Portfolio Strong Position in Distribution and Retail an Inflation Linked Business with Real Return Competitive Advantages Leading electricity distribution and retail company with huge customer base of around 10 million and economies of scale Strong historical growth and untapped potential in
Slide 32: Distribution: Heavily Concentrated on Network Investments But Also an Important Efficiency Game
Energy Portfolio Distribution: Heavily Concentrated on Network Investments But Also an Important Efficiency Game Strong Historical Growth and Distribution Operational Earnings* Regulation Incentivizes Investments Untapped Potential Breakdown (2019) Regulated Asset Base (bn TL) Regulated WACC (Real)
Slide 33: Retail: A Game Between Regulated and Free
Energy Portfolio Retail: A Game Between Regulated and Free Focused on Mass Regulated & Selective Free Customers Customers Shifted from Free to Eligible Free Customer Total Eligible Customer (Millions) 6 5 4 3 2 1 0 1'2016 7'2016 1'2017 7'2017 1'2018 7'2018 1'2019 7'2019 1'2020 Retail Volume Shifted
Slide 34: A Transformation Story: Significant Real Earnings, Cash Flow and Dividend Growth
Energy Portfolio A Transformation Story: Significant Real Earnings, Cash Flow and Dividend Growth Strong Growth in EBITDA Paying Back to the Shareholders Strong Growth in Free Cash Flow Combined Energy EBITDA (m TL) Dividends Paid to Sabancı Holding (m TL) FCF (m TL) 47% 283 4701 CAGR 5735 5337 189
Slide 35: A Transformation Story: Deleveraging & ROE Improvement
Energy Portfolio A Transformation Story: Deleveraging & ROE Improvement Deleveraging Enerjisa Üretim Enerjisa Enerji Improvement in ROE Net Debt / EBITDA* Ratio (x EBITDA*) Return on Equity (%) 17,0 18,2% 11,4% 8,4 8,4 8,3 4,4 4,6% 6,0 5,8 3,0% 4,3 2,6 2,9 2,3 2,1 0,4% 2014 2015 2016 2017 2018 2019
Slide 36: High Reputation in the Sector, Brand Image and Corporate Culture Attract Best Talents
Energy Portfolio High Reputation in the Sector, Brand Image and Corporate Culture Attract Best Talents ~12.000 Total HC ~3.500 ~8.500 White Collar Blue Collar Variety of Best Development Practice Programs Awards Female Male Average Age Seniority 33% 67% 35 5 Year 36 Genele Açık
Slide 37: Digitalization and Advance Data Analytics
Energy Portfolio Digitalization and Advance Data Analytics e ffectiveness Data-driven decision making e fficiency Automization of manual processes e xcellence Digitalization of core business operations 37 Genele Açık
Slide 38: Q & A
Q&A Genele Açık
Hacı Ömer Sabancı Holding A.Ş. — Investor Day (June 2020) on 6ix