Koc Holding A.s. · BIST:KCHOL
Koc Holding A.s — Investor Presentation (March 2009)
42 slides from Koc Holding A.s's investor presentation, March 2009
Slide 1: Investor Presentation March 2009
OV) Kog Holding Investor Presentation March 2009
Slide 2: Sustainable Track Record in Overperforming the Turkish Growth Rates
Sustainable Track Record in Overperforming the Turkish Growth Rates Leading conglomerate in Turkey Ranking 2007 : 186 2006 : 190 Total Sales / GDP* 9% 2005 : 358 Global 500 2004 : 389 Total Exports / Turkey’s Exports** 11% 2007 : 46 Total Share in ISE Market Cap.** 13% 2006 : 49 European
Slide 3: Strongest Beneficiary of the High Growth and Low Inflation Environment
Strongest Beneficiary of the High Growth and Low Inflation Environment 12,000 dealers and after-sales services Largest distribution network 861 bank branches Customer database of around 15 million with strong CRM capabilities, Largest customer database enabling efficient up & cross-selling Lea
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
Slide 5: Main Competitive Advantages
Main Competitive Advantages Leading positioning in low penetrated Superior growth opportunities growth sectors Largest customer database Most efficient use of CRM Higher geographical diversification Better risk management Largest distribution network Highest customer satisfaction Synergies among gro
Slide 6: Focus on Risk & Crisis Management
Focus on Risk & Crisis Management Actions taken to minimize the potential impact of the financial crisis Radical cost management as early as 2Q08 Significant improvement in net cash position US$ 770mn club loan for the use of Group companies Focus on efficiency and restructuring Areas of foc
Slide 7: Focused Growth Strategy
Focused Growth Strategy Energy Automotive Consumer Durables Finance Main Companies Main companies Main Companies Main Companies Tüpraş* / Aygaz* / Opet / Entek Ford Otosan* / Tofaş* / Türk Traktör* / Otokar* Arçelik* / Grundig Elektronik* Yapı Kredi Bankası* Share in Consolidated Revenues Internatio
Slide 8: Koç Holding in the Energy Sector
Koç Holding in the Energy Sector Vision & Strategies Key Indicators Maximize efficiency and increase profitability through 2008 2008 Annual – new investments such as residium upgrade project US$mn YTL mn Chg. (YTL) – new technology, product and service offerings – operational efficiencies and prof
Slide 9: Energy Companies – Competitive Advantages
Energy Companies – Competitive Advantages Turkey’s sole refiner and largest industrial company 4 refineries (İzmit, İzmir, Kırıkkale, Batman) Supplying 70% of the total domestic demand 8th largest in Europe with 28 million tons/year total capacity The largest in Emerging Europe Market le
Slide 10: Koç Holding in the Automotive Sector
Koç Holding in the Automotive Sector Vision & Strategies Key Indicators To become a “Regional Production Base” 2008 2008 Annual Grow as a multi-brand dealership chain in retailing US$mn YTL mn Chg. (YTL) Assume full product development responsibility Total Revenues 4,977 6,435 -1% Maximize e
Slide 11: Automotive Companies – Competitive Advantages
Automotive Companies – Competitive Advantages Manufacturer of commercial vehicles 50-50 JV with Ford Turkey’s market leader Passenger car and LCV manufacturer 50-50 JV with Fiat 3rd in Turkish market Manufacturer of farm tractors Domestic market leader 50-50 JV with Case New Hollan
Slide 12: Koç Holding in the Consumer Durables Sector
Koç Holding in the Consumer Durables Sector Vision & Strategies Key Indicators Grow globally by acquisitions and organic growth 2008 2008 Annual Leverage technology development capabilities to US$mn YTL mn Chg. (YTL) improve brand positioning Maintain domestic market leadership Total Revenues
Slide 13: Consumer Durables Companies – Competitive Advantages
Consumer Durables Companies – Competitive Advantages 3rd largest household appliance manufacturer in Europe Turkey’s market leader (in major appliances) Domestic network of 4500 dealers, 600 after sales service stations 13.7 million units/year manufacturing capacity in Turkey, Romania, Russi
Slide 14: Koç Holding in the Finance Sector
Koç Holding in the Finance Sector Vision & Strategies Key Indicators Consolidate leadership in credit cards and become leader in consumer finance 2008 2008 Annual US$mn YTL mn Chg. (YTL) Become leader in Asset Gathering and first choice bank for High Net Worth Individuals Selective growth on C
Slide 15: Finance Companies – Competitive Advantages
Finance Companies – Competitive Advantages A financial supermarket with leading companies in asset management, insurance, leasing & brokerage Turkey’s 4th largest bank (in terms of total assets) 50-50 JV with UniCredit 861 Branches #1 in Credit Cards #2 in Leasing #1 in Factoring #2 in Ass
Slide 16: M&A Strategy
M&A Strategy Strong Turnaround in Acquired Companies Acquired companies Terms Improvements Under New Management Higher focus on efficiency, profitability and new investment opportunities: Profit enhancement programs, increased product yields, increased nelson complexity, increased export premiums, a
Slide 17: Proactive Divestitures
Proactive Divestitures 2004 – 2008 Sector Buyer Terms Timeline Implied Value: US$299mn St.Gobain Insulation Total Proceeds: US$179mn Isover & Closed on 29 November 06 Materials Koç Holding Share: 17.4% Alamana Ind. Other Koç Share: 43.8% Implied Value: US$202 mn Componenta Total Proceeds: US$111mn I
Slide 18: Proven Track Record in Revenue Growth with Further Strong Potential
Proven Track Record in Revenue Growth with Further Strong Potential due to Low Penetrated Markets Revenues Consolidated-US$bn 1% AG R:3 8C 43.0 -200 2003 36.0 34.5 16.6 18.2 11.1 2003 2004 2005 2006 2007 2008 Further strong growth potential due to leading positions in low-penetrated business lines P
Slide 19: Strong Margins Despite Global Turmoil
Strong Margins Despite Global Turmoil EBITDA Consolidated-US$bn Operating Profit Consolidated-US$bn 4.5 3.9 % % : 31 : 46 GR GR 8 CA 8 CA -200 -200 2003 3.3 2003 2.8 2.7 Normalized* 3.2 2.1 Normalized* 2.6 1.6 1.5 1.2 1.0 0.9 0.6 2003 2004 2005 2006 2007 2008 2003 2004 2005 2006 2007 2008 Operating
Slide 20: Optimal Portfolio Allocation
Optimal Portfolio Allocation Higher Resilience Against Market Volatility Revenues % Operating Profit % FX-denominated & FX-linked Less Sensitivty to Interest & 65 Growth Rates ** 35 82 18 YTL High Sensitivty to Interest & Growth Rates ** 2003 : 56% 2003 : 44% 2003 : 69% 2003 : 31% 2008 : 35% 2008 :
Slide 21: Global Reach
Global Reach Double digit growth in all regions* 10,601 12% US$ mn 9,500 740 552 34% 2,635 US$ mn 1,459 US$ mn 2007 2008 81% 2007 2008 2007 2008 928 11% 111 US$ mn 832 US$ mn 247% 32 2007 2008 2007 2008 Exports Combined-US$bn International Sales Combined-US$bn 31% : 25% GR : C AGR 15.0 8 CA -200 8 1
Slide 22: Strong Cash Position
Strong Cash Position Koç Holding Stand-Alone 31.12.2008 Net Cash Position Total Debt*: ~US$ 0.7 bn Total Cash*: ~US$ 1.7 bn Net Cash: ~US$1bn * In January we made a debt repayment of ~US$400 mn, which did not change our net cash position 2010-2013 Redemption Schedule US$ 300 mn – to be paid in equal
Slide 23: Stronger Resilience Against FX Volatility
Stronger Resilience Against FX Volatility Koç Holding Stand-Alone FX Position 3Q08 YE08 + US$ 556mn + US$ 334mn Koç Holding Consolidated FX Position Weighted by FX Position Effective Ownership 3Q08 YE08 YE08 - US$ 4.2bn - US$ 2.2bn* - US$ 1.4bn * The natural hedging mechanisms due to FX linked prici
Slide 24: Potential Investment Areas
Potential Investment Areas • Residium upgrade project - Tüpraş • Opportunities in different fields • New manufacturing including electricity projects for export generation and markets w”ith our JV renewable energy Automotive partners Focus on higher ROI generating businesses Consumer Energy Durable
Slide 25: 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
Slide 26: Key Takeaways
Key Takeaways 26
Slide 27: 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
Slide 28: 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
Slide 29: Corporate Social Responsibility
Corporate Social Responsibility Contributing to Turkey’s Development through Philantropic Activities Vehbi Koç Foundation Assets: $1 billion Education The Koç Schools Koç University (over $190 Million investment) Turkish Education Foundation (TEV) TEGEV Health Care The American Hospital
Slide 30: Appendix
APPENDIX | www.koc.com.tr
Slide 31: Table of Contents
Table of Contents Page 1. 2008 Earnings Release 32 2. Shareholder Structures 39 3. Contacts and Disclaimer 40 31
Slide 32: Strong Performance Against the Global Turmoil in FY08
Strong Performance Against the Global Turmoil in FY08 Revenues YTL55,631mn (US$43,028mn) 19% YoY increase in YTL terms and 20% in US$ terms Operating Profit YTL5,036mn (US$3,895mn) 40% YoY increase in YTL terms and 41% in US$ terms includes YTL1,675,064,000 capital gain derived from the sale
Slide 33: Main Financial Indicators
Main Financial Indicators € Mn* US$ Mn* YTL Mn YTL Mn Change Change 31.Dec.08 31.Dec.08 31.Dec.08 31.Dec.07 %, YTL %, US$ Revenues 29,344 43,028 55,631 46,802 S 19 S 20 Gross Profit 4,238 6,214 8,034 7,446 S 8 S 9 EBITDA 3,086 4,526 5,851 4,331 S 35 S 36 Operating Profit 2,656 3,895 5,036 3,594 S 40
Slide 34: 19% Increase in Revenues Fuelled by the Surge in Energy & Finance Segments
19% Increase in Revenues Fuelled by the Surge in Energy & Finance Segments Total Revenues TLmn Share of Segment Revenues % 19% 55,631 Energy 62% Automotive 46,802 12% Durables 12% Other Finance 3% 10% FY07 FY08 Segment Contribution to Total Revenues YTLmn 32% 34,561 26,231 1% 3% 8% 23% 6,510 6,435 7
Slide 35: 35% Increase in EBITDA
35% Increase in EBITDA* EBITDA Consumer Consolidated Energy Automotive Finance Other YTL mn Durables Total FY08 1,885 659 607 936 1,765 5,851 Total EBITDA YTLmn Segmental EBITDA Breakdown % Normalized 35% Automotive 5,851 Energy 16% 45% 4,331 2% Normalized Normalized 4,091 4,176 Durables Other 15% 2
Slide 36: Largest Contribution to EBITDA From Energy & Finance
Largest Contribution to EBITDA From Energy & Finance Segment Contribution to EBITDA YTLmn 0.5% 459% 1,894 1,885 1,765 5% 12% 16% 936 804 631 659 688 607 316 Normalized Normalized 75 89 Energy Autom otive Durables Finance Other FY07 FY08 EBITDA Margin by Segment % 91.6 20.1 14.9 16.0 9.7 10.2 9.7 8.8
Slide 37: 40% Increase in Operating Profit
40% Increase in Operating Profit* Operating Profit Consumer Consolidated Energy Automotive Finance Other YTL mn Durables Total FY08 1,570 476 432 851 1,707 5,036 Total Operating Profit YTLmn Segmental Operating Profit Breakdown % Normalized Energy 47% 40% 5,036 Automotive 3,594 14% Normalized Normal
Slide 38: 7.5% Normalized EBITDA Margin
7.5% Normalized EBITDA Margin EBITDA Margin % EBITDA Margin excl. Finance % 10.5 9.9 9.3 8.5 7.8 Normalized Normalized 8.7 7.5 6.9 Normalized Normalized 7.9 6.5 FY06 FY07 FY08 FY06 FY07 FY08 Operating Profit Margin % 9.1 7.7 Normalized 6.1 7.2 Normalized 6.0 FY06 FY07 FY08 38
Slide 39: Shareholder Structures as of December 2008
Shareholder Structures as of December 2008 Koç Holding Koç Family: 70.52% Free Float: 20.34% Vehbi Koç Foundation: 7.15% Koç Pension Fund: 1.99% Consumer Energy Automotive Finance Other Durables Tüpraş Ford Otosan Arçelik Tat Konserve KH share: 38.25%(*) KH share: 38.46% KH share: 39.14% Koç Financi
Slide 40: For Further Questions, Please Contact
For Further Questions, Please Contact: Funda Güngör, Coordinator Investor Relations Strategic Planning Group fundag@koc.com.tr +90 216 531 0535 Asli Selçuk, Manager Investor Relations Strategic Planning Group aslii@koc.com.tr +90 216 531 0537 Neslihan Aycil, Specialist Investor Relations Strategic P
Slide 41: Major Group Companies’ Contacts
Major 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 Yasemi
Slide 42: 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