2011
ANNUAL REPORT
Contents
2 OYAK in Brief 3 OYAK Group 4 History
6 Our Mission, Our Vision, Our Values 7 Highlights
8 Chairman’s Message
10 Board of Directors and Board of Auditors 12 CEO’s Message
15 Executive Management
16 OYAK and Group Companies in 2011 20 Developments in Member Services
42 Independent Auditors’ Report and Financial Statements 46 OYAK Ordu Yardımlaşma Kurumu
Balance Sheet as at 31 December 2011 - Assets 47 OYAK Ordu Yardımlaşma Kurumu
Balance Sheet as at 31 December 2011 - Liabilities 48 OYAK Ordu Yardımlaşma Kurumu
Statements of Income for the Year Ended 31 December 2011 49 OYAK Group Companies
“Second Pillar Occupational Pension Funds” is not a well-known concept in Turkey, but they have been successfully introduced in many developed countries around the world. These funds provide several benefits to their members during their careers and in their retirement, supplementing their main pension program. Various initiatives for starting such funds have been introduced in Turkey since the early 1900’s, but amongst them only OYAK has been successful and has come to the present day.
OYAK has been an observer member of the European Federation for Retirement Provision since 2003.
As a successful implementer of today’s private pension system, OYAK has been one of our Republic’s most valuable and financially strong organizations over the last 50 years, as well as a model institution in many aspects, which it is determined to maintain.
OYAK (Armed Forces
Pension Fund), a unique
and successful model for
Turkey, has celebrated
OYAK in Brief
OYAK: An exemplary model of sustainability
Founded in 1961, OYAK is Turkey’s first and largest, non-state, occupational pension fund.
OYAK, a financially and administratively autonomous corporate entity, operates under Law 205, which it was founded with.
OYAK operates as a pension fund manager and as a private equity investor and exploits its assets in financial and subsidiary investments, and aims primarily to achieve efficiency and profitability in all of its investments.
OYAK stands by its members at every stage of their lives. OYAK is a life insurer in one sense, based on the services it offers its members. Offering a variety of loan products to cover its members’ needs and expectations emerging at various stages of life, OYAK also works as a financial institution.
OYAK is taking great pains to prepare a safer future for its members, which are now nearly 270,000.
Under the service model it has designed, OYAK aims to provide its members with the highest possible return and to offer them services with high added value.
Aiming to ensure the satisfaction, prosperity and safety of its members in its operations, OYAK reflects technology and modern management practices to its services in the most effective manner and goes to great lengths to create a “better life” for its members, both for now and for the future.
What OYAK is not?
• It is not a part of the government’s social security system.
• It is not a part of the Turkish Armed Forces.
• It is not an institution that receives aid or subsidies from the government and/or any agency.
• It is not a commercial institution that participates in defense industry activities.
• It is not an institution that does not pay taxes.
• It is not a corporation or limited company. It does not have capital and issued shares. Hence, neither the government nor personal investors have had OYAK shares.
What is OYAK?
• OYAK is a second pillar occupational pension fund, which was founded to provide additional benefits to its members such as pensions, death and disablement benefits - in addition to the social security benefits offered by the government to the Turkish citizens - through using only the resources provided by its members. Initiatives like OYAK are frequently observed in countries with developed economies and advanced democracies.
• OYAK has been an observer member of the European Federation for Retirement Provision since 2003.
• OYAK is a legal entity which manages the long-term savings that only comprise of the premiums paid to OYAK by its members and the return generated by investing such premiums. OYAK has no separate money or any assets of its own legal entity.
• OYAK, as a trustee, manages all these savings within the framework of such principles as profitability, efficiency and corporate investment.
• OYAK transfers the profit it generates through managing its members’ savings to member accounts and keeps them in accounts until the dates of its members’ retirement. For this reason, all OYAK assets are registered to its members at all times.
• OYAK not only provides pension, death and disablement benefits to its members in line with legislation, but also various services such as housing and lending.
• OYAK, as per the Law no. 205, is a legal entity, subject to the provisions of the private law and is autonomous both administratively and financially.
• OYAK members include the members of the Turkish Armed Forces, members of the Gendarmerie General Command and, as set out in the Law, employees including civilians seeking to participate voluntarily.
IRON & STEEL PRODUCTS
ATAER
ERDEMİR (Iron and Steel Production)
İSDEMİR (Iron and Steel Production) ERMADEN (Mining)
ERENCO (Engineering & Consulting) ERDEMİR Lojistik (Logistics) ERSEM (Steel Service Center) ERDEMİR Romania ERGAZ
CEMENT & CONCRETE
Adana Çimento (Cement)
OYAK Beton (Ready-mix Concrete) Adana Çimento Free Port, TRNC Adana Çimento San. ve Tic. Ltd., TRNC
Bolu Çimento (Cement) Ünye Çimento (Cement)
Ünye Cem SRL, Romania
Mardin Çimento (Cement) Aslan Çimento (Cement)
BİRTAŞ Marmara Madencilik
Aslan Beton (Ready-mix Concrete)
AS-SAN İnşaat
OYKA Kağıt (Craft Paper and Sacks) BİRÇİM
AUTOMOTIVE & LOGISTICS
OYAK Renault (Automotive production) MAİS (Automotive distribution) OMSAN (Logistics)
OMSAN Logistique SARL, France OMSAN Lojistik EOOD, Bulgaria OMSAN Lojistik OOO, Russia OMSAN Logistica SRL, Romania OMSAN Denizcilik A.Ş. (Shipping) OMSAN Havacılık A.Ş. (Aviation) OMFESA Logistics SA, Spain
ENERGY
İSKEN (Power Plant) AYAS Enerji (Power Plant-Project) OYAK Enerji (Wholesaling)
FINANCIAL SERVICES
OYAK Anker Bank (Germany)
VfG GmbH
OYAK Yatırım (Securities)
OYAK Yatırım Ortaklığı
ORFİN Finansman (Automotive Financing)
ANCILLARY HOLDING-OTHER
OYAK İnşaat (Construction)
HEKTAŞ (Agrochemicals, Pharmaceuticals)
TAKİMSAN
TUKAŞ (Food Processing) Tam Gıda (Biscuits) Eti Pazarlama (Marketing) OYTAŞ (Trade)
Vize Agrega Asfalt Madencilik
OYAK Güvenlik (Security Services) OYAK Teknoloji (Technology Services) OYAK Pazarlama (Services)
OYAK Telekomünikasyon
OYAK Konut (Housing) OYAK Girişim (Consultancy)
OYAK Group
Providing added value to the Turkish economy in a continuous and growing manner
Employing about 29,000 people, the OYAK Group includes nearly 60 companies operating in a range of branches such as industry, finance and services. The OYAK Group of companies has continuously and increasingly provided added value to the Turkish economy with their total sales, exports, productions and the taxes which they pay.
Subsidiaries of the OYAK Group in the industry branch are the leading corporations of their sectors, such as the iron and steel, energy, cement production and automotive. These corporations own some of our country’s largest facilities. OYAK Group’s other predominant field of activity is the services sector, in which the Group holds many subsidiaries operating in branches such as construction, foreign trade, logistics, and technology.
According to the combined financial results for the end of 2011, total sales of the OYAK Group of companies hit TRY 29.2 billion, while their assets reached TRY 32.1 billion.
History
1961
• OYAK was established on March 1st, 1961 with the participation of about 65,000 members, in accordance with Law no. 205, to provide additional benefits for its members against any social and physical risk that they may encounter.
• OYAK entered a 1-year private partnership with Verdi Ticaret Ltd. (automotive sector).
• OYAK entered a 1-year private partnership with İbrahim Ethem Kimya Evi T.A.Ş. (pharmaceuticals production).
1962
• OYAK made its first equity investment in Goodyear Lastikleri T.A.Ş.,
with a 7.41% stake in the company.
1963
• OYAK terminated its private partnership with Verdi Ticaret Ltd. after extending it for one more year.
• OYAK terminated its private partnership with İbrahim Ethem Kimya Evi T.A.Ş. after extending it for one more year.
• OYAK entered a 1-year private partnership with Mustafa Tumba (private partnership).
• OYAK bought a 25% stake in HEKTAŞ Ticaret T.A.Ş., the
agro-chemicals company.
• OYAK bought a 93.55% stake in Türk Otomotiv Endüstrileri T.A.Ş.
(automotive sector).
• OYAK entered the cement sector and bought a 52.38% stake in
Çukurova Çimento Sanayi T.A.Ş. later named as Adana Çimento
(production and sale of clinker and cement). OYAK undertook
an equity investment in Grapette Amerikan Patentli Sodalı İçkiler Sanayii A.Ş., (soft drinks industry) with a 10% stake in the company.
1964
• OYAK terminated its private partnership with Mustafa Tumba. • OYAK undertook an equity investment in Türkiye Petrolleri A.O. (fuel
industry) with a 7.67% stake in the company.
• OYAK undertook an equity investment in Motorlu Araçlar Ticaret A.Ş. (automotive sector) with an 80% stake in the company.
1965
• OYAK undertook an equity investment in Petkim Petrokimya A.Ş.
(petrochemical industry) with a 20% stake in the company.
1970
• OYAK terminated its investment in Grapette Amerikan Patentli
Sodalı İçkiler Sanayi A.Ş.
• OYAK terminated its investment in İleri Kimya Sanayi A.Ş.
1974
• OYAK entered an equity investment in OYAK Yatırım ve Holding A.Ş. (later restructured as OYTAŞ) with a 100% stake in the
establishment of the company.
1975
• OYAK undertook an equity investment in Askeri Elektronik Sanayi
A.Ş. (defense industry) with a 15% stake in the company.
1977
• OYAK made an equity investment in OYAK Kutlutaş Konut İnşaat Sanayii ve Ticaret A.Ş. (construction sector) with a 24.2% stake
in the company (OYAK Group held 40% of the company). The
company was renamed as OYAK Kutlutaş Konut Holding A.Ş. in
1978.
• OYAK undertook an equity investment in Ağır Döküm ve Otomotiv San. Tic. A.Ş. (casting and automotive) with an 80% stake in the
establishment of the company (OYAK Group held 100% of the company).
• OYAK undertook an equity investment in OMSAN Otomotiv
Mamulleri Sanayi T.A.Ş. (firstly automotive sector and then logistics)
with a 20% stake in the establishment of the company (OYAK Group held 100% of the company). The company was later renamed as
OMSAN Lojistik A.Ş.
• OYAK undertook an equity investment in HEKTAŞ Ambalaj Sanayii ve Ticaret A.Ş. (package production for agricultural chemicals) (TAKİMSAN) - a subsidiary of HEKTAŞ - with a 0.4% stake in the
establishment of the company (OYAK Group held 100% of the company).
1978
• The foundation of OMSAN was completed.
• OYAK undertook an equity investment in OYAK Kutlutaş İnşaat Tes. San. T.A.Ş. (construction sector) with a 21% stake in the
establishment of the company.
• OYAK undertook an equity investment in OYAK Kutlutaş Pazarlama A.Ş. (construction sector) with a 21% stake in the establishment of
the company.
• OYAK undertook an equity investment in OYAK Kutlutaş İstanbul Prefabrike Eleman San. T.A.Ş. (construction sector) with a 22.5%
stake in the establishment of the company.
1980
• The number of OYAK members hit 72,000.
• OYAK terminated its investment in Türkiye Petrolleri A.O.
1967
• OYAK undertook an equity investment in İleri Kimya Sanayii A.Ş.,
(cologne production) with a 0.1% stake in the company.
• OYAK undertook an equity investment in Turgutlu Konservecilik
A.Ş., (food-tomato paste production) with a 93.9% stake in the
company. OYAK’s stake in the company rose to 96.6% by the end of the year.
• OYAK undertook an equity investment in OYAK Sigorta A.Ş.
(insurance sector) during its establishment, with a 95.6% stake in the company. The company became operational in 1968. • OYAK undertook an equity investment in Motorlu Araçlar İmal ve
Satış A.Ş. (sale and after-sale services for Renault motor vehicles)
during its establishment, with a 97.5% stake in the company, which was initially founded as a limited company (OYAK Group held 100% of the company).
1968
• Founded as a limited company, MAİS was restructured as a
joint-stock company.
1969
• OYAK undertook an equity investment in OYAK Renault Otomobil
Fabrikaları A.Ş. (manufacture and export of Renault branded
passenger cars and their mechanical parts) during its establishment, with a 42% stake in the company (OYAK Group held 43% of the shares in the company).
• OYAK entered an equity investment in Bolu Çimento Sanayii A.Ş.
(production and sale of clinker and cement) with a 25% stake in the company.
• OYAK undertook an equity investment in Ünye Çimento Sanayii ve
Ticaret A.Ş. (production and sale of clinker and cement) with a 40%
stake in the company.
• OYAK undertook an equity investment in Mardin Çimento Sanayii
ve Ticaret A.Ş. (production and sale of clinker and cement) with a
40% stake in the company.
1982
• OYAK undertook an equity investment in ETİ Pazarlama ve Sanayi A.Ş., (biscuit, confectionery sales and marketing) with a 26% stake
in the establishment of the company.
• OYAK undertook an equity investment in TAM Gıda Sanayi ve Ticaret A.Ş., (biscuit, confectionery production) with a 26% stake in
the establishment of the company.
• OYAK undertook an equity investment in OYAK İnşaat A.Ş.
(construction sector) with a 100% stake in the establishment of the company.
1983
• OYAK undertook an equity investment in Pınar Entegre Et ve Yem Sanayii A.Ş., (meat industry) with a 15% stake in the company.
• OYAK undertook an equity investment in Yatırım Sanayi ve Ticaret A.Ş., (paint industry) with a 10% stake in the company.
1984
• OYAK terminated its investment in TOE. • OYAK terminated its investment in MAT. • OYAK terminated its investment in ADSAŞ.
• OYAK undertook an equity investment in ENTAŞ Entegre Tavukçuluk A.Ş. (poultry and egg production) with a 50% stake in
the establishment of the company.
• OYAK acquired 100% of the shares of OYAK Menkul Değerler A.Ş. (OYAK Yatırım – brokerage company) which was founded in 1982 by OYAK Yatırım ve Holding.
1987
• OYAK terminated its partnership with Kutlutaş.
1989
• OYAK set up the Donation-Based Pension Income System in order
to ensure that its members have an additional income after they retire. A total of 497 members participated in this system. OYAK also launched a practice in which it lends up to 80% of its reserves. • OYAK entered an equity investment in OYAK Turizm Tic. A.Ş.
(tourism) with a 100% stake in the establishment of the company in return.
1990
• The number of OYAK’s permanent members reached 117,000. • OYAK undertook an equity investment in the First National Bank of
Boston, with a 34.25% stake in the company.
• OYAK undertook an equity investment in SELYAK Petrol Ürünleri
Üretim Paz. A.Ş. (fuel industry) with a 25% stake in the establishment
of the company in return (OYAK Group held 32% of the company).
1991
• OYAK terminated its investment in YASAŞ.
• OYAK undertook an equity investment in Halk Finansal Kiralama
A.Ş. with a 39% stake in the establishment of the company (OYAK
Group held 40% of the company).
1992
• OYAK undertook an equity investment in Niğde Çimento San. Tic. A.Ş. (production and sale of clinker and cement) by means of the
privatization tender, with a 10% stake in the company (OYAK Group held 39.2% of the company).
• OYAK entered an equity investment in İskenderun Çimento San. Tic. A.Ş. (production and sale of clinker and cement) by means of
the privatization tender, with a 10% stake in the company (OYAK Group held 50% of the company).
1993
• OYAK terminated its investment in Pınar Entegre Et ve Yem Sanayii A.Ş.
• OYAK sold its 20% stake in MAİS to Regie Renault, a French
company.
1994
• OYAK’s share in OYAK Bank increased to 100%.
• OYAK terminated its investment in Petkim Petrokimya A.Ş.
• OYAK sold its 11% stake in OYAK Sigorta to the French AXA Group.
1995
• OYAK terminated its investment in ASELSAN.
• OYAK undertook an equity investment in AXA OYAK Hayat Sigorta
A.Ş. with a 40% stake in the establishment of the company in return.
1996
• OYAK set up the Pension Benefit System to ensure that its members continue to benefit from OYAK services and support after retirement. OYAK also set up the Housing Savings Fund for providing housing support to its members by making them save money in advance.
• OYAK undertook an equity investment in Elazığ Altınova Çimento San. ve Tic. A.Ş. (production and sale of clinker and cement) by
means of the privatization tender with a 35% stake in the company (OYAK Group held 70% of the company).
1997
• After the mutual share transfer between MAİS and OYAK Renault, OYAK has a 51% share in MAİS against the French Regie Renault’s
49%; and OYAK has a 49% share in OYAK Renault against Regie Renault’s 51% stake.
2003
• OYAK undertook an equity investment in OYAK Emeklilik A.Ş.
(private pension fund) with a 100% stake in the establishment of the company.
• OYAK acquired 100% of the shares in OYTEK by purchasing the OYTEK shares held by OYAK Bank.
2004
• TAKİMSAN shares were sold to HEKTAŞ.
• OYAK undertook an equity investment in OYAK Beton A.Ş.
(production and sale of ready-concrete) with a 51% stake in the establishment of the company in return (OYAK Group holds 100% of the company).
• OYAK undertook an equity investment in İskenderun Elektrik Üretim ve Ticaret A.Ş. (energy sector) with a 49% stake in the company.
• OYAK acquired 100% of the shares in OYAK Anker Bank GmbH by purchasing the Anker Bank shares held by OYAK Bank.
• OYTUR merged with OYAK Pazarlama and its legal identity was terminated.
2005
• OYAK terminated its investment in Goodyear Lastikleri T.A.Ş.
• OYAK won the tender called for the privatization of ERDEMİR
(production and sale of flat steel) on October 4th, 2005.
• On December 23rd, 2005, OYAK entered an equity investment in
ATAER Holding A.Ş. (to participate in companies operating in the
iron and steel industry) with a 100% stake in the establishment of the company.
• OYAK undertook an equity investment in Birçim Çimento A.Ş.
(cement industry) with a 22% stake in the company (OYAK Group held 100% of the shares in the establishment of the company).
2006
• ATAER Holding took over 49.29% of ERDEMİR on February 27th. • OYAK terminated its investment in Elazığ Çimento.
1998
• Ordu Pazarları, the first store of which was opened in 1963, were incorporated under the title, OYAK Büyük Mağazacılık Ticaret A.Ş.
(OYPA) (retail sector), which was founded as a subsidiary fully owned by OYAK.
1999
• OYAK entered an equity investment in AXA OYAK Holding A.Ş.
with a 50% stake in the establishment of the company. OYAK transferred its shares in AXA OYAK Sigorta and AXA OYAK Hayat Sigorta to this holding.
2000
• The total number of OYAK’s permanent members reached 179,000, while the number of members participating in the Housing Savings
Fund reached 38,000, with the members of Donation-Based
Retirement Income System reaching 8,000. • OYAK terminated its investment in ENTAŞ.
• OYAK undertook an equity investment in OYAK Güvenlik A.Ş.
(security services) with a 100% stake in the establishment of the company.
2001
• OYAK acquired Sümerbank A.Ş. on August 9th, 2001 in line with
the share transfer contract signed with the Savings Deposits and
Insurance Fund.
2002
• OYAK terminated its investment in SELYAK.
• Sümerbank was merged with OYAK Bank on January 11th, 2002
through total subrogation. Accordingly, YADAŞ Bilgisayar ve Yazılım A.Ş., a Sümerbank subsidiary, was renamed as OYAK Teknoloji Bilişim ve Kart Hizmetleri A.Ş. (technology and information services)
and became a subsidiary of OYAK Bank.
• OYAK undertook an equity investment in OYAK Konut İnşaat A.Ş.
with a 100% stake in the establishment of the company.
• OYAK undertook an equity investment in Adana Kağıt Torba A.Ş.
(kraft Sack and paper mill production) with a 75% stake in the company (OYAK Group holds 100% of the company).
• OYAK Büyük Mağazacılık’s chain store activities were terminated.
The company continued to operate in new areas under the title,
OYAK Pazarlama Hizmet ve Turizm A.Ş. (hygiene services and
tourism activities).
• OYAK entered an equity investment in OYAK Enerji A.Ş. (enery
sector) with a 2% stake in the establishment of the company in return (OYAK Group holds 100% of the company).
2007
• OYAK terminated its investment in OYAK Bank.
• OYAK terminated its investment in OYSA Çimento, which was
established with the merger between OYSA Niğde Çimento and OYSA İskenderun Çimento in 2003.
2008
• OYAK terminated its investment in AXA OYAK Holding A.Ş.
• OYAK terminated its investment in OYAK Emeklilik A.Ş.
2009
• OYAK entered an equity investment in Lafarge-Aslan Çimento (production and sale of clinker and cement) with a 97.3% stake in the company. OYAK entered an equity investment in Lafarge Beton (production and sale of ready-concrete) with a 24.24% stake in the company (OYAK Group holds 100% of the shares in the company). • OYAK made an equity investment in AYAS Enerji A.Ş. (energy
sector) with a 49% stake in the company in return.
2010
• The total number of OYAK’s permanent members reached 259,000, while the number of members participating in the Housing Savings
Fund exceeded 107,000 with the number of Donation-Based
Retirement Income System participants exceeding 26,000. • OYAK sold all of its shares in OYAK Beton to the cement companies
within the OYAK Group.
2011
• OYAK terminated its investment in Halk Finansal Kiralama A.Ş.
• OYAK acquired 100% of AYAS Enerji by purchasing the remaining 51% of the shares in the company.
• OYAK entered an equity investment in OYAK Girişim Danışmanlığı A.Ş. (evaluating investment opportunities) with a 100% stake in the
establishment of the company.
• OYAK undertook an equity investment in ORFİN Finansman A.Ş.
(consumer finance) with a 50% stake in the establishment of the company.
• OYAK signed the agreement for the sale of 50% of its stake in AYAS Enerji to AES Entek.
Our Mission, Our Vision, Our Values
Our Mission
Taking a business-minded approach in providing all the services desired by its members
at the highest standards of quality, Ordu Yardımlaşma Kurumu is an assistance and
pension fund committed to achieve the highest financial returns for its members. It
also functions as a holding company that manages a variety of portfolio and equity
investments distinguished by their social and environmental value, in order to earn
maximum returns for members while maintaining a sound actuarial balance.
Our Vision
OYAK aspires to achieve member satisfaction by being a forerunner of new ideas in
Turkey, through investments that are beneficial both to herself and to the nation, and
consistently distributing a higher return to members every year without putting its assets
at risk.
Our Values
The common values that direct all our behavior, decisions and business objectives:
• Integrity and Transparency
• Responsibility and Accountability
• Competition and Fairness
• Innovation and Excellence
• Mutual Respect
• Member and Associate Satisfaction
2001
Moody’s Investors Service (as of 31.12.2011)
Long Term Foreign Currency Ba2 / Stable Outlook
Long Term Local Currency Ba2 / Stable Outlook
Standard & Poor’s (S&P) (as of 31.12.2011)
Long Term Credit Rating BB+ / Stable Outlook
Long Term (National Scale) TrAA+
Short Term (National Rating) TrA-1
2011 (TRY Million) 2010 (TRY Million) 2011 (USD Million) 2010 (USD Million)
Total Gross Sales (2) 29,221.9 22,151.1 17,498.1 14,763.4
Total Exports 4,516.8 4,150.5
Total Transaction Volume (3) 73,682.5 59,009.6 44,121.3 39,329.3
Pre-tax Profit 2,609.2 1,824.3 1,562.4 1,215.9
Total Taxes Paid 2,149.7 1,583.0 1,287.3 1,055.1
Total Shareholders’ Equity 17,111.3 16,096.9 9,058.9 10,412.0
Total Assets 32,148.0 31,606.2 17,019.5 20,443.9
Number of Employees 28,917 28,571
OYAK Group Combined Results
(1)OYAK’s Highlights
Highlights
OYAK’s Credit Ratings
(1) Excluding OYAK(2) The total of gross sales revenues for production and sales companies (3) Total transaction volume of financial sector subsidiaries
2011
(TRY Million) (TRY Million)2010 (USD Million)2011(1) (USD Million) 2010(2)
Total Net Profit (Technical Interest + Actuarial Net Profit) 1,724.4 1,421.3 1,032.6 947.3
Actuarial Net Profit 1,474.0 1,226.4 882.6 817.4
Annual Rate of Return to Members (%) 14.1 13.1 14.1 13.1
CPI (Consumer Price Index) (%) 10.5 6.4 10.5 6.4
Annual Rate of Return to Members/CPI (Coefficient) 1.3 2.0 1.3 2.0 Equity (Members’ Reserves + Period Profit) 13,815.8 12,204.4 7,314.2 7,894.1
Total Assets 14,298.3 13,947.2 7,569.6 9,021.5
Number of Members 268,112 259,061
(1) Average USD/TRY rate 1.6700; year end USD/TRY rate 1.8889 (for the Year-ended 31 December 2011) (2) Average USD/TRY rate 1.5004; year end USD/TRY rate 1.5460 (for the Year-ended 31 December 2010)
Chairman’s Message
Five years ago, OYAK predicted
the global crisis. Since then, OYAK
has demonstrated an exemplary
performance and continued to achieve
its targets.
In 2011, OYAK celebrated its 50th anniversary with great
pride.
OYAK exists with Turkey and produces added value not only for its members but for every Turkish citizen. It has maintained its position in 2011 as a model institution, a successful corporate citizen and a unique economic model for Turkey. OYAK is determined to grow and strengthen its assets under any global circumstances, both in 2012 and beyond. OYAK holds all the institutional competencies and resources necessary to achieve this target.
In 2007, OYAK had predicted the approaching global financial crisis and decisively continued to advance on its growth path by undertaking the necessary revisions in its strategies, portfolio structuring and business plans.
The proactive strategies we pursued, the business tactics we applied have aimed to minimize the impacts of the crisis, while paving the way for the growth our members’ assets. Five years ago, OYAK predicted the global crisis; since then, it has demonstrated an exemplary performance and continued to achieve its targets.
Thanks to its highly risk-sensitive and cautious business approaches, OYAK added a total of TRY 1,724.4 million to its members’ savings in 2011. We managed to increase our members’ assets to TRY 13.8 billion by the end of the year and offer a rate of return of 14.1% - higher than the rate of inflation. At the same time, our institution conducted multidirectional efforts aimed at diversifying the services and assistance it provides its members in accordance with its primary mission. The results that we achieved throughout the year both in member services and housing production comply with our targets, strengthening member satisfaction. At the end of 2010, the number of our active members totaled 213,178, the number of members participating in the Pension Benefit System was 45,883 and the total number was 259,061. At the end of 2011, these numbers were 219,047, 49,065 and a total of 268,112, respectively. OYAK is one of Turkey’s largest economic powers. Its subsidiaries maintained their strong performance throughout 2011 as the leading participants of their sectors and continued to contribute to OYAK’s revenue base on a consolidated basis.
OYAK is a model institution and pension system not only for its members but also on an international platform, thanks to its credibility, financial strength, managerial structure and uniqueness. OYAK has been rated since 2005 by the globally renowned ratings agencies, Moody’s and Standard & Poor’s (S&P). The credit ratings assigned to OYAK by these agencies confirm its positive image. As one of the global companies and organizations to enjoy, first an equal,
and then a higher than the country rating, OYAK is listed by the same agencies among the top investment organizations/ holdings in the region.
OYAK is one of the largest capital groups of not only Turkey, but also the entire region. We carry out all of our activities with a long-term view that aims to protect the future of our members. The level of corporate maturity that we have reached in terms of governance, transparency and accountability provide us with the energy and the experience we need in order to grow and look to the future with confidence.
Celebrating its 50th year of service with pride and satisfaction
The foundations of our organization were laid down in 1911, and its functions were defined in Law 205, also known as the ‘OYAK Law’ after 1961. In the last 50 years, OYAK turned its members’ savings into major investments and succeeded in becoming one of the most valuable and important corporations in the Turkish economy.
As information is shared, awareness increases, and confidence and expectations grow stronger. The continuous support and trust of informed stakeholders is of paramount importance for every enterprise including OYAK. That is why the focus of all of our communication activities with our stakeholders and the public to promote our institution, was about what OYAK is and what it is not, as well as the value it represents to all Turkish people.
OYAK has two identities: first, it is a corporation that operates based on such principles as equality, fair distribution of resources and sound actuarial balance. OYAK is a second pillar occupational pension fund (a fund that complements the primary pension system). Second pillar occupational pension funds form a system put in place to offer better living conditions to members of any occupational group during their business lives and in their retirement. The system has been successfully implemented in a many developed countries. I would like to express with pride that OYAK is the only representative of such an institution in our country with a successful history of 50 years and is ready to move forward towards the future.
OYAK’s second identity is that it is an income generating investor aiming to fulfill its primary mission of providing acceptable returns to its members. With the awareness of being a pension fund, OYAK directs its members’ savings into financial investments, but also into subsidiary investments, in order to protect and continuously expand its assets. With this identity, OYAK operates under all conditions of competition in the market without privilege. Our group companies also compete and go to great lengths to maintain leadership in their sectors under the same rules and principles.
As OYAK leaves behind 50 successful years of operation, a deep rooted and sustainable system will be passed to future generations. At the same time, as we expressed in our New Year message that we shared with the public, we perceive as our social mission to guide and assist similar establishments and initiatives, deserved by millions of individuals from different occupational groups, and share our knowledge with them.
Having broken so much ground in its 50-year history, OYAK will continue to save, produce and to be one of Turkey’s leading economic powers.
We think the unfavorable conditions of the global financial crisis will continue and affect the business world for some time to come. OYAK is prepared for this. We have the strength and, more importantly, the liquidity to best utilize the business opportunities without compromising our meticulous and cautious policies.
On behalf of myself and in the name of our Board of
Directors, I would like to express my sincerest thanks to
our management, staff and all of our employees, who have set forth their professional competencies under the volatile market conditions of 2011, which marked a milestone in our corporate history.
OYAK will continue to exist with the strong support and trust of our members.
Yours sincerely,
Yıldırım TÜRKER (Ret.) Lieutenant General Chairman
İshak CEYLAN
Major General Board Member
Board of Directors and Board of Auditors
Board of Directors
Board of Auditors
Yıldırım TÜRKER
(Ret.) Lieutenant General Chairman
Nedim Güngör KURUBAŞ
Major General Board Member
Prof. Dr. Necdet SERİN
Board Member Coşkun ULUSOY, Ph.D.Board Member and CEO Abdulkadir POLAT Member Mehmet ÇÖRTEN Major General Member Emre CANKOREL Member
Osman KAYALAR
Rear Admiral Board Member
Yılmaz HIZLI, Ph.D.
(Ret.) Brigadier General Board Member
Lütfi Fikret TUNCEL
(Ret.) Governor Board Member
İlhan TALU
Major General Board Member
In 2011 OYAK continued to strengthen its financial performance and posted successful results.
Under difficult market conditions that prevailed in 2011, OYAK’s strategic priority was to build upon and to preserve its asset base.
Our attention was focused on enlarging the funds under our management by taking the most appropriate actions to benefit from the best opportunities offered in the money and capital markets. Furthermore, the production and sales performance of OYAK’s subsidiaries active in various sectors also made a substantial contribution to our results.
OYAK’s members’ assets reached TRY 13.8 billion in value in 2011. Total net profit (net actuarial profit + technical profit), the best indicator of our performance, amounted to TRY 1.7 billion, which, with an average exchange rate of 1.67,
corresponds to a net profit of over USD 1 billion. With such
earnings OYAK managed to announce an annual rate of return of 14.1%. These results show that OYAK has, once again, delivered returns to its members over and above the posted rate of inflation.
In its simplest terms, the “rate of return” is the ratio of the value we create throughout the year in our business activities to our members’ assets. What we, as a pension fund, call the “rate of return” is actually comparable to what a company would call the “return on equity”. Thus when OYAK’s results are compared with those of Turkey’s biggest corporate groups, they are at least as good or better when measured both by total earnings and by the implied rate of return. This probably is the clearest evidence of how economically and commercially productive, and how effective and exemplary OYAK’s business model is.
Achieved in the fourth year of the global fiscal crisis and in an economic conjuncture where a number of the world’s developed economies verging on bankruptcy, these results, demonstrate a success story in which not just the OYAK community but all of Turkey may take pride.
A great majority of our companies rank among the leaders of their respective sectors in terms of their business volumes and profits.
Abiding by the same risk-sensitive and prudent business model as their parent does, OYAK subsidiaries continued to perform strongly in 2011 and to contribute to our profits and, thus, to the growth in our members’ assets.
ERDEMİR, operating in the iron & steel sector, and the companies that make up the ERDEMİR Group, displayed a
stellar performance in 2011 and announced a total net profit of TRY 1,005.6 million, the highest-ever in their history. The OYAK Cement Group companies, made up of the strongest players in Turkey’s cement industry, also performed successfully in 2011 and were named as the sector’s most profitable companies. Mardin, Ünye and Adana cement companies (in that order) had the highest rates of operational profitability. Both Bolu and Aslan cement companies posted results that were superior to those achieved in 2010. Looking at net profitability, the sector’s top three positions were occupied by our companies.
CEO’s Message
OYAK, celebrating its 50
thanniversary,
remains dynamic as ever and stands
ready to share its knowledge and
experience in providing guidance for
similar new initiatives in Turkey.
In 2011, OYAK Renault sustained its strong financial performance and made a greater contribution to OYAK’s total assets. OYAK Renault was the leading player in the Turkish automotives sector in terms of total exports and domestic production. Last year OYAK Renault’s plants turned out their 3 millionth engine. The company has been the consistent manufacturing and exporting champion of the Turkish
automotives industry for fourteen years in a row. MAİS,
OYAK’s other subsidiary in the automotive sector, dominated the total market for passenger car sales with Renault and, passenger cars and light commercial vehicles with Renault
and Dacia brands.
İSKEN, our investment in the energy sector, maintained
its successful course again in 2011. We have signed an agreement to sell half our stake in AYAS, another energy
company, to AES Entek, a joint venture of the Koç Group
and AES. This newly-created union of strengths in the energy industry will begin working on an investment to build a 625
MW power plant in Adana-Yumurtalık area, pending formal
approvals.
OYAK also continued to effectively manage its cash and financial investments portfolio throughout the year by making use of the most appropriate instruments available in the
money and capital markets. Despite all fragilities and volatilities
witnessed in international markets, OYAK continued to earn more than satisfactory returns on its liquid assets.
We took both pride and pleasure in celebrating the 50th anniversary of OYAK in 2011.
Founded in 1961, OYAK is Turkey’s first and largest privately-owned, supplementary, occupational pension fund, representing an important milestone in the country’s economic history. Its successful track-record, with a sustained growth in assets and a profitable financial performance made OYAK a distinguished supplementary pension model that attracted worldwide interest. Especially within the last decade, OYAK has been burnishing its reputation in the international investment circles as an exemplary institution whose credit ratings are superior or equal to its country, and whose strong financial structure is regarded as admirable.
In its 2011 Global Pension Fund Awards, World Finance called OYAK “The Pension Fund of the Year in Turkey”. In its October issue Investment & Pensions Europe ranked OYAK 152nd in its listing of “Top 1000 European Pension Funds”
and 433rd in its “Top 1000 Global Institutional Investors”
listing.
Looking at past efforts in this direction in Turkey, we see examples of initiatives such as MEYAK for civil servants and
İYAK for workers. For a variety of reasons none of these
undertakings proved to be successful. As OYAK, our hope is
that everyone – from the teacher to policeman and from the civil servant to the unskilled worker – be given access to and enjoy
the benefits of an appropriately-constituted supplementary occupational pension system. Such undertakings are in the interest not just of the systems’ members but of the whole country. By pooling individuals’ savings, other undertakings similar to OYAK will lead to the accumulation of capital that can be directed into big investments managed professionally with a long-term view. National capital is something which our country is the most in need of and which can address one
of the most serious problems that confront its economy: the current account deficit.
We embark upon our second half-century with an even more youthful energy, a greater dynamism and a stronger commitment.
The achievements of the last decade in particular, have clearly demonstrated OYAK’s strength. We owe the strong position we enjoy today to a properly managed mix of foresight, strategy, tactics, and execution. That same structure is what encourages us and gives us the strength we need for OYAK to achieve the goals it has set for the period ahead. It is only through the continued support and confidence of our members that we shall be able to remain a partner and supporter to them throughout their lives.
We expect that 2012 is going to be a year filled with difficulties. The unlimited support program announced by the
European Central Bank on December 21st last year appears
to have forestalled the most serious of the risks faced by the European banking system and to have mitigated at least some
of the severity of the debt crisis. Despite this however, the
global crisis will continue to affect the developed economies in general and Europe’s in particular and that in turn will expose the developing economies to the effects of that crisis in various ways.
In this process, the world economy will lose even more momentum and our own country will most consequently suffer from that. OYAK must therefore continue to take a proactive approach in shaping its strategies, in considering its investment options, and in channeling its members’ assets into the safest possible investment alternatives.
OYAK’s first and foremost avowed mission is to protect its members’ interests and futures under all conditions and at all times be they good or bad. With the constant support and confidence of its members, OYAK will remain committed to that path.
OYAK is an asset for Turkey. It has made and continues to make multidimensional contributions to our national economy. OYAK exists and will always exist not just for its members but for the whole country.
In closing and speaking on my own behalf as well as for my colleagues, I take this opportunity to express our gratitude to our Members, to our General Assembly, to our Board of
Directors, and to our Board of Auditors and also to thank
every employee of every OYAK Group company for their valued efforts and dedication.
Coşkun Ulusoy, Ph.D. CEO
Coşkun ULUSOY, Ph.D.
CEO
Nihat KARADAĞ
Executive Vice President Financial Investments
Celalettin ÇAĞLAR, MSc.
Senior Advisor
Dinç KIZILDEMİR
Executive Vice President Equity Participations
Fatih TAR
Executive Vice President
ERDEMİR Group
Hülya ATAHAN
Executive Vice President
Financial and Administrative Affairs
Ergün OKUR
Executive Vice President Member Services
Executive Management
OYAK and Group Companies in 2011
Having proudly celebrated its 50
thyear in 2011, OYAK continued to produce value
General outlook
2011 marked the fourth year of the global financial crisis. Various policies, practices and solutions were put in effect throughout the year in most developed countries, particularly in Europe, in an attempt to resolve the public debt problem. As a result of mounting global distrust, the growth rates of emerging economies began to fall, while Europe entered a moderate recession.
The environment of distrust resulted in a slowdown in global economic activity, while the Turkish economy remained one of the world’s most rapidly growing economies with a rate of 8.5% in 2011. The major drivers behind this were stable monetary policies, lively domestic demand and a financial sector positioned on robust foundations.
It would appear that 2012 world economy will be of variable market conditions and opposing expectations. While the soft landing in emerging markets continues, Europe will be focusing on finding solutions for the problems in public finance under recessionary circumstances.
The Turkish economy is expected to keep growing in 2012 with the support of its strong internal dynamics, albeit at a slower pace due to the effect of negative economic circumstances in the Eurozone.
Having celebrated its 50th anniversary in 2011, OYAK will
continue to produce value for its members and for the Turkish nation.
OYAK’s contributions to the national economy In 2011, OYAK Group companies:
• produced nearly 9.9 million tons of cement;
• exported more than 1.5 million tons of cement;
• produced 331,000 motor vehicles;
• exported 225,000 motor vehicles;
• produced nearly 7 million tons of finished steel products;
• exported about 1.2 million tons of finished steel products;
• met 4% of Turkey’s need for electric power by generating more than 9,000 GWh of electricity, for the national grid;
• attained exports of USD 4,517 million;
• OYAK and Group companies paid a total of TRY 2,175 million in direct and indirect taxes (TRY 1,605 million in 2010)
OYAK’s contributions to employment
• The total number of personnel employed in OYAK, its subsidiaries and associates rose from 28,825 in 2010 to 29,165 in 2011.
• Besides direct employment, it is estimated that at least 200,000 families (members of which work in such areas as contract labor, farming, transportation services, etc.) make a living on OYAK’s economic power
The main developments that took place in group companies in 2011 are summarized below:
Joining forces in AYAS Enerji
OYAK signed a contract for the sale of 50% of its shares in
AYAS Enerji Üretim ve Tic. A.Ş. to AES Entek, a subsidiary jointly established by the Koç Group (Turkey) and AES (USA).
AYAS Enerji, will undertake a thermal power plant investment
with an installed capacity of 625 MW in Yumurtalık, Adana.
OYAK applied to the respective authorities for permission for the transfer of the shares; the Competition Board subsequently granted approval for the share transfer, while approval from the Energy Market Regulatory Authority is still pending. The power plant, which is planned to be built next
to İSKEN, will be environmentally friendly and operate with
high-quality imported coal. The plant is expected to generate about 4.5 billion kWh of electricity per year, and is targeted to enter operation in 2016.
ERDEMİR: Increased rating from Standard & Poor’s (S&P), “Positive” outlook from Moody’s
Standard & Poor’s raised ERDEMİR’s credit rating from B- to
B, while affirming its credit outlook as “stable”.
Moody’s Investors Service confirmed ERDEMİR’s B2 credit
rating, while changing its credit outlook from “stable” to “positive”.
ERDEMİR was chosen as the “Most Liked Company in its
Sector” in the survey made in cooperation with Adecco, a Swiss human resources firm, and the Capital Magazine. In this survey, companies from 37 different sectors were evaluated.
İSDEMİR completes its efforts to switch to flat steel production
In 2011, İSDEMİR completed its series of investments to
switch to flat steel production, as part of its modernization and transformation projects. The company will maintain its long steel production as well.
The 4th blast furnace, installed as part of such investments,
became operational in August 2011. İSDEMİR’s 4th blast
furnace is Turkey’s largest and most modern blast furnace. Moreover, the 2nd sinter plant, which is required in parallel
with İSDEMİR’s increasing liquid steel manufacturing
capacity, was brought into operation in June 2011.
ERMADEN’s investment in its underground iron mine completed
ERMADEN’s investment in its underground iron mine in Ekinbaşı, in the district of Divriği in Sivas was completed in
OYAK and Group Companies in 2011
ERSEM’s new steel service centers
Launched by ERSEM, the İskenderun Steel Service Center
serves the shipbuilding, steel construction, automotive, general machinery and construction sectors.
Work continues on the Ereğli Steel Service Center investment, in Ereğli, which will also operate under ERSEM.
A new era in the Turkish automotive industry with OYAK Renault’s serial production of its revolutionary new electric car, the Fluence
In 2011, the Fluence ZE, which runs on an electric engine, joined OYAK Renault’s range of models manufactured at the company’s plant in Bursa.
OYAK Renault broke a new ground in the Turkish automotive industry with the start of the mass production of electric car Fluence, in Q4/2011. The company began to export its Fluence model in November 2011.
Moreover, the three millionth engine was produced at OYAK Renault’s facilities. The company has maintained its leading position in production and exports in the Turkish automotive industry for a consecutive 14 years.
MAİS still the market leader
The Turkish automotive market broke a new sales record in
2011 and MAİS, our subsidiary, became the market leader
in the passenger car market and in the passenger car and
light commercial vehicles market with Renault and Dacia
brands together. Symbol, one of the models included to the
MAİS portfolio, became the best-selling private car in Turkey
in 2011, while Fluence ranked 4th.
ORFIN Finansman was founded
In 2011 ORFIN Finansman was founded by the Renault Group and OYAK, with 50/50 partnership. The company would operate in the field of consumer financing to support
the sales of MAİS. The permission for the foundation of
ORFIN was received, while efforts are under way to receive an operating license for the company.
Award to OYAK Yatırım by Global Finance
According to the study entitled “World’s Best Investment Banks 2012” which was performed by Global Finance, OYAK
Yatırım was chosen as Turkey’s best brokerage company.
OMSAN Lojistik raises the bar in its sector
OMSAN became the first in Turkey and the second logistics company in Europe to receive the ISO 27001 Certification, which is the Information Security Management System Standard. Moreover, at Logitrans Logistics Awards 2011, OMSAN received the winning award in the category of “International Logistics Enterprises”.
Developments in the OYAK Cement Group
Adana Çimento reached a decision to add a clinker
production line to its plants in İskenderun in a bid to meet
increasing demand for cement. The investment, which is
appraised to cost about USD 80 million and be completed
within 2 years, is expected to create about 500 jobs in the region.
Ünye Çimento achieved record breaking levels of clinker production, domestic cement sales volumes and total cement sales in 2011, benefiting from developments in its region and the growth in the Black Sea market. Moreover, the company brought its 4th cement mill into operation in
June 2011.
The Refuse-Derived Fuel plant brought into operation by
Aslan Çimento in September 2011, aims to process about 24,000 tons of industrial refuse and waste, generating fuel from the waste and refuse, reducing energy costs by up to 20%, in 2012.
With the completion of the second paper bag production line at the OYKA Çaycuma Sack Factory, the factory’s capacity doubled and reached 140 million pieces per year. The factory also chalked up its highest ever monthly sales of bags (in unit terms) in its history. The OYAK Çaycuma Kraft Paper Factory broke a new record in terms of craft paper production on a monthly basis, following the press investment that completed in 2011.
TUKAŞ: Offering the highest satisfaction of any brand According to the results of the Turkish Customer Satisfaction
Index (TMME) as of Q3/2011, TUKAŞ offered the highest
satisfaction in the category of “Tomato Paste, Sauce and
Canned Food” of any brand. TUKAŞ was also one of the six
highest ranking brands (on the basis of the TMME score) among all brands evaluated throughout 2011.
Developments in housing projects in 2011
The 2nd Phase of the 2nd stage İkitelli OYAKKENT Project
approaching completion
In 2010, an announcement was made to OYAK Members who had completed 15 years of membership and who had not yet benefited from OYAK’s Housing Services. The announcement was related to 507 apartment units being built within the 2nd Phase 2nd Stage of the Istanbul İkitelli
OYAKKENT project. 46 units were allocated to the members following the announcement. Later on an additional 76 units were also allocated to members. As such, in this phase of the project, a total of 122 OYAK members became homeowners. The remaining 385 homes started being sold to third persons
in March 2011 through OYAK İnşaat, the construction
company, and 339 of these units were sold to third persons. All of the homes in this leg of the project are planned to be delivered to their new owners in May 2012, following the receipt of licenses once construction work has been completed.
Developments in the Ankara Eryaman project
On July 4th, 2011, OYAK Members who had completed 15
years in membership and had not yet benefited from OYAK’s Housing Services were given information relating to 211 homes being built within the Ankara-Eryaman project. A total of 830 members applied to become homeowners during the application period, which ended on August 12th, 2011. All of
the homes were allocated to their new owners.
The project design of the additional 344 homes in the Eryaman project was completed in 2011, with construction work scheduled to get underway following the receipt of building licenses in May 2012. OYAK members are expected to be informed at the same time and construction will be completed, by August 2014.
Highlights from our social responsibility efforts
“Sokakta İlk Adımlar” (First Steps in the Street), which is Turkey’s most established, popular and comprehensive road safety training program, completes its 10th year
The project, entitled “Sokakta İlk Adımlar”, launched by
Renault to raise road safety awareness among children and encourage them to adopt the habits of behaving safely in traffic entered its 10th year during the 2011-2012 School
Year. A total of 1.2 million children have benefited from this program in a total of 41 cities.
In Turkey, the rate of child mortality is higher relative to the rate of adult mortality. With children under the age of 10 under twice as much risk as those in older age groups, and given the difficulty in anticipating risks, in 2002 Renault launched
the “Sokakta İlk Adımlar” Road Safety Training project, which
aims to teach children to behave safely in traffic.
As Turkey’s longest lasting corporate social responsibility
project in the field of road safety, “Sokakta İlk Adımlar” has
received a plethora of awards since 2002. These include the Special Award in 2006, awarded by the Tüketici
Dünyası (Consumer World) Magazine, the Best Social
Responsibility Project Award by the Platin Magazine at the
Zirvedekiler (Top Performers) Contest in 2007, the Grand Award at the 7th Golden Compass Contest, awarded by
the Public Relations Society of Turkey in 2008, the Best Awareness Raising Practice Award at the Corporate Social Responsibility Marketplace, and the Third Prize in the evaluation conducted by the CRS Europe International Jury. At the beginning of 2012, the project was chosen as
the Best Social Responsibility Project of 2011 at the ODD (Association of Automotive Distributors) Gladiators Award.
The project was also awarded a plate by the President of the Republic of Turkey, Mr. Abdullah Gül.
“Hayat Matematiktir” (Life is Mathematics): The OYAK Inter-High School Mathematics Contest
The OYAK Inter-High School Mathematics Contest was held in 2002 for the first time by the OYAK Cement Group with the motto “Life is Mathematics”. Students from 107 schools in 5 cities participated in this first contest. The contest gradually grew in popularity and spread to 15 cities with the participation of other OYAK companies. The 9th OYAK Inter-High School
Mathematics Contest, which had the participation of total of 2,040 school students from 510 schools this year, was completed with the final exam conducted in Istanbul on April 30th, 2011. Students from the Zonguldak Science High
School became this year’s champions, with 35.00 points. The Bolu Science High School took the second prize,
followed by the Kahramanmaraş Anatolian Teacher High
School in third place.
Listings compiled by independent agencies indicate the reputable positions of our subsidiaries in their sectors
OYAK subsidiaries listed in the ISO 500
The study, entitled Turkey’s Top 500 Industrial Establishments (ISO 500), prepared by the Istanbul Chamber of Industry based on companies’ activities in 2010, was announced in July 2011. The following OYAK Group companies were
listed in the ISO 500: OYAK Renault, ERDEMİR, İSDEMİR, Adana Çimento, ERMADEN, OYAK Beton, Mardin Çimento, Ünye Çimento, Bolu Çimento and Tam Gıda.
Developments in Member Services
Placing its members’ satisfaction at the core of all of its activities, OYAK differentiates
itself both as a pension fund and a private equity investor to achieve a steady
financial performance.
In 2011, the total net profit generated from member savings amounted to TRY 1.7 billion
In 2011, OYAK’s actuarial profit amounted to TRY 1,474.0 million with technical interest income of TRY 250.4 million. OYAK’s total profit, which is the sum of its actuarial profit and technical interest income, reached TRY 1,724.4 million by the end of 2011.
With an average USD/TRY exchange rate of 1.67 in 2011, our total profit was around USD 1 billion.
This level of profit implies a rate of return of 14.1%. All of the profit generated was transferred to member accounts. Providing its members with a 14.1% rate of return - again above the rate of inflation
Having left behind the fourth year of the global financial crisis, OYAK maintained a high rate of return for its members under
the volatile market conditions during 2011. During the year,
OYAK succeeded in providing a 14.1% rate of return on its members’ assets, exceeding the rate of inflation.
Total member assets amounted to TRY 13.8 billion Member assets rose from TRY 12.2 billion in 2010 to TRY 13.8 billion by the end of 2011.
Placing the satisfaction of its members at the heart of all of its activities, OYAK differentiates itself both as a pension fund and as a private equity investor to achieve a steady financial performance. In other words, OYAK demonstrates successful performance every year as a model of economic sustainability.
The high added value services offered by OYAK to its members represent the strongest element of its unique model and organizational structure.
A total of 268,112 OYAK members by the end of 2011 While 81.7% (219,047) of OYAK members are members who are on active duty, the remaining 18.3% (49,065) are members on the Pension Benefit System.
The number of members on the Pension Benefit System increases continuously each year, and their share in the overall OYAK membership has climbed by 3.7 percentage points since 2006. This increase indicates that OYAK members have strong desire and pleasure to maintain their ties with the corporation throughout their retirement.
In 2011, OYAK conducted member services focusing on member satisfaction and achieved good results. Under the volatile market circumstances throughout the year, OYAK continued to manage, increase and expand its member assets in the most rational manner. In 2011, OYAK increased the value of its total member assets to TRY 13.8 billion, and realized a rate of return of 14.1% on these assets. OYAK’s technical interest income amounted to TRY 250.4 million with an actuarial profit of TRY 1,474.0 million. Accordingly, OYAK’s total net profit reached TRY 1,724.4 million.
Compulsory Benefits comprise of services which
constitute OYAK’s legal basis and which OYAK is obliged to offer under Law 205. These services are
• Retirement Benefits,
• Pension Benefit System Payments, • Death Benefits
• Disability Benefits
Non-compulsory Services comprise of services which OYAK offers on the basis of personal loans and house acquisition services by considering actuarial balance and principles of equality. These services are essentially designed, planned and offered by OYAK within the limits of the funds managed by OYAK.
Services offered by OYAK to its members are classified under two primary categories:
• Compulsory Benefits • Non-compulsory Services
Rates of Participation in the Pension Benefit
System Amongst the Retired Members
(%)2011 2010 2009 2008 2007 80 89 86 85 66
OYAK Results
Number of Members 2011 2010 2009 2008 2007 241,048 250,100 259,061 268,112 235,818 Equity 2011 2010 2009 2008 2007 7,466 9,641 7,894 12,204 7,001 10,846 7,314 13,816 5,985 7,738 Total Assets 2011 2010 2009 2008 2007 8,200 10,588 9,021 13,947 8,182 12,677 7,569 14,298 7,015 9,070 Comparison of Rate of Return and CPI(%)( Rate of Return to Members, CPI)
2011 2010 2009 2008 2007 6.5 14.2 6.4 13.1 14.1 10.5 8.4 54.2 26.3 10.1
14.1%
268,112
Members13,816
TRY Million7,314
USD MillionOYAK Group Combined Results*
Total Gross Sales**
2011 2010 2009 2008 2007 16,329 21,085 14,76322,151 12,324 19,093 17,498 29,222 14,565 18,833
Total Taxes Paid
2011 2010 2009 2008 2007 1,075 1,387 1,055 1,583 851 1,318 1,287 2,149 1,178 1,522 Total Assets 2011 2010 2009 2008 2007 19,157 28,971 20,444 31,606 18,801 28,309 17,019 32,148 21,720 25,297 Total Exports 2011 2010 2009 2008 2007 4,926 4,150 4,322 4,517 3,578 * Excluding OYAK
** The total of gross sales revenues for production and sales companies
29,222
TRY Million17,498
USD Million2,149
TRY Million1,287
USD Million32,148
TRY Million17,019
USD MillionOYAK’s priority in its services is to ensure a sustainable member satisfaction
With its contemporary and exemplary service model, OYAK meets the expectations of its wide member mass of about 270,000 people in an approach based on high quality service and sustainable member satisfaction. As Turkey’s first and largest private pension fund, OYAK attaches priority to its members and places them at the heart of all of its activities and services. Setting forth its approach of “existing for its members, existing with its members” in all of its activities, OYAK is globally a successful example of inter-stakeholder participation and sharing.
The basic function of the OYAK model is to assure the future of its members
The basic function of the social security model established by OYAK is to assure the future of its members. The Company has achieved growth in its member’s savings with the collections from its members, and by exploiting them in investments in various fields, and repaying its members the collections plus their interest (returns) if they decide to cancel their membership, in line with the terms of their membership. The rate of participation among retired OYAK members in the Pension Benefit System was as high as 85% in 2011.
An investment philosophy focused on expanding member assets
By managing the contributions which it collects from its members with a portfolio management approach, OYAK aims to provide a steady return on member assets and to invest these contributions with a long-term point of view. OYAK’s investment philosophy also aims to contribute to the development of the national economy. For this purpose, when making its investment decisions, OYAK primarily prefers such areas that are expected to make the highest contribution to the Turkish economy.
Compulsory Benefits reached TRY 906.0 million in 2011 Retirement Benefit Payments comprise the highest among all mandatory benefit payments made by OYAK to its members, with a 74.4% share. OYAK paid a total of TRY 673.6 million in Retirement Benefits to its 5,020 members who were eligible for retirement.
Breakdown of Compulsory Benefits Paid (%)
Compulsory Benefits (TRY Million) (USD Million)
2011 2010 2009 2008 2007 544.9 703.6 541.8 812.9 508.3 787.5 542.5 906.0 346.9 448.5 Retirement Benefits Pension System Payments Payments for Withdrawals
from the Pension Refunds on Dues Death Benefits Disability Benefits 74.4 16.2 7.8 0.5 0.7 0.4 74.2 17.2 6.5 0.6 0.9 0.6 2010 2011
Compulsory Benefits
Retirement Benefits
Retirement Benefits, equal to the sum of accumulated contributions from OYAK members and returns generated on these over the years, are paid to members who leave OYAK after 10 years or more. In order to ensure the long-term efficiency and sustainability of the system, only the accumulated contributions are paid back to members, who leave OYAK between 3-10 years. OYAK makes no payments to members whose term of membership is less than 3 years.
Retirement Benefits (TRY Million) (USD Million)
2011 2010 2009 2008 2007 422.6 545.7 402.3 603.6 376.1 582.7 403.4 673.6 280.3 362.4
Retirement Benefits Paid (Number of Members) 2011 2010 2009 2008 2007 5,210 4,632 4,680 5,020 5,189
