Ya
Yaşar Group at a Glance
Incorporated in 1945 and wholly controlled by the Selçuk Ya
ş
ar Family
One of Turkey’s leading and most respected consumer products group in Turkey
―
Headquarters in
İ
zmir, 22 companies, 2 foundations, 19 facilities, approx. 6,300 employees
―
Consolidated Revenue of TRY 1.8 bn (USD 1.2 bn) and EBITDA of TRY 245 mn (USD 165 mn) in FY09,
up 58% from FY06
Core businesses include “Food & Beverages” and “Coatings”
Well established and widely recognised leading brands: PINAR and DYO
Six companies listed on the Istanbul Stock Exchange with a combined market cap of over TRY 1.1 bn * (c. USD 745 mn)
Seven companies ranking among “Fortune 500” of Turkey
The food and beverages division produces and sells dairy products (milk, yoghurt, cheese, butter), processed meat products (charcuterie, ready meals, red meat, turkey, fish), natural mineral water, compound feed and other F&B products
The coatings division produces and sells a variety of coatings (decorative, wood, industrial, automotive, marine) and related products (i.e. printing inks)
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YAAR HOLDING A..
FOOD & BEVERAGES COATINGS TISSUE & OTHER
PINAR ET (Meat)
PINAR SÜT (Dairy)
YBP (Sales & Distribution)
ÇAMLI YEM (Agribusiness)
PINAR SU (Beverages)
PINAR ANADOLU (Dairy & Meat)
HDF FZCO (Sales & Distribution - Dubai)
PINAR FOODS (Dairy & Meat - Germany)
DYO BOYA (Coatings)
BORNOVA MATBAA (Printing Inks)
KEMIPEX (Coatings & P.Inks - Russia)
DYO BALKAN (Coatings - Romania)
DYO MATBAA (Portfolio)
DESA ENERJİ(Energy)
YAAR DITİCARET (Trade Business)
YADEX (Trade Business - Germany)
VİKİNG KAĞIT (Tissue)
ÇEME ALTIN YUNUS (Tourism) 61.87% 61.18% 68.56% 75.50% 63.87% 79.71% 99.45% 64.30% 74.17% 94.95% 74.17% 73.43% 94.99% 67.52% 88.97% 100.00% 68.89% 61.84% DYO A.. (Portfolio) 44.98%
Companies listed on ISE
Based on Direct + Indirect Control(Group Companies subject to consolidation in Yaşar Holding IFRS Financial Statements)
Clearly defined responsibilities of the BoD, the CEO and other executive positions
Clear definitions in the “Yaşar Group Governance Handbook”
“Yaşar Group Code of Ethics”, putting forward standards of professional and ethical conduct
Audit and Corporate Governance Committees
Commitment to the Highest Standards of Corporate Governance
Major changes in management, organizational structure and processes in 2000
With the consultancy of McKinsey In line with the OECD corporate
governance principles of 1999
Also in line with the framework of
corporate governance principles issued by the Capital Markets Board of Turkey (CMBT)
Yaşar Holding Annual Report
Corporate Governance Compliance Reports and Annual Reports for ISE listed subsidiaries
Investor Relations Department
YASAR HOLDING Board of Directors
Mehmet Aktas
Chief Executive Officer
Yilmaz Gokoglu Secretary General of the Board BoD Sub-Committees Audit, Human Resource -Governance Ali Sozen President, Food & Beverages Ahmet Yigitbasi President, Coatings Hasan Girenes President, Agribusiness Hikmet Altan President, Finance Levent Daghan President, Fin. Affairs – Bud Cont. Sinan Gercek Vice President, Information Systems Dilek Emil Coordinator, Corporate Relations Filiz Ergin Director, Human Resources Kamil Deveci Coordinator, Audit Turgut Sarioglu Coordinator, Risk Mgmt Legal Consultancy Committees Executive, Corporate Finance, Investment, Performance, Information Security
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Stable Shareholders Supportive of the Experienced Management Team
Selçuk Yaşar Family controls more than 95% of Yaşar Holding. Ultimate control has not changed substantially since the Group’s establishment in 1945
Yaşar is committed to the highest standards of corporate governance (In line with the OECD corporate governance principles of 1999) with clearly defined responsibilities of the BoD, the CEO and other executive positions
Member Member Member Member Member Vice Chairperson Chairperson Position Industry experience Name 25 years Servet Topaloğlu 35 years Mehmet Kahya 27 years Neslihan Tonbul 25 years Hasan Girenes 26 years Mehmet Aktaş 32 years Yılmaz Gökoğlu 24 years İdil Yiğitbaşı
Board of Directors
Key Management Team
President, Coatings President, F&B President, Fin.Affairs & Budget Control President, Finance President, Agribusiness CEO Position Industry experience Name 23 years Ahmet Yiğitbaşı 20 years Ali Sözen 24 years Levent Dağhan 25 years Hikmet Altan 25 years Hasan Girenes 26 years Mehmet Aktaş 47,63% 35,56% 16,42% 0,39%
Hedef Ziraat Ticaret A.S. (Owned by Selçuk Yaşar Family)
DYO A.. and other Yaşar Group Companies
Selçuk Yaşar Family Members
Significant
marketing and R&D
expertise, strong
brand portfolio
Strong track record
as an innovator
and pioneer
Well diversified
business and
product portfolio
Strong presence
in the high potential
F&B and Coatings
industries
Leading brands with
leading market
positions:
PINAR & DYO *
Widespread
distribution network
Yaşar’s Key Competitive Advantages
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Strong Track Record as an innovator in Turkey
1927...
Mr DurmuşYaşar is a
merchant from Rhodes. He opened a shop to sell paint in Kemeraltı, Izmir : “DurmuşYaşar Paint
and Ship Riggings Establishment”
1941...
Mr DurmuşYaşar
initiated the first paint production in Turkey. This at the same time generated the first paint brands of Turkey: ”Yaşarin” &
“HazırlanmışBoya”
1954...
With leadership and efforts of his son Mr Selçuk Yaşar, Mr Durmuş
Yaşar established the first
paint production plants in Bornova. This was at the same time the birth of a new brand: DYO
1969...
Mr Selçuk Yaşar and
Mr Süleyman Demirel are at the opening ceremony of TUBORG, the first privately-owned beer plant in Turkey
1985...
SELÇUK YAAR
PAINTING MUSEUM & ART GALLERY was opened as the first private sector art museum
1975...
The first UHT milk and packed dairy products plant in Turkey was founded (biggest milk production facility in the Middle East): PINAR SÜT 1974...
ALTIN YUNUS, the first 1100 bed capacity hotel in Turkey, started to serve for Turkish tourism
1985...
PINAR ET started producing
processed meat products in the first integrated meat processing plant in Turkey
1985... Yaşar Group
started with its new fish farming business which is the first in Turkey 1974...
YAAR EDUCATION &
CULTURE
FOUNDATION, was founded to serve for social solidarity, respect for moral values and contribution to community
2002... The university started its first academic year: YAAR UNIVERSITY 2005... Innovative product launches continue: launches of first nano-technologic paints, and organic and prebiotic milks in Turkey
1927
’40
’50
’60
’70
’80
’90
’00
’03
’06 2010
2006... Financial Restructuring: Eurobond transaction amounting € 200 mio maturing at 2011 (first corporate Eurobond for a Turkish company) 1984... First spring water bottling in Turkey: PINAR SU 2010... Establishment of UHT Milk production line in Eskişehir and Printing Ink Plant in ManisaProfitability Remained Resilient also during the Economic Downturn
Revenue decrease of 11% (2% excluding feed raw material trade business) from 2008 to 2009 is mainly due to:
— Global economic downturn
— Decline in the commodity prices and in the volume of feed raw material trade business in other segment
— The highest revenue and EBITDA generator, F&B division, remained solid in 2009 with a 3.5% increase in revenue
EBITDA increase of 21% (31% excluding feed raw material trade business) in 2009 mainly comes from increase in the profitability of Food & Beverages, Coatings and Tissue segments
— Effective cost and opex control — OCI and lean six sigma projects
— Increase in the share of higher margin products,
high margin products share 2007 vs 2009;
— Revenue: from %65.7 to %80.4 — EBITDA: from %73.4 to %87.2 1.763 1.981 1.472 1.829 245 202 233 155 0 500 1.000 1.500 2.000 2.500 2006 2007 2008 2009 audited 0 50 100 150 200 250 300
Net sales Consolidated EBITDA (RH scale)
Consolidated revenue of TRY 1.8 bn (USD 1.2 bn) and EBITDA of TRY 245 mn (USD 165 mn) in 2009
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Divisional Breakdown
Consolidated EBITDA growth of 21%, consolidated EBITDA margin of 13.9%
Significant EBITDA growth in Coatings segment with an increase of 32.1%
Remarkable EBITDA growth in F&B segment with an increase of 19.3%
Consolidated revenue of TRY 1.8 bn (USD 1.2 bn) and EBITDA of TRY 245 mn (USD 165 mn) in 2009
Core businesses of the Group (F&B and Coatings), composed c. 90% of total revenue and EBITDA in 2009 Food & Beverages is the highest revenue (73%) and
EBITDA (77%) generator
Contribution of F&B segment is gradually increasing, representing 73% of Group revenues in 2009 from 61% in 2007
Revenue by Divisions
EBITDA by Divisions
61% 63% 73% 20% 16% 16% 5% 5% 14% 16% 6% 5% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2007 2008 2009F&B Coatings Tissue Other
73% 79% 77% 15% 11% 12% 1% 7% 12% 9% 4% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2007 2008 2009
Others 17% Asia 12% Gulf Countries 42% Europe 29%
International Operations
Revenue from international operations USD 115 mn in 2009
90% of the Group’s consolidated sales, or TRY 1.6 bn (USD 1.1 bn), represent sales in Turkey, and the remainder 10% represent sales relating to international operations
The Group's Pınar brand is the market leader in labneh cheese in Saudi Arabia and Kuwait, with 33% and 49% market shares in 2009, respectively (source: Nielsen-2009 retail data). Domestic sales 90% Export & global sales 10%
Group Sales Breakdown
Export & Global Sales by Divisions
Export by Regions
Tissue 11% F&B 62% Coatings 27%
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Stong track record as an “innovator” in Turkey
Strong presence in Turkish food & beverages and coatings industries Strong brand portfolio
Leading brands with leading market positions: PINAR & DYO; supported by * Marketing expertise
(*) With the vision to “Create 10 world brands in 10 years”, Turqualityis thefirst and uniquebranding program in the world supported by Turkish Government. Only prestigious and high potential brands are accepted within this program and supported by 50% of the brand investments realized abroad. PINARtrademark is
qualified for Turquality Support Program as of 2007, andDYO& DEWILUXtrademarks as of 2008.
Unmatched Marketing and R&D Expertise
Well diversified brand and product portfolio, maximum committment to marketing, brand management and R&D Continuous marketing campaigns focused on innovative, value added, profitable and strategic categories
New product launches every year supported with effective marketing campaigns
“Mediacat Felis Award” granted to “Pınar Çocuk” interactive campaign in 2010 “Golden Effie 2007” award in basic food category granted to “Pınar Show” campaign
New product launches in food and beverages New product launches in coatings
Nano technology coatings range in 2005 (first in Turkey),
approval of the patent application by European Patent Office in 2008
With fire-proof, very high scratch resistance, anti-bacterial, self cleaning and antifinger print properties
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Modern and efficient production processes employing the latest technology, including 13 production plants & facilities in food and beverages, 4 production plants in coatings
Food and Beverages division: Turkey’s biggest nationwide cold & frozen distribution chain, 155,000 sales points, 1,083 salespeople, 445 distributors (exclusive distributor of Ferrero in Turkey, sole meat supplier of McDonald’s in Turkey)
Coatings division: 13,000 sales points, 220 salespeople, 570 distributors
Advanced use of technology in logistics management (satellite link technology in truck tracing, datalogger applications, double-decker trailers -unique in Turkish FMCG sector-)
Lean six sigma and OCI projects to realise cost savings
Long-standing Support for Education, Sports, Arts and Culture
Contributions to Contemporary Education
6 Educational Institutions throughout Turkey, including: Primary School in Diyarbakır
Multi-Program High School in Alaçatı Scholarships to over 5,000 students
Contribution to congress, seminars and scientific studies
Contributions to Sports
Pınar KSK Basketball Team Dyo KSK Volleyball
Contributions to Arts
Dyo Painting Contest (since1967) Pınar Kido Painting Contest (since1981) Pınar Kido Children’s Theatre (since1987) TOBAV Sponsorship
Contributions to Cultural Heritage
Archaeological excavations: Nysa,
Urartu, Eryhrai
F
oundations
Selçuk Yaşar Spor ve Eğitim Vakfı Yaşar Eğitim ve Kültür Vakfı
Ya
ş
ar University
7 faculties 2 institutes
12 vocational high schools Over 4,200 students Over 450 academic and
administrative personnel
New campus located on 30,000
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Key Strategies & Objectives
Market driven, sustainable, profitable growth in the core food and beverages and coatings businesses
Continue to invest in
brands and pursue
effective marketing
campaigns
Position to benefit from growing Turkish consumer preferences for
high quality packaged food and beverage products and technologically advanced coatings
Strengthen position in
international markets
Continue to implement
sustainable and
socially responsible
business practices
Emphasise and
leverage on product
innovation capabilities
and focus on quality
Maintain financial
flexibility
Maintain and enhance
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Financial Highlights
71,1 (127,0) 39,0 (51,8)Net Income (loss)
13.9% 10.2% 12.7% 10.5% EBITDA Margin 244.7 201.8 233.0 154.5 EBITDA 10.2% 7.1% 9.4% 6.5%
Operating Profit Margin
180.3 140.7 171.5 95.8 Operating Profit * (91.3) (94.7) (81.5) (80.3)
General administrative expenses
(225.4) (252.8)
(226.7) (205.5)
Marketing and selling expenses
(10.6) (12.0)
(11.7) (11.1)
Research and development expenses
28.8% 25.3%
26.9% 26.7%
Gross Profit Margin
507.6 500.2 491.3 392.6 Gross Profit (1,255.5) (1,480.5) (1,338.0) (1,078.8)
Cost of Goods Sold
1,763.0 1,980.7
1,829.3 1,471.5
Revenues (Net Sales)
2009 TRY (million) audited 2008 TRY (million) audited 2007 TRY (million) audited 2006 TRY (million) audited
* Other operating income and expense has been excluded
Profitability of the Group increased significantly with an EBITDA increase of 21% in the recent year Compared to 2006, increase in consolidated EBITDA is 58%; reaching TRY 245 mn in 2009
Revenue has increased by 20% in the same period
263.3 316.8 254.0 216.9 Trade Payables 980.9 1,001.0 902.3 848.3
Property, Plant, Equipment and Intangibles
511.5 315.1 378.0 291.4 Total Equity 1,679.6 1,644.4 1,507.0 1,351.5 Total Assets 283.4 286.1 278.5 252.0 Trade Receivables 171.9 169.0 177.6 151.7
Inventories and Biological Assets
19.1 50.3 41.6 56.6 Capital Expenditure 1,168.1 1,329.3 1,129.0 1,060.1 Total Liabilities 603.6 672.9 583.2 611.0 Long-term Debt
(including / net of derivatives)
96.6 137.7
133.9 91.4
Short-term Debt and Derivatives
32.0 38.7
44.5 38.0
Cash and Cash Equivalents
2009 TRY (million) audited 2008 TRY (million) audited 2007 TRY (million) audited 2006 TRY (million) audited
Financial Highlights (cont’d)
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Financial Ratios
Key Ratios
2009 audited 2008 audited 2007 audited 2006 audited 2.86 4.01 3.08 4.53 Debt to EBITDA 1.25 1.13 1.31 1.32 Current Ratio 2.66 1.83 2.30 1.82EBITDA to Interest Expense
0.42 0.49
0.48 0.52
Debt to Assets
Leverage and Interest Coverage ratios have improved in 2009 as a result of: Increase in profitability and EBITDA
Optimisation of consolidated cash flows Decrease in total debt
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Yaşar is on Positive Trajectory
One of Turkey’s leading and most respected consumer products group
Stable ownership structure wholly controlled by the Selçuk Yaşar Family and experienced management team
Strong track record as an “innovator” in Turkey: pioneered in the dairy, processed meat, water and coatings industries Consolidated Revenue of TRY 1.8 bn (USD 1.2 bn) and EBITDA of TRY 245 mn (USD 165 mn) in FY09
Six companies listed on the Istanbul Stock Exchange with a combined market cap of over TRY 1.1 bn (c. USD 745 mn)
Strong presence and great expertise in the core businesses, “Food & Beverages” and “Coatings”
Two brands with very strong brand equities: PINAR and DYO
Significant marketing & R&D expertise, widespread distribution network
F&B and Coatings markets have significant upside potential due to favorable economic, demographic and consumer trends Contained diversification (sales ~11% of total consolidated sales) into the non-core businesses of Tissue, Trade & Tourism
Supportive economic backdrop: Turkey economy came out strengthened from the financial crisis
Sovereign Ratings have been upgraded by all rating agencies Inflation has been gradually reduced to single digit
Growth outlook is positive (economy is expected to grow by 6.8% in 2010 according to OECD’s recent Economic Outlook)
* as at 30 April 2010
After successfully navigating through the economic turmoil:
EBITDA has grown at a CAGR above 16% during the past 3 years while
Substantial de-leveraging has been achieved (total debt -20%, debt to EBITDA down to 2.86x from 4.53x since 2006)
Thank
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