TOFAŞ Q1 2016 ANALYST PRESENTATION 03.05.2016 1
2016 Q1 AGENDA Highlights Turkish Automotive Industry Production & Capacity Utilization Domestic Market Developments Tofaş Domestic Market Performance Export Markets & Performance Financial Performance Investments Other Developments 2016 FY Guidance Q&A 2
HIGHLIGHTS Record Q1 Net Sales Revenue of 2,7 billion TL. Third shift started in Bursa plant as of March 1st, 2016. 365 M TL cash Dividend paid to shareholders in April 2016. Fiat Egea/Tipo Hatchback production started on April 12th 2016. Commercial launches in June. Highest quarterly exports volume since 2010. Growth in European automotive demand continues. Fiat Fiorino face-lift start of production in March, sales started in April, 2016.
TURKISH AUTOMOTIVE INDUSTRY Turkish Auto Production - Cumulative Turkish Auto Exports - Cumulative 1.800.000 units 1.500.000 1.200.000 900.000 600.000 300.000 19,4% 334.705 20,5% 20,2% 20,5% 1.358.796 973.842 667.592 22,9% 346.072 25,0% 20,0% 15,0% 10,0% 5,0% 1.400.000 units 1.200.000 1.000.000 800.000 600.000 400.000 200.000 17,3% 249.838 18,1% 17,9% 486.336 706.860 17,5% 992.335 21,9% 266.317 25,0% 20,0% 15,0% 10,0% 5,0% 0 1Q15 2Q15 3Q15 4Q15 1Q16 0,0% 0 1Q15 2Q15 3Q15 2015 FY 1Q16 0,0% Turkey Tofaş % Turkey Tofaş % 2016 Q1 production of Turkish Auto Industry was 4% higher Y-o-Y realizing 346k units. Tofaş contribution reached 23% from 19% Y-o-Y. In 2016 Q1, Tofaş contribution in Turkish automotive exports increased Y-o-Y from 17% to 22%. 4
TOFAŞ PRODUCTION Tofaş Production Volume - Cumulative Capacity Utilization Rate units 196.709 278.252 98% 103% 98% 104% 102% * 136.748 65.061 79.103 2015 03 2015 06 2015 09 2015 12 2016 03 2015 03 2015 06 2015 09 2015 12 2016 03 * 3 shifts production starting March 1st taken into consideration. Tofaş 2016 Q1 production up by 22% Y-o-Y. 102% utilization rate in Q1 (weighted average of two shifts in Jan.& Feb., 3 shifts in Mar.). Tofaş Production: 39% Passenger Cars & 61% Light Commercial Vehicles in 2016. (26% pc, 74% lcv in FY15) 5
DOMESTIC MARKET PC&LCV Q1 COMPARISON -2,8% 173.248 168.486 +0,7% 126.991 127.921-12,3% 46.257 40.565 Passenger Cars Light Commercial Vehicles Total Q1 2015 Q1 2016 6
DOMESTIC MARKET LCV MARKET SEGMENT EVOLUTION -12,3% 46.257 40.565-19,0% -4,7% 24.484 21.773 19.813 20.752 CDV Medium CV Total LCV Q1 2015 Q1 2016 7
TOFAŞ DOMESTIC MARKET PC & LCV MONTHLY RETAIL SALES 000 units 21,5 18,9 9,7 8,8 6,6 5,7 4,2 4,4 4,2 5,0 4,0 6,0 11,0 9,5 9,3 8,6 7,1 6,9 7,4 7,1 7,9 7,9 7,4 7,3 6,7 11,0 10,3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015 2016 Higher shrinkage in domestic CDV (car derived vans) market resulted in a decline of 11,4% in domestic market volumes, with 18,450 units. 8
FIAT PASSENGER CARS DOMESTIC MARKET SHARE Tofaş market share including Premium brands in Q1 16 is 7.3% Fiat has the highest domestic sales from local production ratio with 91% 15,6% 13,1% 7,5% 2016 Q1 YTD 6,8% 6,6% 6,0% Market share expected to grow thanks to completion of Egea family (HB & SW) and automatic transmission. 16,6% RENAULT VW HYUNDAI FIAT FORD OPEL 13,6% 2015 Q1 YTD 7,6% 6,9% 6,6% 6,3% Fiat Egea HB SOP was 12.4.2016 Fiat Egea was awarded the best automobile of the year by Autobest VW RENAULT HYUNDAI TOYOTA FIAT FORD 9
FIAT LIGHT COMMERCIAL VEHICLES DOMESTIC MARKET SHARE Fiat is the leader in CDV market with Doblo & Fiorino. 29,6% 22,4% 17,8% 2016 Q1 YTD New Fiat Fiorino distribution started in April 2016 5,0% 4,5% 3,9% FORD FIAT VW RENAULT MERCEDES PEUGEOT 29,8% 24,6% 2015 Q1 YTD 15,3% Tofaş has been the leader in CDV segment with Fiat Fiorino and Fiat Doblo 4,9% 4,3% 3,9% FORD FIAT VW RENAULT PEUGEOT MERCEDES 10
FIAT PC & LCV COMBINED DOMESTIC MARKET SHARE Tofaş market share including Premium brands: 11,0% Fiat has the highest domestic sales from local production ratio with 89% 14,2% 13,0% 12,1% 10,5% 5,9% 2016 Q1 YTD 4,6% VW RENAULT FORD FIAT HYUNDAI OPEL 16,3% 2015 Q1 YTD 12,5% 11,4% 11,3% 5,8% 4,1% VW FORD FIAT RENAULT HYUNDAI OPEL 11
TOFAŞ EXPORTS Tofaş Monthly Export Volumes thousand units 22,7 20,9 14,7 14,8 14,7 14,9 13,8 13,9 11,0 11,7 12,0 13,2 13,9 11,2 18,3 13,0 16,4 13,3 16,8 17,2 10,6 14,9 15,2 13,4 12,9 3,3 5,5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015 2016 Tofaş exports grew by +35% Y-o-Y in Q1 16, reaching 58k units (43k in Q1 15). All models contributed to the increase in exports seen in Q1 16, pulled by the growth in European markets. 12
TOFAŞ EXPORTS TO EUROPE units 1.400.000 1.200.000 1.000.000 800.000 600.000 400.000 200.000 0 Total European PC Market units 40.000 7,8% 4,5% Tofaş Exports to Europe 148,9% 5,1% 20,8% Rest of Europe GERMANY UK ITALY FRANCE SPAIN January- March '15 January -March '16 6,2% 8,2% 6,9% Total European LCV Market units 200.000 180.000 160.000 140.000 120.000 100.000 80.000 60.000 40.000 20.000 0 15,5% 9,6% 1,2% European markets had a positive performance in 2016 Q1, European PC market grew by 8,1%, whereas the LCV market grew by %10,7 Y-o-Y. Tofaş exports to Europe in 2016 Q1 surged by 40% overall Y-o-Y. 9,3% Rest of Europe FRANCE UK GERMANY ITALY SPAIN January-March '15 January-March '16 30,0% 8,9% 20.000 0 PC January-March 15 LCV Tofaş PC to Europe exports hiked by 149% in 2016 Q1 Y-o-Y with the help of the new Egea sedan. Tofaş LCV exports to Europe grew by 6,2% continuing the positive performance of 2015. 13
TOFAŞ EXPORTS FY 2015 (Total Units :173.873) Q1 2016 (Total Units : 58.533) USA & Canada; 11,7% MENA; 9,9% Other; 2,4% Italy; 26,4% USA & Canada; 5,0% Rest of Europe; 14,6% MENA; 8,8% Other; 1,2% Italy; 37,0% France; 7,7% Rest of Europe; 11,7% Belgium; 4,5% Belgium; 4,3% Germany; 6,3% France; 5,1% Spain; 8,5% UK; 11,1% Spain; 9,8% UK; 6,8% Germany; 7,0% 14
TOFAŞ SHIPMENTS PC&LCV QUARTERLY SHIPMENTS Q1 2016 vs. Q1 2015 000 units 67,1 43,3 78,4 44,5 64,5 38,8 86,7 47,3 78,6 58,3 23,8 33,9 25,8 39,4 20,3 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 Export Domestic Total shipments of Tofaş increased by +17% Y-o-Y in Q1 16 reaching 79k units (67k units in Q1 2015). Growth in shipments resulted from exports (+35%) whereas domestic shipments declined by -15%. 15
SHIPMENTS BY BUSINESS PC&LCV BREAKDOWN Q1 2016 Domestic Exports LCV; 10,6k; 52% PC; 9,7k; 48% LCV; 36,9k; 63% PC; 21,4k; 37% PC LCV Total PC LCV LCV; 48k; 60% PC; 31k; 40% PC LCV 16
SHIPMENTS BY MODEL Shipments Q1 2016 Q1 2015 Δ Domestic Sales Egea 6.833 0 6.833 New Doblo Cargo 4.346 6.718-2.372 New Doblo Panorama 202 144 58 Linea 1.387 7.324-5.937 MCV (sold to PSA) 949 1.465-516 Fiorino (MCV) Cargo 4.089 4.299-210 Fiorino (MCV) Panorama 68 151-83 Imported Vehicles 2.394 3.727-1.333 Total Domestic Sales 20.268 23.828-3.560 Exports Egea (Tipo) 14.371 0 14.371 Doblo Cargo 2.848 1.451 1.397 Doblo Panorama 242-242 New Doblo Cargo 15.756 12.750 3.006 New Doblo Panorama 2.778 3.824-1.046 RAM ProMaster City 2.934 3.248-314 GM Combo 6.975 6.159 816 Linea 154 291-137 MCV Cargo 9.049 10.974-1.925 MCV Panorama 3.442 4.405-963 Others (transit) 26 2 24 Total Exports 58.333 43.346 14.987 Total Sales 78.601 67.174 11.427 17
FINANCIAL PERFORMANCE 18
INCOME STATEMENT TL Million - YTD 31.03.2016 31.03.2015 Net Sales 2.715,6 2.131,1 27,4% Gross Profit 301,6 281,8 7,0% Operating Profit 166,0 163,6 1,5% Profit Before Tax 173,3 178,7-3,0% Net Profit 240,5 205,5 17,0% EBITDA 276,2 254,9 8,3% Gross Margin % 11,1% 13,2% -2,1% Operating Margin % 6,1% 7,7% -1,6% Profit Before Tax Margin % 6,4% 8,4% -2,0% Net Margin % 8,9% 9,6% -0,8% EBITDA % 10,2% 12,0% -1,8% * Foreign Exchange Gain/Losses recorded out of Operating Profit 19
TOFAŞ REVENUES M TL 9.920,7 3.500 3.000 2.500 2.000 1.500 1.000 500 0 2.550 2.131 2.272 1.420 1.307 1.355 2.968 2.716 1.648 1.905 1.130 1.320 824 917 810 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 Local Export 2016 Q1 total revenues grew by +27,4% Y-o-Y reaching 2.7 billion TL. Mainly, increased export volumes contributed to this growth. 20
GROSS PROFIT M TL 1.216,5 400 350 300 250 200 150 100 50 0 13,2% 12,7% 13,2% 10,5% 11,1% 281,8 323,0 299,7 311,9 301,6 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0% Gross Profit Gross Margin Gross Profit grew by 7,0% Y-o-Y, and amounted to 302 million TL. Gross Margin on the other hand occurred as 11,1% in Q1 2016. 21
PROFIT BEFORE TAX M TL 618,0 200 180 160 140 120 100 80 60 40 20 0 178,7 173,3 157,6 149,5 8,4% 132,1 5,8% 6,2% 6,4% 5,0% 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0% PBT PBT Margin Profit Before Tax of Q1 2016 decreased by 3% Y-o-Y, occuring as 173 million TL. PBT margin of Q1 2016 realized as 6,4% being affected by FX movement in Q1. 22
NET PROFIT M TL 830,8 250 200 150 100 50 0 257,6 240,5 205,5 193,4 174,3 9,6% 7,6% 7,7% 8,7% 8,9% 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0% Net Profit Net Profit % Net Profit of Q1 2016 grew by +17,7% Y-o-Y, reaching 240 million TL, positively affected by the deferred tax. Net Margin on the other hand realized as 8,9%. 23
EBITDA M TL 1.062,7 300 250 200 150 100 50 0 282,9 275,5 276,2 254,9 249,4 12,0% 12,1% 11,1% 10,2% 8,4% 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0% EBITDA EBITDA % Q1 2016 EBITDA climbed up to 276 million TL with an increase of 8,3% Y-o-Y whereas EBITDA margin of the first quarter of the year was 10,2%. * Calculated by keeping the non financial exchange rate gain & losses out of operating profit inline with previous years. 24
BALANCE SHEET ASSETS (million TL) Current Assets 31.03.2016 31.12.2015 Cash & Cash Equivalents 2.370,4 2.466,3-95,8 Inventory 716,4 548,3 168,2 Trade Receivables 830,6 1.037,1-206,5 S.T. Consumer Financing Loans 1.230,2 1.091,4 138,9 Other Current Assets 122,3 65,8 56,5 Non-current Assets 31.03.2016 31.12.2015 Fixed Assets 1.916,3 2.111,5-195,2 Intangible Assets 1.615,4 1.284,0 331,5 L.T. Consumer Financing Loans 812,9 852,8-39,8 Other Non-current Assets 485,3 409,6 75,8 Total Assets 10.100,0 9.866,6 233,4 25
BALANCE SHEET LIABILITIES (million TL) Current Liabilities 31.03.2016 31.12.2015 Short-term Financial Liabilities 362,1 311,3 50,8 S.T. Portion Of L.T. Financial Liabilities 1.995,6 1.521,2 474,4 Trade Payables 1.922,2 2.447,5-525,4 Other Current Liabilities 661,9 247,4 414,5 Non-current Liabilities & Equity 31.03.2016 31.12.2015 Long-term Financial Liabilities 2.512,9 2.553,6-40,7 Other Long-term Liabilities 198,9 203,2-4,3 Equity 2.446,4 2.582,3-135,9 Equity & Liabilities 10.100,0 9.866,6 233,4 26
FINANCIAL POSITION EUR million 09.14 12.14 03.15 06.15 09.15 12.15 03.16 Financial Assets 734 608 642 554 713 776 739 KFK Consumer Financing Loans 400 472 521 533 475 612 637 KFK Financial Liabilities -359-466 -488-497 -451-577 -620 Tofaş Financial Liabilities -550-455 -610-586 -777-803 -898 Net Financial Position 225 159 65 4-39 8-142 Factoring 143 132 143 186 160 163 164 27
WORKING CAPITAL EUR million 12.14 03.15 06.15 09.15 12.15 03.16 Trade Receivables Inventory Other Receivables Trade Payables Other Liabilities Net Working Capital Factoring 300 226 246 221 326 259 161 194 229 207 173 223 27 66 18 28 20 38 649 539 609 569 770 599 63 230 55 87 55 183-225 -283-170 -200-306 -262 132 143 186 160 163 164 28
INVESTMENTS EUR million 2011 2012 2013 2014 2015 2016 Q1 Structural 30 36 27 19 32 22 Linea 14 10 2 2 - Minicargo 17 10 5 24 15 2 263 (Doblo & RAM Promaster City) 63 40 51 169 56 6 New Sedan, HB & SW Passenger Cars - - 10 116 275 43 Total 124 96 95 330 377 73 29
OTHER DEVELOPMENTS FIAT Egea Hatchback production started as of April 12th, 2016 30
OTHER DEVELOPMENTS Alfa Romeo 4C Spider sales commenced in March 2016. 31
OTHER DEVELOPMENTS New Alfa Romeo Giulietta sales started in March 2016. 32
OTHER DEVELOPMENTS Maserati Levante launched on April 27th, 2016. 33
2016 EXPECTATIONS 2016 FY domestic light vehicle market is expected to be 940k 950k units. Tofaş domestic sales forecasted around 125k 130k units. Export shipments expected to increase up to 270k 280k units. Expected production volumes in a range of 380k 390k units. Investment guidance for 2016 remains at ~ EUR 400 millions. 34
CONTACTS INSTITUTIONAL INVESTOR RELATIONS M. Emre Ertürk Investor Relations, Budget, Commercial Control & Risk Manager T: +90 212 275 3390 / 2751 F: +90 212 216 4028 : emre.erturk@tofas.com.tr Pırıl Us Financial Risk & Investor Relations Specialist T: +90 212 275 3390 / 2727 F: +90 212 216 4028 : piril.us@tofas.com.tr : Büyükdere Caddesi, No:145, Tofaş Han, 34394, Zincirlikuyu / ISTANBUL TURKEY
DISCLAIMER This presentation contains forward-looking statements that reflect the Company management s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by a variety of variables and changes in underlying assumptions that could cause actual results to differ materially. Neither Tofaş nor any of its directors, managers or employees nor any other person shall have any liability whatsoever for any loss arising from use of this presentation. 36