INVESTOR PRESENTATION MAY 2014

Transcription

1 INVESTOR PRESENTATION MAY 2014

2 2

3 COMPANY PROFILE TUMOSAN manufactures diesel engine and tractors in a closed area of m 2 on its own property of 1.6 million m 2. It has the biggest manufacturing capacity in Turkey. Engine manufacturing capacity: items/year-three shifts. Conform with the European Union emission standard Stage III-A. 3 Cylinder engines are; HP. 4 Cylinder engines are; HP. Tractor manufacturing capacity: /year-three shifts. Tractors between HP with 3 and 4 cylinders. Net Sales TL Mn Net Income TL 29.5 Mn Net Sales TL Mn EBITDA TL 39,2 Mn EBITDA margin 13,4% EBITDA TL 79,5 Mn Net Income TL 62.1 Mn EBITDA margin 18% 3

4 Before IPO OWNERSHIP STRUCTURE 3% 3% 3% 7% 3% 3% Ereğli Teks1l Turizm San. Ve Tiç. A.Ş. Bayram ALBAYRAK Kazım ALBAYRAK Ahmet ALBAYRAK 78% Muzaffer ALBAYRAK Nuri ALBAYRAK Mustafa ALBAYRAK Other Free Float Partner Capital (TL) Share in Capital (%) Ereğli Tekstil Turizm San. ve Tic. A.Ş % Muzaffer ALBAYRAK % Bayram ALBAYRAK % Nuri ALBAYRAK % Kazım ALBAYRAK % Mustafa ALBAYRAK % Ahmet ALBAYRAK % Hedef Girişim Sermayesi Yatırım Ortaklığı A.Ş. - - Free Float - - TOTAL % TL 105mn Capital Before IPO 4

5 Post IPO OWNERSHIP STRUCTURE 1Q14 2% 2% 2% 2% 2% 2% 1% 20% Ereğli Teks1l Turizm San. Ve Tiç. A.Ş. 68% Muzaffer ALBAYRAK Partner Capital (TL) Share in Capital (%) Ereğli Tekstil Turizm San. ve Tic. A.Ş ,65 68,10 % Muzaffer ALBAYRAK ,00 1,74 % Bayram ALBAYRAK ,00 1,74 % Nuri ALBAYRAK ,00 1,74 % Kazım ALBAYRAK ,00 1,74 % Mustafa ALBAYRAK ,00 1,74 % Ahmet ALBAYRAK ,00 1,74 % Hedef Girişim Sermayesi Yatırım Ortaklığı A.Ş ,00 1,30 % Free Float ,35 20,16 % TOTAL ,00 100,00 % Bayram ALBAYRAK Kazım ALBAYRAK Ahmet ALBAYRAK Free Other Float Nuri ALBAYRAK Mustafa ALBAYRAK Hedef Girişim Sermayesi YaUrım Ortaklığı A.Ş. TL 115mn Capital Post IPO 5

6 MILESTONES BEFORE PRIVATISATION 6

7 MILESTONES AFTER PRIVATISATION 7

8 MILESTONES WAY AHEAD 8

9 DEALER AND SERVICE NETWORK 114 DEALERS AND 384 AUTHORIZIED SERVICES LOCATED IN 65 CITIES. 9

10 DEALER AND SERVICE NETWORK 15 DEALERS ABROAD. 10

11 RESEARCH AND DEVELOPMENT TÜMOSAN Research and Development Center has been active in ITU Teknopark / ISTANBUL. Laboratories are located in KONYA. Test facilities are located in KONYA. 11

12 RESEARCH AND DEVELOPMENT Completed Projects 115 HP Tractor. 4WD Front Axle. 16x16 Gear Box. Stage III-A and Stage III-B Diesel Engine. Ongoing Projects 4 Valve 4 cylinder 125 HP and 4 valve 6 cylinder HP engine. 32x32 Gear Box. LPG CNG Engine. 16x16 Full Powershift Transmission. Stage IV 6 cylinder new generation engine. Cotton Picker. ECU - TCU Sprayer. 12

13 R&D EXPENDITURE BREAKDOWN Projects, Million TL Valve Engine 2,6 2,0 2,8 32x32 Gear Box 0,3 16x16 F.P. Transmission 0,4 Lpg / Cng 0,3 0,7 Stage IV Engine %50 of Total Cost 2,6 1,2 0,7 Cotton Pick %50 of Total Cost 0,8 0,9 0,4 Sprayer %50 of Total Cost 0,6 0,6 1,5 ECU TCU Design 0,8 1,3 1,8 Total 7,6 7,7 7,2 13

14 AGRICULTURAL SECTOR 14

15 AGRICULTURAL SECTOR 24.5 million hectares of the existing 38 million agricultural land is being cultivated. Turkey is amongst the first 15 countries in the world with the size of cultivated agricultural land. The number of holdings decreased 4 to 2.3 million. Avarege land size of holdings increased from 4.7 to 7 hectares. Agricultural Holdings Land Distribution 31% 18% 18% 10% 6% 5% 11% 15

16 AGRICULTURAL SECTOR As of the year 2012, the Agricultural Gross Domestic Product (AGDP) is 8.2 % of the total GDP with 62.5 billion $. In terms of agricultural economy, Turkey ranks first of Europe and seventh of the world as of Agricultural Produc.on ($ Bl)

17 ASSESMENT OF AGRICULTURAL SECTOR PROS Favorable ecological conditions. Strong direct and indirect subsidies. Land consolidation. Decline of agri employment and number of holding vs growth of farm size. Competitive labor cost. Able Engineering. R&D subsidies of % 60. Competitive supplier base. Anticipated scrap incentive plan. CONS High cost of mechanization due to imports. Weather sensitive. Credit heavy finance of investment. 17

18 COMPARISON OF TR & EU AGRICULTURAL SECTOR Chosen Indicators Turkey EU Size of Holdings 6.8 Ha 17.5 Ha Agricultural Employment 26 % 6 % Average Tractor Power 70 HP > 100 HP 4WD Tractor Rates 65 % 95% Average Tractor Age

19 2014 OUTLOOK Interest rate of agricultural credits and subsidies support sales. Imports may decline due to exchange rate. Agricultural output might fall 10 % due to adverse weather conditions. Sales numbers will relatively be lower than Expansion of export market Enlargement of dealer&service organisation Not only pricing policy but introduction of new products and innovation will secure success in the market. 19

20 TRACTOR MARKET 20

21 TRACTOR MARKET OF TURKEY Tractor Market / / / / / / TUMOSAN Sales 2012 / / / / / / 3 TUMOSAN TUMOSAN TUMOSAN 2012/ / /3 Total TUMOSAN

22 TRACTOR MARKET OF TURKEY 53,922 54,731 60,304 53,803 34,589 49,297 43,706 33,989 34,525 42,033 34,541 51,033 36,576 24,951 22,954 8,127 16,639 10,587 9,571 24,241 14, AVERAGE TRACTORS 22

23 DEVELOPMENTS IN TRACTOR SECTOR Vineyard & Orchard Tractors 80% 4WD Tractors 75% Average HP 10% 5% 0% 2% 7% 60% 40% 20% 0% 9% 65% 70% 65% 60% 55% 50% 59% 70% 3.5 fold increased in vineyard orchard segment. 7 fold increase in 4WD, reached 65%. Tractor power has increased by 20 % close to 70 HP. 23

24 TRACTOR PARK 704,506 48% 302,647 21% 459,055 31% The size of tractor park is Average age is 23 years. The average age of tractor is 34 years old. Government has a plan to modernize the park with a scrap incentive program. 25 Years Years 10 Years 24

25 SALES VOLUME (TURKISH STATICAL INSTITUTE FIGURES) SALES VOLUME (TSI) 2012/3 2013/3 2014/3 TUMOSAN Sales Volume Total Sales Market Share 14,63 % 14,70% 14,18% 2012/3 2013/3 2014/3 Total Sales Market Share 14,63% Total Sales Market Share 14,70% Total Sales Market Share 14,18% Tümosan Sales Volume Tümosan Sales Volume Tümosan Sales Volume

26 HP ASSESSMENT 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, HP VOLUME < 50 HP HP HP HP HP HP HP HP 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2013 HP Market Share < 50 HP HP HP HP HP HP HP HP 2013 TUMOSAN 2013 Total 2013 Market Share 2013 TUMOSAN Market Share HP 2013 Total 2013 TUMOSAN 2013 Market Share 2013 TUMOSAN Market Share < 50 HP ,97% HP ,97% 10,13% HP ,10% 7,61% HP ,92% 24,93% HP ,52% 27,63% HP ,36% 35,55% HP ,64% 41,84% HP ,82% - 26

27 TUMOSAN SALES VOLUME (SALES TO DEALERS) %- 16,91 1, / /03 Sales and Production 2013/3 2014/3 % Sales (Sales to Dealers) ,91% Production ,86% 27

28 TUMOSAN EXPORT VOLUME % /3 2014/3 2013/3 2014/3 % EXPORT % 28

29 PUBLIC OFFERING AND FINAL SITUATION 29

30 FINANCIAL HIGHLIGHTS Million TL 2013/3 2014/3 Revenues Gross Profit Margin 21% 17% Operating Profit Margin 19% 9% EBITDA Margin 20% 11% Net Income Margin 18% 7% 30

31 COMPARATIVE BALANCE SHEET Liquid Assets Mn TL 2013/3 2014/3 Cash and Cash Equivalents Financial Invest Commercial Receivables Commercial Receivables from Non-Affiliates Commercial Receivables from Affiliates Other Receivables Receivables from Affiliates Other Receivables from Affiliates Stocks Prepaid Expenses Other Liquid Asset Total Liquid Assets Fixed Assets Mn TL 2013/3 2014/3 Other Receivables - 6 Other Receivables from Affiliates - 6 Investment Properties Tangible Fixed Asset Intangible Fixed Assets Other Intangible Fixed Assets - - Other Fixed Assets - - Total Fixed Assets Total Assets

32 COMPARATIVE BALANCE SHEET Short Term Liabilities, Mn TL 2013/3 2014/3 Short Term Loans Current Portion of Amounts Payable after One Year - - Other Financial Liabilities - - Trade Payables Current Payables to Affiliates - - Current Payables to Non-Affiliates Due from Employee Benefits Deferred Income Period Income Tax Liability Short Term Provisions Short Term Provisions for Employee Benefits Other Short Term Provisions Other Short Term Liabilities Total Short Term Liabilities Long Term Liabilities, Mn TL 2013/3 2014/3 Long Term Loans Long Term Provisions Long Term Provisions for Employee Benefits Deferred Tax Liability Total Long Term Liabilities Equities, Mn TL 2013/3 2014/3 Paid-up Capital Share Premiums Fixed Tangible Asset Valuation Fund Actuarial Gain/Loss Fund from Pension Plan Reserves on Retained Earnings Losses from Previous Years Net Income for the Period Non-Controlling Total Equities Total Liabilities and Equities

33 COMPARATIVE INCOME TABLE Real Operating Income, Million TL 2013/3 2014/3 Sales Income Sales Expense: (-) Gross Profit Research and Development Expenses Marketing and Sales Expenses Administrative Expenses Other Operative Income Other Operative Expenses Operating Profit Financial Income Financial Expenses Pretax Profit Period Tax Expenses Deferred Tax Income / Expenses Net Period Income Revaluation Fund *[Actuarial Gain/Loss for Employee Benefits Tax Influence - - Total Comprehensive Income

34 DEBT PROFILE Change in Debt % 3.5 TL 2.4 mn out of TL 3.5 mn has been paid out

35 DEBT PROFILE OF 2014/3 Cash payment of import to evade 6% extra cost of LC Payment For Foundry Due Payment Of Bank Loan 14 M 14 M 1.1 M Total TL Mn

36 FX EXPOSURE FX Based Trade Payables. 22% 14% % of the trade payables is FX based. Need exit strategy. With the exception of diesel pump and injectors localisation if cheaper. 4WD axle already localised. Transaxle for compact tractor will developed. 36

37 CAPEX DEVELOPMENT EXPECT CASTING (TL MN) ,0 11,2 5, Construc1on took the largest part in 2013 and CNC investment was the second. Machinery will receive bulk of investment 2014 onward. 37

38 CAPEX ITEMS Installed tractor production capacity to be increased to Modernization of paint shop. Expansion of Automated Guided Vehicle (AGV) application at assembly and material handling. Shift from manual to compressed air tools for manpower and energy efficiency. Upgrade of existing machining lines. Be prepared to produce new generation diesel engines. Workshop for Harvesters / Material Handling / Construction. Construction & Maintanence. 38

39 CAPEX BREAKDOWN Items Capacity Increase Upgrade Engine Production Line Workshop Construction & Maintenance Total TL Mn

40 IPO CONDITIONS Dividend Policy 2013 With the decision made during the 2013 Ordinary Meeting of General Assembly held on , TL of the 2013 profit has been distributed as of May 28, Bonus Share Distribution 4 % of Bonus Tumosan shares has been distributed to the B group IPO owners, holding the stock for 90 days. A total of Tümosan shares were transferred to the investors on Sales of Shares Repurchased for Incentive nominal shares were repurchased by parent company for the first 10 trading days to support stock price shares already to were sold foreign investor. Financial Performance Guarantee of 2013 Tumosan guaranteed 72.5 mn TL average of EBITDA and Net Income. If not,investors planned to receive bonus shares at the rate of deviation. Avarege is and the deviation is 2.4 % shares transfert to share holders as of March

41 Before Acquisition OWNERSHIP STRUCTURE - TD 3% 3% 3% 7% 3% 3% 78% Partner Capital (TL) Share in Capital (%) Ahmet ALBAYRAK % Bayram ALBAYRAK % Kazım ALBAYRAK % Nuri ALBAYRAK % Mustafa ALBAYRAK % Muzaffer ALBAYRAK % Ereğli Tekstil Turizm San. ve Tic. A.Ş TOTAL % Ereğli Teks1l Turizm San. Ve Tiç. A.Ş. Bayram ALBAYRAK Kazım ALBAYRAK Ahmet ALBAYRAK Muzaffer ALBAYRAK Nuri ALBAYRAK Mustafa ALBAYRAK Other 41

42 After Acquisition OWNERSHIP STRUCTURE - TD 3% 3% 7% 3% 3% 3% 8% 70% Partner Capital (TL) Share in Capital (%) Ahmet ALBAYRAK % Bayram ALBAYRAK % Kazım ALBAYRAK % Nuri ALBAYRAK % Mustafa ALBAYRAK % Muzaffer ALBAYRAK % Ereğli Tekstil Turizm San. ve Tic. A.Ş % TUMOSAN % TOTAL % TUMOSAN Bayram ALBAYRAK Kazım ALBAYRAK Muzaffer ALBAYRAK Nuri ALBAYRAK Mustafa ALBAYRAK Ahmet ALBAYRAK Ereğli Teks1l Turizm San. Ve Tiç. A.Ş. 42

43 TUMOSAN FOUNDRY Established in 2012 Employees 33/67 Capacity (T/Y) 5.000/ Cast Alloy Grey Iron Moulding Market Value Automatic-Horizontal ,00 TL 43

44 TURKISH FOUNDRY INDUSTRY INDICATORS 2011 Number of Foundry GDP Share of Sector 0,5 Sales ( ) Sector Growth Rate +11 Global Market Share (%) 1.5 Import Ratio in Product (%) 20 Average Net Profit (%)

45 TURKISH FOUNDRY INDUSTRY PRODUCTION (TON) Produc.on (Ton) 2,000,000 1,800,000 1,600,000 1,500,000 1,400,000 1,200,000 1,000, , , , , , , , , ,

46 TUMOSAN CASTING REQUIREMENT REQUIREMENT/COST SAVING JUSTIFIES INVESTMENT YEAR REQUIREMENT(T/Y) TRANSPORTATION COST (TL)

47 INCOME/PROFIT EXPECTATIONS YEAR CAPACITY(T/Y) INCOME(TL) PROFIT (TL)

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49 STRATEGY GUIDANCE PRODUCT DIVERSIFICATION Focus on local industry. Meeting requirements of customers. Minimized capital expenditures. Short research and development period. Efficient team with profound expertise. MARKET DIVERSIFICATION 49

50 THANK YOU FOR FURTHER INFORMATION PLEASE OR CALL TUMOSAN INVESTOR RELEATIONS AT