CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT 30 SEPTEMBER 2016
INDEX TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT 30 SEPTEMBER 2016 CONTENTS Page CONSOLIDATED INTERIM BALANCE SHEETS... 1-2 CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME... 3 CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY... 4-5 CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS... 6 CONSOLIDATED INTERIM EBITDA INFORMATION... 7 CONSOLIDATED INTERIM SEGMENT INFORMATION... 8-9 CONSOLIDATED INTERIM FINANCIAL INCOME AND EXPENSES... 10
CONSOLIDATED INTERIM BALANCE SHEETS AT 30 SEPTEMBER 2016 AND 31 DECEMBER 2015 Audited 30 September 2016 31 December 2015 ASSETS Current assets: Cash and cash equivalents 116,567 94,087 Trade receivables 862,225 578,662 Due from related parties 30,050 3,027 Biological assets 100,963 82,037 Inventories 337,901 314,412 Derivative financial instruments 732 61 Other current assets 89,404 85,843 Assets of subsidiary classified as held for sale - 102,652 Total current assets 1,537,842 1,260,781 Non-current assets: Trade receivables 4,752 2,721 Biological assets 30,243 27,583 Financial assets at fair value through profit or loss 4,862 5,030 Investment in associate 19,896 - Property, plant and equipment 1,640,831 1,542,594 Investment property 284,268 283,362 Intangible assets 16,215 10,279 Deferred income tax assets 13,113 7,441 Other non-current assets 17,220 16,649 Total non-current assets 2,031,400 1,895,659 TOTAL ASSETS 3,569,242 3,156,440 1
CONSOLIDATED INTERIM BALANCE SHEETS AT 30 SEPTEMBER 2016 AND 31 DECEMBER 2015 Audited 30 September 2016 31 December 2015 LIABILITIES AND EQUITY Current liabilities: Borrowings 401,892 216,875 Derivative financial instruments 1,194 1,966 Other financial liabilities 28,433 36,275 Trade payables 588,393 623,821 Due to related parties 4,443 3,140 Current income tax liabilities 3,686 6,092 Provision for employment termination benefits 3,358 3,106 Other current liabilities 223,087 96,812 Liabilities of subsidiary classified as held for sale - 75,202 Total current liabilities 1,254,486 1,063,289 Non-current liabilities: Borrowings 1,228,191 1,154,453 Derivative financial instruments 26,194 3,335 Trade payables 58,405 29,048 Deferred income tax liabilities 69,178 73,323 Provision for employment termination benefits 80,241 73,018 Other non-current liabilities 3,700 - Total non-current liabilities 1,465,909 1,333,177 Total liabilities 2,720,395 2,396,466 Share capital 225,943 225,943 Adjustment to share capital 200,871 200,871 Total paid-in capital 426,814 426,814 Treasury shares (43,677) (43,677) Contribution from shareholders 5,323 5,323 Revaluation reserve 453,951 476,848 Actuarial losses arising from defined benefit plans (23,540) (19,568) Cash flow hedge reserves (369) (871) Currency translation reserve 9,863 11,158 Accumulated losses (555,414) (544,376) Net loss for the period 85,439 (34,668) Equity attributable to owners of the parent company 358,390 276,983 Non-controlling interest 490,457 482,991 Total equity 848,847 759,974 TOTAL LIABILITIES AND EQUITY 3,569,242 3,156,440 2
CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME FOR THE NINE- MONTH PERIODS ENDED AT 30 SEPTEMBER Restated (*) 30 September 2016 30 September 2015 Revenue 2,652,775 2,408,258 Cost of sales (1,883,829) (1,697,494) Gross profit 768,946 710,764 Selling and marketing costs (374,475) (348,486) General administrative expenses (128,457) (120,623) Research and development costs (23,542) (21,073) Other operating income 16,242 22,661 Other operating expense (27,250) (19,573) Operating profit 231,464 223,670 Finance income 64,937 119,256 Finance expense (235,765) (459,775) Profit/ (Loss) before taxation on income 60,636 (116,849) Taxation on income (10,000) (14,749) Profit/ (Loss) for the period from continuing operations 50,636 (131,598) Profit/ (Loss) from discontinued operations 72,459 (2,282) Profit/ (Loss) for the period 123,095 (133,880) Attributable to: 123,095 (133,880) Non-controlling interests 37,656 24,058 Owners of the parent company 85,439 (157,938) (*) In accordance with the provisions of IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations", financial performance of DYO Matbaa for 30 September 2015 was separately presented on the statement of comprehensive income together with the related explanatory notes. 3
CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED AT 30 SEPTEMBER 2016 AND 30 SEPTEMBER 2015 Attributable to owners of the parent company Actuarial losses Revaluation arising reserve of from Net Adjustment Contributions property defined Currency Cash loss Non- Share to Share Treasury from plant and benefit translation flow Accumulated for the controlling Total Capital Capital Shares shareholders equipment plans adjustments hedges losses period interests Equity Balances at 1 January 2016 225,943 200,871 (43,677) 5,323 476,848 (19,568) 11,158 (871) (544,376) (34,668) 482,991 759,974 Transfer from net loss for the period to accumulated losses - - - - - - - - (34,668) 34,668 - - Dividend payment - - - - - - - - - - (37,694) (37,694) Increase in share capital of a subsidiary - - - - - - - - - - 10,331 10,331 Addition to scope of consolidation - - - - - - - - 1,679 - - 1,679 Changes in shareholdings in subsidiaries - net - - - - (12,927) 946 - - 11,981 - - - Sales of plant, property and equipment - net - - - - (509) - - - 509 - - - Total comprehensive income - - - - - (4,918) (1,295) 502-85,439 34,829 114,557 Depreciation transfer - net - - - - (9,461) - - - 9,461 - - - Balances at 30 September 2016 225,943 200,871 (43,677) 5,323 453,951 (23,540) 9,863 (369) (555,414) 85,439 490,457 848,847 4
CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED AT 30 SEPTEMBER 2016 AND 30 SEPTEMBER 2015 Attributable to owners of the parent company Actuarial losses Revaluation arising reserve of from Net Adjustment Contributions property defined Currency Cash loss Non- Share to Share Treasury from plant and benefit translation flow Accumulated for the controlling Total Capital Capital Shares shareholders equipment plans adjustments hedges losses period interests Equity Balances at 1 January 2015 225,943 200,871 (43,677) 5,323 356,883 (14,381) 7,639 (2,523) (536,861) (8,815) 415,619 606,021 Transfer from net loss for the period to accumulated losses - - - - - - - - (8,815) 8,815 - - Dividend payment - - - - - - - - - - (42,628) (42,628) Changes in shareholdings in subsidiaries - net - - - - 9,337 (275) - (210) (12,033) - 3,181 - Sales of plant, property and equipment - net - - - - (713) - - - 713 - - - Total comprehensive income - - - - - (3,452) 3,911 1,879 - (157,938) 22,887 (132,713) Depreciation transfer - net - - - - (9,357) - - - 9,357 - - - Balances at 30 September 2015 225,943 200,871 (43,677) 5,323 356,150 (18,108) 11,550 (854) (547,639) (157,938) 399,059 430,680 5
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS FOR THE PERIOD ENDED AT 30 SEPTEMBER 1 January - 1 January - 30 September 2016 30 September 2015 Period profit/ (loss) 123,095 (133,880) Adjustments to reconcile net cash from operating activities 238,603 424,404 Adjustment to taxation 10,000 14,437 Depreciation and amortization 66,510 58,365 Interest income (2,795) (2,427) Interest expense 109,455 97,579 Gain arising from realized cross currency swap transactions - (36,090) Provision for employment termination benefits 10,978 10,147 (Gain)/ loss from sales of property, plant and equipment - net 367 490 Bad debt provision 10,892 2,167 Unutilized provision for doubtful trade receivables (3,089) (316) Provision for litigation cost - net 183 457 Provision for marketing and promotion charges - net 80,360 80,662 (Gain)/ loss arising from changes in fair value less estimated point-of-sale costs of biological assets (1,300) (13,611) Provision for obsolescence of inventory - net 352 334 Unrealised foreign exchange loss from borrowings 27,977 208,763 Adjustments related to swap transactions 19,775 7,307 Gain arising from government grants (18,603) (3,860) Gain arising from sale of subsidiary (72,459) - Changes in working capital (303,274) (137,487) Employment termination benefits paid (12,818) (8,433) Government grants received 12,446 4,267 Taxes paid (22,222) (11,260) Net cash generated from operating activities 35,830 137,611 Interest received 2,846 2,427 Purchases of property, plant and equipment, intangible assets, biological assets and order advance given (179,406) (121,191) Proceeds from sales of property, plant and equipment, intangible assets and investment property 8,425 2,824 Proceeds from sale of subsidiary 59,688 - Net cash used in investing activities (108,447) (115,940) Redemption of borrowings and other financial liabilities (184,917) (204,600) Proceeds from borrowings and other financial liabilities 392,176 295,202 Dividends paid to non-controlling interest (34,623) (42,628) Interest paid (91,635) (99,825) Participation into increasing share capital of subsidiary by non-controlling interest 10,331 849 Proceeds from cross currency swap transaction 3,847 46,984 Net cash flows generated from/ (used in) financing activities 95,179 (4,018) Net increase in cash and cash equivalents before foreign currency translation differences 22,562 17,653 Effect of currency translation differences (94) 828 Changes in blocked cash and cash equivalents 6 (65) CASH AND CASH EQUIVALENTS (EXCLUDING BLOCKED DEPOSIT) AT THE BEGINNING OF THE PERIOD (*) 92,926 101,601 CASH AND CASH EQUIVALENTS (EXCLUDING BLOCKED DEPOSIT) AT THE END OF THE PERIOD (*) 115,400 120,017 (*) The blocked deposits as of 30 September 2016 and 31 December 2015 were amounting to TL1,167 and TL1,161, respectively. 6
CONSOLIDATED INTERIM EBITDA INFORMATION FOR THE NINE- MONTH PERIODS ENDED AT 30 SEPTEMBER Restated 30 September 2016 30 September 2015 Revenue 2,652,775 2,408,258 Cost of sales (1,883,829) (1,697,494) Gross profit 768,946 710,764 Gross profit margin 29.0% 29.5% Selling and marketing costs (374,475) (348,486) General administrative expenses (128,457) (120,623) Research and development costs (23,542) (21,073) EBIT 242,472 220,582 EBIT margin 9.1% 9.2% Add back depreciation and amortisation 66,510 56,760 Add back provision for ETB 10,978 9,763 Add back fair value (gain)/ loss from biological assets (1,300) (13,611) EBITDA 318,660 273,494 EBITDA margin 12.0% 11.4% 7
CONSOLIDATED INTERIM SEGMENT INFORMATION FOR THE NINE- MONTH PERIODS ENDED AT 30 SEPTEMBER SEGMENT INFORMATION The segment results for the nine-month periods ended at 30 September 2016 are as follows: Food and beverage Coatings Tissue Other Group Total gross segment sales 1,879,264 622,248 121,013 65,363 2,687,888 Inter-segment sales (1,367) (11) (121) (33,614) (35,113) Revenue 1,877,897 622,237 120,892 31,749 2,652,775 EBITDA 196,232 95,554 13,364 13,510 318,660 EBITDA margin 10.4% 15.4% 11.1% 42.6% 12.0% The segment assets and liabilities at 30 September 2016 and capital expenditure for the nine-month period then ended are as follows: Food and beverage Coatings Tissue Other Group Assets 1,836,958 969,635 177,496 571,308 3,555,397 Deferred income tax assets 13,113 Derivative financial instruments 732 3,569,242 Liabilities 557,998 330,182 47,257 26,190 961,627 Borrowings 1,630,083 Other financial liabilities 28,433 Derivative financial instruments 27,388 Current income tax liabilities 3,686 Deferred income tax liabilities 69,178 2,720,395 Capital expenditures for the nine-month period ending at 30 September 2016 103,890 57,121 2,290 13,808 177,109 8
CONSOLIDATED INTERIM SEGMENT INFORMATION FOR THE NINE- MONTH PERIODS ENDED AT 30 SEPTEMBER SEGMENT INFORMATION (continued) The segment results for the nine-month periods ended at 30 September 2015 are as follows: Food and beverage Coatings (*) Tissue Other Group Total gross segment sales 1,751,236 527,382 97,557 50,712 2,426,887 Inter-segment sales (1,640) (29) (163) (16,797) (18,629) Revenue 1,749,596 527,353 97,394 33,915 2,408,258 EBITDA 181,130 73,340 7,748 11,276 273,494 EBITDA margin 10.4% 13.9% 8.0% 33.2% 11.4% The segment assets and liabilities at 31 December 2015 and capital expenditure for the nine-month period ended at 30 September 2015 are as follows: Food and beverage Coatings Tissue Other Group Assets 1,663,373 689,980 177,002 515,931 3,046,286 Deferred income tax assets 7,441 Derivative financial instruments 61 Assets of subsidiary classified as held for sale 102,652 102,652 3,156,440 Liabilities 497,957 269,394 42,362 19,232 828,945 Borrowings 1,371,328 Other financial liabilities 36,275 Derivative financial instruments 5,301 Current income tax liabilities 6,092 Deferred income tax liabilities 73,323 Liabilities of subsidiary classified as held for sale 75,202 75,202 2,396,466 Capital expenditures for the nine-month period ending at 30 September 2015 84,225 17,409 6,088 9,256 116,978 Capital expenditures of subsidiary classified as held for sale - 668 - - 668 117,646 9
CONSOLIDATED INTERIM FINANCE INCOME AND EXPENSE FOR THE NINE- MONTH PERIODS ENDED AT 30 SEPTEMBER FINANCIAL INCOME AND EXPENSES Restated 30 September 2016 30 September 2015 Finance income: Foreign exchange gain 54,287 59,860 Income from cross currency swap transaction 3,847 44,413 Interest income 2,795 4,311 Other 4,008 10,672 64,937 119,256 Finance expense: Interest expense on borrowings (108,559) (97,430) Foreign exchange loss (87,360) (332,035) Loss arising from fair value measurement of cross currency swap transactions (23,079) (13,817) Bank commissions (5,236) (3,824) Interest expense on swap transactions (1,439) (1,648) Other (10,092) (11,021) (235,765) (459,775) 10