Koç Holding's esteemed shareholders and stakeholders,

We have left behind a year that was scene to important developments for the world. Despite the ongoing challenges in the global markets, Koç Group continued to deliver successful financial and operational performance.

Undoubtedly, Turkey’s robust growth environment played a significant role in our achievements.

The focused growth strategy that we initiated well before the financial crisis hit the markets in 2008 proved to be the right path forward.

Our portfolio restructuring, which we completed when the asset prices were at their peak, and stringent cost management measures that we took enabled us to confront the crisis with a strong net cash position.

We responded with dynamism as the markets began to expand early in 2010.

We acted with a sound long-term focus to diversify our international markets, enhance our market shares and complete investments to further strengthen our competitive advantages. As a result we were able to weather the most challenging phases of the crisis and managed to outperform our competition.

Koç Holding posted consolidated revenues of TL53.8 billion in 2010, representing an increase of 20%, while our net profit after tax and minorities was TL1.7 billion, increasing by 21%.

In 2010, we continued to create value by generating combined revenues that are equivalent to 7% of the Turkish GDP and realizing 10% of Turkey’s total exports.

While maintaining our successful financial and operational performance, we created 5,000 new jobs through new investments and increases in capacity utilization, raising the number of employees to 73,000 people. Our total combined investments reached TL1.9 billion.

We continued to create shareholder value with our publicly traded companies. With a market capitalization of $12 billion as of 2010-end, Koç Holding outperformed both the Istanbul Stock Exchange (ISE) and its peers, becoming the holding company with the highest market capitalization at the ISE. Foreign ownership of Koç Holding’s free float reached 78%, the highest level in our history.

In 2011, our aim is to strengthen our global standing and further enhance our success.

We will continue to focus on maximizing productivity and profitability in the sectors where we operate, while also pursuing an active approach to evaluate new investment opportunities. Accordingly, if the right conditions are achieved, we will monitor partnership and investment opportunities in the domestic and international markets.

We will spare no effort to raise our competitive edge through innovation and technology improvements in our businesses and focus on innovative, environmentally sensitive and energy-efficient products and services.. We will endeavor to minimize the impact of regional and economic fluctuations by diversifying our export markets.

In 2011, we have budgeted a capital expenditure of TL3.7 billion on a combined Group basis. Our plan is to increase our consolidated revenues by 6% to TL57.1 billion and our consolidated operating profit by 9% to TL4.5 billion.

Dear shareholders and stakeholders,

2011 is a year when Koç Holding will celebrate 85 proud years of operations. I have full confidence that, with our values, we will transform new developments around the world into opportunities and continue to be a driving force of the Turkish economy

The potential and knowledge created by our highly competent employees and our long history will continue to provide us the strength and self-confidence we need.

Sincerely yours,

Turgay Durak

CEO