KOÇ HOLDING SUSTAINS RECORD LEVEL INVESTMENTS IN 2014
KOÇ HOLDING SUSTAINS RECORD LEVEL INVESTMENTS IN 2014 AND CONTINUES TO PIONEER IN R&D AND INNOVATION
TURGAY DURAK, CEO OF KOÇ HOLDING,ASSESSED THE FINANCIAL RESULTS OF 2013:
"2013 PRESENTED CHALLENGES BOTH FOR THE GLOBAL AND THE TURKISH ECONOMY. NEVERTHELESS, THE KOÇ GROUP CONTINUED TO DELIVER EXCEPTIONAL RESULTS . GLOBAL AND DOMESTIC DEVELOPMENTS INDICATE ANOTHER TOUGH YEAR AHEAD IN 2014. THE KOÇ GROUP IS DETERMINED TO CONTINUE WITH HISTORICALLY LARGE INVESTMENTS IN ITS CURRENT BUSINESSES; DRIVEN BY OUR MOTTO "I LIVE AND PROSPER AS LONG AS MY COUNTRY LIVES AND PROSPERS " .
Koç Holding closed 2013 with successful results despite the challenges both at home and abroad; consolidated sales revenues totaled 66,2 billion Turkish lira and net profit for parent company shares reached 2,7 billion Turkish lira. "There were two separate periods in 2013: prior to and after the FED announcements regarding tapering off asset purchases, made during the third week of May. In terms of the industries we do business in, we see that almost every industry has been affected differently by this economic conjuncture. The Group closed 2013 with results that are in parallel with the targets we had set at the start of the year, despite all of the uncertainties and challenging market conditions. Koç Group strives to work so as to make the utmost contribution to our country with the faith we have in the long-term potential of Turkey. Our successful results is a manifestation of how we work together as a great familywith more than 80,000 personnel and executives; over 10,000 dealers, with whom we make a difference in the lives of millions of consumers; our strong supplier base and the synergy we have developed with the unions that represent our employees. I thank everyone who has made a contribution to this achievement," said Turgay Durak, CEO of Koç Holding, as he assessed the Group's financial results for 2013.
He continued, "We are in the midst of the biggest organic investment period in the Group's history."
Turgay Durak emphasized Koç Group's continued large-scale investments with a focus on growth despite the fluctuating macroeconomic conjuncture at home and abroad in 2013. He added, "We made a record combined investment of 6.4 billion Turkish lira in 2013. We are in the midst of the biggest organic investment period in the Group's history. A number of crucial investments are planned for completion within 2014. At a cost of $2.7 billion, the Residuum Upgrade Project by Tüpraş is undoubtedly the most important among them, and it is 92 percent completed. Upon completion at the end of 2014, the Residuum Upgrade Project is expected to help lower the current account deficit by nearly $1 billion. Following the introduction of the Transit Custom at Ford Otosan last year, the New Transit and the Courier, which are light commercial vehicles, are set to be released on the market in the first half of 2014. I would also like to state that the new R&D Center at Ford Otosan is going to begin operations with a 1,300-strong staff of engineers. The Doblo project, with its exports to the USA, and facelift investments are also due to start this year. Work will be stepped up in 2014 within the scope of the new automobile project, which is planned for production towards the end of 2015 with a projected investment of $520 million. Construction of TürkTraktör's new 50,000-capacity plant in Erenler, Adapazarı is in the works with a proposed opening date of June 2014. The third and fourth prototypes of Altay, a strategically important national tank project, are being manufactured by Otokar as we speak. Yapı Kredi is going to open 60 new branches in 2014 to increase its market share, thanks to a strengthened workforce and a customer-focused banking approach. R&D as well as new product and capacity increase investments will continue on the side of durable consumer goods. New market share gains have helped Arçelik forge ahead on the way to becoming one of the biggest white goods manufacturers in the world. Recently, Arçelik launched a new production line at the Gaesti plant for its white goods brand Arctic in Romania. The Refrigerator Plant in Romania has given Arçelik the second biggest production capacity in Europe, just behind its Eskişehir Refrigerator Plant, which boasts the biggest production capacity in Europe. We are assessing investment and purchasing potentials by continuously looking into manufacturing and sales opportunities in new markets."
A constant leader in R&D and innovation
"One of our critical objectives remains as preserving our leadership role through technology and innovation investments in order to enhance our companies' global competitiveness," said Turgay Durak as he pointed out that Koç Group Companies maintained their leadership in R&D investments and patent development in 2013 within this scope. Mr. Durak also drew attention to the 14 R&D centers within Koç Group that have been approved by the Ministry of Science, Industry and Technology. He stated that more than 3,000 employees work at the R&D centers: "The Turkish Patent Institute's 'Companies with the Highest Number of Domestic Patent Applications in 2013' list ranked Arçelik at the number one spot, with Ford Otosan pursuing it in second place. Tofaş and Türk Traktör took sixth and ninth place, respectively. In 2013, The Turkish Exporters Assembly rewarded Arçelik with the 'Most Innovative Company' award for the second time. In light of all of these gratifying developments, Koç Group aspires to strengthen its technological and innovative abilities so as to improve Turkish companies' competitiveness in the global markets," he finished.
Export results make us proud
Turgay Durak highlighted the continuing achievements of Koç Group Companies in the Turkish Exporters Assembly awards. "Tüpraş maintained its leadership in exports, with Ford Otosan again pursuing it in second place. Tofaş and Arçelik took fifth and sixth place, respectively," he said. He also emphasized the fact that Koç Group accounted for nearly 10 percent of Turkey's total exports by achieving combined exports of $15.7 billion in 2013.
We are among the Turkish companies that the international finance markets trust the most
"Consistent financial success also manifests itself in the company's share price performance," Mr. Durak stated, stressing that Koç Holding's average market value surged by 40 percent, whereas BIST 30 Index rose by 24 percent on average year-on-year in 2013. He highlighted that while net asset values of holding companies in Turkey were traded with an average discount of 35 percent, Koç Holding was traded with an average of only 3 percent. "We are proud to see that Koç Group is among the Turkish companies that the international finance markets trust and have the most faith in. We pride ourselves on the fact that international credit rating agencies S&P and Moody's set Koç Holding's long-term corporate credit score as 'investable' in 2013," he asserted.
We are a pioneer in social investments and strategic philanthropy
Mr. Durak underlined the proud developments of 2013 in terms of Vehbi Koç Foundation's activities. "Vehbi Koç Foundation preserves and demonstrate the sense of responsibility we feel for our country and society. The resources it allocates have turned it into one of the biggest foundations in Europe. Since its establishment, the Foundation has been striving to support the growth of our country's economy, to serve as the best-in-classmodel and to address the needs of our society. Construction of the second phase of Koç University School of Medicine's Health Sciences Campus began in 2013 and it is set for completion in the first half of 2014. Once complete, Koç University Health Sciences Campus and the Training and Research Hospital is going to become one of the biggest health projects to be realized in Turkey, with 400 beds, imaging centers equipped with state-of-the-art devices, intensive care units, and emergency services for adults and children. We believe our Health Sciences Campus is going to grow into an important center in our country and in the world, thanks to the special hospital services that are dedicated to oncology and children's diseases," he said. Mr. Durak remarked that Vehbi Koç Foundation's model school project would gain speed in 2014. He continued: "After our model school is completed, the Model School Guide, which will contain all the information - from the architecture of the school to the education model - will be available for use when a foundation, institution or philanthropist wishes to build a school."
Our social responsibility projects are developing long-term and permanent solutions for our country
Turgay Durak maintained that Koç Group's social investments were based on two foundations using a holistic, long-term and strategic approach. The first is the Vehbi Koç Foundation and the second is Koç Group's social responsibility projects that are nearly the size of those of a non-governmental organization."We are carrying out the 'Vocational High School, a National Matter' and the 'For My Country' projects with the support of our employees and dealers. It gives us great pleasure to see that these projects are producing long-term and permanent solutions for our country," he explained. He continued, the 'No Barriers for My Country' project has been introduced with the purpose of improving physical conditions so as to ensure more involvement of disabled people in work and society, and also to develop social awareness and sensitivity to this subject. Due to the impact of the project and the interest it has garnered, we have decided to extend it for another year. Our project team is going to ensure participation by Koç Group personnel in the 'Right Approach to Disability Trainings.' Then, it is going to continue to extend these trainings to all corners of Turkey through our ambassadors, who are My Country volunteers. Furthermore, according to each company's sector and area of responsibility, efforts will be maintained to design new products and services for the disabled, and added support will be provided for social work projects.