ARÇELİK A.Ş. — Interim / Quarterly Report 2023

Oct 20, 2023

3Q23 Financial Results

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October 20, 2023

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3Q23 HIGHLIGHTS

Solid revenue growth momentum and annual margin improvement at all lines maintained..

TRY58.2bn

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Consolidated revenue growth of 70% y/y driven by continued strong unit growth in Türkiye, strategic pricing initiatives and TRY depreciation.

Revenue

Wholesale & retail demand in Türkiye remained strong while the demand in international 10.6% markets continued to decline. EBITDA Margin EBITDA margin was 10.6%, up by 190 bps y/y thanks to eased raw material costs, strong Türkiye operations and strategic pricing across regions. 24.0% OPEX / Sales Net Working Capital/Sales was 23.4% as of 3Q23. 23.4% NWC / Sales Leverage was down to 2.36x as of September, 2023. 2.36x Successful issuance of USD400m Eurobond.

Leverage

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Key Factors Sales / Margins

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REVENUE GROWTH GROSS MARGIN
70% 32.8%
Strong unit growth in Türkiye Lower raw material costs on both q/q & y/y
TRY depreciation on both q/q & y/y Favorable EURUSD parity on y/y
Price increases on both q/q & y/y
58,218
32.8%
31.9%
46,948
28.8%
34,255
TRYmn
3Q22 2Q23 3Q23 3Q22 2Q23 3Q23
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3Q23 Financial Results

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EBITDA MARGIN

10.6%

Better gross profitability on both q/q & y/y Increased OPEX/Sales on both q/q & y/y

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10.8% 10.6%
8.7%
3Q22 2Q23 3Q23
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Operational Performance

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3Q23 Financial Results

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Steady growth in revenue gained momentum in Türkiye 3Q23 Financial Results thanks to ongoing robust demand and strategic pricing efforts

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MDA6*

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ARÇELİK y/y growth (%)
TÜRKİYE y/y growth (%)
30% 30%
2%
(0%)
Jul-Aug 22 Jul-Aug 23
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AIR CONDITIONER*

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ARÇELİK y/y growth (%)
TÜRKİYE y/y growth (%)
498%
334%
(57%) (54%)
Jul-Aug 22 Jul-Aug 23
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TELEVISION**

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ARÇELİK y/y growth (%)
TÜRKİYE y/y growth (%)
16% 19%
(5%)(4%)
8M22 8M23
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Türki e Revenue Growth y

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121%
22%
Unit growth in MDA6
22,403 Unit growth in A/C
18,398
Unit growth in TV
10,128
Price increases
TRYmn
3Q22 2Q23 3Q23
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Türki e Share in Total Revenue y

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3Q23 9M23
30% 38% 30% 38%
3Q22 9M22
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MDA6 and A/C data (sell-in, in unit terms) is based on WGMA for July-August period on a cumulative basis. *TV market reflects the data of a retail panel market for 8M23 period in unit terms on a cumulative basis. Sensitivity: Public

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Demand in Western Europe continued to decline but at a slower rate whereas it showed signs of improvement in Eastern Europe

3Q23 Financial Results

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23% Share in total revenue

Western Europe

Eastern Europe

16%

Share in total revenue

y/y market growth in unit terms

MDA6 Market

MDA6 Market

y/y market growth in unit terms

8M23 6M23

• The slowdown in consumer demand in the Western

• W. Europe European markets continued in July and August, yet with a slower pace.

• Germany • Price increases across the industry has been continued in July and August yet with a lower rates given the weakness in demand. In the 8M23, despite

• France

• Price increases across the industry has been continued in July and August yet with a lower rates given the weakness in demand. In the 8M23, despite price increases, market contracted by mid to low single digit percentage in value terms.

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Great Britain

Italy Spain

Arçelik in Western Europe

• The decline in the number of units sold was partially balanced by price increases; nevertheless, revenue in 3Q23 decreased by approximately a low-singledigit percentage in EUR terms y/y.

Belgium

Austria

• Arçelik’s price index as a group has increased in 8M23 in Western Europe.

(20%) (10%) 0% 10% 20%

• Cycling quite a low base, consumer demand in Russia continued to grow significantly in both months of July and August.

• Demand continued to fall in other major countries in Eastern Europe in July-August period y/y on a cumulative basis.

• Driven by strong Russian market, consumer demand in Eastern Europe was increased by low-teens percentage in July-August period y/y on a cumulative basis.

Arçelik in Eastern Europe

• Despite higher units sold in Eastern Europe and price increases, annual revenue growth was c.2% in EUR terms due to appreciated EUR.

8M23 6M23

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E. Europe

Russia

Poland

Romania

(20%) (10%) 0% 10% 20%

MDA6 market charts and the market positionings reflect the data of a retail panel market. Sensitivity: Public

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Demand in key geographies remained to be weak

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9%
Share in total
revenue
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Africa & Middle East

• Revenues generated from Africa & Middle East increased by c.7% y/y in 3Q23 in EUR terms, mainly driven by strong Middle East operations.

• Defy’s domestic unit sales increased by low-teens percentage in the third quarter on a yearly basis while export units declined by high single digit percentage.

• Defy’s net sales increased by c.4% in ZAR terms in 3Q23 y/y. In EUR terms, net sales were contracted at around low-teens percentage, as a result of depreciated ZAR against EUR.

• Compared to the declining trend in the first and the second quarter of 2023, consumer demand improved in 3Q23 and was flattish compared to a year ago. Defy maintained its strong market leadership as of September 2023.

3Q23 Financial Results

Asia-Pacific

• Revenues from APAC were down by c.31% in EUR terms in 3Q23 y/y. The contraction was primarily as a result of weak demand environment.

• In Pakistan, net sales increased by c.16% y/y in PKR terms thanks mainly to price increases, despite lower units sold given the unfavourable economic conditions. In EUR terms, net sales were contracted by c.17%, reflecting the depreciation of PKR and contracted sales units.

• In Bangladesh, net sales were down by c.35% in BDT terms in 3Q23 y/y due to unit contraction in major products such as refrigerator, air conditioner, computer and sewing machine. BDT continued to depreciate against EUR which has led to c.47% y/y lower net sales in EUR terms.

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12%
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Share in total revenue

• Despite the declining market due to challenging macroeconomic conditions and restrictions on trade, Beko Egypt posted a solid revenue growth of %54 in EUR terms y/y thanks mainly to increased white goods sales.

• Compared to the first eight months of 2022, MDA6 market contracted at high-single digit percentage in Egypt. In this period, Beko increased its market share in the country, in both unit and value terms and also its price index.

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Declining trend in raw material prices have been continued

3Q23 Financial Results

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Average Metal Prices Index - Market

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3Q23 99
2Q23 105
1Q23 111
2022 122
4Q22 102
3Q22 110
2Q22 136
1Q22 141
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Average Plastic Prices Index - Market

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3Q23 141
2Q23 147
1Q23 154
2022 175
4Q22 156
3Q22 176
2Q22 195
1Q22 175
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• Metal raw material prices have contracted on both quarterly and yearly basis mainly due to declined global demand, increased policy rates and decreased energy & input costs.

• Plastic raw material prices declined on both quarterly and yearly basis in 3Q23 as a result of lower demand and decreased energy and transportation costs.

Source: Steel BB, Steel Orbis Index includes: CRC, HRC, Galvanized Steel, Stainless Steel, Copper, Aluminium

Source: ICIS - Chemical Industry News & Chemical Market Intelligence Index includes: ABS, Polystyrene, Polyurethane, Polypropylene

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Sales Performance

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3Q23 Financial Results

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Resilient revenue composition through diversification

3Q23 Financial Results

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Sales Bridge

Sales Breakdown by Geography

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3Q23
70.0% y/y Türkiye
9%
70.000
2% [2%] Western Europe
60.000 14%
5%
50.000 10.607 1.392 CIS & Eastern Europe
3% 30% 38%
40.000 12.276 311 44.0% 5.8% 35.815 5% 3% Africa
y/y 4%
y/y
30.00020.000 24.127 121.2%y/y 46.531 1.3%y/y 46.842 57.449 5% 3Q22 Middle East
34.255
16% Pakistan
10.000 22.403
17%
TRYm 10.128 25%
-
Bangladesh
3Q22 TR Organic INT Organic INT FX Acquisition 3Q23
Impact Impact 23% Other
International Türkiye
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Financial Performance

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3Q23 Financial Results

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Summary financials

3Q23 Financial Results

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TRYmn 3Q23 3Q22 y/y 2Q23 q/q Revenue 58.218 34.255 70% 46.948 24% Gross Profit 19.077 9.861 93% 14.998 27% EBIT 4.844 2.100 131% 3.958 22% EBIT - exc. one-off items 5.118 2.046 150% 3.958 29% Profit Before Tax 1.354 231 485% 1.126 20% Net Income 1.146 495 132% 683 68% Net Income -exc. one-off items 1.420 441 222% 683 108% EBITDA 6.182 2.986 107% 5.047 22% EBITDA -exc. one-off items 6.456 2.932 120% 5.047 28% Gross Profit Margin 32,8% 28,8% 398 bps 31,9% 82 bps EBIT Margin 8,3% 6,1% 219 bps 8,4% (11 bps) EBIT Margin -exc. one-off items 8,8% 6,0% 282 bps 8,4% 36 bps Net Profit Margin 2,0% 1,4% 52 bps 1,5% 51 bps Net Profit Margin -exc. one-off items 2,4% 1,3% 115 bps 1,5% 98 bps EBITDA Margin 10,6% 8,7% 190 bps 10,8% (13 bps) EBITDA Margin -exc. one-off items 11,1% 8,6% 253 bps 10,8% 34 bps

9M23 9M22 y/y 145.057 94.724 53% 46.491 28.116 65% 11.495 6.013 91% 11.769 5.930 98% 3.191 1.987 61% 2.988 2.059 45% 3.262 1.977 65% 14.920 8.404 78% 15.194 8.321 83% 32,1% 29,7% 237 bps 7,9% 6,3% 158 bps 8,1% 6,3% 185 bps 2,1% 2,2% (11 bps) 2,2% 2,1% 16 bps 10,3% 8,9% 141 bps 10,5% 8,8% 169 bps

EBIT was calculated by deducting the impact of FX gains and losses arising from trade receivables & payables, credit finance income and charges and cash discount expense and adding income & expenses from sale of property plant and equipment.* Sensitivity: Public Net income before minority

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Leverage maintained at healthy levels

3Q23 Financial Results

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Net Debt & Leverage

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2,70 70.000.000
2,50 2,45 2,36 60.000.000
50.000.000
2,00 43,731
37,465 40.000.000
1,50
28,411 30.000.000
1,00
20.000.000
0,50
10.000.000
TRYmn
0,00 0
9M22 6M23 9M23
Net Debt Leverage
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Debt Currency & Rates Breakdown

Currency	Effective Interest Rate	Original Currency	TRY Equivalent
	p.a.	(mn)	(mn)
TRY	29.4%	13,017	13,017
EUR USD	5.8% 8.6%	1,262 116	36,627 3,183
GBP ZAR	7.0% 9.8%	6 1,057	205 1,534
AUD	5.8%	30	529
PKR	23.2%	19,046	1,796
BDT RUB	7.9% 15.3%	7,733 1,791	1,922 501
RON	7.7%	91	527
PLN	8.0%	148	929
NOK SEK	5.9% 5.3%	5 118	12 296
CHF	4.0%	0.1	2
IDR	9.5%	89,105	158
MYR	6.0%	31	184
THB	5.5%	382	287
VND	7.2%	44,000	50
CZK TOTAL LOANS	8.8%	145	173 61,932
USD	8.5%	400	10,941
EUR	3.0%	354	10,263
TRY	14.2%	671	671
TOTAL BOND TOTAL			21,875 83,807

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Cash Currency Breakdown Debt Currency Breakdown Debt Maturity Profile
TRY39.6bn (EUR1.4bn) TRY83.8bn (EUR2.9bn) TRY83.8bn (EUR2.9bn)
11% 11% 4%
17% USD Other 2029+
Other 17% 15%
USD 2028
16% 36%
54% TRY 3% 2023
17% EUR 2027
TRY
16%
2026
24%
56% 2% 2024
EUR 2025
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EBITDA margin expansion thanks to improved cost environment 3Q23 Financial Results FCF under pressure due to increased WC and higher CAPEX

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EBITDA Margin

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3Q22 3Q23
Non-cash
GP Margin OPEX/Sales
Items
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Working Capital/Sales

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24,4%
23,4%
22,7%
21,0%
2022 1Q23 2Q23 3Q23
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CAPEX/Sales

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5.1%
4.0%
3Q22 3Q23
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Free Cash Flow
1,729
TRYmn (2,538)
3Q22 3Q23
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Guidance

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3Q23 Financial Results

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2023 Guidance

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Revenue

3Q23 Financial Results

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• Turkey (in TRY) c.75% growth

• International (in FX) c. (-) 4%

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EBITDA Mar in c.10.5%
g
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WC/Sales <25%
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CAPEX c.300 mio EUR

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Q&A

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3Q23 Financial Results

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Appendix

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3Q23 Financial Results

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Margins by segments

3Q23 Financial Results

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Consolidated

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31,9% 32,8% 70.000
30,0% 28,8% 58.218 60.000
25,0% 46.948 50.000
20,0% 34.255 40.000
15,0% 30.000
10,0% 20.000
5,0% 10.000
0,0% 0
3Q22 2Q23 3Q23
Revenue Gross Margin
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White Goods

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35,0% 32,4% 34,0% 60.000
30,0% 28,4% 44.798 50.000
25,0%
35.091 40.000
20,0% 27.529 30.000
15,0%
20.000
10,0%
10.000
5,0%
0,0% 0
3Q22 2Q23 3Q23
Revenue Gross Margin
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Consumer Electronics

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25,0% 6.000
25,6%
25,0% 23,8%
5.000
20,0% 4.046
4.000
15,0% 2.796 3.000
2.126
10,0% 2.000
5,0% 1.000
0,0% 0
3Q22 2Q23 3Q23
Revenue Gross Margin
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Other

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35,0% 32,4% 32,4%
30,9%
30,0%
9.061 9.373 10.000
25,0%
20,0%
15,0% 4.599
10,0%
5,0%
0,0% 0
3Q22 2Q23 3Q23
Revenue Gross Margin
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Close watch on FX risk, proactively taken actions

3Q23 Financial Results

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2.000 3,9% 6,0%
4,0%
1.000 2,9% 1,7% 2,9% TRYm Before Hedge Hedged Position Net Position
2,0%
0
0,0% EUR (17,162) 14,615 (2,546)
0,7%
-1,2% -1.000 0,3%0,3% -2,0%
-0,5%
-1,2% -1,2%
-2.000 -2,4% -2,6% -1,7% -4,0% USD (13,902) 12,369 (1,534)
-5,1% -3,6% -2,9% -3,2% -6,0%
-3.000 -4,1% -6,6% -8,0% GBP 2,002 (1,754) 247
-6,5% -10,0%
-4.000 Other (961) (243) (1,204)
-12,0%
-5.000
-13,0% -14,0% TOTAL (30,023) 24,986 (5,037)
-6.000 -14,0% -16,0%
Net FX Position / Equity (14.0%)
Net FX Position Net FX/Equity
18 Q1 18 Q2 18 Q3 18 Q4 19 Q1 19 Q2 19 Q3 19 Q4 20 Q1 20 Q2 20 Q3 20 Q4 21 Q1 21 Q2 21 Q3 21 Q4 22 Q1 22 Q2 22 Q3 22 Q4 23 Q1 23 Q2 23 Q3
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• FX hedging is a strictly pursued policy in Arçelik since more than 30 currencies are actively managed in global operations.

• It is a KPI for the company management not to have a FX exposure exceeding low single-digit % of equity.

• The primary strategy on balance sheet hedging mainly through cash, receivables, payables and financial liabilities, and the remaining part is hedged through financial derivatives.

2023

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Contacts

Özkan Çimen

CFO

(+90) 212 314 34 34

Mine Şule Yazgan

Finance & Enterprise Risk Executive Director

(+90) 212 314 30 60

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3Q23 Financial Results

Öktem Söylemez

Investor Relations Senior Lead

(+90) 212 705 96 81

www.arcelikglobal.com investorrelations@arcelik.com

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2Q23 Financial Results

Disclaimer

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This presentation contains information and analysis on financial statements as well as forwardlooking statements that reflect the Company management’s current views with respect to certain future events. Although it is believed that the information and analysis are correct and 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 nor of its or nor other shall have Arçelik any managers employees any person any liability whatsoever for any loss arising from the use of this presentation.

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Thank You!

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