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Overview

Message from the CEO

Esteemed Stakeholders,

During the preparation of our annual report, the earthquakes in the southeastern region of our country had a deep impact on all of our lives. I would like to present my get-well wishes to all our stakeholders affected by the disaster. I wish for mercy on those who lost their lives, give my condolences to their relatives and wish for the quick recovery of the injured. As soon as the news of the disaster arrived, All Anadolu Group companies focused on their stakeholders. Our group companies and social companies instantly took action to support our people and help the regions that were devastated by the disaster. In addition to all the donations in kind and in cash, our companies are involved in lots of support projects and campaigns with the help their voluntary employees and stakeholders. It will take time to heal the wounds of this disaster. Meanwhile, we will maintain our support to the region. I wish such disasters and sorrows would never happen again.

We left behind another year that we maintained our strong and consistent performance with our approximately 80 companies, 86 production facilities, 6 R&D centers and more than 80.000 employees in 19 countries. In all the 7 sectors we are operating in, we invest in our brands, in innovations that will enable us to provide the better for our consumers, in digitalization and in projects that will add value to our future. We continue to take prudent steps toward our goals thanks to the effective financial and operational strategies we employ. We will carry our sustainability works forward as we announced our “From Anadolu to the Future” sustainability strategy and our goals for a better future. We will focus on the future of nature, business and people in all our operations. We became a participant of UN Global Compact as AG Anadolu Grubu Holding. We were ranked first in the “Investment Holding Companies” category among the best performing 100 publicly traded companies in the Refinitiv Diversity and Inclusion Index, which evaluates more than 12 thousand companies worldwide. We were listed among The 20 Most Admired Companies of Türkiye for the second consecutive time. It has also been a significant development for both our Group and our country that Togg, in which we have a 23% share and we consider as an important asset among our Group’s investments, came out of the production line. We continue to work together for our common future, become more motivated with new success stories and begin the new year with new expectations and targets.

As Anadolu Group, we recorded consolidated sales of TL 178,0 bn, which is 119% higher compared to 2021. Main contributors to the increase of our sales were soft drink, beer, Migros and automotive operations. Our consolidated EBITDA improved by 133% to TL 25,3, implying a margin of 14.2% as a result of better operational profitability in 2022. On the balance sheet side, our consolidated assets increased by 62% and exceeded TL 182,2 bn. Despite foreign currency appreciation against TL, our consolidated net debt decreased in TL terms and we generated a strong free cash flow.

Our Group companies continued to embrace significant achievements this year.

Anadolu Efes continued to bring many innovations to the brewing industry with its consumer-oriented approach. It continued its sustainability journey in 2022 without slowing down, which it placed at the center of its business processes. It has implemented new projects that created positive impact on both environment and society for a better planet. With the vision of adapting to the spirit of the time, it successfully continued its digital transformation process. 2022 will mainly be marked as “taking responsibility” for Coca-Cola İçecek (CCI). It proudly announced its Sustainability Commitments for 2030 focusing on six environmental and social pillars as packaging, water, climate, human rights, diversity and inclusion and community development on all these topics. It also issued the largest sustainability-linked bond in Türkiye and the first in the beverage industry across Europe, Middle East, Africa (EMEA). Many awards crowned these efforts such as ESG Bond Deal of the Year by the Bonds, Loans & Sukuk Türkiye Awards and Best Business Awards. Continuing to grow with more than 2,800 stores, online channels and more than 60 thousand employees, Migros united all its online operations under the roof of "Migros One" and entered a new business line with Migros Food. MoneyPay received its license from the Central Bank of the Republic of Türkiye as an electronic money institution. Migros put its name on the BIST Sustainability 25 Index, which was published by Borsa İstanbul for the first time this year, as the only representative from its sector. It was named the "Most Admired" company of the organized retail sector for the 19th consecutive year. Migros took its place among the “Climate Leaders” for the 4th time and the “Water Leaders” for the 2nd time with the CDP reporting.

In total of our companies operating in the automotive sector, we achieved a growth of 132% and we continue our innovative studies steadily. Anadolu Isuzu introduced its electric mini pickup truck model Big.e, designed and produced entirely in its production facilities and will bring vitality to the cities in the last kilometer transportation, in Germany. It has further strengthened its experience in the electric bus field with the new CitiVolt, which features all-electric driving and zero emissions. It made a strong entry into the German market, that has high standards in transportation, and has been the first Turkish company to export buses in high volumes. It started to obtain 55% of the electricity it needs in production from renewable energy, with the solar power plant installed on the roof of its production facilities. Transforming with the change of logo and corporate identity, Kia Türkiye made a strong start to the year with the launch of New Sportage model. In addition to the all-electric model EV6, which received the "2022 Car of the Year" award globally, the New Niro with its hybrid and electric models, was launched in our country. Our brand achieved the highest market share of all time at the end of November 2022. Serving with 76 branches in 37 different cities and a large fleet of vehicles, Garenta continues to offer a safe and easy rental model to its users with its high-quality car rental service. It managed to achieve a customer satisfaction rate of 9.7 out of 10 thanks to its service approach that does not compromise on quality. ikinciyeni.com has renewed its website and mobile application and started to offer its services with a more user-friendly and innovative approach. Serving with vendors in 20 locations as of the end of 2022, it continues to work hard to meet the needs and expectations of its users with the auction model it has introduced to the sector and its various campaigns. Anadolu Motor strengthened its commercial relations while expanding its production network. Already a distributor of Honda Marine, it became a distributor of the Oxe Diesel brand. Taking part in exhibitions out abroad and in our country, it launched Stage 5 engines at the EIMA fair in Italy.

We also consistently maintain our activities in our Agribusiness, Energy and Industry Group companies. Anadolu Etap changed its organizational structure and was divided to two different companies operating in agribusiness and soft-drinks sectors. Anadolu Etap İçecek reached an all-time record in fruit processing by reaching over 340 tons. It generates 70% of its revenues from exports. Anadolu Etap Tarım, the biggest fruit grower company in Türkiye, maintains its operations in 7 farms on 30.000 decares of land and more than 3 million fruit trees and generates more than 50% of its sales from exports. Its MİÇO project, which has been supporting the uninterrupted education of children of seasonal nomadic workers, has touched over 2,000 children. Aslancık and Paravani Hydroelectric Power Plants, our renewable energy investments in the energy sector, are continuing their activities successfully. Increasing its effectiveness in the market by further improving its service quality and the benefit it adds to the sector, Adel Kalemcilik saw the positive effects of the regional authorized dealership system it implemented last year and continues to lead its sector in a rapidly changing new world. In addition, Adel Kalemcilik received 11 national and international awards in total with the 1500Kelime.com Platform, which is implemented in the field of Quality Education and contributes to the mental development of children by improving their vocabulary.

We continue to create value for our society with our social organizations. Anadolu Foundation has provided scholarship support for more than 30,000 young people to date. It also helps its scholars prepare for the future with Anadolu Academy Learning and Development Programs. My Dear Teacher Program, which was prepared in line with the "Education Vision" of the Ministry of National Education, has reached more than 190,000 teachers in 55 provinces. It has provided more than 700,000 free health services to nearly 60,000 people in need with its Free Healthcare Services Program. Mahmut-Dudu Yazıcı Anatolian High School in Nevşehir, the latest example of our Foundation’s contribution works for the society, has been completed within the year and was handed over to the Ministry of Education. Anadolu Medical Center and registered its world class healthcare with several renewed accreditations without compromising on high quality. It was registered for the sixth time with accreditations like ESMO (European Society for Medical Oncology) and JCI (Joint Commission International), which is considered as the gold standart in global healthcare services. Furthermore, It maintains its success in the field of health tourism. Anadolu Efes Sports Club have had its name written in gold letters once again as being a “Ground-Breaking Team” by becoming the champion two years in a row in the Turkish Airlines EuroLeague, the most prestigious organization of European basketball. Anadolu Efes was also selected as the "Europe's Best Marketing Club" for the fifth time in the Turkish Airlines EuroLeague Devotion Marketing Awards among all the clubs competing in the EuroLeague and EuroCup.

These significant accomplishments give inspiration to all of us. In 2023, we will continue to add value in every field in which we operate. While leaving behind another year in our success story, I would like to thank all of our stakeholders for their support and their trust.

Hurşit Zorlu
CEO

March 2023