Arçelik Anonim Sirketi : 2023 Q4 Financial Results Presentation

2023 Financial Results

March 1, 2024

Disclaimer	2023	Financial Results

With the Capital Markets Board of Turkey's Bulletin dated 28.12.2023 numbered 2023/81, CMB announced that issuers and capital market institutions shall prepare their annual financial statements ending on 31.12.2023 or later, in accordance with IAS 29 inflationary accounting provisions.

Accordingly, this presentation on 2023 year-end financial results contain the Company's audited financial information prepared according to Turkish Accounting / Financial Reporting Standards by application of IAS 29 inflation accounting provisions, in accordance with CMB's decision dated 28.12.2023. In addition to these, given that the guidance information and the 2023 interim financial results announced so far were presented without the application of inflation accounting, in order to enable investors and analysts to conduct a full-fledged analysis, supplementary historical information for selected key performance indicators used in prior periods' investor presentations were provided. Such supplementary information is made available only for this period, and contains unaudited financial information prepared for management reporting purposes.

This presentation does contain forward-looking statements and figures that reflect the Company management's current views with respect to certain future events based on the base-case assumptions. Although it is believed that the expectations reflected in these statements are reasonable under current conditions, they may be affected by a variety of variables and changes in underlying assumptions that could cause actual results to differ. Neither Arçelik nor any of its directors, managers, or employees nor any other person shall have any liability whatsoever for any loss arising from the use of this presentation.

2

2023

HIGHLIGHTS

TRY257.1bn

Revenue 7.8%

EBITDA Margin 24.8%

OPEX/Sales

24.2%

NWC/Sales

2.67x Leverage

Resilient demand in Türkiye, weakness in international markets. Margin expansion at all lines thanks to eased costs in 2023.

Consolidated revenues were flattish in 2023 compared to 2022.

Wholesale & retail demand in Türkiye was solid throughout 2023 while the demand in international markets remained weak.

EBITDA margin was 7.8% in 2023, up by 145 bps y/y thanks to declined raw material costs.

Net Working Capital/Sales was 24.2% as of 2023.

Leverage was 2.67x as of 2023.

3

Key Factors Sales/Margins	2023	Financial Results

REVENUE GROWTH

Flattish

Strong unit growth in Türkiye

Strategic pricing initiatives

Declined international MDA6 unit sales

257,172257,104

TRYmn

20222023

GROSS MARGIN

29.3%

Lower raw material costs

Favorable EURUSD parity

Lower capacity utilisation

26.7%	29.3%
2022	2023

EBITDA MARGIN

7.8%

Better gross profitability

Increased OPEX/Sales

6.4%	7.8%
2022	2023

4

Operational Performance

2023 Financial Results

Türkiye in 2023: Another year of sustained strong leadership	2023	Financial Results
as consumer demand remained robust throughout the year

MDA6*

Türkiye Revenue Growth

ARÇELİK y/y growth (%)

TÜRKİYE y/y growth (%)

5%	12%				12% 14%
	2%
		(3%)	(7%)	(2%)
4Q22	4Q23	2022	2023

AIR CONDITIONER*

ARÇELİK y/y growth (%)

TÜRKİYE y/y growth (%)

23%

78,027***	96,152
TRYmn
2022	2023

Unit growth in MDA6

Unit growth in A/C

Unit growth in TV Price increases

138%

	73%		92%
4%	23%	10% 8%
(3%)
4Q22	4Q23	2022	2023

TELEVISION**

ARÇELİK y/y growth (%)

TÜRKİYE y/y growth (%)

28% 32%

		5% 8%	7%	4%
	(6%)
	(17%)
4Q22	4Q23	2022	2023

Türkiye Share in Total Revenue

2023

30% 37%

2022

*MDA6 and A/C data (sell-in, in unit terms) is based on WGMA for the given periods.

**TV market reflects the data of a retail panel market for the given period in unit terms.6

***Adjusted with the rate of 1. 64773.

Europe in 2023: Consumer demand contracted progressively at declining rates in	2023	Financial Results
Western Europe towards the end of the year, as it improved in Eastern Europe

23%	Western Europe
Share in total
revenue

Eastern Europe	16%
Share in total
	revenue

y/y market growth in unit terms

9M23 2023

W.Europe

Germany

France

Great Britain

Italy

Spain

Belgium

Netherlands

Denmark

Norway

Austria

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

MDA6 Market

• Negative consumer sentiment resulted in lower demand across Western European countries. However, the level of contraction gradually decreased towards the end of 2023.
• In unit terms, consumer demand declined by c.1% y/y and c.6% y/y in 4Q23 and 2023, respectively.
• In value terms, consumer demand declined by c.2% y/y and c.3% y/y in 4Q23 and 2023, respectively.

Arçelik in Western Europe

• The decline in the number of units sold was partially mitigated by price increases; nevertheless, revenue in 2023 decreased by c.4% in EUR terms y/y.
• Arçelik's price index as a group improved in 2023 in Western Europe.

MDA6 Market

• In unit terms, consumer demand in Eastern Europe increased by c.8% and c.2% y/y in 4Q23 and 2023, respectively, due mainly to the low base of 2022.
• In Russia, consumer demand was up by c.12% y/y in 2023 in unit terms as a result of low base impact.
• Romania and Poland markets continued to fall in 4Q23 and closed 2023 with c.8% and c.12% contraction respectively.

Arçelik in Eastern Europe

• Revenues from Eastern Europe was up by c.7% y/y in 2023 in EUR terms thanks mainly to higher units sold and price increases.
• Beko maintained its leadership position in Eastern Europe with an improved price index.

y/y market growth in unit terms

9M23 2023

E. Europe

Russia

Poland

Romania

Ukraine

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

MDA6 market charts and the market positionings reflect the data of a retail panel market for the given period in unit terms.	7

Demand was under pressure in key regions in 2023	2023	Financial Results

8%	Africa & Middle East
Share in total
revenue

• Revenues generated from Africa & Middle East decreased by c.6% y/y in 2023 in EUR terms.
• Defy's domestic unit sales increased c.4% y/y in 2023 while export units declined by c.8%.
• Defy's net sales increased by 3% in ZAR terms in 2023 y/y. In EUR terms, net sales were contracted at low-teens percentage, as a result of depreciated ZAR against EUR.
• South African MDA6 market was contracted by c.6% y/y in 2023. Defy maintained its strong market leadership in 2023.
• In Egypt, MDA6 market was down by c.9% y/y in 2023 in unit terms. Beko Egypt outperformed the market and gained market share in unit terms in 2023.
• Beko Egypt posted a solid revenue growth of %27 in EUR terms y/y in 2023 thanks mainly to increased white goods sales.

Asia-Pacific	14%
Share in total
	revenue

• Revenues generated from APAC were down by c.18% in EUR terms in 2023 y/y. The contraction was primarily as a result of weak demand environment throughout 2023.
• In Pakistan, net sales decreased by c.2% y/y in 2023 in PKR terms due to lower units sold given the unfavorable economic conditions impacting the demand negatively. In EUR terms, net sales were contracted by c.30%, reflecting the depreciation of PKR and contracted sales units.
• In Bangladesh, net sales were flattish in BDT terms in 2023 y/y. As a result of depreciated BDT against EUR, net sales contracted by c.16% y/y in EUR terms.

8

Softened raw material prices throughout 2023

Average Metal Prices Index - Market

2023 103

4Q23 98

3Q23 99

2Q23 105

1Q23 111

2022 122

4Q22 102

• Metal raw material prices contracted in 2023 on a yearly basis mainly due to declined global demand, increased policy rates and decreased energy & input costs.

Source: Steel BB, Steel Orbis

Index includes: CRC, HRC, Galvanized Steel, Stainless Steel, Copper, Aluminium

2023 Financial Results

Average Plastic Prices Index - Market

2023 147

4Q23 146

3Q23 141

2Q23 147

1Q23 154

2022 175

4Q22 156

• Plastic raw material prices declined on a yearly basis in 2023 as a result of lower demand and decreased energy and transportation costs.

Source: ICIS - Chemical Industry News & Chemical Market Intelligence

Index includes: ABS, Polystyrene, Polyurethane, Polypropylene

9

Sales Performance

2023 Financial Results