Türk Traktör ve Ziraat Makineleri : 30.09.2022 Independent Audit Report

TÜRK TRAKTÖR VE ZİRAAT MAKİNELERİ A.Ş.

CONVENIENCE TRANSLATION INTO ENGLISH OF CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD FROM 1 JANUARY TO 30 SEPTEMBER 2022

(ORIGINALLY ISSUED IN TURKISH)

TÜRK TRAKTÖR VE ZİRAAT MAKİNELERİ A.Ş.

CONTENTS	PAGE
CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION ................................	1 - 2
CONDENSED INTERIM STATEMENTS OF PROFIT
OR LOSS AND OTHER COMPREHENSIVE INCOME ........................................................	3
CONDENSED INTERIM STATEMENTS OF
CHANGES IN EQUITY...............................................................................................................	4 - 5
CONDENSED INTERIM STATEMENTS OF CASH FLOWS...............................................	6
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS ..........................	7 - 50
NOTE 1	ORGANISATION AND NATURE OF OPERATIONS OF THE COMPANY ...........................................	7
NOTE 2	BASIS OF PRESENTATION OF FINANCIAL STATEMENTS ................................................................	7	- 12
NOTE 3	CASH AND CASH EQUIVALENTS...........................................................................................................	13
NOTE 4	FINANCIAL LIABILITIES..........................................................................................................................	13	- 16
NOTE 5	TRADE RECEIVABLES AND PAYABLES...............................................................................................	16	- 17
NOTE 6	INVENTORIES ............................................................................................................................................	17	- 18
NOTE 7	PROPERTY, PLANT AND EQUIPMENT ..................................................................................................	18	- 19
NOTE 8	RIGHT OF USE ASSETS .............................................................................................................................	20
NOTE 9	INTANGIBLE ASSETS ...............................................................................................................................	21	- 22
NOTE 10	OTHER ASSETS AND LIABILITIES .........................................................................................................	22
NOTE 11	PREPAID EXPENSES AND DEFERRED INCOME ..................................................................................	22	- 23
NOTE 12	PROVISIONS, CONTINGENT ASSETS AND LIABILITIES....................................................................	23	- 27
NOTE 13	EMPLOYEE BENEFITS ..............................................................................................................................	28
NOTE 14	EQUITY ........................................................................................................................................................	29	- 30
NOTE 15	REVENUE AND COST OF SALES ............................................................................................................	30
NOTE 16	OTHER INCOME/EXPENSE FROM OPERATING ACTIVITIES ............................................................	31
NOTE 17	FINANCIAL INCOME.................................................................................................................................	31
NOTE 18	FINANCIAL EXPENSE ...............................................................................................................................	31
NOTE 19	TAX ASSETS AND LIABILITIES ..............................................................................................................	32	- 34
NOTE 20	EARNINGS PER SHARE ............................................................................................................................	34
NOTE 21	RELATED PARTY EXPLANATIONS........................................................................................................	35	- 39
NOTE 22	FINANCIAL INSTRUMENTS AND NATURE AND EXTENT OF RISKS ARISING FROM
	FINANCIAL INSTRUMENTS.....................................................................................................................	40	- 49
NOTE 23	SUBSEQUENT EVENTS.............................................................................................................................	49

TÜRK TRAKTÖR VE ZİRAAT MAKİNELERİ A.Ş.

CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 30 SEPTEMBER 2022

(Amounts expressed in Turkish Lira ("TRY") unless otherwise indicated.)

			Current Period	Audited
			Unaudited
		Notes	30 September	31 December
		2022	2021
ASSETS
CURRENT ASSETS
Cash and cash equivalents	3	2,777,892,613	1,566,586,803
Trade receivables
-	Trade receivables from related parties	5, 21	974,964,539	635,170,444
-	Trade receivables from third parties	5	920,370,439	629,307,137
Inventories	6	2,712,913,215	1,739,360,491
Prepaid expenses	11	4,098,094	2,657,912
Other current assets	10	609,904,308	366,839,583
TOTAL CURRENT ASSETS		8,000,143,208	4,939,922,370
NON - CURRENT ASSETS
Financial investments		2,850,000	-
Trade receivables
-	Trade receivables from third parties	5	2,291,058	109,458
Other receivables
-	Other receivables from third parties		393,761	956,197
Property, plant and equipment	7	807,252,476	629,264,236
Right of use assets	8	20,504,700	23,215,525
Intangible assets	9	549,395,868	438,576,994
Prepaid expenses	11	73,639,486	44,979,811
Deferred tax assets	19	232,517,719	33,622,002
TOTAL NON - CURRENT ASSETS		1,688,845,068	1,170,724,223
TOTAL ASSETS		9,688,988,276	6,110,646,593

The financial statements prepared as at and for the period ended 30 September 2022 have been approved by the Board of Directors on 26 October 2022.

The accompanying notes form an integral part of these financial statement

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TÜRK TRAKTÖR VE ZİRAAT MAKİNELERİ A.Ş.

CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 30 SEPTEMBER 2022

(Amounts expressed in Turkish Lira ("TRY") unless otherwise indicated.)

			Current Period	Audited
			Unaudited
		Notes	30 September 2022	31 December 2021
LIABILITIES
CURRENT LIABILITIES
Short-term financial liabilities
Short-term financial liabilities to other parties
-	Bank borrowings	4	1,877,441,837	-
Short-term portion of long-term financial liabilities
Short-term portion of long-term financial liabilities from
	related parties
-	Lease liabilities	4, 21	10,167,871	8,085,198
Short-term portion of long-term financial liabilities from
third parties			569,077,930
- Bank borrowings	4	989,869,504
-	Lease liabilities	4	3,036,627	2,414,639
Trade payables
- Trade payables to related parties	5, 21	141,768,986	180,945,657
-	Trade payables to third parties	5	2,949,144,730	2,228,517,987
Payables related to employee benefits	13	89,617,433	77,664,295
Other payables
-	Other payables to third parties		70,101,654	61,519,026
Government incentives and aids	10	3,356,129	3,692,202
Deferred income	11	314,273,977	173,947,802
Tax liability for the period	19	142,276,804	17,838
Short - term provision
-	Short term provision for employee benefits	12	13,594,779	6,501,091
-	Other short term provisions	12	71,825,831	54,374,044
TOTAL CURRENT LIABILITIES		6,676,476,162	3,366,757,709
NON - CURRENT LIABILITIES
Long-term financial liabilities
Long-term financial liabilities from related parties
-	Lease liabilities	4,21	12,111,331	17,605,800
Long-term financial liabilities from third parties
- Bank borrowings	4	439,615,393	537,231,153
-	Lease liabilities	4	293,718	426,967
Long - term provisions
-	Long term provision for employee benefits	12	117,161,828	76,294,116
-	Other long term provisions	12	66,596,694	61,336,750
TOTAL NON-CURRENT LIABILITIES		635,778,964	692,894,786
EQUITY		2,376,733,150	2,050,994,098
Paid-in share capital	14	53,369,000	53,369,000
Adjustments to share capital	14	39,014,356	39,014,356
Merger reserve		(5,569,000)	(5,569,000)
Restricted profit reserves		238,702,293	118,969,138
Other accumulated comprehensive income and
expense not to be reclassified to profit or loss
- Actuarial loss arising from
defined benefit plans		(86,506,607)	(62,365,129)
Other accumulated comprehensive income and
expense to be reclassified to profit or loss
-	Gain/(Losses) on cash flow hedging		48,548,649	110,720,788
Retained earnings		477,121,790	474,667,368
Net profit for the year		1,612,052,669	1,322,187,577
TOTAL LIABILITIES		9,688,988,276	6,110,646,593

The accompanying notes form an integral part of these financial statements.

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TÜRK TRAKTÖR VE ZİRAAT MAKİNELERİ A.Ş.

CONDENSED INTERIM STATEMENTS OF PROFIT OR LOSS AND

OTHER COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30 SEPTEMBER 2022

(Amounts expressed in Turkish Lira ("TRY") unless otherwise indicated.)

			Current	Current	Prior		Prior
			Period	Period	Period		Period
			Unaudited	Unaudited	Unaudited		Unaudited
			1 January -	1 July -	1 January -		1 July-
		Notes	30 September	30 September	30 September		30 September
			2022	2022	2021		2022
	Revenue	15	14,616,448,422	5,735,695,920	8,043,340,383		2,466,920,402
	Cost of sales (-)	15	(11,856,013,855)	(4,609,213,200)	(6,600,229,241)	(2,058,538,382)
	GROSS PROFIT		2,760,434,567	1,126,482,720	1,443,111,142		408,382,020
	Marketing expenses (-)		(395,282,227)	(155,759,152)	(203,451,910)		(62,769,396)
	General administrative expenses (-)		(241,540,030)	(93,528,938)	(122,893,758)		(41,419,906)
	Research and development expenses (-)		(49,920,258)	(16,771,181)	(39,799,699)		(12,921,634)
	Other income from operating activities	16	939,291,963	234,204,537	1,055,304,659		339,804,547
	Other expenses from operating activities (-)	16	(1,143,800,135)	(286,722,699)	(1,155,366,261)		(388,695,790)
	OPERATING PROFIT		1,869,183,880	807,905,287	976,904,173		242,379,841
	Income from investment activities		972,621	(736)	2,086,041		1,589,426
	OPERATING INCOME BEFORE		1,870,156,501	807,904,551	978,990,214		243,969,267
	FINANCIAL INCOME/(EXPENSES)
	Financial income	17	422,389,087	93,886,386	240,741,044		56,945,245
	Financial expenses	18	(520,294,894)	(192,788,884)	(174,572,206)		(54,222,471)
	PROFIT BEFORE TAXATION ON		1,772,250,694	709,002,053	1,045,159,052		246,692,041
	INCOME
	Taxes on income (-)	19	(334,487,474)	(109,099,355)	(281,967,004)		(6,465,107)
	Deferred tax income/(expense)	19	174,289,449	52,827,628	67,046,710		(18,449,076)
	NET PROFIT FOR THE PERIOD		1,612,052,669	652,730,326	830,238,758		221,777,858
	Earnings per share (TRY)	20	0,3021	0,1223	0,1556		0,0416
	Other comprehensive income/(expense)
	Not to be reclassified to profit or loss:
	Actuarial loss arising from defined benefits
	plans	12	(30,176,847)	1,595,780	(3,385,266)		(756,234)
	Other comprehensive expense not to be
	reclassified
	to profit or loss, tax effect
	Actuarial gain/ loss arising from defined benefit
	plans, tax effect	19	6,035,369	(319,156)	677,053		151,247
	To be reclassified to profit or loss :
	Profit/(Losses) on cash flow hedging		(80,743,038)	(23,429,839)	15,174,005		(6,209,624)
	Other comprehensive expense to be
	reclassified to profit or loss,
	tax effect
	Losses on
	cash flow hedging, tax effect	19	18,570,899	5,388,863	(3,793,501)		1,552,406
	Other comprehensive income/(expense)		(86,313,617)	(16,764,352)	8,672,291		(5,262,205)
	TOTAL COMPREHENSIVE INCOME		1,525,739,052	635,965,974	838,911,049	216,515,653

The accompanying notes form an integral part of these financial statements.

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