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COMPANY PRESENTATIONMARCH 2017
DISCLAIMER
This document does not constitute a recommendation by AE Arma-Elektropanç (“Issuer”), Tacirler Securities(“Lead Manager”), any of their respective subsidiaries or related companies, directors, officers, employees oragents to subscribe for, or purchase, any of the Bonds. The Issuer, the Lead Manager and their respectivesubsidiaries or related companies, directors, officers, employees and agents accept no liability whatsoever forany loss arising from this document or its contents or otherwise arising in connection with the offer of Bonds.This document is for preliminary informational purposes only and is not an offer to sell or the solicitation ofan offer to purchase or subscribe for the Bonds and no part of it shall form the basis of or be relied upon inconnection with any contract or commitment or whatsoever. The information in this document is given ingood faith and has been obtained from sources believed to be reliable and accurate at the date ofpreparation, but its accuracy, correctness and completeness cannot be guaranteed.
AGENDA
3
OVERVIEW 4
MANAGEMENT
OPERATIONS AND SERVICES
PROJECTS
FINANCIAL
CAPITAL MARKET INFORMATIONS
4
OWNERSHIP STRUCTURE
Source: Company
Name Title Shares (%) Experience Academic Background
A.Medih Ertan Chairman 28 42 Electronics Engineer (MSc)
Kemal Kızılhan Co-Chairman 28 33 Electrical Engineer
Hasan İnce Board Member 28 30 Electrical Engineer
H.Demir Özkaya GM & Board Member 8 36 Electronics Engineer (MSc)
M.Asım Coşkun Shareholder 6 38 Electrical Engineer
Ersan Can Shareholder 2 30 -
28
28
28
16
Ownership Structure (%)
A.Medih Ertan
Kemal Kızılhan
Hasan İnce
Other
5
MILESTONES
Source: Company
Two strong, leading companies in the construction and engineering sector of Turkey, ARMA MÜHENDİSLİK SANAYİ VE TİCARET A.Ş. (founded in 1986) and ELEKTROPANÇ ELEKTRİK SANAYİ VE TİCARET LTD. (founded in 1991) joined forces snd merged to establish AE ARMA-ELEKTROPANÇ in
October 2001.
AE has completed MEP works of functional buildings (residential, commercial, retail, educational, healthcare, social and cultural, theme parks, sports arena, data centre, hospitality, transportation & infrastructures and industrial) with a total area of 7 mn sqm in Europe, Asia and Africa.
MEP Works of 6 schools, 14 hotels, 18 skycrapers, 13 residences, 12 Office buildings and 17 shopping malls have been completed to date.
Total contract value of 16 on-going projects in three continents is USD 715 mn.
6
OVERVIEW
Source: Company
7
AE Arma-Elektropanç ranked at 222nd in the “Top International 250 Contractors 2016” list by rising 7 rows issued by Engineering News Record (ENR)
AE has been listed at 245th and 229th respectively at 2014&2015
OVERVIEW
AE Arma-Elektropanç ranked 3rd & 5th respectively in the list of “Top 25 MEP Contactors of the Middle East in 2015 & 2016”
Listed in the Fortune 500 Turkey and Capital 500 Turkey among Turkey’s top largest 500 companies
Source: Company
8
Strategic Collaboration Agreement signed with Clark Energy at 2016 for delivering cogeneration and trigeneration facilities in North African Market
OVERVIEW
Global Partnership Agreement signed with SAMSUNG C&T at 2015
Global Partnership Agreement signed with HYUNDAI E&C at 2016
Source: Company
9
35 Years of Experience
Sustainability
ExperiencedEngineering Force
High Sense of Quality
One of the leadingMEP firms in
Turkey, MENA andRussian Federation
Approximately 2100 employees from 28 different
nationalities
OVERVIEW
TS EN ISO 9001 : 2008
BS OHSAS18001 : 2007
BS EN ISO14001 : 2004
ISO DOCUMENTS
Source: Company
10
A GLOBAL COMPANY
Source: Company
1.415
1.888
2.185 2.297
2.101
0
500
1.000
1.500
2.000
2.500
2012 2013 2014 2015 2016
Number of Employees
1.483
366
167
19 61 5 0
200
400
600
800
1.000
1.200
1.400
1.600
UAE Turkey Russia Algeria UnitedKingdom
Azerbaijan
Number of Employees Per Contries Operation
1.242
501
111 52 39 35 27 20 12 14 9 6 6 5 4 3 2 2 2 1 1 1 1 1 1 1 1 1
0
200
400
600
800
1.000
1.200
1.400
IND
IA
TUR
KEY
BA
NG
LAD
ES
UZB
EKIS
TAN
PH
ILIP
PIN
E
PA
KIS
TAN
RU
SSIA
KIR
GYZ
STA
N
SYR
IA
UN
ITED
KIN
GD
OM
JOR
DA
N
AZE
RB
AIJ
AN
EGYP
T
ALG
ERIA
UK
RA
INE
NEP
AL
PA
LEST
INE
SUD
AN
SRI L
AN
KA
IREL
AN
D
SOU
TH A
FRIC
A
IRA
Q
UA
E
YEM
EN
CA
NA
DA
MO
LDO
VA
FRA
NC
E
LEB
AN
ON
Number of Employees By Nationalities
AGENDA
11
OVERVIEW
MANAGEMENT 12
OPERATIONS AND SERVICES
PROJECTS
FINANCIAL
CAPITAL MARKET INFORMATION
ORGANIZATIONAL CHART
12
BOARD OF DIRECTORS
GENERAL MANAGER
H. DEMIR ÖZKAYA
AE INTERNATIONAL
DEPUTY GENERAL MANAGER
TENDER & PR & HR
BURAK Ç. KIZILHAN
DEPUTY GENERAL MANAGER
ELECTRICAL WORKS
KEREM BAŞAR ERDEM
DEPUTY GENERAL MANAGER
MECHANICAL WORKS
SERDAR YÜKSEL
DEPUTY GENERAL MANAGER
P&L & ADMINISTRATION
M. ASIM COŞKUN
DEPUTY GENERAL MANAGER
STRATEGY & BD & CONTRACTS
LEVENT SÜMER
DEPUTY GENERAL MANAGER
FINANCE
AYDIN TÖREMEN
DEPUTY GENERAL MANAGER
IM & Q&R & P&CC
PINAR ERTAN
BOARD ASSISTANT
DİLEK TURĞUL
Source: Company
13
BOARD MEMBERS
Source: Company
14
BOARD MEMBERS
Source: Company
AGENDA
15
OVERVIEW
MANAGEMENT
OPERATIONS AND SERVICES 16
PROJECTS
FINANCIAL
CAPITAL MARKET INFORMATIONS
16
SUBSIDIARIES
Source: Company
17
Russia
Turkey
UAE
Azerbaijan
TRNC
AlgeriaQatar
Lebanon
AE Turkey
4 on-going projects
607,500 m2 area
$85,9 contract value
AE UAE
5 on-going projects
643,275 m2 area
$239,2 contract value
AE Russia
4 on-going projects
744,835 m2 area
$311,5 contract value
AE Algeria
2 on-going projects
448,717 m2 area
$61,7 contract value
MAP OF OPERATIONS
UK
AE UK
1 on-going project
11,250 m2 area
$16,4 contract value
Source: Company
18
TECHNICAL SOLUTIONS OF AE – MECHANICAL SERVICES
Source: Company
19
TECHNICAL SOLUTIONS OF AE – ELECTRICAL SERVICES
Source: Company
20
RISK MANAGEMENT
•Reduction
•Transfer or Elimination
•Acceptance
•Monitoring & Controlling
•New Risk Assessment & Monitoring
•Evaluation
•Bid / No-Bid Decision
•Pricing Assessment
•Initial Assessment
•Go / No-Go Decision
Business Development Stage
Political
Legal
Social
Financial
Environmental
Proposal Stage
Financial
Legal
Operational
Technological
Negotiation Stage
Financial
Legal
Operational
Execution Stage
Financial
Legal
Environmental
Operational
Social
Source: Company
21
RISK MANAGEMENT
Source: Company
RISK CATEGORY RISK MANAGEMENT
Sovereign risks & new business development risks
30 years of experience in the MEP sector within the existing countries of operation; very experienced top management & business development team with a broad international network.
Successful track record of completed MEP works more than 7m m2 in a diversified geography including Europe, Asia and Africa.
Focusing on eight different regions to mitigate country specific risks. Management targets to further diversify geographic presence by increasing the share of revenues in potential
countries Georgia, Azerbaijan, Kazakhstan and Sub-Saharan Africa . Risk averse strategy; selective in terms of expansion into new geographies (Saudi Arabia and Libya are not
considered due to high risk capacity because of payment problems). Working with reliable and strong employers/main contractors on projects with pre-committed financing
facilities in place. Majority of the backlog / tenders is based on invitations from existing partners and repeat business. Management bids for projects totalling USD 2bn each year; targeting to win USD 200-250m worth of new
projects (representing 10%-12.5% success factor) going forward.
Receivable risks Working with reputable contractors who are the largest or leading construction companies in their countries; including Dogus Construction and Nurol Construction in Turkey, Shapoorji Pallonji in India, ALEC LLC and DutcoBalfour Beatty in the Middle East, CSCEC in China, Kier Construction and MACE in the UK, Sixco in Belgium.
Weak correlation with the Turkish economy ; 85% of revenues are generated from international markets denominated in hard currency.
Within the last 10 years, the Company didn’t make any provisions for doubtful trade receivables or any write-offs as the awarded projects have pre-committed facilities in place.
Implementation of the ERP system to set the right pricing at the initial proposal stage. Management team closely monitors project-based and consolidated cash flows.
22
RISK MANAGEMENT
Source: Company
RISK CATEGORY RISK MANAGEMENT
Risks related with the construction sector
MEP segment bears lower operational risks compared to the construction sector; based on rating companies’ criteria, MEP companies rank two scales lower in terms of risk profile than construction companies.
The application process for MEP works starts at a later stage of the construction which offsets some of the risk related to construction.
JCR Eurasia Rating, has affirmed the LT national rating of the Company as “A- (TRK)” with positive outlook on the basis of low leverage, large portion (85%) of international revenues and increasing quality of assets with relatively secure receivables portfolio.
Bond refinancing risk The Company has established strong relationships with both local and international banks and has available limits which can be drawn down if required.
Conservative leverage structure; comfortable levels of net debt to EBITDA ratio of 1.6x and net debt to equity ratio of 0.8x as of 2016, which will be covenanted at 3.5x and 2.0x, respectively, during the investment period.
Risks associated with MEP site operations
Long lasting relationships are established with experienced subcontractors and well-known international vendors.
Contract clauses are evaluated in depth and risk clauses are heavily negotiated to mitigate contract related risks.
Comprehensive Project Management Plan is conducted and operations under this plan are closely monitored. Weekly evaluation meetings are organized to review all operational issues and evaluate risks. ERP system is used in every phase of the operations to integrate the work flows and increase operational
efficiency. Effective cost control system is in place. Complying strictly with the HSE and QA/QC procedures. BIM (building information modelling) is used in the design works.
BIDDING
ProposalFollow-up
Negotiations
NEW PROJECT
CreatingProject Team
Planning
Procurement
OPERATION
ProjectManagement
Cost Control
DELIVERY
CustomerSatisfaction
PROPOSAL
Request forProposal
Risk Analysis
Creating Proposal Team
Proposal Work
23
OPERATIONAL FLOW
EMPLOYER
MAINCONTRACTOR
SUPPLIER SUPPLIER
SUPPLIER SUPPLIER
CONSULTANT
1
EMPLOYER
MAINCONTRACTOR
SUPPLIER SUPPLIER
SUPPLIER SUPPLIER
CONSULTANT
2
Source: Company
24
LONG-TERM BUSINESS TRENDS
Source: Company
The company’s core business; Electrical, Mechanical, Building Automation Systems, Thermal and Moisture Protection and Waste Management product categories will be critical to the implementation of green buildings.
The share of MEP business in the construction sector is expected to reach at least 50% to 60% thanks to advancements in technology and increasing number of sustainable and smart buildings.
The regional priorities will lead to different levels of adoption over the next 10-20 years but the long-term trends point in the same direction towards adoption of sustainable & smart & green Buildings.
Expenses related to new technologies or implementation of new techniques will decline as wide-spread usage and economies of scale rise rapidly.
Operating Margins are expected to rise for especially new projects with a rising share of MEP business.
Consolidation in the MEP segment is likely to result in a number of larger companies in the next five years.
AGENDA
25
OVERVIEW
MANAGEMENT
OPERATIONS AND SERVICES
PROJECTS 26
FINANCIAL
CAPITAL MARKET INFORMATIONS
26
SELECTED COMPLETED PROJECTS
Source: Company
27
SELECTED COMPLETED PROJECTS
Source: Company
28
SELECTED ON-GOING PROJECTS
Source: Company
29
SELECTED ON-GOING PROJECTS
Source: Company
30
AXIS TOWERS
2017 - 2018
94,000 m² / 147m / 2 towers
POTENTIAL PROJECTS
ANAKLIA PORTS
2017 - 2020
100 million tons of cargo/per year
Source: Company
HILTON GARDEN INN RESIDENCE
2017 – 2018 / 29,200 m²
BATUMI STADIUM
2017 – 2019 / 20,035 capacity
GEORGIA
31
QATAR
QATAR 2022 WORLD CUP
6 NEW STADIUMS BETWEEN
2017-2020
RUSSIA 2018 WORLD CUP
3 NEW STADIUMS UNTIL 2018
POTENTIAL PROJECTS
DATA CENTERS
AMAZON, FACEBOOK, GOOGLE,
YAHOO INVESTMENTS
LONDON CITY AIRPORT
EXPANSION
2017 - 2022 – 150,000 m2
RUSSIAUK & IRELAND
Source: Company
32
JUMEIRAH CENTRAL
UNITED ARAB EMIRATES
DUBAI CREEK HARBOUR
POTENTIAL PROJECTS
ETISALAT DATA CENTERS
Source: Company
DUBAI SOUTH
EXPO 2020
AGENDA
33
OVERVIEW
MANAGEMENT
OPERATIONS AND SERVICES
PROJECTS
FINANCIAL 34
CAPITAL MARKET INFORMATIONS
34
CONSOLIDATED FINANCIAL STATEMENTS / BALANCE SHEET
Source: Company
31.12.2014 31.12.2015 31.12.2016
ASSETS (m TL)
CURRENT ASSETS 297,1 460,4 743,6
Cash & Cash Equivalents 5,6 17,2 9,9
Trade Receivables 81,4 89,5 238,8
Other Receivables 1,5 6,3 6,5
Costs and Est. Earnings in Excess of Billings on Uncomp. Cont. 181,3 289,2 422,4
Prepaid Expenses 7,5 36,7 49,9
Other Current Assets 19,8 21,5 16,0
NON-CURRENT ASSETS 13,6 21,8 25,1
Other Receivables 0,1 7,4 0,3
Tangible Fixed Assets 1,7 3,4 14,2
Intangible Fixed Assets 0,8 1,4 1,9
Other Non-Current Assets 11 9,6 8,7
TOTAL ASSETS 310,7 482,2 768,7
31.12.2014 31.12.2015 31.12.2016
LIABILITIES (m TL)
SHORT TERM LIABILITIES 172,3 290,0 606,4
Financial Liabilities (Short Term) 36,7 47,6 109,5
Trade Payables (Short Term) 65,3 125,0 329,7
Deferred revenue (Short Term) 48,0 88,2 124,8
Billings in Excess of Costs and Est. Earnings on Uncomp. Cont. 9,6 16,5 20,4
Other Current Liabilities 12,7 12,7 22,1
LONG TERM LIABILITIES 42,0 91,4 27,7
Financial Liabilities (Long Term) 14,5 53,7 7,6
Other Payables (Long Term) 16,7 0,0 0,0
Other Non-current Liabilities 10,8 37,7 20,1
EQUITY 96,4 100,8 134,6
Capital 92,2 92,2 100,0
Foreign Currency Translation Differences -11,6 -16,0 -18,8
Actuarial gains and losses 1,2 1,4 -0,2
Retained Earnings 10,8 14,3 17,0
Profit/(Loss) of The Period 3,8 8,9 36,6
TOTAL LIABILITIES 310,7 482,2 768,7
35
CONSOLIDATED FINANCIAL STATEMENTS / BALANCE SHEET
Source: Company
226,6
328,4 310,7
482,3
768,7
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
TOTAL ASSETS (m TL)
33,7 35,7
96,4100,8
134,6
0,0
20,0
40,0
60,0
80,0
100,0
120,0
140,0
160,0
2012 2013 2014 2015 2016
EQUITY (m TL)
36
CONSOLIDATED FINANCIAL STATEMENTS / INCOME STATEMENT
Source: Company
31.12.2014 31.12.2015 31.12.2016
Revenue (m TL) 386,9 459,7 797,1
Gross Profit / (Loss) (m TL) 49,5 55,9 101,6
Margin of Gross Profit / (Loss) %) 12,79% 12,16% 12,75%
EBIT (m TL) 24,5 29,2 65,2
Margin of EBIT (%) 6,33% 6,35% 8,18%
EBITDA (m TL) 25,6 31,3 67,6
Margin of EBITDA (%) 6,62% 6,81% 8,48%
Net Profit / (Loss) (m TL) 3,8 8,9 36,6
Margin of Net Profit / (Loss) %) 0,97% 1,95% 4,59%
37
CONSOLIDATED FINANCIAL STATEMENTS / INCOME STATEMENT
Source: Company
260,9
330,9386,9
459,7
797,1
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
REVENUE (m TL)
16,3 14,2
25,6
31,3
67,6
0,0
10,0
20,0
30,0
40,0
50,0
60,0
70,0
80,0
2012 2013 2014 2015 2016
EBITDA (m TL)
38
KEY RATIOS
Source: Company
260,9
330,9386,9
459,7
797,1
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
Revenue (m TL)
16,3 14,2
25,6
31,3
67,6
0,0
10,0
20,0
30,0
40,0
50,0
60,0
70,0
80,0
2012 2013 2014 2015 2016
Ebitda (m TL)
226,6
328,4 310,7
482,3
768,7
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
Total Assets (m TL)
33,7 35,7
96,4100,8
134,6
0,0
20,0
40,0
60,0
80,0
100,0
120,0
140,0
160,0
2013 2013 2014 2015 2016
Shareholder's Equity (m TL)
260,9330,9 386,9
459,7
797,1
6,23%
4,31%
6,61% 6,82%
8,48%
0,00%
1,00%
2,00%
3,00%
4,00%
5,00%
6,00%
7,00%
8,00%
9,00%
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
Revenue/Ebitda
Revenue (m TL) Ebitda (%)
6,0
27,9
45,6
84,1
107,2
16,3 14,2 25,6 31,3
67,6
0,37
1,96 1,78
2,68
1,59
0,00
0,50
1,00
1,50
2,00
2,50
3,00
0,0
20,0
40,0
60,0
80,0
100,0
120,0
2012 2013 2014 2015 2016
Net Debt / EBITDA
Net Debt (m TL) Ebitda (m TL) Net Debt/Ebitda (x)
6,0
27,9
45,6
84,1
107,2
33,7 35,7
96,4 100,8
134,6
0,18
0,78
0,47
0,83 0,80
0,00
0,10
0,20
0,30
0,40
0,50
0,60
0,70
0,80
0,90
0,0
20,0
40,0
60,0
80,0
100,0
120,0
140,0
160,0
2012 2013 2014 2015 2016
Net Debt / Equity
Net Debt (m TL) Equity (m TL) Net Debt/Equity (x)
39
KEY RATIOS
Source: Company
260,9
330,9386,9
459,7
797,1
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
Revenue (m TL)
16,3 14,2
25,6
31,3
67,6
0,0
10,0
20,0
30,0
40,0
50,0
60,0
70,0
80,0
2012 2013 2014 2015 2016
Ebitda (m TL)
226,6
328,4 310,7
482,3
768,7
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
Total Assets (m TL)
33,7 35,7
96,4100,8
134,6
0,0
20,0
40,0
60,0
80,0
100,0
120,0
140,0
160,0
2013 2013 2014 2015 2016
Shareholder's Equity (m TL)
260,9330,9 386,9
459,7
797,1
6,23%
4,31%
6,61% 6,82%
8,48%
0,00%
1,00%
2,00%
3,00%
4,00%
5,00%
6,00%
7,00%
8,00%
9,00%
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
2012 2013 2014 2015 2016
EBITDA / Revenue
Revenue (m TL) Ebitda (%)
35,2 68,5 54,9 70,8 109,9
225,8262,3 332,0
388,9
687,245%
27%
17% 19%
73%
0%
10%
20%
30%
40%
50%
60%
70%
80%
2012 2013 2014 2015 2016
0,0
100,0
200,0
300,0
400,0
500,0
600,0
700,0
800,0
900,0
Growth in Revenue
Turkey (m TL) Overseas (m TL) Growth in Revenue (%)
AGENDA
40
OVERVIEW
MANAGEMENT
OPERATIONS AND SERVICES
PROJECTS
FINANCIAL
CAPITAL MARKET INFORMATIONS 41
41
CREDIT RATING
Source: Company
First Updated
20-Mar-2015 11-May-2016
Long Term International Foreign Currency BBB- / (Stable) BBB- / (Stable)
Long Term International Local Currency BBB- / (Stable) BBB- / (Stable)
Long Term National Local Rating A- (Trk) / (Stable) A- (Trk) / (Stable)
Short Term International Foreign Currency A-3 / (Stable) A-3 / (Stable)
Short Term International Local Currency A-3 / (Stable) A-3 / (Stable)
Short Term National Local Rating A-1 (Trk) / (Stable) A-1 (Trk) / (Stable)
Sponsor Support 2 2
Stand Alone B B
Outlook Stable Positive
42
INFORMATION ABOUT AUDIT FIRM
HLB INTERNATIONAL
HLB International is a leading network of independent professional accounting firms and business advisers with member firms well-established locally and mostly ranked among the top 12 nationally.
INSPIRED FOR MORE THAN 40 YEARS - Formed in 1969, HLB International services clients through its member firms in 140 countries, their 2,210 partners and 20,110 staff in over 660 offices worldwide.
INSPIRED FOR QUALITY - A member of the Forum of Firms, HLB International is committed to the highest quality standards
INSPIRED SERVICES AROUND THE WORLD -HLB International’s member firms can support you as you grow regionally and globally.
HLB International's member firms provide or have provided services to such well-known names as General Electrics, Siemens, Gazprom, Veolia, Huawei, Chronopost International or Tatneft.
140 countries 2,210 partners 20,110 staff over 660 offices US$ 2.08 billion annual revenue
Source: http://www.hlbi.com/index.php?option=com_content&view=article&id=700&Itemid=825
43
BOND ISSUANCES
Source: Company
1st Issuance, May 2015 2nd Issuance, November 2015 3rd Issuance, November 2015
ISIN Code TRSAEST51717 TRSAESTK1716 TRFAESTK1612
Issue TypeTRY Domestic/sales to qualified
investorsTRY Domestic/sales to qualified
investorsTRY Domestic/sales to qualified
investors
Issue Size 25.000.000 TRY 10.000.000 TRY 10.000.000 TRY
Maturity 728 days 728 days 364
Issue Date 6 May 2015 25 Kas 2015 25 Kas 2015
Redemption Date 3 May 2017 25 Kas 2017 23 Kas 2016
Pricing Floating Floating Floating
Coupon Payment Period Quarterly Quarterly Quarterly
Benchmark GovernmentBond GovernmentBond GovernmentBond
Spread 450 bps 475 bps 425 bps
Has been paid off on 23rd November 2016
44
UPCOMING BOND ISSUANCES
Source: Company
Details First Tranche Second Tranche
SPK Approved Amount* 105.000.000 TRY
ISIN Code TRSAEST91812 TRSAEST91911
Issue Market TRY Domestic TRY Domestic
Issue Method Sales to qualified investors Sales to qualified investors
Type Floating Floating
Coupon Payment Period Quarterly Quarterly
Benchmark Benchmark Government Bond 3 month TRLIBOR
Pricing (Coupon Rate Calculation)For the first coupon Benchmark government bond with
ISIN of TRT110718T18For the first coupon 3 month TRLIBOR rate
on the TRLIBOR website
Term / Maturity 18 Months 30 Months
Spread/Margin 450 bps per annum 500 bps per annum
Issue Size 25.000.000 TRY 45.000.000 TRY
Use of fundsThe proceeds will be used for financing working capital needs, refinancing of existing bond issuances and capital expenditures including purchase of machinery and equipment required for construction
sites as well as new hardware and software systems to improve operational efficiency.
Intermediary Tacirler Yatırım Tacirler Yatırım* The first three issuances for TRY 25,000,000, TRY 10,000,000 and TRY 10,000,000 were completed on 5 May 2015, 25 November 2015 and 25 November 2015, respectively pursuant to the issuance certificate of the SPK dated 7 April 2015 which then allowed the Issuer to raise up to TRY 150,000,000. The upcoming bond issuance will be raised based on the revised issuance certificate of TRY 105m which will expire on 12 May 2017.
45
TAXATION INFORMATION
INTEREST INCOME DERIVED FROM PRIVATE SECTOR BONDS CAPITAL GAINS DERIVED FROM PRIVATE SECTOR BONDS
Resident corporations
1) Among those issued in Turkey through the intermediation of banks or intermediary institutions; a) Interest income derived by joint stock companies, companies limited by shares and limited companies and investment funds; - is subject to 0% withholding. - is subject to corporate tax. b) Interest income derived by companies (**) other than those mentioned above; - is subject to 10% withholding. - Companies which are required to submit tax return can offset the withholding paid from the corporate tax calculated on the corporate tax return.
1) Among those issued in Turkey through the intermediation of banks or intermediary institutions;a) Gains derived by joint stock companies, companies limited by shares and limited companies and investment funds;- are subject to 0% withholding.- are subject to corporate tax.b) Gains derived by companies (**) other than those mentioned above;- are subject to 10% withholding.- Companies which are required to submit tax return can offset the withholding paid from the corporate tax calculated on the corporate tax return.
Resident real persons
1) Interest income derived from those issued in Turkey; - is subject to 10% withholding.- Withholding is the final tax. - Not declared.
1) Income derived from those issued in Turkey through the intermediation of banks or intermediary institutions;- Subject to 10% withholding.- Withholding is the final tax.- Not declared.
Non-resident corporations (1)
1) Among those issued in Turkey through the intermediation of banks or intermediary institutions; a) Interest income derived by foreign corporations in the nature of joint stock companies, companies limited by shares and limited companies and foreign corporations which are determined by Ministry of Finance to be in similar nature with investment funds and investment trusts established according to the Capital Markets Code (***); - is subject to 0% withholding. - Withholding is the final tax. - Not declared. b) Interest income derived by companies other than those mentioned above; - is subject to 10% withholding. - Withholding is the final tax. - Not declared.
1) Among those issued in Turkey through the intermediation of banks or intermediary institutions;a) Gains derived by foreign corporations in the nature of joint stock companies, companies limited by shares and limited companies and foreign corporations which are determined by Ministry of Finance to be in similar nature with investment funds and investment trustsestablished according to the Capital Markets Code (***);- are subject to 0% withholding.- Withholding is the final tax.- Not declared.b) Gains derived by companies other than those mentioned above;- are subject to 10% withholding.- Withholding is the final tax.- Not declared.
Non-resident real persons
1) Interest income derived from those issued in Turkey; - is subject to 10% withholding. - Withholding is the final tax. - Not declared.
1) Income derived from those issued in Turkey through the intermediation of banks or intermediary institutions;- Subject to 10% withholding.- Withholding is the final tax.- Not declared.
(*) Non-resident corporations, who do not own a permanent establishment and a permanent representative in Turkey.(**) The companies other than those mentioned under article 2/1 of the Corporate Tax Code (capital stock companies; joint stock companies, companies limited by shares and limited companies and investment funds) can be exemplified as cooperatives economic public institutions, foundations and associations and their economic enterprises and business partnerships.(***) Pursuant to the Income Tax General Communiqué series no 277 promulgated in the Official Gazette dated 25 December 2010, limited liability partnerships, country funds, funds owned by administrations and establishments, investment companies and all the other foreign corporate investors, which are operating in Turkey exclusively for deriving capital gains through marketable securities and other capital market instruments and for using the rights related to these, are considered as taxpayers in similarnature with investment funds and investment trusts established according to the Capital Markets Code no 2499.
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UPCOMING BOND ISSUANCES
KEY RISK ABOUT THE INSTRUMENT
INFORMATION ABOUT THE LISTING
These bonds are unsecured and there is not any third party guarantee for these bond
The investors subject to general provisions of Turkish execution and bankruptcy law in case of in case of insolvency of the company.
The bonds will be traded between qualified investors in the Outright Purchases and Sales Market of Borsa Istanbul upon approval
Source: Company
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AE has successfully completed the MEP contracting of more than 7 million sqm of various functional buildings across 3 continents namely
Europe, Asia and Africa!
AE ARMA-ELEKTROPANÇ
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