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Investor PresentationMay 2019
2
As being the 2nd biggest army in NATO, Turkey has healthy growth rate of defense budget.
2,3%
2,7%2,5%
2,2% 2,3% 2,3% 2,2% 2,2%2,0%
2,2%
2,5%
0,0%
0,5%
1,0%
1,5%
2,0%
2,5%
3,0%
0
200
400
600
800
1.000
1.200
1.400
Mili
tary
Sp
en
din
g as
a %
of
GD
P
GD
P (
Bill
ion
$ -
no
min
al t
erm
s)
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
16,0
18,0(Billion $)
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017… 20XX
97.
90. 93.
86.
80.76.
74.
67.62.
50.
58.57.
55.
Turkey and ASELSAN’s Place in Global Defense
649
250
68
6764
61
50
50
4743
19
USA
CHİNA
SAUDİ ARABİA
INDİA
FRANCE
RUSSİA
UK
GERMANY
JAPAN
SOUTH KOREA
…
…
TURKEY
(Billion $)
Total global military spending in 2018 is around 1,8 Trillion USD. Compared to
previous year, Turkey has ranked first in terms of increase in military spending with
24%, while maintaining its place in the ranking of global defense spending.
Defense spending is expected
to reach USD 21 Billion USD in
2019.
*Defense News Top 100
2018 Top 10 Spenders vs. Turkey Military Spending of Turkey (5-year averages)
Military Spending as a % of GDP (TURKEY) ASELSAN Global Defense Ranking*
*SIPRI
*SIPRI, TÜİK
*SIPRI
3
• TAFF was established by the merger of Land, Navy and Air
Forces Foundations.
• TAFF’s objective is to enhance the warfare capability of
Turkish Armed Forces through national defense industry.
• TAFF owns several defense companies operating in separate
fields.
• The only privilege of the shares owned by TAFF have is
nominating 6 members of the 9 members of Board of Directors.
ASELSAN is the only defense company listed on BIST.
Turkish Armed Forces Foundation74,20%
Free Float25,70%
Other0,10%
Shareholder Structure
TAFF BOARD OF TRUSTEES
-President (Chairman)
-Vice President
- Minister of National Defense
- Chief of General Staff
- Undersecretary of Defense Industry
TAFF
ASELSAN TAI ROKETSAN HAVELSAN ASPİLSAN İŞBİR
Shareholder Structure and TAFF
Turkish Armed Forces Foundation (TAFF)
4
COMMUNICATION
SATELLITE SYSTEMS
IT and CYBER
SECURITY
AVIONIC
ELECTRO-OPTIC
NAVAL SYSTEMS
GUIDANCE and
UNMANNED SYSTEMS
AIR and MISSILE DEFENSE
COMMAND CONTROL
LAND and WEAPON SYSTEMS
MICROELECTRONICS
MICROELECTRONICS
GUIDANCE and ELECTRO-OPTICSDEFENSE SYSTEMS
TECHNOLOGIES
RADAR SYSTEMS
ELECTRONIC WARFARE
MICROWAVE PRODUCTS
RADAR, ELECTRONIC
WARFARE
SECURITY
TRAFFIC and AUTOMATION
ENERGY and HEALTH
TRANSPORTATION
TRANSPORTATION,
SECURITY, ENERGY and
AUTOMATION
Field of Activities
COMMUNICATION INFORMATION
TECHNOLOGIES
5
InternationalLocal
ASELSANNET
Share : 100%Founded : 2004 Assets : 188,2 Mio $
Share : 15%Partner : TAFFFounded : 1988Assets : 1,2 Bio $
ROKETSAN
Share : 50%Partner : Sivas Optik MalzemeleriFounded : 2014Assets : 18,5 Mio $
ASELSAN HASSAS OPTİK
ASELSAN BİLKENT MİKRO NANOShare : 50%Partner : BİLKENT Ünv.Founded : 2014Assets : 24,6 Mio $
MİKROELEKTRONİKShare: 85%Partner : İTÜ ETAParticipation : 2010Founded : 2006Assets : 3,8 Mio $
YİTALShare : 51%Partners : TÜBİTAK, SSMFounded : 2017Assets : 0,6 Mio $
Share : 30%Partner : HAB,TUSAŞGAZİ Unv.Founded : 2018Assets : 0,4 Mio $
TEKNOHAB A.Ş.
Share : 51%Partner : Konya Sav. SanayiFounded : 2018Assets : 16,1 Mio $
ASELSAN KONYA SİLAH SİST. A.Ş.
ULAK A.Ş.Share : 51%Partner : SSTEK A.Ş. Founded : 2017Assets : 14,1 Mio $
Our Affiliates
MACEDONIA BRANCH
Share : 100%Founded : 2014Assets : 7 Mio $
ASELSAN MIDDLE EAST
(JORDAN) Share : 49%Partner : KADDB Investment GroupFounded : 2012Assets : 7,6 Mio $
SOUTH AFRICA BRANCH
Share : 100%Founded : 2011Assets : 1 Mio $
ASELSAN-BAKU
(AZERBAIJAN)
Share : 100%Foudned: 1998Assets: 1,8 Mio $
SADEC (SAUDI ARABIA)
Share : 50%Partner : TAQNIA DSTFoudned : 2016Assets : 1,9 Mio $
KAZAKHSTAN ASELSAN
ENGINEERING (KAZAKHSTAN)
Share : 49%Partner : Kazakhstan EngineeringFounded : 2011Assets : 37,3 Mio $
BARQ QSTP LLC. (QATAR)Share : 48%Partner : BARZAN Holding, SSTEK A.Ş.Founded : 2018Assets : 0,3 Mio $
IGG ASELSAN INTEGRATED SYSTEMS
(UNITED ARABIAN EMIRATES)
Share : 49%Partner : IGGFounded : 2011Assets : 2,8 Mio $
ASPİLSAN A.Ş.Share : 1%Partner : TAFFFounded : 1981Assets : 10,3 Mio $
BİTES A.Ş.Share : 51%Partner : Real PersonFounded : 2016Assets : 1,7 Mio $
Assets are given as of 31.03.2019
6
University-Industry Cooperation
Human Resources
Engineers60%
Technicians28%
Administrative Staff
7%
Support5%
Total Employees : 6.725
Engineers : 4.036Location and Fringe Benefits
Back to Turkey Project
Projects Carried Out with Universities
Internship and Co-op Opportunities for High
school and University Students
Masters and Doctorate Program Incentives
for Employees
ASELSAN Academy
Talent Management
7
712
994
1.363
1.874
450
200
249
312
289
57
0
500
1.000
1.500
2.000
2.500
2015 2016 2017 2018 2019 1Q
Client Financed Self Financed
912
1.243
Million TL
1.675
2.163
507
The Biggest R&D Spender in Turkey
ASELSAN will not pay any corporate taxes till 2023 due to tax incentives on R&D activities.
R&D Spending
8
+46%
REVENUE
(TL)
2019 1Q Summary Financials
0,8
Billion $
NEW
CONTRACTS
39%
INCREASE in
EBITDA
9,5
Billion $
BACKLOG
20%
EBITDA
MARGIN
935 1.135 1.419 1.361 1.773 2.075 2.1923.365
4.628
8.120
1.746103 7783 272
398460 547
485
784
889
252
0
1.000
2.000
3.000
4.000
5.000
6.000
7.000
8.000
9.000
10.000 Million TL
Domestic Sales Exports
1.038 1.212 1.502 1.6332.171 2.535 2.739
3.850
5.412
9.009
1.998
CAGR
27%
Financial Highlights Domestic Sales and Exports
(Million TL) March'18 March'19 ∆%
Net Sales 1.365 1.998 46
Gross Profit 332 466 40
Operating Profit (EBIT) 243 344 41
EBITDA 283 395 39
Net Profit 351 629 79
Gross Profit Margin 24,3% 23,3% ↓
Operating Profit (EBIT) Margin 17,8% 17,2% ↓
EBITDA Margin 20,8% 19,8% ↓
Net Profit Margin 25,7% 31,5% ↑
Operating Cash Flow (OCF) (605) (637) ↓
Free Cash Flow (FCF) (744) (846) ↓
Cash and Cash Equivalents 480 2.555 432
9
Presidency of Defense
Industries58%
Other 18%
TAI10%
Ministry of National Defense
10%Exports
4%
351 579958
406 373
9541.154
701 1.704
443
1.148
411
1.947
2015 2016 2017 2018 2019 1Q
<50 50-300 >300
1.305
2.881
2.070
4.057
816
1,37
2,36
1,41
2,172,00*
2015 2016 2017 2018 2019 1Q
Book-to-Bill Ratio
$4,3
$6,2$6,8
$9,1 $9,5
2015 2016 2017 2018 2019 1Q
New Contract Awards (Million USD)Backlog History (Billion USD)
Our Backlog
Middle East and Asia
3,2%
Americas and Europe
0,2%
Caspian Region0,6%
Exports
Backlog
Client
Distribution
USD49%
EUR28%
TL23%
Backlog
Distribution
(Currency)
USD25%
EUR15%
TL60%
Cost
Distribution
(Currency)
Defense93%
Non-Defense 7%
Backlog
Distribution
2019 2,0 - 2,3
2020 2,3 - 2,7
2021 1,8 - 2,1
2022 0,9 - 1,3
2023 and Beyond 0,7 - 1,1
Backlog Aging
(Billion USD)
STM Savunma Teknolojileri Müh.
ROKETSAN
Turkish Land Forces
Central Finance Unit
(*) Annualized.
10
Laser Guidance
KitMILGEM I-Class
Frigate
Prospective Projects and Potential Business Areas
Non-Defense Areas
Prospective Projects
Indigenous
Helicopter
Railway Signaling Systems Energy Management and Smart
Grid Systems
Health Systems
11
9.009
Million TL
1.998
Million TL
40%-50%
GrowthNet Sales
21% 20% 19-21%EBITDA
Margin
738
Million TL
209
Million TL
1.000
Million TLCAPEX
2018 2019 1Q 2019 Guidance
2019 Guidance
12
21,3
76,2
137,6
214,7233,0
2015 2016 2017 2018 2019 1Q (*)
ASELSAN vs. BIST 100
Stock Performance ASELSAN reached a market value of 4,31 Billion USD as of 31.03.2019.
6,5
4,2
7,6 7,8
15,6
2015 2016 2017 2018 2019 1Q (*)
Dividend Per Share (per 100 shares) Earnings Per Share (per 100 shares)
+ 257%
+ 56%
+ 80%
167,43
120,02
0,00
50,00
100,00
150,00
200,00
250,00
300,00
350,00
400,00
ASELSAN BIST 100
+ 9%
(*) Annualized. (*) Annualized.
13
ASELSAN Elektronik Sanayi ve Ticaret A.Ş.
Mehmet Akif Ersoy Mah. 296. Cad. No:16
06370 Yenimahalle, Ankara
Phone: +90 312 592 10 00
Contact
Address
Web
www.aselsan.com.tr
14
APPENDIX
15
Consolidated Balance Sheet (Million TL)
Assets Liabilities
(Milllion TL) 31.12.2018 31.03.2019
CURRENT ASSETS 11.617 11.672
Cash and Cash Equivalents 3.116 2.555
Trade Receivables 3.072 2.972
Inventories 3.577 4.048
Prepaid Expenses 1.319 1.445
Other Current Assets 533 652
NON-CURRENT ASSETS 7.857 8.543
Financial Investments 779 779
Long-term Trade Receivables 2.827 3.418
Property, Plant and Equipment 1.336 1.419
Intangible Assets 1.082 1.151
Prepaid Expenses 504 465
Deferred Tax Assets 734 709
Other Long-term Assets 595 602
TOTAL ASSETS 19.474 20.215
(Milllion TL) 31.12.2018 31.03.2019
CURRENT LIABILITIES 4.685 4.312
Short-term Financial Liabilities 766 1.057
Trade Payables 2.549 2.118
Deferred Income 633 351
Other Short-Term Liabilities 737 786
NON-CURRENT LIABILITIES 4.612 5.093
Long-term Financial Liabilities 20 0
Long-term Trade Payables 1.768 2.221
Deferred Income 2.297 2.333
Other Long-term Liabilities 527 539
(Milllion TL) 31.12.2018 31.03.2019
EQUITY 10.177 10.810
Share Capital 1.140 1.140
Share Premiums 2.797 2.797
Other Funds 1.260 1.265
Retained Earnings 2.662 4.979
Net Profit for the Period 2.318 629
TOTAL LIABILITIES AND EQUITY 19.474 20.215
16
Income Statement
Consolidated Income Statement (Million TL)
(Milllion TL) 31.03.2018 31.03.2019
PROFIT OR LOSS
Revenue 1.365 1.998
Cost of sales (-) (1.033) (1.532)
GROSS PROFIT 332 466
General administrative expenses (-) (44) (71)
Marketing expenses (-) (25) (29)
Research and development expenses (-) (19) (22)
Other operating income 509 747
Other operating expenses (-) (375) (450)
OPERATING PROFIT 378 641
Income from investing activities 1 0
Share of Losses of Equity-Accounted Investments (2) (1)
OPERATING PROFIT BEFORE FINANCIAL EXPENSE 375 640
Financial income 62 271
Financial expenses (-) (121) (255)
PROFIT BEFORE TAX FROM CONTINUING OPERATIONS 316 656
Tax income/ (expense) from continuing operations 36 (26)
- Current tax expense (2) (1)
- Deferred tax income / (expense) 38 (25)
PROFIT FOR THE PERIOD FROM CONTINUING
OPERATIONS 352 630
Profit for the period attributable to:
Non-controlling interest (0,02) 0
Shareholders of the parent 351 630
17
Cash Flow
Consolidated Statement Of Cash Flow (Million TL)
(Milllion TL) 31.03.2018 31.03.2019
OPERATING CASH FLOW (OCF) (605) (637)
Net Profit for the Period 351 630
Depreciation and Amortization 40 51
Change in Inventory (282) (465)
Trade Receivables (477) (452)
Prepaid Expenses (345) (86)
Deferred Income (230) (387)
Change in Trade Payables (109) 81
Others (14) (9)
CASH FLOW FROM INVESTING ACTIVITIES (139) (209)
Tangible Assets (49) (118)
Intangible Assets (87) (91)
Minority Effect of New Establishment - 2
Cash Inflow from Financial Investments (4) (2)
FREE CASH FLOW (FCF) (744) (846)
18
Forward Looking Statements
The information contained herein has been prepared by ASELSAN (the Company). The opinions
presented herein are based on general information gathered at the time of writing and are subject
to change without notice.
These materials contain statements about future events and expectations that are forward-looking
statements. Any statement in these materials that is not a statement of historical fact is a forward-
looking statement that involves known and unknown risks, uncertainties and other factors which
may cause our actual results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by such forward-looking
statements. Except to the extent required by law, we assume no obligations to update the
forward-looking statements contained herein to reflect actual results, changes in assumptions or
changes in factors affecting these statements.
This presentation does not constitute an offer or invitation to sell, or any solicitation of any offer
to subscribe for or purchase any securities and nothing contained herein shall form the basis of
any contract or commitment whatsoever. No reliance may be placed for any purposes whatsoever
on the information contained in this presentation or on its completeness, accuracy or fairness.
None of the Company nor any of its shareholders, directors, officers or employees nor any other
person accepts any liability whatsoever for any loss howsoever arising from any use of this
presentation or its contents or otherwise arising in connection therewith.
