Ülker Bisküvi Sanayi A.S.

Thank you, Michael. Hello, everybody. This is Veste. Welcome to Cabot Suisse first quarter 2026 earnings race webcast. Here with me in the room are CEO, Mr. Özgür Kılıçdöker, and our CFO, Tugay Banu Sürücü. I now leave the ground to our CEO, Özgür Bey, for the opening remarks and initial thoughts.

Özgür Bey, please. Thank you, Veste. Good morning, good afternoon, and good evening, everyone, wherever you are. Thank you for joining UKI B-Suite's 2026 first quarter earnings call. I'll walk you through our results, strategic progress, and our roadmap for the rest of the year. First, I'll start with the key highlights, then review operation and financial performance, and close our outlook for 2026 growth plan, and then you'll take questions at the end. Looking at the key highlights, 2025 was a resilient year despite softer demand and regional challenges, and 2026 has started in even a more challenging context in terms of both geopolitics and macroeconomy. Despite this challenging environment, we continue maintaining our leadership in Turkey and strengthen regional competitiveness even more. Innovation scales strongly, contributing meaningfully to growth, and balance sheet discipline remains as a core strength. Looking at the macroeconomic highlights, this slide is important because it explains why we as the management focus in 2026 is not simply growth, but culture of growth, cash discipline, and protection of earnings. Macroenvironment in Turkey remains challenging. Inflation is still high at around 31% as of March 2026. As you can see in the details, education is the top of the liquid, 52%, rent is 42%, and food inflation is 32%. And it is really elevated. At the same time, consumer confidence is stable, but not yet strong enough to support a growth-based discretionary demand recovery. The implication of our category is clear. Consumers are still buying trusted brands, but they are more selective on basket size, price points, and promotions. This is why our commercial actions in Turkey are more granular than in the high inflation period of 2022 to 2024. Today, we are in a more disinflationary environment that means large and frequent pricing is harder, and the consumer is more sensitive to affordability. First quarter 2026 numbers should be viewed against this challenging environment. We emphasize volume resilience, the role of the international portfolio, and the balance sheet capacity to manage volatility. So, here we share our key messages of today. Firstly, we delivered 1.6 billion per year net income, demonstrating our ability to protect earnings despite a highly volatile operating environment. This reflects the strength of our operation model and disciplined execution. On the top line, consolidated volumes made resilience at 182,000 tons. Importantly, our complexionary business is slightly growing year on year, even as overall market demand softened. In Turkey, our core categories continue to perform resiliently, supported by the strength of our strong portfolio and consistent in market execution. Our international operations were a standout, delivering 8.8% volume growth, showing strong momentum despite ongoing regional geopolitical tensions. On profitability side, we maintain disciplined margin management, and we are closing the quarter at a 15.1% EBITDA margin. This reflects mainly timing impacts on cost and inventory, rather than any structural change in our earnings capacity. Finally, our balance sheet remains solid with around 70% of debt structured for long-term, while working capital dynamics are largely driven by the immense declining effects. Overall, this quarter once again demonstrates our ability to navigate volatility while protecting both growth and profitability fundamentals. Looking at the new product launches, We are accelerating innovation in Turkey and internationally. Some of the launches you see on the screen, these launches strengthen our core, expand into new spaces, and keep us ahead of consumers' expectations. This is how the drive grows. Faster innovation, sharper execution, and strong brands. And this momentum will continue in years to come. Now let's look at the first quarter revenue details. Innovation continues to be a meaningful growth driver for us. In the first quarter, new product launches contributed 9% of our total snaking revenues, led by a strong 10% in domestic markets and 6% internationally. This reflects both the scale and pace of our innovation engine, particularly in our core markets. Overall, we are building a more innovation-led growth model, with MPGs becoming an increasingly consistent contributor to top-line performance. Sustainability is the core driver of our long-term growth and resilience. We maintain our number one position in the LCEG London Stock Exchange Group ranking and strengthen our climate and supply chain strategies with a Our ESG performance places us in the top 3% globally. And we were ranked in the top of the list third year in a row. We have completed our transition to 100% recycle-ready packaging. In our value chain, beyond KAKOA and beyond the ASIMAP programs, continuous scale supporting farmers ensuring deforestation-free sourcing and strengthening resilient supply chains. Looking ahead, we are advancing our 2050 net-zero commitment and executing our decarbonization roadmap in line with our SDK commitments, turning sustainability into measurable, long-term value creation. We continue to earn strong external recognition across sustainability, people, innovation and stakeholder engagement priorities. We supported the Ramadan celebrations at the heart of the education project implemented across all 81 provinces under the leadership of the Ministry of National Education of Turkey. We hosted our Minister of Industry and Technology, Mr. Mehmet Fatih Kaçır, at our Ülker Gebze factory. one of the key hubs for our digitalization and technology investments, as well as our Industry 4.0 applications. We ranked first in the LCEG ESG performance evaluation conducted by the London Stock Exchange Group, as I mentioned before. We were selected in the SNET category of Turkey's Happiest Workplaces Survey for the fifth year in a row. We were top of the list. According to the assessment of the International Equal Pay Association, we became the first company in Turkey to receive the equal pay certificate among all companies with more than 5,000 employees. In Standard & Poor's Global Corporate Sustainability Assessment, we managed to be in the top 3% among both companies. We received the Syndicated Loan of the Year Award from the financial institution of global capital. We have continued to strengthen our employer brand and people agenda through impactful initiatives across talent, performance, culture, and recognition. Engagement in internal platforms and programs has significantly increased, while strong participation in such talent initiatives reflects our attractiveness as an employer. At the same time, we have reinforced disciplined performance management and maintained competitive reward outcomes. We have also fostered a strong sense of belonging and culture through company-wide engagement moments while continuing to invest in future leadership pipelines. These efforts are complemented by consistent external recognition, positioning us among leading employers both in Turkey and globally. Now, let's dive into our operational performance. The operating story of first quarter is mixed, but it is also very important. Turkey remains soft from a demand perspective. International markets flow volume-led momentum, although not all regions contribute in the same way. The key is that the portfolio is diversified enough to manage these differences. and our operating model uses several levers across regions, categories, and channels. Turkey's conventional market has shifted into a structural volume decline with minus 2.5% in 2025, and what we have seen is minus 2.4% decline in Q1 also in 2026. So, as you can see, the markets remain soft in the volume demand perspective. This trend reflects a clear behavior shift in consumers. Discretionary spending is tightening, with budgets increasingly redirected toward essentials and savings. As a result, non-essential authenticity categories, particularly trucks, are disproportionately impacted. In this context, the market outlook requires sharper focus on value delivery, affordability, and portfolio resilience rather than relying on volume net growth. This slide shows why geography diversification is a core part of the UTAG investment case. The first quarter was of a uniform story across markets. Turkey's revenue declined by 5.8% and EBITDA declined by 27.7%, reflecting soft domestic demand and margin pressure from post-timing. Turkey, of course, also remained under pressure, with revenue down 1.4% and EBITDA down 30.1%, mainly driven by the weak correlation between Forex and inflation. At the same time, International operations provided important volume and revenue support. Middle East revenue grew by 6.4% in local currency, but EBITDA declined by 21.8%. In late 2025, the Saudi FNCG market experienced a sharp contraction, and the consumer became more value conscious. So, while the top line is improving, we remain disciplined on margin and brand investments. Revenue generated from our North Africa business grew by 18.2% and a much smaller EBITDA decline of 3.2%. This is broadly consistent with the more constructive consumer backdrop in Egypt. Their inflation has cooled and volume demand remains positive. Central Asia delivered 23.9% revenue growth, but EBITDA was slightly lower. Uzbekistan establishment Respecting deliberate market-building investments and the timing of phasing spending is one of the key elements of our Central Asia strategy. Turkey is still the largest contributor, and we are very focused on protecting profitability here. But the international footprint gives us optionality, scale, and local growth platforms. The right interpretation of this slide is therefore not simply region-by-region growth. It is how a multi-market portfolio helps us manage a volatile year. Let me briefly turn into Uzbekistan, which we see as one of the most strategically important growth engines in our international portfolio. The market combines scale and strong fundamentals with a large and young consumer base, and the modern trade environment that is still developing, creating a long-run way for structured category growth. In the first quarter of 2026, our effort was deliberately grant-led and focused on building the market. We progressed on three clear levers. First, innovation. We supported Dajani with one new MPV, ensuring fresh news and stronger reasons to buy in the market. Second, brand demand generation. We delivered two brand campaigns with an integrated mix across outdoor, digital, and consumer-facing touch points. We also continued disruptive commercial advertising as a visible lever, reinforcing salience and accelerating consumer recruitment. Third, goods market. We sustained strong trade activity across channels, and we focused on direct distribution in Tashkent, While out of Tashkent, we focus on the establishment of our route to market through distributors. Overall, we are building Uzbekistan for the long term through innovation, grant investment, and route to market expansion. So it becomes one of our most meaningful international growth contributors over the coming years. This slide shows the revenue architecture of the business. In the first quarter, total net value was 33.9 billion on an IAS 29 adjusted basis. Domestic operations accounted for 24.5 billion Turkish Lira, or 72% of the total. International operations accounted for 9.4 billion Turkish Lira, which is 28% of the pie. At first glance, you may see this as a Turkey-led company with international exposure. That is true, but it is not the full story. The international portfolio is now broad enough to matter in the quarter-to-quarter balance of the business. The Middle East, North Africa, Central Asia, and exports each play a different role.

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