Turkcell Iletisim Hizmetleri A.S. (NYSE:TKC) (BIST:TCELL):
- Please note that all financial data is
consolidated and comprises that of Turkcell Iletisim Hizmetleri
A.S., (the “Company”, or “Turkcell”) and its subsidiaries and
associates (together referred to as the “Group”). All non-financial
data is unconsolidated and comprises Turkcell only figures. The
terms "we", "us", and "our" in this press release refer only to the
Company, except in discussions of financial data, where such terms
refer to the Group, and where context otherwise requires.
- In this press release, year-on-year
comparison of our key indicators is provided and figures in
parentheses following the operational and financial results for the
year end 2014 refer to the same item at the year end of 2013 and
figures in parentheses following the operational and financial
results for the fourth quarter of 2014 refer to the same item in
the fourth quarter of 2013. For further details, please refer to
our consolidated financial statements and notes as at and for the
year ended December 31, 2014, which can be accessed via our website
in the investor relations section (www.turkcell.com.tr).
- Please note that selected financial
information presented in this press release for the fourth quarters
and year end of 2014 and 2013, both in TRY and US$ is based on IFRS
figures.
- In the tables used in this press
release totals may not foot due to rounding differences. The same
applies for the calculations in the text.
HIGHLIGHTS
FULL YEAR
- Turkcell Group revenues and EBITDA1
both grew by 6% to TRY12,044 million (TRY11,408 million) and
TRY3,762 million (TRY3,544 million), respectively. EBITDA margin
was at 31.2% (31.1%).
- Net income fell 20% to TRY1,865 million
(TRY2,326 million), adversely impacted mainly by macroeconomic
conditions in our international markets of operation as well as
several one off items. Excluding the one-off items, net income
would be TRY2,135 million2.
- Mobile business revenues in Turkey rose
3% to TRY9,369 million (TRY9,123 million) with an EBITDA margin of
31.2% (31.0%).
- Mobile broadband revenues grew by 34%
to TRY1,931 million (TRY1,437 million) with strong demand for
data.
- Voice revenues3 fell by 1% to TRY6,374
million (TRY6,460 million), mainly due to lower MTRs.
- Subsidiaries4 registered revenue growth
of 17% to TRY2,674 million (TRY2,285 million) and EBITDA growth of
18% to TRY838 million (TRY712 million).
- On January 28, 2015, Turkcell announced
CEO, Sureyya Ciliv’s resignation. On the same day, the Turkcell
Board of Directors appointed Ilker Kuruoz as acting CEO in addition
to his role as the Chief Technology Group Officer.
FOURTH QUARTER 2014
- Group revenues grew by 8% to TRY3,103
million (TRY2,884 million) with the higher contribution of mobile
broadband and fiber broadband revenues.
- Group EBITDA1 rose 8% to TRY917 million
(TRY851 million) with an EBITDA margin of 29.6% (29.5%).
- Net income fell by 49% to TRY258
million (TRY505 million), mainly due to currency devaluation in
Ukraine and Belarus, along with various one-offs. Excluding one-off
impacts, net income would be TRY390 million2.
- Mobile business revenues in Turkey
reached TRY2,392 million (TRY2,240 million) on 7% growth, while the
EBITDA margin rose to 30.1% (29.9%).
- Mobile broadband revenues rose by 44%
to TRY567 million (TRY394 million), posting the highest growth rate
of the year.
- Voice revenues3 grew by 1% to TRY1,555
million (TRY1,547 million).
- Revenues of subsidiaries4 climbed 10%
to TRY711 million (TRY644 million) with an EBITDA increase of 8% to
TRY196 million (TRY181 million).
(1) EBITDA is a non-GAAP financial measure. See page 16 for the
reconciliation of EBITDA to net cash from operating activities.(2)
The adjusted figures are non-IFRS measures. For further details on
the factors for which adjustments have been made and on the
calculation of the adjustments, please see page 9.(3) Voice
revenues include outgoing, incoming, roaming and other (comprising
almost 1% of Turkcell Turkey) revenues.(4) Including
eliminations.(*) For details, please refer to our consolidated
financial statements and notes as at, and for the year ended
December 31, 2014 which can be accessed on our web site in the
investor relations section (www.turkcell.com.tr).
COMMENTS FROM CEO, ILKER KURUOZ
“Turkcell Group reached its 2014 targets. Consolidated revenues
rose 6% to TRY12 billion, while EBITDA grew 6% to TRY3.8 billion.
Meanwhile, EBIT rose 9% to TRY2.1 billion, while net income
declined by 20% to TRY1.9 billion, mainly due to unfavorable
macroeconomic conditions in countries of our international
operations.
In 2014, Turkcell Turkey’s revenues grew by 3% on 34% growth in
mobile broadband. Meanwhile, Turkcell Superonline revenues grew by
35% year-on-year on the back of an increased fiber subscriber base.
Our Ukrainian business sustained its operational performance, and
accordingly its revenues rose by 13% in local currency terms.
Nonetheless, its revenues contracted 12% in TRY terms due to 97%
local currency devaluation in Ukraine.
The Turkcell team in 2014 continued to differentiate itself with
its focus on providing superior customer experience and
best-in-class service to create more value for its customers
through technology, innovation, and operational excellence. We
introduced the Turkcell T50 to our customers, Turkey’s first
operator branded smartphone with 4G, which ranked among the top
selling smartphones in Turkey. Meanwhile, we launched our TV
platform Turkcell TV Plus which, differentiated by the synergy
between our 3G network and fiber infrastructure, strengthened our
offering with a triple play service.
We are proud to have transformed Turkcell from a GSM only
operator to a leading communication and technology company, both in
Turkey and in the region, over the past 20 years. We sustain our
pioneering role and leadership of the sector through consistent
investment in technology and infrastructure, thereby providing our
customers superior value. In the 4G era, we target creating more
value for our customers with a sustained focus on quality,
supported by accelerated investments, and innovative products and
services.
We believe that the strong team spirit of Turkcell employees and
support of our business partners, who together have made the
company “Turkey’s Turkcell”, will ensure continued success. We
thank all of our stakeholders for sharing our success story with
us.”
OVERVIEW OF TURKCELL TURKEY
The mobile market remained competitive in 2014. The market
continued to opt for price oriented offers over product, service
and network speed. Furthermore, the market has shifted towards
increased data incentive bundled offers. Despite some upward price
adjustments in early Q414, these did not lead to significant
improvement in overall competition. In light of the first quarter
of 2015 thus far, we expect this competitive environment to
prevail.
As Turkcell, our strategy has always been to provide a superior
and differentiating customer experience through operational
excellence and investment in technology and innovation, ensuring a
high quality offering.
As a result of our continued focus on quality, our postpaid
subscriber base expanded by 1.2 million yearly net additions to
15.2 million. Accordingly, the postpaid share in total subscribers
reached 44%, and 70% in total revenues. Overall, our subscriber
base declined by 0.5 million to 34.6 million, mainly through losses
from the more price-sensitive prepaid segment. Meanwhile, blended
ARPU for the full year rose by 4% driven by an increased postpaid
subscriber base and rising mobile data demand.
On the smartphone front, the momentum has continued, despite the
regulatory change on credit card payment and local currency
depreciation. This durable growth of the smartphone market should
help us realize our strategy to monetize the mobile broadband
business. Our attractive contracted offers and the success of our
affordable T-branded smartphones led to 3.1 million additions to
our smartphone base, which rose to 12.7 million. This amounted to a
10 pp yearly increase in smartphone penetration on our network to
40%.
In 2014, we had continued to differentiate ourselves with our
innovative products and services. We strengthened our leading M2M
solution provider position with the launch of our “Connected Car
Platform”. We expanded Turkcell-branded applications further with
“Super SmallBiz” targeting small businesses and “Turkcell My Child
and Me” for parents. Our latest T-series smartphone, T-50, became
the top selling smartphone in Turkey in Q314, while Turkcell TV+,
our TV platform, strengthened our product offering and enabled
Turkcell Superonline to provide triple play services.
Looking forward, we remain quite enthusiastic about the new era
of 4G in Turkey. We aim to sustain our technology leadership in the
market by leveraging on the synergy with our fiber broadband
subsidiary to ensure our customers enjoy the full value of the 4G
environment.
Turkcell Group
Guidance*:
For 2015, we anticipate continued growth on a consolidated
basis, mainly through our mobile broadband and fiber broadband
businesses in Turkey. We target consolidated revenues in the range
of TRY12,800 – TRY13,100 million and consolidated EBITDA in the
range of TRY3,850 – TRY4,050 million. In accordance with our growth
plans, we expect an operational capex to sales ratio of around 20%,
with increased investments in preparation of the mobile network to
4G transition, further expansion of the fiber network, and the roll
out of Astelit’s 3G network. This ratio excludes new spectrum fees
in Turkey and Ukraine related to 4G and 3G, respectively, which are
expected to be auctioned this year.
(*) Please note that this paragraph contains forward looking
statements based on our current estimates and expectations
regarding market conditions for each of our different businesses.
No assurance can be given that actual results will be consistent
with such estimates and expectations. For a discussion of factors
that may affect our results, see our Annual Report on Form 20-F for
2013 filed with U.S. Securities and Exchange Commission, and in
particular, the risk factor section therein.
FINANCIAL AND OPERATIONAL REVIEW
The following discussion focuses principally on the developments
and trends in our business in the fourth quarter and full year 2014
in TRY terms. Selected financial information presented in this
press release for the fourth quarters and for the full year 2014
and 2013, both in TRY and US$, is based on IFRS figures.
Selected financial information for the fourth quarter of 2013,
third and fourth quarters of 2014 and full year 2013 and 2014, both
in TRY and US$ prepared in accordance with IFRS, and in TRY
prepared in accordance with the Turkish Accounting standards is
also included at the end of this press release.
Financial Review of Turkcell Group
Profit & Loss Statement
(million TRY)
Quarter Year Q413
Q414 y/y % FY13
FY14 y/y % Total Revenue 2,883.6
3,103.2 7.6% 11,407.9 12,043.6
5.6% Direct cost of revenues1 (1,851.3) (1,972.2) 6.5%
(7,063.9) (7,383.9) 4.5%
Direct cost of
revenues1/revenues (64.2%) (63.6%)
0.6pp (61.9%) (61.3%) 0.6pp
Depreciation and amortization (481.6) (450.7) (6.4%) (1,594.4)
(1,639.4) 2.8%
Gross Margin 35.8% 36.4%
0.6pp 38.1% 38.7% 0.6pp Administrative
expenses (152.0) (146.8) (3.4%) (550.3) (562.7) 2.3%
Administrative expenses/revenues (5.3%) (4.7%)
0.6pp (4.8%) (4.7%) 0.1pp Selling and
marketing expenses (510.4) (517.8) 1.4% (1,843.6) (1,974.6) 7.1%
Selling and marketing expenses/revenues (17.7%)
(16.7%) 1.0pp (16.2%) (16.4%)
(0.2pp) EBITDA2 851.5 917.1
7.7% 3,544.5 3,761.8 6.1% EBITDA
Margin 29.5% 29.6% 0.1pp 31.1%
31.2% 0.1pp EBIT3 369.9
466.4 26.1% 1,950.1 2,122.4 8.8%
Net finance income / (expense) 149.7 (176.9) (218.2%) 555.3 (291.6)
(152.5%) Finance expense (89.7) (400.1) 346.0% (204.6) (1,247.0)
509.5% Finance income 239.4 223.2 (6.8%) 759.9 955.4 25.7% Share of
profit of associates 75.8 (6.9) (109.1%) 297.3 207.3 (30.3%) Other
income / (expense) (35.6) 1.4 (103.9%) (58.9) (76.3) 29.5% Monetary
gains / (losses) 72.5 32.3 (55.4%) 176.9 205.1 15.9%
Non-controlling interests (7.9) 128.9 n.m. (3.4) 428.2 n.m. Income
tax expense (119.5) (187.3) 56.7% (591.4) (730.4) 23.5%
Net
Income 504.9 257.9
(48.9%) 2,325.9 1,864.7
(19.8%)
(1) Including depreciation and amortization expenses.(2) EBITDA
is a non-GAAP financial measure. See page 16 for the reconciliation
of EBITDA to net cash from operating activities.(3) EBIT is a
non-GAAP financial measure and is equal to EBITDA minus
depreciation and amortization expenses.
Revenue grew by 7.6% year-on-year to TRY3,103.2 million
(TRY2,883.6 million) in Q414 driven by:
- 6.8% rise in mobile business revenues
in Turkey to TRY2,391.7 million (TRY2,239.5 million)
- 43.9% growth in mobile broadband
revenues to TRY566.7 million (TRY393.7 million) with increased
smartphone users on our network, higher number of mobile broadband
users and increased data usage
- 25.7% fall in SMS revenues due to the
declining usage trend impacted by the adoption of OTT (“over the
top” messaging) and other alternative instant messaging services,
coupled with the ICTA’s 20% ceiling price decrease on SMS, which
came into effect on 1 January 2014
- 20.7% increase in mobile services
revenues with our increased efforts to promote these services
- 10.5% increase in the revenues of
subsidiaries to TRY711.4 million (TRY644.0 million) comprising
22.9% (22.3%) of the Group top line.
- 28.1% increase in Turkcell Superonline
revenues to TRY335.8 million (TRY262.1 million)
- 27.9% decline in Astelit’s revenues to
TRY167.1 million (TRY231.9 million)
For the full year, revenues grew by 5.6% to TRY12,043.6 million
(TRY11,407.9 million) driven by:
- 2.7% increase in mobile business
revenues in Turkey to TRY9,369.5 million (TRY9,123.1 million).
Excluding MTR cut impact, mobile business revenues in Turkey would
have increased by 5%.
- 34.4% rise in mobile broadband revenues
to TRY1,930.6 million (TRY1,436.7 million) with increased
smartphone penetration of 10 percentage points in a year, a higher
number of mobile broadband users and increased data usage
- 23.0% fall in SMS revenues due to the
declining usage trend impacted by the increasing adoption of OTT
and alternative messaging services, coupled with the ICTA’s 20%
ceiling price decrease on SMS
- 5.3% growth in mobile services
revenues
- 17.0% rise in the revenues of
subsidiaries to TRY2,674.1 million (TRY2,284.7 million)
constituting 22.2% (20.0%) of the Group top line.
- 35.4% growth in Turkcell Superonline
revenues to TRY1,252.5 million (TRY925.2 million)
- 12.0% decrease in Astelit’s revenues to
TRY758.2 million (TRY861.6 million)
Direct cost of revenues* rose by 6.5% to TRY1,972.2
million (TRY1,851.3 million) in Q414, while as a percentage of
revenues declining to 63.6% (64.2%) driven by the decrease in
depreciation and amortization expenses and other various cost
items, more than offsetting the increase in operational expenses of
certain subsidiaries.
For the full year, direct cost of revenues grew by 4.5% to
TRY7,383.9 million (TRY7,063.9 million), while as a percentage of
revenues decreasing to 61.3% (61.9%). This decrease was led by the
lower interconnect costs of Turkcell Turkey and decrease in various
other cost items as opposed to the rise in the operational expenses
of certain subsidiaries.
The table below presents the interconnect revenues and costs of
Turkcell Turkey:
Million TRY Quarter Year
Q413 Q414 y/y %
FY13 FY14 y/y % Interconnect
revenues 253.2 281.3 11.1% 1,171.3 1,116.5 (4.7%)
as a % of
revenues 11.3% 11.8% 0.5pp 12.8%
11.9% (0.9pp) Interconnect costs (238.6) (267.1)
11.9% (1,118.3) (1,049.7) (6.1%)
as a % of revenues
(10.7%) (11.2%) (0.5pp)
(12.3%) (11.2%) 1.1pp
Administrative expenses as a percentage of revenues
declined 0.6pp to 4.7% (5.3%) in Q414, mainly due to lower bad debt
expenses (0.4pp) and other cost items (0.2pp). For the full year,
administrative expenses as a percentage of revenues decreased by
0.1pp to 4.7% (4.8%).
*In 2013, the direct cost of revenues included a total tax
expense of TRY34 million regarding the ICTA decision dated
September 26, 2012 enabling users of mobile lines without
subscription to register those lines under their names at no
charge.
Selling and marketing expenses as a percentage of
revenues fell by 1.0pp to 16.7% (17.7%) in Q414, mainly driven by
the decrease in selling expenses (0.6pp), marketing expenses
(0.3pp) and other cost items (0.1pp).
For the full year, selling and marketing expenses as a
percentage of revenues increased to 16.4% (16.2%) driven by the
increase in selling expenses (0.2pp) and other cost items (0.4pp)
more than offsetting the decline in marketing expenses (0.4pp).
EBITDA* rose by 7.7% to TRY917.1 million (TRY851.5
million), while the EBITDA margin was at 29.6% (29.5%) in Q414. The
decrease in selling and marketing expenses by 1.0pp and
administrative expenses by 0.6pp was offset by the increase in
direct cost of revenues (excluding depreciation and amortization)
by 1.5pp as a percentage of revenues.
For the full year, EBITDA rose to TRY3,761.8 million (TRY3,544.5
million) on 6.1% growth, while the EBITDA margin stood at 31.2%
(31.1%). The 0.2pp decrease in direct cost of revenues (excluding
depreciation and amortization) and in administrative expenses by
0.1pp was offset by the 0.2pp increase in selling and marketing
expenses as a percentage of revenues.
The EBITDA of subsidiaries grew by 8.3% to TRY196.0 million
(TRY181.0 million) in Q414. For the full year, the EBITDA of
subsidiaries rose by 17.6% to TRY 837.5 million (TRY712.1
million).
Net finance expense of TRY176.9 million (net finance
income of TRY149.7 million) was recorded in Q414, mainly due to the
increase in translation losses to TRY383 million (TRY59.0
million).
For the full year, Turkcell Group recorded a net finance expense
of TRY291.6 million (net finance income of TRY555.3 million) due to
higher translation losses of TRY1,110.8 million (TRY75.6 million),
partially offset by higher interest income earned on time
deposits.
The table below presents translation loss details:
Million TRY Quarter Year
Q413 Q414 y/y %
FY13 FY14 y/y % Turkcell Turkey
21.9 72.9 232.9% 139.1 225.8 62.3% Turkcell Superonline (18.4)
(6.3) (65.8%) (59.2) (38.2) (35.5%) Astelit (2.3) (294.9) n.m.
(7.6) (991.2) n.m. Best (58.9) (149.6) 154.0% (123.6) (294.5)
138.3% Other (1.3) (5.1) 292.3% (24.3) (12.7) (47.7%)
Turkcell
Group (59.0) (383.0) 549.2%
(75.6) (1,110.8) n.m.
The share of profit of equity accounted investees was a
loss of TRY6.9 million (income of TRY75.8 million), mainly due to
non-cash impairment charges of US$88 million recorded by Fintur in
relation to goodwill and fixed assets in Q414. The impact of this
on our Group financials was TRY83 million on the basis of our
41.45% share of Fintur.
For the full year, our share in the net income of unconsolidated
investees fell by 30.3% to TRY207.3 million (TRY297.3 million)
impacted mainly by non-cash charges of US$125 million in Fintur,
stemming from write down of operational assets and impairment
charges relating to goodwill and fixed assets. These charges
negatively impacted our Group financials by TRY116 million on the
basis of our 41.45% share in Fintur.(*)EBITDA is a non-GAAP
financial measure. See page 16 for the reconciliation of EBITDA to
net cash from operating activities
Income tax expense details for Q414 and FY14 are
presented in the table below:
Million TRY Quarter Year
Q413 Q414 y/y %
FY13 FY14 y/y % Current Tax
expense (166.7) (170.3) 2.2% (650.5) (709.4) 9.1% Deferred Tax
Income/expense 47.2 (17.0) (136.0%) 59.1 (21.0) (135.5%)
Income
Tax expense (119.5) (187.3)
56.7% (591.4) (730.4)
23.5%
Net income fell by 48.9% to TRY257.9 million (TRY504.9
million) in Q414. Net income was negatively impacted by the
devaluation of UAH against US$ in Ukraine and BYR against US$ in
Belarus, non-cash impairment charges incurred by Fintur, decrease
in monetary gain and a higher tax expense. Net income was impacted
by several one-off items both in Q413 and Q414. Excluding one-off
items, net income in Q414 would be TRY390 million (TRY630 million
in Q413).
For the full year, net income declined by 19.8% to TRY1,864.7
million (TRY2,325.9 million). This was mainly driven by devaluation
in Ukraine and Belarus, the impact of non-cash impairment charges
incurred by Fintur and a higher tax expense. Excluding one-off
items, net income in FY14 would be TRY2,135 million (TRY2,511
million in FY13).
Net income impacts (million TRY) Q413
FY13 Net income impacts (million TRY)
Q414 FY14 Net income excluding
one-offs* 630 2,511 Net income excluding one-offs*
390
2,135 BeST impairment (61) (61) Best impairment (35) (35)
ICTA Decision Regarding a Tariff** (41) (41) Fintur impact (83)
(116) Other impacts (23) (83) A-Tel Share Sale impact - 24
Reimbursements** (8) (29) ICTA penalties** (2) (108) Other impacts
(4) (6)
Net income reported 505
2,326 Net income reported 258
1,865
* Net income excluding one-off impacts is a presentation
of our net income, adjusted to exclude certain items that we
consider to be exceptional. However, it should not be relied upon
as comparable to reported net income prepared in accordance with
the IFRS that we apply. Although we expect that the specific items
represented in this adjustment are non-recurring, no assurance can
be given that this will be the case and that we will not be
affected by similar items in the future.** For details, please
refer to consolidated financial statements and notes as at and for
the years ended December 31, 2013 and December 31, 2014 under the
note 34 which can be accessed via our website.
In Q413 and FY13, other impacts mainly comprised impairment
charges, regulatory penalties and the tax expense regarding the
ICTA decision as explained at the footnote of direct cost of
revenues section.
Total debt as of December 31, 2014 was at TRY3,697.7
million (US$1,594.6 million), compared to TRY3,545.0 million
(US$1,555.6 million) as of September 30, 2014 in consolidated
terms. The debt balance of Ukraine (including intra-group debt) was
TRY1,580.3 million (US$681.5 million), Belarus was TRY1,540.3
million (US$664.2 million) and Turkcell Superonline was TRY737.0
million (US$317.8 million).
TRY2,890.9 million (US$1,246.7 million) of our consolidated debt
is at a floating rate, while TRY2,449.8 million (US$1,056.5
million) will mature within less than a year. As of December 31,
2014, our debt/annual EBITDA ratio in TRY terms was 98%. (Please
note that the figures in parentheses refer to US$ equivalents).
Cash flow analysis: Capital expenditures, including
non-operational items in Q414, amounted to TRY935.3 million, of
which TRY593.7 million was related to Turkcell Turkey, TRY254.4
million to Turkcell Superonline, TRY37.7 million to Astelit and
TRY15.6 million to BeST. The cash flow item noted as “other”
included cash inflows mainly relating to the effects of foreign
exchange rate valuations on cash and cash equivalents and cash
outflows due to corporate tax payment and the change in net working
capital.
For the full year, capital expenditures including
non-operational items were at TRY2,144.8 million, of which
TRY1,361.6 million was related to Turkcell Turkey, TRY552.8 million
to Turkcell Superonline, TRY101.3 million to Astelit and TRY35.4
million to BeST. The cash flow item noted as “other” mainly
comprised cash inflow related to dividends from Fintur and cash
outflows due to corporate tax payment and the change in net working
capital.
In 2014, operational capex as a percentage of revenues realized
at around 17%.
Consolidated Cash Flow (million TRY) Quarter
Year Q413 Q414
FY13 FY14 EBITDA1 851.5 917.1
3,544.5 3,761.8 LESS: Capex and License (818.5) (935.3) (1,822.3)
(2,144.8) Turkcell (500.2) (593.7) (1,057.8) (1,361.6) Turkcell
Superonline (172.1) (254.4) (399.1) (552.8) Ukraine2 (61.2) (37.7)
(144.6) (101.3) Net interest Income/ (expense) 208.7 206.1 630.9
819.3 Other 199.1 57.8 (995.2) (1,633.8) Net Change in Debt (15.2)
94.2 (227.9) 100.5
Cash generated / (used) 425.6
339.9 1,130.0 903.0 Cash balance
8,128.9 9,031.9 8,128.9
9,031.9
(1) EBITDA is a non-GAAP financial measurement. See page 16 for
the reconciliation of EBITDA to net cash from operating
activities.(2) The appreciation of reporting currency (TRY) against
US$ is included in this line.
Operational Review in Turkey
Summary of Operational Data Quarter
Year Q413 Q414 y/y%
FY13 FY14 y/y% Number
of total subscribers (million) 35.2 34.6
(1.7%) 35.2 34.6 (1.7%) Postpaid 14.0
15.2 8.6% 14.0 15.2 8.6% Prepaid 21.2 19.4 (8.5%) 21.2 19.4 (8.5%)
ARPU(Average Monthly Revenue per User), blended (TRY)
21.3 23.0 8.0% 21.7 22.5
3.7% Postpaid 36.5 38.0 4.1% 37.3 37.7 1.1% Prepaid 11.3
11.6 2.7% 11.8 11.6 (1.7%)
ARPU, blended (US$) 10.5
10.3 (1.9%) 11.4 11.2 (1.8%)
Postpaid 18.0 17.0 (5.6%) 19.6 18.8 (4.1%) Prepaid 5.6 5.2 (7.1%)
6.2 5.8 (6.5%)
Churn (%) 6.7% 7.7%
1.0pp 27.4% 28.3% 0.9pp MOU (Average
Monthly Minutes of Usage per Subscriber), blended
257.5 279.3 8.5%
259.3 275.3 6.2%
Subscribers of Turkcell Turkey declined by 548 thousand
(98 thousand net losses in Q414) to 34.6 million in 2014 due to
losses in the more price-sensitive prepaid segment in the ongoing
aggressive competitive environment. Meanwhile, we expanded our
postpaid subscriber base by 1.2 million net additions during the
year, mainly through pre to post switches and superior network
quality. Consequently, our postpaid subscriber share in total
subscriber base has improved to 43.9% (39.8%).
Churn Rate refers to voluntarily and involuntarily
disconnected subscribers. Our churn rate increased by 1.0pp to 7.7%
in Q414, and by 0.9pp to 28.3%* for the full year, primarily
impacted by the increased competition in the market.
ARPU rose by 8.0% to TRY23.0 (TRY21.3) in Q414 on the
back of higher mobile broadband usage and increased postpaid
customer base. For the full year, ARPU grew by 3.7% to TRY22.5
(TRY21.7) driven by the same factors.
MoU rose by 8.5% to 279.3 minutes in Q414 and by 6.2% to
275.3 minutes in 2014. This increase in MoU was led by higher
incentives and higher package utilization.
OTHER DOMESTIC AND INTERNATIONAL OPERATIONS
Astelit’s financial performance has been adversely
impacted by the unfavorable political and macroeconomic environment
in Ukraine throughout the year. The local currency devaluation,
which has reached 97% for the full year, led Astelit’s contribution
to Group revenue to contract in 2014 and also caused significant FX
losses at the Group level. In 2015, the local currency devaluation
exceeded 60% year-to-date.Astelit recorded 15% revenue growth in
local currency in the fourth quarter, while in TL terms,
registering a decline of 27.9% to TRY167.1 million (TRY231.9
million). EBITDA declined 30.4% to TRY49.7 million (TRY71.4
million) with an EBITDA margin of 29.7% (30.8%). For the full year,
local currency revenue growth was at 13%, whereas, in TL terms,
there was a decrease of 12.0% to TRY758.2 million (TRY861.6
million). With the 11.7% decline in EBITDA to TRY232.2 million
(TRY262.9 million), Astelit maintained its EBITDA margin at 30.6%
(30.5%) in 2014.On the operational front, Astelit recorded 1.1
million net additions throughout the year, increasing its
three-month active subscriber base to 10.3 million. Blended ARPU
(3-month active) rose by 1.2% to UAH33.3 (UAH32.9) in Q414 and
remained almost flat at UAH34.5 (UAH34.4) for the full year. The
MoU (12-months active) fell by 5.3% to 162.8 minutes (172.0
minutes) in Q414, and by 6.9% to 166.7 minutes (179.0 minutes) in
the full year, due to changing consumer behavior as a result of
tough macroeconomic conditions.
(*) Churn rate in FY13 was impacted by the ICTA decision
enabling users of mobile lines without a subscription to register
those lines undertheir names. Each subscription line registered due
to this decision had to be recorded as a churn, and also as an
acquisition in operators’records. Excluding the impact of this
decision, the churn rate would have been 26.4% in 2013.
Ukraine has been facing political tension since early 2014. As a
result, in Crimea, which constituted 3% of Astelit’s revenues in
2014, operations have been discontinued starting from Q414 for
reasons beyond its control, and are unlikely to be resumed in the
near future. As of December 31, 2014, Astelit’s non-current assets
in Crimea were fully depreciated to their scrap value. Yet, despite
occasional network disruptions in the Donetsk and Luhansk regions,
Astelit has continued its operations to date without major
incident.
We continue to believe in the potential of the Ukrainian mobile
market and remain committed to our operations in that country. On
January 15, 2015, we announced Astelit’s application to participate
in the 3G license tender. In compliance with the 3G tender
conditions, Astelit paid tender guarantees of UAH270 million for
each three lots, totaling UAH810 million, on February 10, 2015.
Introduction of 3G technology is expected to open a new chapter in
Ukraine’s telecommunication industry, and we are excited to extend
the expertise we have developed in our home market to this
arena.
Astelit* Quarter Year
Q413 Q414 y/y%
FY13 FY14 y/y% Number of
subscribers (million)1 12.6 13.9
10.3% 12.6 13.9 10.3% Active (3
months)2 9.2 10.3 12.0% 9.2 10.3 12.0%
MOU (minutes) (12
months) 172.0 162.8 (5.3%) 179.0
166.7 (6.9%) ARPU (Average Monthly Revenue per
User), blended (US$) 3.1 1.8 (41.9%)
3.2 2.2 (31.3%) Active (3 months) (US$) 4.1
2.4 (41.5%) 4.3 3.0 (30.2%) Active (3 months) (UAH) 32.9 33.3 1.2%
34.4 34.5 0.3% Revenue (million UAH) 912.8 1,046.7 14.7% 3,595.2
4,051.7 12.7%
Revenue (million TRY) 231.9
167.1 (27.9%) 861.6 758.2
(12.0%) Revenue (million US$) 114.2 74.5 (34.8%) 449.8 347.2
(22.8%) EBITDA (million UAH) 281.0 310.4 10.5% 1,096.0 1,237.3
12.9%
EBITDA (million TRY) 71.4 49.7
(30.4%) 262.9 232.2 (11.7%) EBITDA
(million US$)3 35.2 22.2 (36.9%) 137.1 106.3 (22.5%)
EBITDA
margin 30.8% 29.7% (1.1pp) 30.5%
30.6% 0.1pp Net loss (million UAH) (19.1) (2,078.7)
n.m. (261.5) (5,593.2) n.m.
Net loss (million TRY)
(4.9) (323.2) n.m. (60.7)
(1,066.9) n.m. Net loss (million US$) (2.4) (145.0)
n.m. (32.7) (484.3) n.m. Capex (million UAH) 213.9 327.2 53.0%
541.5 688.9 27.2%
Capex (million TRY) 61.2
37.7 (38.4%) 144.6 101.3 (29.9%)
Capex (million US$) 26.8 15.8 (41.0%)
67.8 43.7 (35.5%)
(*) Astelit, in which we hold a 55% stake through Euroasia, has
operated in Ukraine since February 2005.(1) We may occasionally
offer campaigns and tariff schemes that have an active subscriber
life differing from the one that we normally use to deactivate
subscribers and calculate churn.(2) Active subscribers are those
who in the past three months made a revenue generating activity.(3)
EBITDA is a non-GAAP financial measurement. See page 16 for the
reconciliation of Euroasia’s EBITDA to net cash from operating
activities. Euroasia holds a 100% stake in Astelit.
Turkcell Superonline resumed its solid financial and
operational performance on 28.1% revenue growth and a 34.2% EBITDA
rise in Q414. The EBITDA margin improved 1.2pp to 25.6% (24.4%),
mainly with the increasing scale of the business.
In Q414, the share of residential and corporate segment revenues
in total revenues reached 71% (64%) following the 52.8% and 27.4%
growth of residential and corporate segment revenues, respectively.
Meanwhile, the share of non-group revenues reached 78% (74%).
For the full year, growth momentum continued with a revenue rise
of 35.4% and EBITDA increase of 37.6%. The EBITDA margin reached
26.1% (25.7%) on a 0.4pp improvement. Residential segment revenues
grew by 53.2%, while the corporate segment revenues grew by 32.2%.
Accordingly, the share of residential and corporate business in
total revenues rose to 67% (63%). The share of non-group revenues
increased to 77% (74%).
Turkcell Superonline’s total subscriber base (including ADSL
subscribers) reached 1.2 million on the back of 346 thousand net
additions in 2014. FTTH subscriber base1 increased to 735 thousand
with a 165 thousand net increase for the full year. By the end of
2014, Turkcell Superonline has become the market leader in terms of
number of total FTTH subscribers in Turkey.
Turkcell Superonline has continued to invest in its fiber
network, increasing home passes2 by 380 thousand in 2014 to 2.1
million. Furthermore, capitalizing on its network, Turkcell
Superonline has strengthened its product offering with the addition
of the TV platform, Turkcell TV+.
In 2015, we expect Turkcell Superonline to continue its growth
momentum by expanding its subscriber base, increasing its home
passes2 with further capital expenditure in its infrastructure.
Moreover, we expect that the arrival of the new 4G era will
bring additional synergies between our mobile and fiber businesses,
and strengthen Turkcell Superonline’s already successful business
model.
Turkcell Superonline* (million TRY) Quarter
Year Q413 Q414
y/y% FY13 FY14
y/y% Revenue 262.1 335.8 28.1%
925.2 1,252.5 35.4% Residential 94.4 144.2
52.8% 329.6 504.9 53.2%
% of revenues 36.0%
42.9% 6.9pp 35.6% 40.3% 4.7pp
Corporate 73.7 93.9 27.4% 253.4 335.1 32.2%
% of revenues
28.1% 28.0% (0.1pp) 27.4% 26.8%
(0.6pp) Wholesale 94.0 97.7 3.9% 342.3 412.5 20.5%
% of
revenues 35.9% 29.1% (6.8pp) 37.0%
32.9% (4.1pp) EBITDA 3
64.1 86.0
34.2% 237.8 327.1 37.6% EBITDA
Margin 24.4% 25.6% 1.2pp 25.7%
26.1% 0.4pp Capex 172.1 254.4 47.8% 399.1 552.8 38.5%
FTTH subscribers 570.0 735.1 29.0%
570.0 735.1 29.0%
(*)Turkcell Superonline is our wholly-owned subsidiary,
providing fiber broadband.(1) FTTH subscriber base refers to
residential, corporate and wholesale fiber subscribers.(2) Home
passes figure refers to the total of home passes and office passes
figures.(3)EBITDA is a non-GAAP financial measure. See page 16 for
the reconciliation of EBITDA to net cash from operating
activities.
Fintur subscriber base declined 0.7 million during the
year, resulting from Kcell’s subscriber decline, mainly due to
clean-up of subscribers. Fintur’s consolidated revenues declined by
19.7% to US$423 million (US$527 million) in Q414, driven mainly by
decrease in Kcell revenues resulting from devaluation of the
Kazakhstani Tenge (KZT) against the US$. For the full year,
revenues fell by 11.5% to US$1,801 million (US$2,036 million)
mainly due to the same factors.
Fintur had a negative impact of US$3 million (US$37 million
contribution) on our net income in Q414 driven mainly by non-cash
impairment charges at Fintur as discussed on page 8. Fintur’s
contribution to Turkcell’s net income declined by 39.1% to US$95
million (US$156 million) in 2014 due to non-cash charges as
explained on page 8.
Fintur* Quarter Year
Q413 Q414
y/y% FY13 FY14
y/y% Subscribers (million)
21.5 20.8
(3.3%) 21.5 20.8 (3.3%) Kazakhstan 14.3
13.0
(9.1%) 14.3 13.0
(9.1%) Azerbaijan 4.4 4.6
4.5% 4.4 4.6
4.5% Moldova 1.0 1.1
10.0% 1.0
1.1
10.0% Georgia 1.8 2.1
16.7% 1.8 2.1
16.7%
Revenue (million US$)
527 423 (19.7%)
2,036 1,801 (11.5%) Kazakhstan 322 248 (23.0%)
1,233 1,052 (14.7%) Azerbaijan 151 127 (15.9%) 584 549 (6.0%)
Moldova 20 17 (15.0%) 79 72 (8.9%) Georgia 35 31 (11.4%) 140 128
(8.6%) Fintur’s contribution to Group’s net income (million US$)
37 (3) (108.1%)
156 95 (39.1%)
(*) We hold a 41.45% stake In Fintur, which has interests in
Kazakhstan, Azerbaijan, Moldova, and Georgia.
Turkcell Group Subscribers amounted to approximately 71.5
million as of December 31, 2014. This figure is calculated by
taking the number of subscribers of Turkcell and each of our
subsidiaries and unconsolidated investees. It includes the total
number of mobile subscribers of Turkcell Turkey, Astelit and BeST,
as well as of our operations in the Turkish Republic of Northern
Cyprus (“Northern Cyprus”), Fintur and Turkcell Europe. Turkcell
Group subscribers rose by 0.2 million year-on-year mainly driven by
the increase in subscriber base of Astelit.
Turkcell Group Subscribers (million) 2013 2014
y/y % Turkcell Turkey 35.2 34.6 (1.7%) Ukraine 12.6 13.9 10.3%
Fintur 21.5 20.8 (3.3%) Northern Cyprus 0.4 0.4 - Belarus 1.2 1.4
16.7% Turkcell Europe1 0.4 0.4 - TURKCELL GROUP
71.3
71.5 0.3%
1: The “wholesale traffic purchase” agreement, signed between
Turkcell Europe GmbH operating in Germany and Deutsche Telekom for
five years in 2010, had been modified to reflect the shift in
business model to a “marketing partnership”. The new agreement
between Turkcell and a subsidiary of Deutsche Telekom was signed on
August 27, 2014. The transfer of Turkcell Europe subscribers and
operations to Deutsche Telekom’s subsidiary was completed on
January 15, 2015.
OVERVIEW OF THE MACROECONOMIC ENVIRONMENT
The foreign exchange rates that have been used in our financial
reporting, along with certain macroeconomic indicators, are set out
below.
Quarter Year
Q413 Q414
y/y% FY13 FY14
y/y% TRY / US$ rate Closing Rate 2.1343 2.3189 8.6% 2.1343
2.3189 8.6% Average Rate 2.0302 2.2421 10.4% 1.9094 2.1850 14.4%
Consumer Price Index (Turkey)
2.3% 1.6%
(0.7pp) 7.4% 8.2% 0.8pp GDP Growth
(Turkey)
4.5% n.a. n.a. 4.1%
n.a. n.a. UAH/ US$ rate Closing Rate 7.99 15.77 97.4%
7.99 15.77 97.4% Average Rate 7.99 14.09 76.3% 7.99 11.87 48.6%
BYR/ US$ rate Closing Rate 9,510 11,850 24.6% 9,510 11,850 24.6%
Average Rate 9,282 10,912 17.6% 8,883
10,255 15.4%
RECONCILIATION OF NON-GAAP FINANCIAL MEASUREMENTS:
We believe that EBITDA is a measurement commonly used by
companies, analysts and investors in the telecommunications
industry that enhances the understanding of our cash generation
ability and liquidity position, and assists in the evaluation of
our capacity to meet our financial obligations. We also use EBITDA
as an internal measurement tool, and accordingly, we believe that
its presentation provides useful and relevant information to
analysts and investors. Our EBITDA definition includes Revenue,
Direct Cost of Revenue excluding depreciation and amortization,
Selling and Marketing expenses and Administrative expenses, but
excludes translation gain/(loss), finance income, share of profit
of equity accounted investees, gain on sale of investments,
income/(loss) from related parties, minority interest and other
income/(expense). EBITDA is not a measure of financial performance
under IFRS, and should not be construed as a substitute for net
earnings (loss) as a measure of performance, or cash flow from
operations as a measure of liquidity. The following table provides
a reconciliation of EBITDA, which is a non-GAAP financial
measurement, to net cash from operating activities, which we
believe is the most directly comparable financial measurement
calculated and presented in accordance with IFRS.
Turkcell Group (million US$) Quarter Year
Q413
Q414 y/y% FY13
FY14 y/y% EBITDA
420.4 409.1
(2.7%) 1,858.0 1,725.2 (7.1%) Income
tax expense (59.4) (83.5) 40.6% (310.7) (334.6) 7.7% Other
operating income / (expense) (16.9) (1.3) (92.3%) (29.2) (40.3)
38.0% Financial income / (expense) 78.2 3.9 (95.0%) 299.9 17.8
(94.1%) Net increase / (decrease) in assets and liabilities 26.5
14.9 (43.8%) (824.0) (566.3) (31.3%) Net cash from operating
activities
448.8 343.1
(23.6%) 994.0 801.8
(19.3%) Turkcell Superonline (million TRY) Quarter
Year
Q413 Q414 y/y%
FY13 FY14 y/y% EBITDA
64.1 86.0 34.2% 237.8 327.1
37.6% Income tax expense 35.3 (8.6) (124.4%) 38.4 (19.1)
(149.7%) Other operating income / (expense) 2.7 0.9 (66.7%) 0.6 3.1
416.7% Financial income / (expense) (18.4) (37.7) 104.9% (63.7)
(57.8) (9.3%) Net increase / (decrease) in assets and liabilities
15.2 82.7 444.1% (106.0) 48.0 (145.3%) Net cash from operating
activities
98.9 123.3
24.7% 107.1 301.3
181.3% Euroasia (million US$) Quarter Year
Q413 Q414 y/y%
FY13 FY14 y/y% EBITDA
35.2 22.2 (36.9%) 137.1 106.3
(22.5%) Other operating income / (expense) (0.2) 0.5
(350.0%) 1.1 1.0 (9.1%) Financial income / (expense) (9.0) (13.8)
53.3% (50.9) (56.1) 10.2% Net increase / (decrease) in assets and
liabilities (27.4) 15.5 (156.6%) (10.9) 17.4 (259.6%) Net cash from
operating activities
(1.4) 24.4
n.m. 76.4 68.6
(10.2%)
FORWARD-LOOKING STATEMENTS: This release includes
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, Section 21E of the Securities Exchange Act
of 1934 and the Safe Harbor provisions of the US Private Securities
Litigation Reform Act of 1995. This includes, in particular, our
targets for revenue, EBITDA and capex in 2015 and our 4G and 3G
development in Turkey and Ukraine, respectively. More generally,
all statements other than statements of historical facts included
in this press release, including, without limitation, certain
statements regarding our operations, financial position and
business strategy may constitute forward-looking statements. In
addition, forward-looking statements generally can be identified by
the use of forward-looking terminology such as, among others,
"will," "expect," "intend," "estimate," "believe", "continue" and
“guidance”.Although Turkcell believes that the expectations
reflected in such forward-looking statements are reasonable at this
time, it can give no assurance that such expectations will prove to
be correct. All subsequent written and oral forward-looking
statements attributable to us are expressly qualified in their
entirety by reference to these cautionary statements. For a
discussion of certain factors that may affect the outcome of such
forward looking statements, see our Annual Report on Form 20-F for
2013 filed with the U.S. Securities and Exchange Commission, and in
particular the risk factor section therein. We undertake no duty to
update or revise any forward looking statements, whether as a
result of new information, future events or otherwise.
ABOUT TURKCELL: Turkcell is the leading communications
and technology company in Turkey, with 34.6 million subscribers as
of December 31, 2014. Turkcell is a leading regional player with
its approximately 71.5 million subscribers in nine countries as of
December 31, 2014. It was one of the first among the global
operators to have implemented HSPA+. It has announced two new HSPA+
Technologies on its 3G network to meet rising data usage. Having
successfully integrated 3C-HSDPA and DC-HSUPA Technologies, it
became the first mobile operator in the world to enable peak speed
of 63.3 Mbps downlink while also enabled an 11.5 Mbps uplink on a
3G network. Turkcell Superonline, a wholly owned subsidiary of
Turkcell, is the first telecom operator to offer households fiber
broadband connection at speeds of up to 1,000 Mbps in Turkey. As of
December 2014, Turkcell’s population coverage is at 99.81% in 2G
and 91.21% in 3G. Turkcell reported a TRY12.0 billion (US$5.5
billion) revenue with total assets of TRY23.7 billion (US$10.2
billion) as of December 31, 2014. It has been listed on the NYSE
and the BIST since July 2000, and is the only NYSE-listed company
in Turkey. Read more at www.turkcell.com.tr
This press release can also be viewed using the Turkcell
Investor Relation app, which can be downloaded
here for iOS,
and here for Android mobile
devices.
TURKCELL ILETISIM HIZMETLERI A.S.
TURKISH ACCOUNTING STANDARDS SELECTED
FINANCIALS (TRY Million)
Quarter Ended Quarter
Ended Quarter Ended 12 Months Ended 12 Months
Ended December 31, September 30, December
31, December 31, December 31, 2013
2014 2014 2013 2014
Consolidated Statement of Operations Data Revenues
Communication fees 2,545.3 2,757.5 2,631.9 10,242.8 10,437.2
Revenues from betting business 73.1 69.1 85.5 230.4 297.9 Monthly
fixed fees 18.2 10.0 10.4 75.9 51.5 Simcard sales 7.2 11.9 6.3 29.8
31.7 Call center revenues and other revenues 239.8 313.7 369.1
829.0 1,225.3 Total revenues 2,883.6 3,162.2 3,103.2 11,407.9
12,043.6 Direct cost of revenues -1,848.9 -1,879.0
-1,972.2 -7,058.9 -7,380.8 Gross profit 1,034.7
1,283.2 1,131.0 4,349.0 4,662.8 Administrative expenses -152.0
-138.0 -146.8 -550.3 -562.7 Selling & marketing expenses -510.4
-496.5 -517.8 -1,843.6 -1,974.6 Other Operating Income / (Expense)
35.3 424.0 269.4 907.9 1,053.6
Operating profit before financing and investing costs 407.6 1,072.7
735.8 2,863.0 3,179.1 Income from investing activities 8.9 1.7 5.4
30.2 20.0 Expense from investing activities -15.3 -10.2 9.3 -58.1
-16.8 Share of profit of equity accounted investees 75.8
66.8 -6.9 297.3 207.3 Income before financing
costs 477.0 1,131.0 743.6 3,132.4 3,389.6 Finance expense 85.1
-255.6 -459.8 -383.2 -1,424.9 Monetary gain/(loss) 72.5 48.3
32.3 176.9 205.1 Income before tax and
non-controlling interest 634.6 923.7 316.1 2,926.1 2,169.8 Income
tax expense -120.0 -217.0 -187.1 -592.4
-731.1 Income before non-controlling interest 514.6 706.7 129.0
2,333.7 1,438.7 Non-controlling interest -7.9 49.0
128.9 -3.4 428.2 Net income 506.7 755.7
257.9 2,330.3 1,866.9 Net income per share
0.23 0.34 0.12 1.06 0.85
Other Financial Data
Gross margin 35.9% 40.6% 36.4% 38.1% 38.7% EBITDA(*) 851.5 1,050.4
917.1 3,544.5 3,761.8 Capital expenditures 818.5 555.1 935.3
1,822.3 2,144.8
Consolidated Balance Sheet Data (at
period end) Cash and cash equivalents 8,128.9 8,692.0 9,031.9
8,128.9 9,031.9 Total assets 21,255.6 22,673.4 23,668.3 21,255.6
23,668.3 Long term debt 1,528.5 1,101.3 1,247.9 1,528.5 1,247.9
Total debt 3,332.5 3,545.0 3,697.7 3,332.5 3,697.7 Total
liabilities 6,544.8 6,472.5 6,979.5 6,544.8 6,979.5 Total
shareholders’ equity / Net Assets 14,710.8 16,200.9 16,688.8
14,710.8 16,688.8 * For further details, please refer
to our consolidated financial statements and notes as at 31
December 2014 on our web site.
TURKCELL ILETISIM
HIZMETLERI A.S.
IFRS SELECTED FINANCIALS (TRY
Million)
Quarter Ended Quarter
Ended Quarter Ended 12 Months Ended 12 Months
Ended December 31, September 30, December
31, December 31, December 31, 2013
2014 2014 2013 2014
Consolidated Statement of Operations Data Revenues
Communication fees 2,545.3 2,757.5 2,631.9 10,242.8 10,437.2
Revenues from betting business 73.1 69.1 85.5 230.4 297.9 Monthly
fixed fees 18.2 10.0 10.4 75.9 51.5 Simcard sales 7.2 11.9 6.3 29.8
31.7 Call center revenues and other revenues 239.8 313.7 369.1
829.0 1,225.3 Total revenues 2,883.6 3,162.2 3,103.2 11,407.9
12,043.6 Direct cost of revenues -1,851.3 -1,880.2
-1,972.2 -7,063.9 -7,383.9 Gross profit 1,032.3
1,282.0 1,131.0 4,344.0 4,659.7 Administrative expenses -152.0
-138.0 -146.8 -550.3 -562.7 Selling & marketing expenses -510.4
-496.5 -517.8 -1,843.6 -1,974.6 Other Operating Income / (Expense)
-35.6 17.8 1.4 -58.9 -76.3
Operating profit before financing costs 334.3 665.3 467.8 1,891.2
2,046.1 Finance costs -89.7 -83.7 -400.1 -204.6 -1,247.0 Finance
income 239.4 225.7 223.2 759.9 955.4 Monetary gain/(loss) 72.5 48.3
32.3 176.9 205.1 Share of profit of equity accounted investees 75.8
66.8 -6.9 297.3 207.3 Income before
taxes and minority interest 632.3 922.4 316.3 2,920.7 2,166.9
Income tax expense -119.5 -216.4 -187.3 -591.4
-730.4 Income before minority interest 512.8 706.0 129.0
2,329.3 1,436.5 Non-controlling interests -7.9 49.0
128.9 -3.4 428.2 Net income 504.9 755.0
257.9 2,325.9 1,864.7 Net income per share
0.23 0.34 0.12 1.06 0.85
Other Financial Data
Gross margin 35.8% 40.5% 36.4% 38.1% 38.7% EBITDA(*) 851.5 1,050.4
917.1 3,544.5 3,761.8 Capital expenditures 818.5 555.1 935.3
1,822.3 2,144.8
Consolidated Balance Sheet Data (at
period end) Cash and cash equivalents 8,128.9 8,692.0 9,031.9
8,128.9 9,031.9 Total assets 21,284.6 22,699.3 23,694.2 21,284.6
23,694.2 Long term debt 1,528.5 1,101.3 1,247.9 1,528.5 1,247.9
Total debt 3,332.5 3,545.0 3,697.7 3,332.5 3,697.7 Total
liabilities 6,549.5 6,476.3 6,983.6 6,549.5 6,983.6 Total
shareholders’ equity / Net Assets 14,735.1 16,223.0 16,710.6
14,735.1 16,710.6 * For further details, please refer
to our consolidated financial statements and notes as at 31
December 2014 on our web site.
TURKCELL ILETISIM
HIZMETLERI A.S.
IFRS SELECTED FINANCIALS (US$
MILLION)
Quarter Ended Quarter
Ended Quarter Ended 12 Months Ended 12 Months
Ended December 31, September 30, December
31, December 31, December 31, 2013
2014 2014 2013 2014
Consolidated Statement of Operations Data Revenues
Communication fees 1,252.0 1,280.6 1,172.7 5,369.0 4,779.3 Revenues
from betting business 36.0 32.1 38.2 120.4 136.1 Monthly fixed fees
9.0 4.6 4.7 40.0 23.6 Simcard sales 3.6 5.6 2.8 15.6 14.6 Call
center revenues and other revenues 117.0 144.7 164.2 430.4 559.3
Total revenues 1,417.6 1,467.6 1,382.6 5,975.4 5,512.9 Direct cost
of revenues -905.6 -870.4 -877.6 -3,693.3
-3,375.5 Gross profit 512.0 597.2 505.0 2,282.1 2,137.4
Administrative expenses -74.3 -63.6 -65.2 -286.8 -256.8 Selling
& marketing expenses -250.7 -230.3 -230.7 -964.1 -903.1 Other
Operating Income / (Expense) -16.9 8.7 0.6
-29.2 -35.5 Operating profit before financing costs
170.1 312.0 209.7 1,002.0 942.0 Finance expense -39.1 -37.6 -175.4
-95.5 -559.3 Finance income 117.3 105.8 98.9 395.4 437.5 Monetary
gain/(loss) 31.6 17.1 12.6 82.9 88.4 Share of profit of equity
accounted investees 37.4 31.4 -2.7 155.4
96.6 Income before taxes and minority interest 317.3 428.7
143.1 1,540.2 1,005.2 Income tax expense -59.4 -100.5
-83.5 -310.7 -334.6 Income before minority interest
257.9 328.2 59.6 1,229.5 670.6 Minority interest -3.9 23.8
57.9 -1.3 194.3 Net income 254.0 352.0
117.5 1,228.2 864.9 Net income per
share 0.12 0.16 0.05 0.56 0.39
Other Financial Data
Gross margin 36.1% 40.7% 36.5% 38.2% 38.8% EBITDA(*) 420.4
489.1 409.1 1,858.0 1,725.2 Capital expenditures 360.3 222.5 394.2
853.8 924.9
Consolidated Balance Sheet Data (at period
end) Cash and cash equivalents 3,808.7 3,814.1 3,894.9 3,808.7
3,894.9 Total assets 9,972.6 9,960.6 10,217.9 9,972.6 10,217.9 Long
term debt 716.2 483.3 538.1 716.2 538.1 Total debt 1,561.4 1,555.6
1,594.6 1,561.4 1,594.6 Total liabilities 3,068.7 2,841.8 3,011.6
3,068.7 3,011.6 Total equity 6,903.9 7,118.8 7,206.3 6,903.9
7,206.3 * Please refer to the notes on reconciliation
of Non-GAAP Financial measures on page 16 ** For further details,
please refer to our consolidated financial statements and notes as
at 31 December 2014 on our web site.
TurkcellInvestor RelationsNihat Narin, Tel: + 90
212 313 1888investor.relations@turkcell.com.trorCorporate
Communications:Tel: + 90 212 313
2321Turkcell-Kurumsal-Iletisim@turkcell.com.tr
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