annual report 2010

‹NDEKS B‹LG‹SAYAR S‹STEMLER‹ MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
ANNUAL REPORT
contents
Message from the Chairman ………………………………………......................................................................... 1
Agenda of General Assembly Meeting …………………………….............................................………….....…..
3
1. Company ………………………………………………………………………........................................................ 6
1.1 Summary Info ...........................................................................................................................................
6
1.2 Capital and Shareholding Structure ........................................................................................................... 10
1.3 Board of Directors, Auditing Board and Auditing Committee ..................................................................... 11
1.4 Management Organisation ........................................................................................................................ 12
1.5 Management Team ................................................................................................................................... 13
1.6 Historical Background ............................................................................................................................... 15
2. Sector of Operation ………………………………………..………………….……………………………………... 22
2.1 Turkish IT Sector ...................................................................................................................................... 22
2.2 Sub-segments of the IT Sector ................................................................................................................. 27
2.3 Growth of the IT Sector ............................................................................................................................ 35
3. Subsidiaries …………………………………………………………………………………………………………… 42
3.1 Datagate Bilgisayar Malzemeleri Tic. A.fi .................................................................................................. 42
3.2 Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. ........................................................................................................ 43
3.3 Neotech Teknolojik Ürünler Da¤›t›m A.fi. .................................................................................................. 44
3.4 ‹nfin Bilgisayar Ticaret A.fi. ....................................................................................................................... 44
3.5 Teklos Teknoloji Lojistik A.fi. .................................................................................................................... 45
4. Operation …………………………………………………………………………………………………………….... 48
4.1 Structure of Product Supply and Distribution ............................................................................................ 48
4.2 Logistics ................................................................................................................................................... 49
4.3 Invoicing and Payment Collection ............................................................................................................. 49
4.4 Technical Service and Customer Relations ............................................................................................... 49
4.5 Sales and Marketing ................................................................................................................................. 50
5. Corporate Governance Principles Compliance Report ……………………………………………………….... 54
6. Board of Directors' Suggestions on Dividend Distribution ……………..........………………………………... 64
7. Auditing Board’s Report ………………..……………………………………..…………………………………….. 70
8. Independent Auditor’s Report ………………………………………………..………………………………......... 74
9. Financial Statements and Notes ………………………………………………..………………………………...... 78
ANNUAL REPORT
Dear Shareholders;
Before our activities performed in 2010, and the relevant balance sheet
and profit & loss account reflecting the results of these activities, I
would like to talk briefly about the latest developments in the global
economy and Turkish economy, and the expectations of the IT sector
in 2011.
After the global crisis in 2008, the world started having slow recovery,
and in 2010, the growth rate reached the growth tempo that the sector
was having before the global crisis. Although, the growth rates of
developing countries contribute lots to global economic recovery,
developed countries’economies could not meet the expectation
regarding economic recovery. In 2010, the world had 5 % growth with
the help of financial supports conducted commonly by EU & IMF and
stimulus packages of developing countries. It is essential to say that
increasing debt amount with precautions taken may result in problems
in EU.
Turkish Economy had quite successful year in 2010 with 8,9% growth
by means of strong financial structures in public and financial institutions.
We estimate 5 % - 6 % growth in 2011 as the strong economic recovery
resulted in current account deficit.
IT Sector achieved 10% growth in 2010 compared to 2009 and reached
6 billion USD. Individual consumer demand, smart devices, proliferation
of internet connection, common campaigns of Telecom Companies,
usage of social networking websites have been main drivers in terms
of e- government services sector to grow.
We consider that Increasing interest for mobile and tablet, increasing
demand of individual consumers, proliferation of internet usage with
the changes in Turkish Trade Law will contribute the sector growth by
8%-9% in 2011. In 2010, our Company’s turnover reached
1.228.175.766 TRL with an increase of 12.94% comparing to the
previous year. Our gross profit has been TRL 74.903.229; and its ratio
to sales realized as 6.10%. Operating costs of our Company has
increased from 2.25% to 2.34% of the sales, comparing to the previous
year. Net income after tax reached 13.171.469 TRL.
As the company, we consider investing in IT sector. In this way, we
acquired 51 % of Art›m Biliflim ve Da¤›t›m A.fi. that has the contracts
of multifarious producers who provides value added solutions in 2011.
Nevres Erol B‹LEC‹K
Chairman
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ANNUAL REPORT
In 2011, as the company management, we will continue our business understanding, which is focused on profitability, making costeffective analyses, aiming at the realization of the sales budget figures, producing sales policies with a target of customer satisfaction
using mobile channel sales teams and prioritizing productivity.
I would like to express my gratitude to all who contributed to our success, to our business partners, suppliers, employees, and particularly
to our shareholders.
Yours Faithfully,
Erol B‹LEC‹K
Chairman
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ANNUAL REPORT
Agenda of General Assembly Meeting 2010
1. Opening and Election of the Chair of the Meeting,
2. Authorisation of the Chair of Meeting for signing of the Minutes of General Assembly Meeting,
3. Review of the Board of Director's Report, Auditing Board's Report and Independent Auditor's Report prepared by AGD Ba¤›ms›z
Denetim ve Dan›flmanl›k S.M.M.M. A.fi. regarding the activities and related accounts of 2010,
4. Review and approval of the Balance Sheet and Profit & Loss Account of 2010,
5. Acquittal of the members of the Board of Directors and Auditing Board in respect of the duties performed during the year 2010,
6. Approval of the appointment of Independent Audit Company,
7. Review and approval of the Board of Directors' suggestion on dividend distribution for the year 2010 and determination of the
dividend distribution date,
8. Providing the shareholders with information on “Disclosure Policy” adopted by a resolution of the Company Board in accordance
with the Corporate Governance Principles,
9. Determining the remunerations to be paid to the Board Members in 2011,
10. Determination of the remunerations and number of the members of the Auditing Board and election thereof,
11. Wishes and closure.
Date of Meeting : 06.05.2011
Time of Meeting : 10:00
Place of Meeting : Ayaza¤a Mah. Cendere Yolu No :9/1 fiiflli / Istanbul - Turkey
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‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
1. COMPANY
ANNUAL REPORT
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ANNUAL REPORT
1. Company
1.1 Highlights
• ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi., which was founded in 1989 to operate in the computer field, has
became a company distributing about 200 worldwide brands, employing 382 people and cooperating with over 7.500 business
partners, holding the leadership position of the sector for a long time.
• In the Turkey Top 500 ICT Companies Ranking performed every year by Interpro Medya A.fi., our company ranked 7th (seventh) in
the general ranking based on turnover achieved in 2009 among the companies including telephone operators and mobile phone
sellers. Our company ranked first in the hardware category with a turnover of 1.020.865 (thousand TRL) among the companies
including those above. On the other hand, our Company ranked 1st (first) with a sales revenue of TRL 1.087.422 (thousand TRL),
like the previous years, in the category of companies selling only computers. Further, it ranked first in seven IT categories.
• ‹ndeks acting as a holding company has 6 affiliates and subsidiaries, each of which operates in different fields of technology products.
The following companies are included in the consolidated financial statements of ‹ndeks. The product groups of such companies
are shown in the following table:
Product Groups by Company
INDEKS
DATAGATE
NETEKS
NEOTECH
TEKLOS
• PC
• Notebooks
• Printers
• Servers
• Peripherals
• Software
• Microprocessor
• Hard Disk
• Main board
• Display Card
• Monitor
• Optical Products
• Server Products
• Memory Products
• Notebooks
• Desktops
• Backup Units
• Network Products
• Accessories
• Security Products
• Network (Modem-USBAdaptor) products
• Laser Printers
• Corporate Network Systems
• Network Equipment
• Structured Cabling
• Private Exchange Systems
• Network Security Solutions
• ADSL and SME
Communication Solutions
• Consumer Electronics
• Communication Equipment
• Alternative Electronic
Products
• Logistics and Transportation
Major distributorships undertaken by main product groups are shown below:
PC
Products
APPLE
ASUS
FUJITSU
HP
LENOVO
LG
MSI
SONY VAIO
TOSHIBA
OEM
ALPS
INTEL
IOMEGA
KINGSTON
LITE-ON
NEC
PHILIPS
SEAGATE
VIEWSONIC
WD
BELKIN
SAMSUNG
WD
FUJITSU
Printer &
Peripherals
Network
Products
Software
Products
Household
Electronics
AIRTIES
3COM
IBM
APC
APPLE
ALIED TL
LOTUS
CANON
HITACHI
CHECKP. MICROSOFT
EPSON
LG
CISCO
NOVELL
HP
NOKIA
HCS
SYMANTEC
IBM
PANASONIC
HP
TIVOLI
OKI
SONY
PANASONIC NEWBRIDGE
VIEWSONIC
NORTELL
XEROX
TREND M.
PANDUIT
AVAYA
IBM ISS
Memory
and
Medium
Sized
Systems
HP
IBM
LACIE
SEAGATE
WD
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ANNUAL REPORT
a) Breakdown of Sales:
69% of the Company’s income is derived from the sales of PC and OEM (Original Equipment Manufacturer–computer parts). Breakdown
of the Company’s sales is as follows:
Breakdown of Sales on Product Category Based
OEM
19.72%
Communication
5.35%
Printer
7.59%
Software
3.86%
Computer
48.95%
Peripherals
2.35%
Other Medium Sized
1.61%
Systems
2.11%
Household
Electronics
8.46%
b) Major Manufacturers of our Company
‹ndeks Bilgisayar has a wide range of product line, which allows it to reach more number of dealers, with this advantage, to increase
its sales above the sector average. Breakdown of the major distributorships undertaken by our Company are shown below:
3 COM
CORNING
JUNIPER
NOVEL
TARGUS
ACER
DELL
KINGMAX
OKI
TIPPING POINT
AIR TIES
EPSON
KINGSTON
PANDUIT
TOSHIBA
AOC
FUJITSU SIEMENS
LENOVO
PANASONIC
TREND MICRO
APC
GENIUS
LEXMARK
POWERSONIC
TRUST
APPLE
GIGABYTE
LG
SAMSUNG
VERITAS
ASUS
GKB
LINKSYS
SAPPHIRE
VERITECH
AVAYA
HCS
LITE – ON
SEAGATE
VESTEL
AVOCENT
HOMEND
MAXTOR
SERVER i SERIES
WACOM
BELKIN
HP
MICROSOFT
SERVER p SERIES
WESTERN DIGITAL
CABINET
IBM
MSI
SIEMENS
XEROX
CANON
IMATION
NEC
SONY
CHECKPOINT
IOMEGA
NOKIA
SONY VAIO
CISCO SYSTEM
ISS
NORTEL NETWORKS
SYMANTEC
(*) Trademarks are listed in alphabetic order.
c) Changes in the Share Price throughout the Year:
‹NDEKS in ISE: Having held an IPO in June 2004, our company’s shares are traded in Istanbul Stock Exchange (ISE) national market
under the code of “INDES”. The ISE-100 index opened at 52.825 in 2010, closed at 66.004 on 31.12.2010 with the increase of 25
%. The lowest level was 48.739 on 25.02.2010 and the highest level was 71.777 on 25.10.2010.
The TRL/USD exchange rate opened at 1.4810 at the beginning of the year, had some fluctuations during the year and closed the
year at 1.5376 USD valued by 3.8% within the year.
The year-end value of 1 share was TRL 2.63, whereas its value was 1,54 at the beginning of the year. According to the closing value
on the last transaction day of the year, the value of our Company is TRL 147.280.000.
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ANNUAL REPORT
d) Awards achieved in 2010
Company
Date
Description
Cisco
15.01.2010
Our subsidiary, Neteks A.fi achieved the distributor of the year award organized by
Cisco Systems in 2009. This award was given in revenue, business development,
common channel and dealers satisfafaction categories.
Lenovo
01.02.2010
Indeks achieved the most efficient business partner award which was organized by
Lenovo in China in 2009. This award was given in revenue, growth, number of dealers
made purchasing from the distributor, financial performance and payment performance
categories
IBM
12.02.2010
Indeks has been awarded the distributor of the year organized by IBM Turk Ltd in
Istanbul. This award was given in revenue, growth, number of dealers made purchasing
from the distributor, financial performance and payment performance categories
Interpromedya A.fi.
29.06.2010
‹ndeks Bilgisayar ranked 7th among the Turkey Top 500 ICT Companies with its
sales income of TRL 1.087.422 in the turnover-based general ranking as determined
by Interpromedya A.fi. In the analysis of the general ranking results, ‹ndeks Bilgisayar
ranked 1st, as the previous years, among the companies dealing with computer
trade only. Further, it ranked first in six different ICT categories. These are Personal
computer, Mobile, Printing systems, data back up and storage, monitor, operating
systems and B2B E-Trade. Further, Datagate Bilgisayar Malzemeleri Tic. A.fi., which
is a 59% subsidiary of ‹ndeks Bilgisayar, ranked first in the category of “OEM (computer
parts)” incomes and Neteks ‹letiflim Da¤›t›m Ürünleri A.fi., which is a 50% subsidiary
of ‹ndeks Bilgisayar, ranked first in the category of “Data Communication Hardware”.
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ANNUAL REPORT
e) Distributorships Undertaken in 2010:
Al›nan Ödül
Company
Tarih
Date
Aç›klama
Description
Turkish Telecom
17.03.2010
Our logistic company called Teklos A.fi. achieved the contract of Turkish
Telecom for storage and distribution of the products which will be provided
to the customers of Turkish Telecom.
Canon Eurasia Ltd.
22.12.2010
Our subsidiary Neotech A.fi. has started negotiations with Canon Eurasia
Ltd for the distribution of cameras, video camcorders products and their
accessories in Turkey as Canon is one of the biggest producer of these
types of products in the world.
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ANNUAL REPORT
f) Data on Financial Structure:
LIQUIDITY RATIOS
31.12.2010
31.12.2009
Current Ratio
1,24
1.30
Liquidity Ratio
0,93
0.85
OPERATING RATIOS (*)
31.12.2010
31.12.2009
Receivables Turnover
69
61
Payables Turnover
86
74
Inventory Turnover
37
31
PROFITABILITY RATIOS
31.12.2010
31.12.2009
Gross Profit Margin
6,10 %
5.91 %
Operating Profit Margin
3,76 %
3.66 %
Net Profit Margin
1,07 %
1.47 %
Profit Before Tax Margin
1,51 %
2.06 %
FINANCIAL STRUCTURE RATIOS
31.12.2010
31.12.2009
Shareholders’ Equity / Total Liabilities & Shareholders’ Equity
22 %
26 %
Short Term Liabilities / Total Liabilities & Shareholders’ Equity
76 %
71 %
Long Term Liabilities / Total Liabilities & Shareholders’ Equity
2%
3%
Financial Debts / Total Liabilities
5%
10 %
(*) The figures in quarterly financial accounts have been
taken into consideration in the calculation of the averages.
1.2 Capital and Shareholding Structure
As of 31.12.2010, the shareholding structure of our Company is as follows:
Shareholder's Name
Country
Shares %
Number of Shares
Amount of Shares
Nevres Erol Bilecik
T.C.
%38,63
21.634.440
21.634.440
Ayfle ‹nci Bilecik
T.C.
%2,37
1.325.558
1.325.558
Yunanistan
%35,56
19.911.119
19.911.119
Public Offer
T.C.
%23,44
13.126.987
13.126.987
Other
T.C.
%0,00
1.896
1.896
56.000.000
56.000.000
Pouliadis ana Associates S.A.(*)
TOTAL
(*) Voting rights of the shares of Pouliadis and Associates S.A. were given to 5 Greek banks.
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ANNUAL REPORT
Capital Increase throughout the Year:
The upper limit of authorized capital of our Company was determined as TRL 75.000.000 and its share capital issued as of 31.12.2009
is TRL 56.000.000. Covering the all maximum authorized capital, i.e. TRL 75.000.000, from the profit of 2006, an application is made
to Capital Markets Board (CBM) of Turkey for issuing shares with nominal value of TRL 1.000.000 for the capital increase from TRL
55.000.000 to TRL 56.000.000 and the application was approved with the resolution of CBM with no. 25/699 of 28.06.2007. The
capital increase was registered on 10.07.2007 and announced on the Turkish Trade Register Gazette with no. 6852 of 16 July 2007.
Our company’s capital of TRL 56.000.000 is composed of Group A registered shares in value of TRL 318,18 and Group B bearer
shares TRL 55.999.681,82.
Group A shareholders are authorised to determine half plus one of the board members and to receive 5% of the remaining profit after
the first issue reserve funds and first dividend.
1.3 Board of Directors, Auditing Board, Auditing Committee and Corporate Governance Committee
Board Members
In the General Assembly held on 25.05.2009, Members of the Board of Directors were elected for duration of three years, and their
duties and powers were determined pursuant to the Company's Articles of Association and the relevant provisions of the Turkish
Commercial Code. Resolutions of the General Assembly were published in the Turkish Trade Register Gazette with no. 7336 of 19
June 2009.
Name & Surname
Title
Term of Office
Nevres Erol Bilecik
Chairman
3 years
Salih Bafl
Deputy Chairman
3 years
Atilla Kayal›o¤lu
Board Member
3 years
Ayfle ‹nci Bilecik
Board Member
3 years
Halil Duman
Board Member
3 years
Members of the Auditing Board
Name & Surname
Title
Term of Office
Veli Tan Kirtifl
Auditor
1 year
Haluk fien
Auditor
1 year
Members of the Auditing Committee
Name & Surname
Title
Term of Office
Salih Bafl
Committee Member
3 years
Ayfle ‹nci Bilecik
Committee Member
3 years
Corporate Governance Committee
Name & Surname
Title
Term of Office
Salih Bafl
Chairmen of the Committee
3 years
Ayfle ‹nci Bilecik
Committee Member
3 years
Halil Duman
Committee Member
3 years
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ANNUAL REPORT
1.4 Organisation Chart:
Organisation chart of the company is given below:
Erol B‹LEC‹K
Chairman of
the Board
Tayfun Y‹⁄‹T
Technology
Development Manager
Naim SARAÇ
Internal Audit
Manager
Atilla KAYALIO⁄LU
General Manager
Business Unit
Management
Sales Management
Halil DUMAN
Assistant
General Manager
Product Management
Product
Management
Accounting
Retail
Finance
Non-Retail
Logistics
Software
Customer Services
Elektronic Sales
Import
Medium Sized Systems
Human Resources
Ankara
‹zmir
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ANNUAL REPORT
1.5. Board of Directors
The Board of Directors of the company consists of five members. Curriculum Vitae of the board members are given below.
Nevres Erol Bilecik, Chairman of the Board of Directors: Erol Bilecik was born in 1962 and graduated from Istanbul Technical
University, Department of Computer Engineering. Erol Bilecik, who established ‹ndeks A.fi. in 1989, acts as the chairman of the following
subsidiaries of Index, besides our company: Despec Bilgisayar Pazarlama ve Ticaret A.fi., Datagate Bilgisayar Malzemeleri Ticaret
A.fi., Neteks ‹letiflim Ürünleri Da¤›t›m A.fi., Neotech Teknolojik Ürünler Da¤›t›m A.fi., Desbil Teknolojik Ürünler Ticaret Afi., Homend
Elektrikli Cihazlar San. Ve Ticaret Afi., ‹nfin Bilgisayar Ticaret A.fi. and Teklos Teknoloji Lojistik Hizmetleri Afi. Moreover, between the
years 2002 and 2005, he presided TUBISAD (Turkish Informatics Industry Association) established in 1974, the oldest civil society
organisation in the ICT sector, members of which are companies realising 95% of the total transaction volume of the Turkish ICT sector.
Erol Bilecik is married with two children and speaks English.
Salih Bafl, Deputy Chairman: Salih Bafl was born in 1965, and graduated from Anadolu University, Department of Business
Administration. He has been working for Index Group since 1990. In 2003, while he was acting as the Assistant General Manager Finance & Accounting for ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi., he was appointed as the General Manager
and Vice Chairman of the Board of Directors of Datagate Bilgisayar Malzemeleri Ticaret A.fi.. He curren acts as the Deputy Chairman
for the companies, ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret Afi., Teklos Teknoloji Lojistik Hizmetleri Afi., Homend
Elektrikli Cihazlar San. Ve Ticaret Afi., ‹nfin Bilgisayar Ticaret A.fi. and Desbil Teknolojik Ürünler Ticaret A.fi., and as one of the members
of the Board of Directors for the companies Despec Bilgisayar Pazarlama ve Ticaret Afi., Neotech Teknolojik Ürünler
Da¤›t›m A.fi. and Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. Salih Bafl is married with one child and speaks English.
Atilla Kayal›o¤lu, General Manager, Board Member: Atilla Kayal›o¤lu was born in 1952, and graduated from Bo¤aziçi University,
Department of Mechanical Engineering in 1974; following that he received a masters degree from Syracuse University, Department
of Industrial Engineering. He carried out several duties in IBM Turk between the years 1980-1999; and in 1999, when he was the Global
Services Manager he left IBM Turk and joined Index. Kayal›o¤lu acts as a Board Member and General Manager of ‹ndeks Bilgisayar
Sistemleri Mühendislik Sanayi ve Ticaret A.fi.; he also acts as a Board Member of the companies of Neteks ‹letiflim Ürünleri Da¤›t›m
A.fi., Datagate Bilgisayar Malzemeleri Ticaret Afi., ‹nfin Bilgisayar Ticaret A.fi. and Teklos Teknoloji Lojistik Hizmetleri Afi.. Atilla Kayal›o¤lu
is married with two children and speaks English.
Ayfle ‹nci Bilecik, Board Member, Computer Engineer: Ayfle ‹nci Bilecik was born in 1964 and graduated from Istanbul Technical
University, Department of Computer Engineering. She also acts as a Board Member of Desbil Teknolojik Ürünler Ticaret A.fi., being a
subsidiary of Index. Being one of the founding partners of ‹ndeks Bilgisayar founded in 1989, Ayfle ‹nci Bilecik used to work as an
engineer specialized in software in the ICT sector for long years. Ayfle ‹nci Bilecik is married with two children and speaks English.
Halil Duman, Board Member: Halil Duman was born in 1965, and graduated from Marmara University, Department of Business
Administration. He carried out several duties in Yücelen ‹nflaat A.fi. between the years 1987 and 2000; and in 2000, when he was
the Manager of Finance, he left Yücelen ‹nflaat and joined Index as Finance Director. Duman acts as a member of the Board of Directors
of ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi., and also acts as a Board Member of Datagate Bilgisayar Malzemeleri
Ticaret Afi., Neteks ‹letiflim Ürünleri Da¤›t›m Afi., Teklos Teknoloji Lojistik Hizmetleri Afi., Neotech Teknolojik Ürünler Da¤›t›m Afi.,
Despec Bilgisayar Pazarlama ve Ticaret Afi., Desbil Teknolojik Ürünler Ticaret A.fi. Homend Elektrikli Cihazlar San. ve Ticaret Afi., ‹nfin
Bilgisayar Ticaret A.fi. ve Alk›m Bilgisayar Afi, and acts as Assistant General Manager - Finance of ‹ndeks Bilgisayar Sistemleri Mühendislik
Sanayi ve Ticaret A.fi. Halil Duman is married with two children.
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ANNUAL REPORT
Names and titles of executives are as follows:
Board Member - General Manager
Atilla KAYALIO⁄LU
[email protected]
Board Member – Asst. General Manager
Halil DUMAN
[email protected]
Internal Audit Manager
Naim SARAÇ
[email protected]
Technology Development Manager
Tayfun Y‹⁄‹T
[email protected]
Finance Manager
Birgül ÖZTÜRK
[email protected]
Accounting Manager
Halim ÇA⁄LAYAN
[email protected]
Customer Services and Logistics Dept. Manager
Çetin EK‹NC‹
[email protected]
IT Manager
Erkan BERBER
[email protected]
Import Manager
Canan Koç RANA
[email protected]
Administrative Affairs Manager
Selahattin GÜL
[email protected]
Ankara District Manager
Özcan AKDEN‹Z
[email protected]
‹zmir District Manager
Osman fiAH‹N
[email protected]
Marketing and Communication Manager
Özen BOZÇA⁄A BEZ‹RC‹
[email protected]
Group Sales Manager
Mahmut ÖLÇER
[email protected]
Retail Channel Sales Manager
Atilla ALKAfi
aalkas @index.com.tr
Electronic Sales and Marketing Manager
Korkut YILDIRIM
[email protected]
IBM e server Software Manager
‹lker SALTO⁄LU
[email protected]
OEM Sales Manager
Elif fiEN
[email protected]
HP Business Unit Manager
Ebru KOÇO⁄LU
[email protected]
Microsoft IBM and Lenovo Sales Manager
Sedat AZ‹ZO⁄LU
[email protected]
Asus, Dell, Toshiba, Canon Business Unit Manager
Yeliz ÖZCAN
[email protected]
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ANNUAL REPORT
1.6 Historical Background
2010
Foto & Video
2009
2008
2007
787 Million $ Revenue
2006
630 Million $ Revenue
2005
563 Million $ Revenue
2004
431 Million $ Revenue
Public Offer
2003
2002
2001
2000
163 Million $ Revenue
1999
105 Million $ Revenue
IBM POS
1998
1997
51 Million $ Revenue
1996
PC
Distribütör
1995
1994
1993
5 Million $
Revenue
Consumables
1992
1991
1990
15
Business Partner
NIXDORF
AS400
Kingston
ANNUAL REPORT
‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi. was founded on 10.07.1989 to operate in the computer sector. The
Company was transformed into a joint stock company in April 2000. The headquarters of the Company, in which Greece-based
Pouliadis Group participated in August 2000, is in Istanbul. The Company operates in the Information Technologies (“IT”) sector and
deals with the purchase, sales, technical and software support of computers, computer supplies and data transmission equipment.
The Company made a distributorship agreement with 3M, being an American company operating in Turkey, for 3M magnetic medium
products in 1989. The Company increased its market share in the 3M magnetic products market from 1,2% to 55% in one year. It
achieved a turnover of 875 thousand USD with only a staff of 6 in 1989. In the next year, in 1990, it made a turnover of 1.380 thousand
USD with a staff of 19. It ranked 82nd among the Turkish IT companies in 1990.
In 1991 it made a contract with the Italian company named Olivetti to act as the “Authorised Seller” of Olivetti PC products. In the
same year, it increased the number of staff to 36 and made a turnover of 2.188 thousand USD in 1991. It ranked 45th, rising 37 steps
in the ranking of the Turkish IT companies.
The Company set up Ankara branch as its first branch in 1992 and started more permanent activities in the Central Anatolia Region.
In 1992 the number of its staff increased to 49 and its turnover to 3.7 million USD. It ranked 30th, rising 15 steps in the ranking of
the Turkish IT companies, in 1992.
It climbed to the rank of 20th among the Turkish IT companies with its turnover of 9.2 million USD and staff of 56 in 1993.
In 1994, it has become the Turkish Distributor of HP consumables, APC Uninterrupted Power Supplies and Siemens Nixdorf PC
products. Then, it became the 19th biggest IT company of the Turkish market. In 1994 it achieved a turnover of 11.3 million USD
with its staff of 61.
It founded its ‹zmir branch in April 1995 and signed “Business Partner” contract with IBM in May. Just in the second half of the same
year, i.e. at the end of 1995, it was granted “IBM PC Business Partner Award” by IBM due to its achievements as a business partner.
With its significant ‘channel’ activities in the same year, ‹ndeks won “The Most Active Distributor Award” of INTERPRO, which is
considered valuable by the sector. It achieved a turnover of 15.9 million USD with its staff of 62 in 1995. Thereafter, it has become
the 16th biggest IT Company in the sector.
In 1996, IBM changed the distribution model in PC sales organization and adopted the “distributorship” model. Thus, ‹NDEKS has
become the first Turkish company that made a distributorship contract with IBM. It made 4.127 units of IBM PC in 8 days in April of
the same year, which was first in the market. By the end of year, ‹ndeks reached the turnover of 38.7 million USD with a staff of 70
and ranked 9th by climbing 7 steps more in the ranking of the Turkish IT companies. It was deserved to receive the tiTRLe of “The
Most Active Computer Company” once more in 1996, just like in 1995.
In 1997, ‹ndeks has become the 8th biggest IT Company in Turkey, with a turnover of 58.6 million USD and a staff of 75.
The Company made a distributorship agreement for Lotus & IBM Software products, thereby starting distribution of software in 1998.
In the same year, it made a distributorship agreement with HP A.fi. for distribution of hardware products. In the same year, it made
a new agreement with IBM and became the distributor of AS/400, being one of the most important value-added products of Turkey.
Towards the end of that year, ‹ndeks made a distributorship agreement with Kingston. In 1998, the Company won “The Most Active
IT Company Award” again after 1995 and 1996 and became the only IT company that achieved to win the same award third times.
In November 1998, the “Supplies Department” of ‹ndeks Bilgisayar was reorganised as an independent company and became “DESPEC
Türkiye” with a joint investment with Von Dorp Despec Group, which was the “Number 1” in its field in Europe. With its turnover of
89.4 million USD with a staff of 131 in 1998, ‹ndeks climbed another 2 steps in the ranking of Turkish IT ranking and became the 6th
Biggest Turkish IT Company.
In 1999, ‹ndeks made distributorship agreements with many significant products such as Cisco, Microsoft, Xerox, IBM Pos and Escort;
and its “logistics centre” started operations in June of the same year. “‹ndeks Logistics Centre”, which is situated on an area of 2,500
sqm and equipped with highly functional technology, was one of the most important investments of ‹ndeks in canal. The Company
reached the turnover of 111 million USD with a staff of 155 in 1999.
On 12 April 2000, the company transformed from a Limited Liability Company into a Joint Stock Company. In August 2000, Pouliadis
and Associate Societe Anonyme Industrial and Commercial of High Technology Systems S.A. ('Pouliadis S.A.') acquired 50% of
‹NDEKS Bilgisayar which thereby became a company with foreign shareholder. In the same year, ‹ndeks made an agreement for
distributorship of Epson products and added Epson products to its increasingly growing range of products. ‹ndeks Bilgisayar achieved
a turnover of 163 million USD by the end of 2000.
16
ANNUAL REPORT
In 2001, the Company made a distributorship agreement with COMPAQ. With this agreement, ‹NDEKS blazed a trail being the only
distributor dealing with IBM, HP and COMPAQ PC products. In the same year, ‹ndeks also made distributorship agreements for Novel,
Sony and Microsoft OEM products. The Company continued its investments in spite of the economic crisis in 2001 and in March of
the same year, it acquired 50.5% of Datagate Bilgisayar Malzemeleri Ticaret Afi. (DATAGATE), which is a leading company in Computer
parts/OEM sector, thereby boosting the morale of the sector. In the same period, it acquired 70% of Neteks ‹letiflim Ürünleri Da¤›t›m
A.fi. (NETEKS) , which is one of the highly experienced distribution companies in network, and continued its growth in spite of the
crisis. In the Turkey Top 500 ICT Companies Ranking performed by Interpro Medya A.fi. in 2001, our company ranked 1st in the
category of “IT Hardware Incomes”, 2nd in the category of “Turkish IT Companies” and 11th in the general ranging of the ICT Sector.
In 2002, Oki printers and Toshiba notebook and server products were included in the ‹ndeks range of products. In July 2002, all
companies of the group relocated to its current three-storey building with an indoor area of 10.000 sqm in the address of Cendere
Yolu, No: 23 Ka¤›thane. The turnover of the Company in 2002 was 189 million USD.
Products with Fujitsu Siemens and Nec brands were added to the product portfolio of the Company in 2003. Further, the share of
‹ndeks in DATAGATE, of which 50.5% shares were acquired by ‹ndeks in 2001, thereby being an affiliate of the Company, was increased
to 85%. The consolidated turnover of the Company was realized as 323 million USD as of the end of 2003.
15.34% of the ‹ndeks Bilgisayar shares was offered to public on ISE via a capital increase through rights issue after restricting the
execution of pre-emptive rights of existing shareholders, on 24.06.2004. The Company made distributorship contracts with Kingmax
and Asus for memory and barebone products, respectively, in 2004 and started to distribute such products. In the same year, ‹ndeks
Bilgisayar A.fi. was awarded ISO 9001:2000 certificate.
On 02.02.2005, in accordance with the resolution of the Board of Directors dated 02.02.2005, ‹ndeks acquired 80% of Neotech
Teknolojik Ürünler Da¤›t›m Anonim fiirketi for wholesale trade of consumer electronics and communication products as a new field of
operation of the Company. In March 2005, the Registered Capital System was adopted, and its maximum registered capital was
approved as TRL 75.000.000. In May 2005, the issued capital of ‹ndeks was increased from TRL 17.600.000 to 45.000.000. In
September 2005, the Company made an exclusive distributorship agreement with TPV Technology Limited, which manufactures 19,5%
of the monitors in the global market and has realised a turnover of 4 billion USD in 2004, for distribution of AOC branded LCD, CRT
Monitor, Plasma Monitor and LCD TV products in Turkey.
According to the Top 500 Turkish ICT Companies report issued by Interpro on 27.05.2005 for 2004, our Company ranked 1st in the
categories of Notebooks, Desktop PCs, Print Systems, Servers, Data Backup and Storage Units, Office Software and OEM and 8th
in the turnover-based general ranking of Turkey, in which Turk Telekom ranked 1st. With these results, ‹ndeks Bilgisayar achieved to
be the only local computer company in the Top Ten.
In February 2006, 30.30% of the shares of the second biggest company of the group and a subsidiary of ‹ndeks Bilgisayar, namely
Datagate Bilgisayar Malzemeleri Ticaret A.fi., was offered to public in February 2006. of was offered to public on ISE via a capital
increase through rights issue after restricting the execution of pre-emptive rights of existing shareholders. Began to be traded on ISE
on 10.02.2006 Thus, 2 companies of the group have been offered to public and begun to be traded on ISE.
Partnership share of ‹ndeks Bilgisayar decreased from 85% to 59.2% with the public offering of Datagate. The issued capital of ‹ndeks
Bilgisayar was increased from TRL 45.000.000 to TRL 55.000.000 in May 2006. TRL 8.718.703 out of the amount of increase, i.e.
TRL 10.000.000, is covered from the profit of the period of 2005 and the remaining TRL 1.281.297 from extraordinary reserves. ‹ndeks
has executed one of the most important and greatest investments in ICT sector by purchasing Karadeniz Orme A.S., which is founded
on a 39.761 m2 land and having 18.969 m2 indoor area, in order to be used as a logistics centre. The trade name of Karadeniz Orme
AS has been changed into Teklos Teknoloji Lojistik Hizmetler A.fi. and its field of activity has been customized to be able to work on
the logistics services. The head office of the company moved to its new location on 26.10.2006. EVOS (Effective Efficient Operational
Result-Oriented) ERP System developed by ‹ndeks A.fi. in 2006 was started to be used by ‹ndeks Group Companies on 01.01.2007.
EVOS Project was developed by the Software Engineers Group of ‹ndeks A.fi. within a period of 9 months.
Our Company and its subsidiaries included in the consolidated financial statements made distributorship agreements with Canon for
printer, fax and scanner products, with Western Digital Corporation for hard disk products, with Panasonic for consumer electronics,
with Viewsonic for monitor products and with Sony Vaio for notebook products. According to the 2005 Turkey Top 500 ICT Companies
report issued Interpro in 2006, ‹ndeks Bilgisayar, with its turnover of 758.634 (thousand TRL), again ranked 1st in the category of
companies selling only computers, like in 2004. With this result, the Company kept its special place as the only local computer
company in the Top Ten. Moreover, it was ranked the biggest company in the category of markets with respect to the incomes from
Server, Print Systems, OEM, Operating System, Office Software and E-Trade sales.
17
ANNUAL REPORT
‹ndeks Bilgisayar and its subsidiaries made distributorship contracts with Philips for monitors and PC peripherals, Asus for notebook
products, Apple IMC for Apple brand products, Trend Micro for software products for internet security and viruses, Nokia for E-series
products, LG Electronics for notebook products in 2007. The issued capital of the Company was increased from TRL 55.000.000 to
TRL 56.000.000 in July 2007. The amount of increase, i.e. TRL 1.000.000, is covered from the profit of the period of 2006.
On 24.07.2007, ‹ndeks Bilgisayar and its subsidiary Datagate Bilgisayar A.fi sold 50% of their shares in Neteks ‹letiflim Ürünleri Da¤›t›m
A.fi., an affiliate of ‹ndeks Bilgisayar, to Westcon Group Eurepean Operation Limited, one of the leading global companies in its field.
Of the 50% shares sold, 26% and 24% were provided by ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi and Datagate
Bilgisayar Malzemeleri Ticaret A.fi., respectively. Following such sale, Neteks become a JV of which shares are held by ‹ndeks Bilgisayar
A.fi. and Westcon Group on 50%-50% basis. It was the first time that with this agreement, Westcon Group made an investment in
Turkey under a partnership; until then, it was operating only with its fully owned subsidiaries in 19 countries around the world.
According to the 2007 Turkey Top 500 ICT Companies Ranking performed by Interpro Medya A.fi., our company ranked seventh,
one step higher than the previous year, in the general ranking based on turnover achieved in 2006 among the companies including
telephone operators and mobile phone sellers. On the other hand, it ranked first with its sales income of 901.778 (thousand TRL),
like the previous years, in the category of companies selling only computers. Further, it ranked first in nine ICT categories. The categories
in which ‹ndeks Bilgisayar ranked first are the Portable computer wholesale trader and distributor, Data backup and storage hardware,
Server, Print systems wholesale trader and distributor, Data communication hardware, OEM products, Operating system, Office
software wholesale trader and distributor and E-trade.
In 2008, ‹ndeks Bilgisayar made a distributorship agreement with LG, which is one of the most valuable brands of the world, for
notebooks, consumer products and monitors and with Asustek for Asus branded server products. In the same year, Neotech, being
a subsidiary of ‹ndeks Bilgisayar, and Datagate were appointed as the distributors of Wacom and Belkin products, respectively. Our
Company ranked sixth, one step higher than the previous year, in the general ranking based on sales made in 2007 among the first
500 ICT companies including telephone operators and mobile phone sellers in Turkey. On the other hand, our Company ranked 1st
with a sales revenue of TRL 1.022.919 thousand TRL, like the previous years, in the category of companies selling only computers.
Further, it ranked first in eight ICT categories.
In 2009, ‹ndeks Bilgisayar made distributorship agreements with Iomega and Dell and a supply contract with Best Buy. The contracts
made by Neotech A.fi., a subsidiary of ‹ndeks Bilgisayar, for Apple and Airties products were transferred to ‹ndeks Bilgisayar as a result
of the segment adjustments in this year. In the same period, Neteks, a 50% affiliate of ‹ndeks Bilgisayar, made distributorship agreements
with Juniper, IBM ISS and Avaya. On the other hand, Datagate A.fi. made a distributorship agreement with Fujitsu Siemens. ‹ndeks
Bilgisayar ranked 7th among the Turkey Top 500 ICT Companies with its sales income of 927.893 thousand TRL in the turnover-based
general ranking as determined by Interpromedya A.fi. In the analysis of the general ranking results, ‹ndeks Bilgisayar ranked 1st, as
the previous years, among the companies dealing with computer trade only. Further, it ranked first in six ICT categories. Further,
Datagate Bilgisayar Malzemeleri Tic. A.fi., which is a 59% subsidiary of ‹ndeks Bilgisayar, ranked first in the category of “OEM (computer
parts)” incomes and Neteks ‹letiflim Da¤›t›m Ürünleri A.fi., which is a 50% subsidiary of ‹ndeks Bilgisayar, ranked first in the category
of “Data Communication Hardware”.
In 2010, our logistic company called Teklos A.fi. achieved the contract of Turkish Telecom for storage and distribution of the products
which will be provided to the customers of Turkish Telecom. ‹ndeks Bilgisayar ranked 7th among the Turkey Top 500 ICT Companies
with its sales income of TRL 1.087.422 in the turnover-based general ranking as determined by Interpromedya A.fi. In the analysis
of the general ranking results, ‹ndeks Bilgisayar ranked 1st, as the previous years, among the companies dealing with computer trade
only. Further, it ranked first in six different ICT categories. These are Personal computer, Mobile, Printing systems, data back up and
storage, monitor, operating systems and B2B E-Trade. Further, Datagate Bilgisayar Malzemeleri Tic. A.fi., which is a 59% subsidiary
of ‹ndeks Bilgisayar, ranked first in the category of “OEM (computer parts)” incomes and Neteks ‹letiflim Da¤›t›m Ürünleri A.fi., which
is a 50% subsidiary of ‹ndeks Bilgisayar, ranked first in the category of “Data Communication Hardware”. Furthermore, Indeks has
started negotiations with Canon Eurasia Ltd for the distribution of cameras, video camcorders products and their accessories in Turkey
as Canon is one of the biggest producer of these types of products in the world. Our subsidiary, Neteks A.fi achieved the distributor
of the year award organized by Cisco Systems in 2009. Indeks achieved the most efficient business partner award which was organized
by Lenovo in China in 2009. In addition, Indeks has been awarded the distributor of the year organized by IBM Turk Ltd in Istanbul.
18
ANNUAL REPORT
19
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
2. SECTOR OF
OPERATION
ANNUAL REPORT
21
ANNUAL REPORT
2. Sector of Operation
2.1 IT Sector
2.1.1 Turkish IT Sector
The usage of computers in Turkey started in the end of the 1980’s. Although there was a very rapid development in the sector between
the years of 1990 and 1995, usage of computers were limited to mostly financial sector, governmental units, big businesses and
universities. In the second half of the 1990’s, the increase in the usage of computers made the IT sector one of the most rapidly
growing sectors in Turkey. According to the data issued by International Data Corporation (“IDC”), the Turkish Information and
Communication Technologies (“IT”) sector achieved a compound annual growth rate (“CAGR”) of 20% between 1997 and 2000. In
2000, the Turkish IT sector has reached its greatest business volume thus far with 2.3 billion USD, whereas that figure reduced to
1.2 billion USD with 49% recession in 2001 because of the economical crisis that was encountered in the end of 2000 and the
postponement of the demand of IT investments by public and private sectors. The figures achieved in 2000 were again caught only
in 2004, with a business volume of 2.4 million USD. In other words, it took 4 years to eliminate the effects of the crises. However,
one should also consider that one of the causes of the shrinkage of the business volume was the continuously price reduction of
products, which is the structural feature of the IT Industry.
As a consequence of the realization of the postponed IT investments especially in the private sector in parallel with the improvement
in the macroeconomic indicators after 2001, the IT sector continued its growth with a compound annual growth rate (“CAGR”) of
27.9% between 2001 and 2007, which is higher than the growth rates in the period before the crisis. Particularly the increasing usage
of internet in the recent years has made a great contribution to this development. With the contribution of the increasing interest and
the continuing investments in the market for notebooks, Turkish IT Sector reached the value of 5.2 billion USD in 2007. However, in
despite of the negative pressure of the global economic shrinkage on the consumption tendency and the appreciation of USD against
TRL, contrary to the previous crisis periods, the Turkish IT Sector did not shrink, but has reached 5.3 billion USD in 2009. The
contribution of tax stimulus packages of the government during 6 months cannot be underestimated for this growth. According to
IDC’s research, IT market achieved growth from 2009 to 2010 with 10,7 %.
Turkish IT Market Business Volume (Mio $)
9.665
10.000
CAGR(09-14): %12.5
9.000
50%
7.688
8.000
60%
8.767
6.910
7.000
(Mio USD)
5.361
5.000
30%
4.000
(% Growth)
40%
5.937
6.000
20%
3.000
2.000
10%
1.000
0%
0
2009
2010
2011F
IT Sector Business Volume
2012F
2013F
2014F
% Growth
Source: IDC 2011
22
ANNUAL REPORT
According to the 2011 Turkey IT Expenditures Research conducted by IDC, the Turkish IT market is expected to have a 12.5%
compound annual growth rate (CAGR) in the period between 2009 and 2014, reaching 9.7 billion USD in 2014. IT investment demands
deferred in the 2001 crisis period have been started to be realized with the appearance of the increasing stable outlook of the economy
and these investment expenditures have been one of the most powerful dynamics of the market in the first 5 years following 2001.
New investments that increased after merger and acquisition operations in all sectors, beginning in the finance and telecommunication
sectors and spread to other sectors from 2005 on, technology replacement investments, increased IT investment made by the
government as part of e-government projects, increase in the internet usage rates and finally, in the number of the users who follow
up the rapidly developing technology became the driving forces of the market between 2005 and 2008. Although the first quarter of
2008 started very favourably, the sector started to lose its strength due to the suit brought to close AKP, a slowdown was experienced
in the third quarter when not so many negative results were observed. However, with the last quarter, the sector was affected by
the global financial crisis that started at the beginning of October, and thus, the quarter was closed with a double-digit shrinkage.
2009 was experienced as a year when the wounds of the crisis were bandaged; the effects of the crisis in the first quarter diminished
with the effect of the VAT cut applied for 6 months, including the second and third quarters, and positive growth was recorded in the
fourth quarter. In 2010, IT sector achieved quite gradual growth after constitutional referendum particularly static summer season.
Turkey has been one of the major developing countries due to the improving general economic conditions, increased per capita income
and steps taken for globalization. In addition to highly qualified and cost effective human resources, majority of the young population
is contributing to the attractiveness of our country. When the pressure of the diminished consumption tendency on the IT Market due
to the crisis in 2008-2009 decreased, it is estimated that the IT sector will grow by 16.4 comparing to the previous year and with such
growth, the sector will reach 6.9 billion USD by the end of 2011.
On the other hand, if the share of the end-users in the market is monitored in the period between 1995 and 2009, it would be clearly
seen that the market structure has changed considerably. Accordingly, the IT market comprised governmental and public bodies
(38%), finance sector companies (30%), private sector companies (20%), individual users (7%) and SMEs (5%) in 1995. However, the
shares of government and public sector companies, finance sector companies and private sector companies in the market decreased
while those of individual users and SMEs increased in the period between 1995 and 2009. As a result, as of 2010, the Turkish IT
market comprises 40% individual users, 17% government and public sector companies, 16% private sector companies, 13% finance
sector companies and 14% SMEs.
Changes in the Market Share of End Users
2011F
18%
11%
2010
17%
13%
2009
18%
14%
2008
20%
2005
16%
10%
40%
35%
25%
35%
20%
38%
12%
25%
38%
0%
42%
14%
18%
25%
1995
14%
14%
16%
15%
22%
2000
15%
10%
23%
30%
30%
40%
18%
50%
7%
20%
60%
70%
10%
5%
80%
90%
7%
100%
1995
2000
2005
2008
2009
2010
2011T
Public Institutions
38%
25%
22%
20%
18%
17%
18%
Finance Sector
30%
35%
25%
15%
14%
13%
11%
Private Sector (Corporate)
20%
23%
25%
18%
16%
16%
15%
SME
5%
7%
10%
12%
14%
14%
14%
Individiual Users
7%
10%
18%
35%
38%
40%
42%
Source: IDC 2011
According to the 2009 report of ITU (International Telecommunication Union) on the basis of 2007 data, the rate of PC ownership
per household is 70% in the USA, 75% in England, 79% in Germany, 40% in Greece, 53% in Italy, 21% in Brazil and 29% in Turkey.
The rate of internet users is 62% in the USA, 67% in England, 71% in Germany, 25% in Greece, 43% in Italy, 15% in Brazil and 19%
in Turkey.
23
ANNUAL REPORT
It is estimated that the rate of the number of PC in operating status to the total population has increased from 8% to 27% in the period
between 1995 and end of 2010, and that the rate of the internet users to the total population has increased from 10% to 37% in the
same period. This indicates that PC ownership and internet usage rates increased over 3 times in the last 15 years. PC ownership
and internet usage rates have increased by 67% and 40%, respectively in the last 5 years. Comparing to the country data published
by ITU above, it is clear that Turkey is far below the developed countries with respect to the PC ownership and internet users rate
and that there is a long distance to be covered in this field. The PC and internet penetration in Turkey between 1995 and 2010 has
developed as shown in the following graphics.
40%
60%
50%
50%
35%
30%
30%
40%
40%
27%
37%
30%
20%
25%
15%
20%
12%
10%
15%
8%
10%
0%
1995
2000
2005
PC Penetration
2010
2011
2012F
0%
10%
1995
2000
2005
2010
2011T
2012F
Internet Penetration
Source: IDC 2011
According to the results of “Households IT Usage Research” published by the Turkish Statistical Institute (TÜ‹K) in April 2010, the PC
and internet usage rates of individuals are 40.1% and 38.1%, respectively. The survey indicates that computer and internet usage
rates of people between 16 and 74 ages are 50.5% and 48.6% for men and 30.0% and 28.0% for women, respectively.
The age group in which the rate of computer and internet usage is highest is 16-24.These rates are higher in men than women in all
age groups. By educational level, the population who use the computer and internet most are graduates of first degree and higher
education levels. 11.8% of people place order for or purchase goods or service for personal use via internet.
According to the report results, PC and internet usage rates have increased by 8% and 9%, respectively in the period between 2009
and 2010. Another interesting feature of the report is that although the computer and internet usage rate of the rural population is
lower than the urban population, the computer and internet usage rates increased by 16% and 15%, respectively, in the rural areas.
Although the increasing rate is pleasing, it is clear that the computer and internet usage rate in the urban areas is over 2 times higher
than the rural areas.
24
ANNUAL REPORT
Comparison of computer and internet usage on area based (rural & urban) (%) (2009-2010)
Computer usage rate
2009
Computer and
internet users
In the last
there months
Between three months
and one year
Over one year
Never used
Change
2010
Internet usage rate
Change
%
2009
2010
%
41,64
9%
Turkey
40,11
43,18
8%
38,14
Urban
47,70
50,61
6%
45,52
49,23
8%
Rural
22,16
25,60
16%
20,68
23,69
15%
Turkey
35,60
39,08
10%
33,97
37,58
11%
Urban
42,60
46,28
9%
40,87
44,72
9%
Rural
19,02
22,04
16%
17,64
20,67
17%
Turkey
2,29
1,94
-15%
2,43
2,24
-8%
Urban
2,77
2,12
-23%
2,78
2,57
-7%
Rural
1,14
1,50
32%
1,59
1,46
-8%
Turkey
2,23
2,17
-3%
1,75
1,82
4%
Urban
2,33
2,21
-5%
1,87
1,93
3%
Rural
2,00
2,06
3%
1,46
1,57
7%
Turkey
59,89
56,82
-5%
61,86
58,36
-6%
Urban
52,30
49,39
-6%
54,48
50,77
-7%
Rural
77,84
74,40
-4%
79,32
76,31
-4%
Source : TUIK 2009, 2010
Computer and Internet Usage in the Seperation of Urban and Rural
60
50,61
49,23
50
43,18
41,64
40
30
23,69
25,60
20
10
0
Computer usage
Turkey
Internet usage
Urban
Rural
Source: TUIK 2011
Public investment in IT sector increasingly grows year by year with the contribution of the “e-Transformation Turkey Project” in
accordance with the Information Society Strategy adopted by the Prime Ministry. Accordingly, the share of IT investments out of the
total public investments increased to 159 million USD in 2002, 389 million USD in 2005, 555 million USD in 2007, 590 million USD in
2009 and 675 million USD in 2010.
25
ANNUAL REPORT
Amount of Total Payment
(Current Prices)
Number of Project
Year
Amount of Total Payment
(2010 Prices)
Ürünleri
(000) TRL
(000) $ US
(000) TRL
(000) $ US
2002
203
286.013
158.808
478.029
297.511
2003
204
369.321
208.656
536.205
318.536
2004
211
451.181
281.285
587.673
376.958
2005
200
626.253
388.494
814.734
533.215
2006
203
791.065
557.716
900.868
685.156
2007
237
816.753
555.463
927.964
629.695
2008
271
814.890
591.529
835.966
589.603
2009
244
847.663
590.418
890.046
619.939
2010
177
1.083.743
675.524
1.083.743
675.524
Source: State Planning Agency 2009, Public Information & Communication Technology Investments
2.1.2. IT Market Comparison in the World and Turkey
According to IDC’s report regarding growth rates between countries, the highest growth rate from 2009 to 2010 was seen in Ukraine
with 76% and respectively Russia with 55 %, BAE with 32 %, Romania with 28 %, Egypt with 27 %, South Africa with 26 %, Poland,
Saudi Arabia and Czechoslovak with 16 %. Turkey has been the 10th in above rank with 12 % growth rate on PC quantity based
sales. Israel has been stated after Turkey with 9 % growth rate.
World IT Market - Country Based PC Market Growth Analysis, 2009 - 2010 (Quantity)
12.000
10.000
8.000
6.000
4.000
2.000
0
Russia
Turkey
Poland
Saudi
Arabia
Ukraine
UAE
South
Africa
Chech Rep.
Israel
Egypt
Romania
2009
7.122
3.210
2.854
1.351
1.997
1.762
1.637
1.121
1.011
656
478
2010
11.070
3.607
3.304
2.379
2.319
2.318
2.069
1.305
1.104
836
614
%55
%12
%16
%76
%16
%32
%26
%16
%9
%27
%28
Growth
Source: IDC 2011
Turkish IT Market - Dealers Market Share Analysis, 2009 - 2010 (Million $ USD)
1400
1200
1000
800
600
400
200
0
Retail
Classic
Dealers
Producer
Shops
Producing
Shops
Direct
Producer
Telecom
Authorized
Seller
Virtual
Shops
2009
1.339
473
179
172
163
75
147
43
2010
1.329
633
357
220
120
76
76
13
Growth
- %0.7
%33.8
%98.8
%27.6
- %26.5
%22
%13
%8
Market Share 2010
%47
%4
%1.3
- %48.5
%3
%3
- %69.6
%0
Source: IDC 2011
26
ANNUAL REPORT
According to IDC’s report regarding Turkish IT Market, market shares of the dealers in 2010; 47 % in retails, 22 % in Regular Dealers,
13 % in Producer Shops, 8 % in Corporate Dealers, 4 % in producers, 3 % Telecom, 3 % in Authorized Sellers, less than 1 % in Visual
Markets (online shops). The major growth was recorded by Producer Shops and Regular Dealers, Corporate Dealers and Telecom
Dealers respectively.
The growth rates are 98 %, 33,8 %, 27,6 %, 1,3 % respectively. On the other hand, Visual Shops -69,6 %, Authorized Sellers -48,5
%, Producer Direct -26,5 % and Retail -0,7 % were shrank. The stakes of retail shops were too small and especially after 2007 and
2008, the market share of these shops increased in considerably important amount. The main factor was that the individual users
took important stake from the market up to 40 % in 2010. It is expected to be higher in the future.
2.2 Sub-segments of the ICT Sector
Turkish IT sector is essentially separated into three main groups, namely hardware, software and IT services. According to the Turkey
results published by IDC in 2011, the business volume of the Turkish Information and Communication Technologies (IT) market reached
5.3 billion USD in 2009, 5.9 billion USD in 2009. The same report shows that the share of the “Hardware”, “Software” and “IT Services”
sub-segments in the total market are 75 %, 10 % and 15 %, respectively. This indicates that the Turkish IT sector has got a structure
where “hardware” is predominant with respect to income created.
IT Sector Expenditures, 2009-2014 (mio US$)
8.000
7.000
6.000
5.000
4.000
3.000
2.000
1.000
0
2009
2010
2011
2012F
2013F
2014F
- Hardware
3.975 $
4.443 $
5.251 $
5.842 $
6.700 $
7.366 $
- Software
533 $
584 $
671 $
760 $
863 $
963 $
- Service
854 $
909 $
988 $
1.086 $
1.204 $
1.336 $
Source: IDC 2011
Turkish IT Sector 2009-2014 (Mio $)
IT Sector Contents (x m $)
2010
2011 F
3.975,0
4.443,1
5.251,0
Software
532,6
584,2
670,9
759,7
863,1
963,3
Service
853,6
909,4
988,2
1.086,2
1.204,0
1.336,1
Total IT
5.361,2
5.936,7
6.910,1
7.687,9
8.766,6
9.665,0
10,7%
16,4%
11,3%
14,0%
10,2%
Growth on Segments
2010
2011 F
2013 F
2014 F
Hardware
11,8%
18,2%
11,3%
14,7%
9,9%
Software
9,7%
14,8%
13,2%
13,6%
11,6%
Service
6,5%
8,7%
9,9%
10,8%
11,0%
IT
11%
16%
11%
14%
10%
2013 F
2014 F
Hardware
2009
Growth %
Distribution in Segments
5.842,0
2012 F
2012 F
2013 F
2014 F
6.699,5
7.365,6
2009
2010
2011 F
Hardware
74,1%
74,8%
76,0%
76,0%
76,4%
76,2%
Software
9,9%
9,8%
9,7%
9,9%
9,8%
10,0%
Service
15,9%
15,3%
14,3%
14,1%
13,7%
13,8%
IT
100%
100%
100%
100%
100%
100%
(Telecom, Network tools are not included for the calculation)
27
2012 F
ANNUAL REPORT
According to the 2011 Turkey IT Expenditures Survey conducted by IDC, the Turkish IT market is expected to have a 12.5% compound
annual growth rate (CAGR) in the period between 2009 and 2014, reaching 9.6 billion USD in 2014. These estimates are based on
the anticipated growth rates, investments anticipated to be made by companies rapidly as they were deferred due to the crises of
2001 and 2008, effects of IT expenditures incurred by the public sector for e-transformation projects on IT consumption, increased
use of IT in education, anticipated increased rate of the use of internet and mobile technologies and replacement investments to be
caused by new technologies.
Growth Rates in Turkish IT Market Between 2009-2014 (%) on Sub-Group Based
Total IT
Service
Software
Hardware
90.00%
75.00%
60.00%
45.00%
30.00%
15.00%
0.0%
2009
2010
2011F
2013F
2012F
2014F
Source: IDC 2011
2.2.1 Hardware Market
Hardware market in Turkish IT sector is the sub-segment having the biggest share regarding the sales amounts of 1999 – 2009, with
the ratios changing between 57% and 74%. With tax stimulus packages of the government for only 6 months in 2009 and constitutional
referendum at the end of third quarter were both supported the growth in the sector. The hardware sector achieved growth from 2009
to 2010 as 11,8 %.
Growth Rates & Targets of Hardware Expenditures in IT Sector, 2009-2014 (Mio USD,%)
8.000
7.366
18%
6.700
Hardware
6.000
16%
5.842
14%
5.251
5.000
3.975
12%
4.443
10%
8%
3.000
(% Growth)
7.000
4.000
20%
6%
2.000
4%
1.000
2%
0
0%
2009
2010
Hardware
2011F
2012F
2013F
2014F
% Growth
Source: IDC 2011
28
ANNUAL REPORT
IDC expects Hardware sector capacity is expected to reach 7,336 million USD in 2014.
2.2.1.1 PC Market:
The hardware sub-group consisting of Desktop PCs, portable PCs (“Laptop PCs”, “Notebooks”), Servers and Peripherals is monitored
via the sales data in PC market which represent a very significant portion of the total sales. Accordingly, total sales of the PC market
were realized as 2.691.519 in 2008, whereas such total number (both notebook and desktop) rose to 3.210.386 units with an increase
of 19.3% in 2009. In 2010, it reached 3.607.136 with 12,4 % growth rate.
However, when the sales in the PC market are considered by quantity excluding the server market, it is noticed that portable PCs
have gained majority in this market for the first time in 2009. From the year of 2004, supplying portable PCs with high performance,
increased mobility possibility with their lighter structure and affordable prices to the consumers has enabled significant
increases in their sales, and finally, sales of portable PCs have surpassed those of desktop PCs in 2009.
When the market share of mobile PC was 35,7 % in 2005, it reached 63 % in 2009 and 66,1 % in 2010. In this paralel, when the
market share of desktop PC was 64,3 %, it decreased to 37 % in 2009 and 33,9 % in 2010.
Estimation of Turkish PC Market on Type and Quantity Based, 2005-2010
Type
Desktop
Notebook
Total
2005
(%)
1.027.336 64.3
570.366 35.7
1.597.702 100,0
2006
(%)
1.331.144 63.7
757.597 36.3
2.088.741 100,0
2007
(%)
1.415.568 54.3
1.191.332 45.7
2.606.900 100,0
2008
(%)
1.455.049 54.1
1.236.470 45.9
2.691.519 100,0
2009
(%)
1.186.862 37.0
2.023.524 63.0
3.210.386 100,0
2010
(%) CAGR(%)
1.221.607 33.9
3.52%
2.385.529 66.1
33.13%
17.69%
3.607.136 100,0
Growth
2006
29.57%
32.83%
30.7%
2007
6.34%
57.25%
24.8%
2008
2009
2.79% -18.43%
3.79% 63.65%
3.2%
19.3%
2010
2.93%
17.89%
12.4%
Trends in Market Shares of Desktops & Notebooks
Quantity
2011F
Amount (USD)
32%
2011F
68%
28%
72%
2010
34%
66%
2010
29%
71%
2009
37%
63%
2009
32%
68%
2008
54%
2005
2008
46%
64%
92%
1995
8%
96%
0%
20%
2005
36%
2000
40%
Desktop Market Share
4%
60%
80%
Notebook Market Share
45%
100%
55%
53%
47%
2000
84%
1995
16%
91%
0%
20%
40%
Desktop Market Share
9%
60%
80%
100%
Notebook Market Share
Source: IDC 2011
The developments at PC market are closely related with the ongoing projects in public and educational sectors. The stable growth
in demand of the consumers is also considered as another significant factor on this issue. The growing retail chains and financial
opportunities offered to the consumers by these chains have been the most important driving forces for the PC sales. Besides, noticing
the benefits of mobile computing systems by the corporate companies is seen as another important reason for the growth. At this
point, one may clearly see from then market sales figures that the demand by the small and large enterprises seeking productivity for
portable PCs as an important part of mobile data systems has increased.
29
ANNUAL REPORT
Turkish IT Market on Main Form Based 2009 – 2010
2009
2010
Desktop PC
37.0%
Mobile PC
63.0%
Desktop PC
34%
Total PC Sales Quantity: 3.210.386
Mobile PC
66%
Total PC Sales Quantity: 3.607.136
Source: IDC 2011
Besides the producers which have international brands, a considerable part of hardware production both inside and outside the country
is performed with the main components that are obtained from the global computer parts suppliers by big and small-sized companies.
Over time, these factors have transformed the hardware product market and the especially PC market into a low added value structure
in which the competition is highly sensitive to the price.
According to IDC’s 2011 report, 36 % of Desktop PCs were sold by local producers, 28 % International Producers and the rest consists
of processor selling amount to local market. In this category, local producers are dominant in 2010. When look at the Notebook
amounts, local producers have market share of 19 % and International producers have market share of 81 %.
Suppliers Based Distribution of Turkish Desktop and Notebook Market, 2010
Notebook
Desktop
Others
36%
International
Producers
28%
Local Producers
19%
International
Producers
81%
Local Producers
36%
Source: IDC 2011
30
ANNUAL REPORT
2.2.1.1.1 Desktop PCs
PC Desktop products have represented the most important product category within the sub-group of hardware in terms of the unit
and sale volumes until 2009. Total sales of Desktop PCs decreased from 594 thousand in 2000 to 251 thousand in 2001 due to the
2001 economic crisis. PC sales increased with the rate 41% CAGR between 2002 and 2005, well above the economical development,
with the influence of the decrease in the year 2001 and reached 1 million units in 2005. Desktop PC sales rose to 1.33 million units
and 1.4 million units with an increase of 30% and 6% in 2006 and 2007, respectively.
Such sales again increased by 10-15% in the first three quarters of 2008 and by 2,8% in the last quarter due to the global crises,
and closed the year with a sales quantity of 1.45 million units, which was the highest historical level. However, as a consequence of
the development of the mobile technology, the share of the desktop PC sales in the total PC market decreased to 37%, and the sales
quantity was realized as 1,19 million units with a decrease of 18,4% in 2009.
PC Desktop market exhibits much segmented structure where the domestic producers are dominated. While international producers
get a market share of 28%, the remaining part of the market is under the control of the big or small sized domestic producers. These
are Hewlett Packard 16,3 %, Casper 13,9 %, Exper 11,3 %, Arçelik 3,5 %, Fujitsu 3 %, Lenovo 3 %, Pro2000 2,9 %, Dell 2,4 %,
Crea 2,4 %, Acer Group 1,7 %, Vestel 1,6 % and Others 38 %.
Quantity Based Distribution of Desktop Sales (000), 2010
1.600,0
1.400,0
1.200,0
1.000,0
800,0
600,0
400,0
200,0
0,0
Desktop PC
2000
2001
2002
2003
2004
593.5
251.4
344.8
516.4
710.1
2005
2006
2007
2008
2009
Source: IDC 2011
Hewlett - Packard
16.3%
Others
38.0%
Casper
13.9%
Vestel
1.6%
Arçelik
3.5%
Acer Group
1.7%
Crea
2.4%
Dell
2.4%
31
Fujitsu
3.0%
Pro2000
2.9%
2010
1.027.3 1.331.1 1.415.6 1.455.0 1.186.9 1.221.6
Lenovo
3.0%
Exper
11.3%
ANNUAL REPORT
2.2.1.1.2 Notebooks
Since 2004, a significant consumption activity has started all over the world in Portable PCs (notebook, netbook) market when the
international big producers decreased the prices with increasing competition in this market and the developing technology. As a
consequence of affordable price policies of producers and retailers, notebook prices for end users decreased to 400 - 1000 USD on
average in Turkey, which eventually made these products affordable for home users and increased the widespread usage of the
notebooks in the offices. Accordingly, the share of Portable PCs (except for server) in the total PC sales by quantity has increased
from 5% to 23.8% between 1998 and 2004 and then to 45.9% in 2008. Supplying portable PCs with high performance, increased
mobility possibility with their lighter structure and affordable prices to the consumers has enabled significant increases in their sales,
and finally, sales of portable PCs have reached 63.03%, well above those of desktop PCs in 2009. In 2010, it reached 66,1 %.
Sales of Portable PCs in 2000 increased from 51 thousand units to 221 thousand units in 2004 and then rose to 1.236 thousand units
in 2008, 2.023 thousand units in 2009 and 2.385 thousand units in 2010. According to the 2011 results of the IDC report on Turkish
IT Expenditures, the Turkish mobile PC Market is estimated to reach 3 million units in 2011, and the share of the mobile PC shares
in the total PC sales shall reached 66,1 % in 2010.
It seems that international brands are more dominant in the Notebook PC market than the Desktop PC market. According to the
2010 data obtained from IDC, the most important leading brands in the Portable PC market, namely Acer, Hewlett Packard, Toshiba,
Casper, Lenovo and Dell, control 66.1% of the market in terms of quantity.
As a consequence of the fact that just like in the desktop products in previous periods, the structure of notebook products tends to
be standardised, it is observed that some part of the market shares of international brands are left to the domestic producers. The
market share of the domestic producers which was 10% at the end of the year 2003 increased to 16.8% in 2008 and 19% in 2010.
According to the 2010 results, the shares of Casper and Exper, which are the two big domestic market of the Turkish market, were
realized as 8,84 % and 5.77%, respectively.
Notebook Sales (000) and Supplier Based Distribution of Sales, 2010
2.500,0
2.250,0
2.000,0
1.750,0
1.500,0
1.250,0
1.000,0
750,0
500,0
250,0
0,0
Notebook PC
2000
2001
2002
2003
2004
2005
2006
51,1
33,2
68,9
138,1
221,5
570,4
757,2
2007
2008
2009
2010
1.191,3 1.236,5 2.023,5 2.385,5
Source: IDC 2011
Exper
5.8%
Others
8.5%
Acer
15.1%
LG Electronics
6.1%
Hewlett - Packard
14.5%
Samsung
6.5%
Asus
7.0%
Dell
8.7%
Lenovo
8.8%
Toshiba
10.1%
Casper
8.8%
32
ANNUAL REPORT
2.2.2 Software Market
The size of the software sub-group increased from USD 276 million in 1999 to USD 377.3 million in 2000. However, in the 2001 crisis,
just like in hardware sector, software sector decreased to USD 172.3 million with shrinkage of about 54%. In 2009 it reached 533
million USD. However, due to the pressure of the crises that has deepened in the last quarter of 2008 on the consumption tendencies,
the sales of the Turkish Software Market decreased to 609 million USD with minor shrinkage of 1% in 2009, contrary to the dramatic
shrinkage of the 2001 crisis.
As of the end of 2010, the share of the software sub-group in the entire IT market in terms of the total turnover is at very low levels in
comparison with Europe and America with 9.8% share, mainly because of pirated usages. Microsoft Office, being a commonly used
program, is the most pirated program. The laws which were enacted by the Turkish Parliament in 1995 for purpose of ensuring the
protection of the registration rights decreased the pirated usage rate. According to the estimations of our company, while 70% of the
software is illegally used in Turkey, this rate is around 35% in the USA.
Because the operating system software is purchased as incorporated into the computer, its pirated usage is less than other software.
The registration right laws had influence on the custom suppliers using pirated products most frequently. Most of the custom suppliers
use the licensed operating system software at present.
IT Sector Software Expenditures Growth Figures and Growth Targets, 2009-2014 (Mio USD,%)
16%
1.200
963
1.000
12%
760
800
10%
671
600
584
533
8%
6%
400
4%
200
2%
0
0%
2009
2011F
2010
Software
2014F
2013F
2012F
% Growth
Source: IDC 2011
Ages of the Biggest 20 Software Companies of Turkey
5
4
3
Average
13 years
2
1
0
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Source: State Planning Agency 2007, Information and Communication Technology Specialisation Commission
33
23
(% Growth)
Software
863
14%
ANNUAL REPORT
The average age of the top 20 software companies of Turkey is 13. While the imported products in the software sector have the most
important share, there is also an increase in the Turkey-based software. Because the government keeps it compulsory to use the
domestic software in some of the projects, it is expected that shares of the Turkey-origin software companies will continue to increase.
A great part of the software produced in Turkey is used by the banking, accounting, human resources and textile sectors for production.
While some part of the software companies offers the ready-to-use packages, particularly the domestic companies in the sector offer
software solutions tailored to specific requirements of their customers. Microsoft is the leader of the application software and IBM is
leader of the system software. The other major companies in the software sub-group are SAP, Oracle, Havelsan, Logo Yaz›l›m, Likom
Yaz›l›m and Link Bilgisayar.
2.2.3 IT Services Market
Contrary to the hardware and software sub-sectors, IT Services sub-sector s the constant and necessary services relating to the
existing IT investments periodically and leasing services. In the 2001 crisis, the Turkish IT Services Market decreased to 288.2 million
USD with a decrease of 39% comparing to the previous year. The volume of the Turkish IT Services Market grew faster than the total
market in 2002, reaching 403.5 million USD, and the share of the IT Services in the total market increased to a record level of 28.1%
in the same year. However, in spite of the pressure of the crisis that deepened in the last quarter of 2008 on the consumption tendencies,
the market was realized at 854 million USD in 2009.
The share of the IT Services in the total market was 15.9% in 2009, which decreased to 15.3 in 2010. However, it is expected that
this share will increase due to the needs that may arise during the integration of newer technology systems on the existing systems
and outsourcing of IT operations by big companies and banks in particular.
IT Sector IT Services Growth Figures and Growth Targets, 2009-2014 (Mio USD,%)
1.600
1.400
12%
1.336
1.200
1.000
854
909
1.204
10%
872
988
8%
800
6%
600
400
4%
200
2%
0
(% Growth)
IT Services
1.086
0%
2009
2010
IT Services
2011F
2012F
2013F
2014F
% Growth
Source: IDC 2011
‹ndeks Bilgisayar in the ICT Sector:
In Turkey, Top 500 ICT Companies Ranking performed every year by Interpro Medya A.fi., our company ranked seventh in the general
ranking based on turnover achieved in 2009 among the companies including telephone operators and mobile phone sellers. On the
other hand, it ranked first, like the previous years, in the category of companies selling only computers. Further, it ranked first in seven
IT categories.
34
ANNUAL REPORT
2009 Top 10 ICT Companies Revenue Range (Sales Revenue)
2009
Range
Company
US $ (mio)
1
Türk Telekom
6,787
2
Turkcell
5,739
3
Vodafone
1,631
4
Avea
1,608
5
KVK
1,317
6
Gen-pa
1,088
7
‹ndeks Bilgisayar
698
8
Hewlett-Packard
612
9
Teknosa
562
10
Digitürk
514
Important Events in the IT Sector in 2010:
Important events that occurred in the Turkish IT Sector in 2010 are listed below:
Business - Entertainment - Education world is recognised by Technology!
1- Announcement of smart devices
2- Announcement of tablets
3- Demand for internet connection from everywhere
4- Individual Consumer is the leader of technology world
5- Telecom campaings
6- Prevalence of Social Networking websites in Anatolia
7- Transformation of citizen << >> e-citizen
8- Turkey became the 7th biggest internet market of Europe.
9- Constitutional referandum at the end of third quarter, market started to have gradual growth.
2.3 Growth of the Turkish IT Sector:
Factors Inciting the Growth of the Turkish IT Sector:
• Rapidly Increasing Usage of Technology: All business and public companies recognise the value of the increasing control over
sources, development of productivity, expanding the business volume and analysing the customer requirements by using the
technological devices.
• Economic Performance: The development of the IT market was struck down by the economic crises of 2001 and 2008. After
the economic crisis, Turkey entered a recovery period with strict economic policies. Economic stability makes a direct positive effect
on IT investments.
• Changing Economic Structure: The importance of service sector increased, with a decrease of agriculture in the economy in
Turkey in the last ten years. The increasing operations in the service sector instigate the IT investments especially in retail, wholesale,
logistics, financial services, professional and personal services markets.
• Developing Trade with European Union-27 and other EU countries: Turkey made 38.94% of its importation from the European
Union (EU)-27 countries in 2010, respectively. When including also the other European countries in the figures, 55% of the importation
was made from the EU countries in 2010. On the other hand, 46% of the total export is made to the European Union (EU)-27 countries
in 2010. When including also the other European countries in the figures, 56% of the exportation was made to the EU countries in
2010.
Development of the trade with the European Union and Direct Foreign Investments in Turkey will increase IT investments and competition
in local industries, instigate the investments of European Union-originated companies in Turkey, which ultimately expedites the change
of quality standards in data management and analysis systems.
35
ANNUAL REPORT
Direct Foreign Investment Inflow: Direct foreign capital investments in developing countries such as Turkey, make important
contribution to the development of the country economy. It makes direct contribution to the improvement of IT investments.
The economic reforms implemented by Turkey just after the 2001 crisis and the macroeconomic stability, together with the political
stability, contributed to the improvement of the business and investment environment and broadened the horizon of the companies
in their investment decisions. With the economic and political stability environment, Turkey utilized foreign resources in considerable
amounts. The amount of the direct foreign investment flowed into Turkey was 1.8 bn USD in 2003, 2.9 bn USD in 2004, 10 bn USD
in 2005, 20.2 bn USD in 2006, 22 bn USD in 2007 and 18 bn in 2008. With the effect of the global crisis towards the end of 2008,
the foreign capital investments remained limited to 18%. However, the effects of the crisis have aggravated in 2009, which ultimately
resulted in a decrease of 58% in such investments (7.6 bn USD). In 2010, it became 7 billion USD with 8 % decrease.
Privatization: Income obtained from privatization has increased considerably in the last 5-6 years. According to the data obtained
from the Turkish Privatization Administration, the income obtained from privatization was 187 million USD in 2003, 1.3 billion USD in
2004, 8.2 billion USD in 2005, 4.3 bn USD in 2007, 6.3 billion USD in 2008 and 2.3 billion USD in 2009. 1.225 million USD, 600 million
USD and 440 million USD out of 2.3 bn USD obtained in 2009 was resulted from the privatization of Baflkent Elektrik, Sakarya Elektrik
and Meram Elektrik, respectively. In 2010, 3,1 billion USD privatisation was made.
Investments made following the privatizations by the new owners of the privatized companies in new infrastructure and technological
optimization efforts supported the growth in the IT sector.
Banking Sector: The banking sector has undergone a structural change since 2001. Banks are under the pressure of the diminishing
profitability due to the changing market conditions. Bank managements are trying to increase their profitability while protecting their
market shares. To be marketing-oriented and address to the target customer segment more efficiently have been necessary for all
banks. Most of banks have strong growing targets in all customer segments.
IT Managements in Turkish Banks replace the existing IT infrastructure in a certain schedule, instead of replacing all of them at once,
in order to use them efficiently and respond to the requirements of the competition.
Public Sector: Information Society projects conducted in accordance with the Information Society Action Plan established by the
Prime Ministry are defined one of the most important projects of the general policies of the Government. As part of such efforts, etransformation Turkey Project aims to carry out the process of transformation into an information society in a harmonious and integrated
structure under. The administration in charge of the project is the State Planning Organization attached to the Prime Ministry. The
State Planning Organisation determines its public investment program by evaluating and selecting the proposals for projects submitted
by public institutions and agencies with respect to the plan targets, public investment policies, national economy, the European Union
process, sector-specific and intersector priorities and allocating resource to the selected projects.
It is estimated that the number and amount of the projects relating to the public information and communication technology will increase
in the forthcoming period.
Telecommunication Sector: Turkey made major progress in the telecommunication sector with respect to the compliance with the
EU and catching up with the global changes in the recent years. As part of the process of the accession of Turkey to the European
Union, the chapter “Information Society and Media” was opened and the negotiations have started on 19 December 2008 because
Turkey has met the criteria for the chapter to be opened. On the other hand, the chapter “Information Society and Media” in the Third
National Program, which was adopted on 31 December 2008 to schedule the commitments of Turkey for harmonisation with the EU
acquisition, commits to complete necessary arrangements in 2009 and 2010.This commitment aims at the liberalization of the electronic
communication sector, creation of good working competition atmosphere, catching up with the development in information and
communication fields and establishment of infrastructure and legal foundations for the related fields. Accordingly, it is estimated that
a resource of about 8 million Euros will be needed for the institutional structuring for purpose of the harmonization with and implementation
of the EU acquits.
The enforcement of the Electronic Communication Law, which had been on the agenda of the telecommunication sector for five years
from 2003, on 10 November 2008 and the enforcement of the Authorisation Regulation on Electronic Communication on 28 May 2009
are some of the favourable events that occurred in the recent years. In addition to the foregoing, the enforcement of the Number
Porting Regulation at the beginning of July may be considered one of the most important steps taken for introduction of the third
generation electronic communication service.
Rapid progress of technological developments makes impact on every part of our lives and creates some concepts such as information
economy and internet economy. Extraordinary developments in the IT sector go beyond the country borders of the goods and finance
markets and take the world into an economic globalization. Besides such progress in the IT technology, telecommunication sector
also experiences many developments. As a consequence, it is inevitable that the countries that cannot keep up with such developments
will remain behind the technologically advanced countries.
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ANNUAL REPORT
Logistics Sector: Intensifying competition in the logistics sector entails to follow the business process via Supply Chain Management
(SCM) to control the supply of materials and distribution costs. Big producers operating in consumables and household appliances
feel this need considerably. Supply Chain Management solutions require making additional investments in web technologies and
communication networks, etc.
Retail Sector: Competition in the Turkish retail sector is intensifying. Investments made by international actors in the Turkish market
increasingly continue. Media Markt, Dixons, Darty, Electro World and Best Buy have also been included in the chain stores in Turkey
in the recent years. Entrance of the international actors into the Turkish market has made a favourable effect on the growth rate of
the sector. It is the first time Best Buy and Media Markt has met in the Turkish market in 2009.
Growing Individual Consumer Market: It is obvious that consumers use the IT more than before. Opportunity of payment by instalment
with credit cards and growth of retail markets rapidly support the growth of the individual consumer market. PC usage of end users
and their demand for peripherals have increased from 7% to 38% of the market between 1995 and 2009. Accordingly, the structure
of the market has changed, and individual consumers have represented the biggest share in the end user market since 2007.
Internet Technology and Portals: Corporate usage of internet technology is still improving. Data portals become common via internet
banking. The public sector is the main factor instigating the portal turnovers due to the e-government projects. Telecommunication,
production, insurance and distribution sectors use portals for developing business with partners and suppliers, enhance communication
and cooperation with customers and develop the management of the internal business processes.
According to the Information society strategy (2006-2010) report, priority subjects considered and hindrances that should be overcome
for all actions taken towards an information society are concentrated on the following items:
•
•
•
•
•
•
•
•
•
•
•
•
Increasing the sustainable growth and competitiveness,
Enhancing the life quality,
Prevention of numerical gap,
Enhancing the competence of human resource and employment,
Presentation of public services from multi-platforms in a citizen-oriented and efficient manner,
Generalizing the e-trade,
Ensuring standardization and security in information society applications,
Develop R-D and innovativeness in tune with the market and creating value accordingly,
Generalizing wide band communication infrastructure,
Enriching the content and information society applications,
Making use of the convergence potential of technologies,
Making use of media channels for development of information society.
Strategic Priorities of Turkey
According to the Information society strategy (2006-2010) report, the priorities of the Turkish Strategy are established on the following
7 foundations:
1- Social Transformation: "Opportunity for information and communication technologies for everybody". Economic and social benefit
will be increased by efficient use of citizens in their daily and working lives.
2- Penetration of Information and Communication Technologies into Business Life: "Competition advantage of companies with
information and communication technologies".
SMEs will be encouraged to prefer e-trade by increasing their computer ownership and internet access rates; the need for information
and communication technologies relating to the strategically important sectors and regions will be determined and to meet such need,
sector-specific productivity programs will be implemented.
3- Citizen-Oriented Service Transformation: "Presentation of public service in high standards"
Public services will be transferred to electronic environment starting from the frequently used and value added services via information
and communication technologies, and at the same time, the business processes will be restructured in accordance with the user
requirements, thereby making service presentation more efficient.
4- Modernization in Public Management: "Public management reform supported with IT"
An e-government formation attaching priority to efficiency and citizens’ satisfaction and having organization and process structures
in tune with the country conditions will be realized by support of IT.
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5- Global Competitive Information Technologies Sector; "Internationally acting IT Sector"
Actions to be taken are project-oriented services, improvement of the capabilities and international expansion in IT services and more
competitive sector-specific solutions in software.
6- Competitive, Widespread and Cheap Communication Infrastructure and Services; "Providing access to high quality and
cheap wide band to every level of the society"
For ensuring the improvement and widespread usage of the communicational infrastructure and services, an efficient competitive
environment will be created in the field of the telecommunication infrastructure. By this way, fast, secure, continuous and quality
communication services will be provided, and an environment suitable for the establishment of the telecommunication infrastructures
based on new technologies will be created.
7- Development of R-D and Innovativeness: "New product and services suitable to the demand of the global market"
Priority will be attached to R-D activities in the IT sector which is a highly demanded Innovative and highly value-added sector in the
global markets. Development of new technologies and transformation of such technologies into production will be supported. In
addition, for development and efficiency of R-D and innovativeness activities, ITs will be used to the maximum extent.
The first four of the foregoing strategic priorities are for the change in the daily life of the citizens participating in the economic and
social transformation, public sector and business life, and the other strategic priorities are for the IT infrastructure necessary for the
realization of such transformation, strengthening the sector that will provide such infrastructure and development of the new product
and services that will enhance the competitiveness of our country, being suitable to the demands of the market.
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ANNUAL REPORT
39
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
3. SUBSIDIARIES
ANNUAL REPORT
41
ANNUAL REPORT
3. Subsidiaries
Name of Subsidiary
Percentage of Share
Issued Capital
Datagate Bilgisayar Malzemeleri A.fi.(*)
% 59,24
10.000.000 TRL
Neteks ‹letiflim Ürünleri Da¤. A.fi.(*)
% 50,00
1.100.000 TRL
Neotech Teknolojik Ürünler Da¤›t›m A.fi.
% 80,00
1.000.000 TRL
‹nfin Bilgisayar Ticaret A.fi.
% 99,80
50.000 TRL
Neteks D›fl Ticaret Ltd. fiti. (**)
% 49,50
5.000 TRL
Teklos Teknoloji Lojistik A.fi.
% 99,99
5.000.000 TRL
(*) With %7,5 registered, total %59,24
(**) Neteks D›fl Ticaret Ltd. fiti is a 99% owned subsidiary of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi.
The financial statements of Datagate Bilgisayar Malzemeleri A.fi., Neotech Teknolojik Ürünler Da¤. A.fi. and Teklos Teknoloji Lojistik
Hizmetleri A.fi. are consolidated by full consolidation method and those of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. by proportional
consolidation method. The financial statements of ‹nfin Bilgisayar Ticaret A.fi. and Neteks D›fl Ticaret Ltd fiti are not included in the
consolidation because their low volumes of operation are not likely to be of significance for the financial statements.
3.1. Datagate Bilgisayar Malzemeleri Tic. A. fi.
Datagate is engaging in the representation, sales, distributorship, marketing, logistics and
after sales services of many IT producer supplying IT components such as microprocessors, hard
discs, memory units, optical units, motherboards, tapes, video accelerator cards, monitors, various
types of hardware supporting software.
The company was founded in Istanbul in 1992. Head office and logistic operations of the Company are carried out in Ayaza¤a Mahallesi
Cendere Yolu No: 9/2 fiiflli /ISTANBUL. . Ankara and ‹zmir offices provide service for Anatolia.
The partnership started with the acquisition of 50.5% shares of Datagate Bilgisayar Malzemeleri A.fi by ‹ndeks Bilgisayar A.fi. in 2001
reached 85.00% with an additional acquisition of 34.5% by the same company in November 2003. Partnership share of ‹ndeks
Bilgisayar decreased to 59.24% with the public offering of Datagate in February 2006.
In February 2006, the shares of Datagate Bilgisayar Malzemeleri Tic. A.fi. were offered to public successfully, restricting the preferential
rights of the existing shareholders, and begun to be traded in the New Economy Market of Istanbul Stock Exchange. Its capital, which
was TRL 1,550,000 before public offering, has increased to TRL 6,600,000 following the public offering. With the public offering, the
capital of Datagate Bilgisayar Malzemeleri Tic. A.fi. was increased from TRL 6.600.000 to TRL 10.000.000 in 2007, covering TRL
1.910.004 from the profit of the period in 2006 and TRL 1.489.996 from the Share Premiums. The maximum registered capital of
the company is TRL 20.000.000.
Datagate was subject to an Independent Audit and it achieved sales revenue of TRL 305.497.533 in 2010 according to its audit report
which is prepared in accordance with International Financial Reporting Standards as required by the Capital Market Regulations. The
financial statements show that the company earned an operating profit of TRL 4.657.774 and net profit of TRL 1.712.982 in 2010.
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The main product groups and brands distributed by Datagate are listed below:
Product Group
Brands
Hard Disk
Seagate, Maxtor
Microprocessor
Intel
Main board
Intel, MSI
Display Card
MSI, Sapphire, Gigabyte
Monitor
AOC, Fujitsu, Acer
Laptops
Acer, Fujitsu
Desktops
Fujitsu, Acer
Memory Products
Veritech, Samsung, Transcend
Server Products
Intel, Fujitsu
Card Readers
Sony
Network Products
Intel
Backup Units
Fujitsu, Seagate
Accessories
Belkin, Genius
Security products
GKB, Avermedia
Network (Modem-USB-Adaptor) products
Belkin
Projector
Acer
3.2. Neteks ‹letiflim Ürünleri Da¤›t›m A.fi.
Neteks was established to provide network and communication products to the market through its
retailers and business partners as a distributor company in 1996. Neteks has tried to provide
complete network solutions to business partners by accommodating the most experienced names
in their fields in Turkey. Besides the corporate networks systems and its components of the companies
such as Cisco, Nortel Networks, 3Com, HP, Juniper and Avocent, Neteks A.S. also distributes corporate telephone switchboard
systems of Nortel Networks and Avaya, structural cable products of HSC, Corning, Panduit and Günko, network security solutions
of Check Point, Trend Micro and IBM ISS.
The main product groups and brands distributed by Neteks are listed below:
Ürün Grubu
Markalar
Kurumsal A¤ Sistemleri
Cisco System, Nortel Networks
3Com, HP, Avocent
Kurumsal Santral Sistemleri
Nortel Networks, Avaya
Yap›sal Kablolama Çözümleri
Corning, HCS, Panduit, Günko
A¤ Güvenlik Çözümleri
Check Point, Trend Micro,
IBM, ISS
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ANNUAL REPORT
Netex was subject to an Independent Audit and it achieved sales revenue of TRL 107.884.168 in 2010 according to its audit report
which is prepared in accordance with International Financial Reporting Standards as required by the Capital Market Regulations. The
financial statements show that the company earned an operating profit of TRL 2.675.970 and net profit of TRL 1.547.920 in 2010.
70% and 24% of the share of Neteks were acquired by ‹ndeks and Datagate A.fi., respectively, in 2001. In 2007, 6% of Neteks A.fi.’s
shares which are held by other shareholders were acquired by Indeks A.fi. at US$ 374.000. Our company kept 50% of shares for
itself and sold 26% to Westcon Group European Operation Limited at US$ 1.820.000. According to the agreement signed between
the parties, 24% of the shares of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. held by Datagate Bilgisayar A.fi, as a 59,24% affiliate of ‹ndeks
Bilgisayar A.fi. and listed in Istanbul Stock Exchange, were sold to Westcon Group European Operation Limited at US$ 1.680.000.
Of the 50% shares sold, 26% and 24% were provided by ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret A.fi and Datagate
Bilgisayar Malzemeleri Ticaret A.fi., respectively. ‹ndeks Bilgisayar A.fi. and Westcon Group have had 50-50% of the shares of Neteks
A.fi after the sale of shares.
3.3. Neotech Teknolojik Ürünler Da¤›t›m A.fi.
Neotech Teknolojik Ürünler Da¤›t›m A.S. was established with a capital of 100.000 TRL on
04.02.2005. The company, being an 80% affiliate of ‹ndeks A.S., operates in wholesale marketing
of consumer electronics and communication devices. The company increased its capital from
TRL 100.000 to TRL 1.000.000 in 2007.
The main product groups and brands distributed by Neotech are listed below:
Product Group
Brands
Household Electronics Product
Homend
Home Electronics Product
Sony, Toshiba, Viewsonic, NEC
LG, Panasonic
Projectors
NEC, Canon, Viewsonic
Mobile Phones
Blackberry, Samsung, iPhone
Photo & Video
Canon
The contracts made between our company and Apple and Airties, respectively, have been transferred to ‹ndeks Bilgisayar A.fi., which
is our main shareholder, within the year.
Neotech was subject to an Independent Audit and it achieved sales revenue of TRL 122.424.058 in 2010 according to its audit report
which is prepared in accordance with International Financial Reporting Standards as required by the Capital Market Regulations. The
Company earned an operating profit of TRL 2.959.890 and net profit of TRL 829.965 in 2010 according to the financial statements.
3.4. ‹nfin Bilgisayar Ticaret A.fi.
‹nfin Bilgisayar Ticaret Anonim fiirketi was established in 2001 to help the retailers with their sales and export
operations within the framework of investment operations under incentive certificates.
Due to the fact that its biggest part of purchase and sales of the company was arisen out of the companies
included in the financial statements, and its business volume was so low that does not make any impact on the financial statements,
this company is left out of the said statements
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ANNUAL REPORT
3.5. Teklos Teknoloji Lojistik A. fi
This company was founded under the name of Karadeniz Örme Sanayi A.fi. to operate in textile sector on
03.01.1973. In March 2006, ‹ndeks has executed an important and greatest investment in IT sector by
purchasing Karadeniz Orme A.S., which is founded on a 39,761 square meters land and having 18,969
square meters indoor area, in order to be used as a logistics headquarters. The trade name of Karadeniz
Orme AS has been changed into Teklos Teknoloji Lojistik Hizmetler A.fi. and its field of activity has been changed to as logistics
services.
Teklos Teknoloji Lojistik Hizmetler A.fi. is providing logistic services to the companies operating in the IT sector. The company distributed
10.287.389 units of products and 515.427 cartons in 2009.
Teklos was subject to an Independent Audit and it achieved sales revenue of TRL 6.160.060 TRL in 2010. According to its audit report
which is prepared in accordance with International Financial Reporting Standards required by the Capital Market Regulations. The
statements show that the company earned an operating profit of TRL 3.388.433 and net profit of TRL 2.742.279 in 2010.
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‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
4. OPERATION
ANNUAL REPORT
47
ANNUAL REPORT
4. Operation
The supply and distribution structure of Indeks Bilgisayar A.fi. is shown as follows:
1. Structure of Product Supply and Distribution:
Indeks operates as a main distributor (“broadline distributor”) in IT industry. It buys IT products from suppliers at certain prices and
maturity periods and subsequently sells the products to the sales channels that will sell them to the end user. The company does
not plan to develop a sales structure that will include direct sales to the end user in the near future.
Supplier
Supplier
Supplier
Supplier
Supplier
Supplier
‹NDEKS B‹LG‹SAYAR A.fi.
System
Integrators
Value Added
Dealers Channel
Regular Dealers
Retail
Chain
Retail Channel
Regular
Shops
E-Commerce
END USER
1.1 Suppliers:
The hardware and software suppliers of the company are grouped into two categories.
• Global brands that operate in Turkey: ((IBM, HP, LENOVO, INTEL, SEAGATE, CANON, OKI, SYMANTEC, MICROSOFT, APC,
FUJITSU SIEMENS, EPSON, TOSHIBA, SONY, ASUS): As this is the nature of the business, these global companies prefer working
with distributors which are less in numbers instead of handling distribution,
• Global brands that do not operate in Turkey: (KINGSTON, NEC, VIEWSONIC, WESTERN DIGITAL) These companies have not set
up offices in Turkey yet. However, these companies conduct their imports, sales and marketing activities through the dealership of
distributors.
1.1.2 Distribution Channel:
As a distribution company, Indeks buys the products from suppliers. Furthermore, it resells them to the sales channels which sell to
the end user. The structure of distribution channels which Indeks sells to and which sell IT products to the end user in Turkey is
summarised below:
1.1.2.1 Solution Provider Dealers Channel (System Integrators)
With respect to the number of people they employ, companies in this channel have at least 100 employees. They are among the
relatively old companies in the industry. The end user these companies target is solely the big corporate customers. They have
experience in the industry and have especially high service, sales and product recognition capabilities. The main target of the companies
in this channel is to adapt new technologies to corporate customers.
The numbers of these companies are not more than 100 all over Turkey at the moment.
1.1.2.2 Value Added Dealers:
With respect to the number of people they employ, companies in this channel have 25-100 employees. These companies are more
limited with respect to capital but thanks to their young and dynamic structures, they are able to make quick decisions and operate
on low margins by keeping costs down. Their target group is multinational companies and corporate customers with generally one
location.
Distributors support these companies with respect to finance, logistics, and product information. These companies do not have an
intensive relationship with the manufacturers. The numbers of these companies are more than 500 all over Turkey.
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ANNUAL REPORT
1.1.2.3 Regular Dealers (Classic):
These are pretty small companies with a staff of 5 to 25. They do not have their own unique solutions. Their target is SMEs and the
home market. They number at least 4.000 to 5.000 and are the biggest group in the IT industry.
These companies carry out their operations fully with distributor company resources. Their sales are more directed towards OEM
products and peripherals than branded products.
1.1.2.4 Retail Channel
In the recent years, Retail Chains diversified and reached huge transaction volume with the reason of investments made by local chains
shops and the investment also made by international chains in this category. Furthermore, Food Chain Shops and Dowry Shops
increased their business volume. Majority of home market needs is provided by above mentioned chain shops in Turkey. For Indeks,
there are 3 types of retail groups:
• Retail Chains:
The retail chains are big groups having more than one store under the same brand such as Teknosa, Bimeks, Vatan, Gold,
Media Markt , Darty, Electro world, Best Buy Teknolojiks, NT, Yalç›nlar, Evkur, Metro, Migros, Real, Carrefour, Tesco/ Kipa.
The main function of some groups of this category is computer, while some of them such food markets and dowry shops
are chains dealing with computer as a secondary business.
• Regular Computer Stores (Classic):
These stores are small companies where the owner of the store and a few sales representatives work and they operate
with limited resources. They are totally focused on computers.
• E-Retail:
This channel is based on virtual markets which open virtual stores and operate in the internet medium. Due to the widespread
usage of the internet in the recent years, the number of the companies operating in this channel is increasingly growing.
The companies such as Hepsiburada, e-store are the examples of this type of channel.
2. Logistic
Indeks makes sales and distribution via its 382 employees and more than 7000 dealers with companies included into consolidation
in its financial statements to 81 provinces of Turkey from its logistic centres in Istanbul, Ankara and Izmir.
The branch offices in Ankara and ‹zmir established in 1992 and 1995, respectively, operate as “district offices”. Having their own
logistic, sales, accounting, finance, current accounts and customer services departments, they are responsible for sales to the dealers
and development of the sales channels in their cities. Ankara office is responsible for the district Ankara, Central Anatolia and Eastern
Anatolia Regions, ‹zmir Office for the District Izmir, Western Anatolia and Aegean Regions. The areas not included the foregoing shall
be under the responsibility of the headquarters in Istanbul.
Indeks has executed one of the most important and greatest investments in IT sector by purchasing Karadeniz Orme A.fi., which is
founded on a 39,761 square meters land and having 18,969 square meters closed area, in order to be used as a logistics headquarters.
The trade name of Karadeniz Orme A.fi. has been changed into Teklos Tekn oloji Lojistik Hizmetler A.fi. and its field of activity has
been customized to be able to work on the logistics services. Teklos Teknoloji Lojistik Hizmetler A.fi. is providing logistic services to
the group companies and other companies in IT sector as well. The head office of the company moved to its new location on
26.10.2006.
Indeks has also district warehouses in Ankara and Izmir.
3. Invoicing and Collection
Indeks makes sales to almost all companies dealing with computer and IT products.
This kind of dealers, which are estimated as number about 5,000 in total in Turkey, are considered Regular Dealer (Classic Dealers).
Credit Committee:
Credit claims of the dealers are submitted to the Credit committee that does meetings every week on a regular basis for this purpose.
These meeting are organized with headed of CFO (Assistant General Manager responsible for Financial and Operational Affairs),
Assistant CFO, Finance Manager, Credit & Risk Manager and Sales Managers of related customers.
4. Technical Support and Customer Service
The Company does not provide after sale service. Instead, it directs its customers to the companies of each product authorised to
provide service. It is because the suppliers prefer their own solution partner to provide service to the end user.
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ANNUAL REPORT
5. Marketing and Sales
Due to the structure of the IT industry, the technologies and prices of the products that Indeks distributes are subject to frequent
changes and improvements. Therefore, an efficient and effective inventory management and rate of inventory turnover may make
significant impact on the operational performance of companies.
Considering the dynamic structure of the industry, Indeks assigns one product manager for each group of product. The product
managers have the mission of understanding the requirements of the sales groups with differing targets and objectives are comprehended
better and therefore, the Company provides better service to such groups, following up the market and technology trends, executing
the marketing activites.
Exchange of information with customers are provided via web, e-mail and fax.
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51
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
5. CORPORATE GOVERNANCE
PRINCIPLES COMPLIANCE
REPORT 2010:
ANNUAL REPORT
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ANNUAL REPORT
5. Corporate Governance Principles Compliance
Report 2010:
1. Corporate Governance Principles Compliance Statement
Our Company complies with and applies the Corporate Governance Principles published by the Capital Markets Board within the
operating period between 01.01.2010 and 31.12.2010. These principles are adopted by the company management. Some of these
principles were adopted immediately, and works continue to fulfil the deficiencies.
SECTION I - SHAREHOLDERS
2. Shareholders Relations Department:
We have established an Investor Relations Department in order to facilitate the relations with the shareholders. The Department carries
out it activities reporting to Asst. General Manager-Finance Halil Duman, and contact information of the responsible people are as
follows.
Name & Surname
Title
E-mail address
Telephone No.
Halil Duman
Assistant General Manager
[email protected]
0-212-312 21 09
Naim Saraç
Internal Audit Manager
[email protected]
0-212-331 21 15
Halim Ça¤layan
Accounting Manager
[email protected]
0-212-331 23 70
Emre Ba¤c›
Internal Auditor
[email protected]
0-212-331 21 17
During the period, Investor Relations Department has provided information to the shareholders and intermediary institution analysts,
and to this end, questions asked via telephone, fax or e-mail were answered. Questions asked by the shareholders and intermediary
institutions during the period were answered pursuant to CMB's "Communiqué on the Disclosure of Special Events to the Public"
Series VIII, No. 39. Besides, our Company makes a press conference each year, evaluates the previous year, publishes the targets
for the relevant year, thus informs the investors. Recently, a press conference was made on 05.04.2011 for the group companies,
and information was provided on the activities.
3. Use of Shareholders' Rights to Obtain Information:
Shareholders direct their requests to our Company to obtain information via telephone, fax or e-mail. A great part of the questions
asked by the investors are on the subsidiaries of the Company, contents of the concluded distributorship contracts, capital increase,
and share certificate activities. No distinction is made among shareholders as regards the exercise of the right to obtain information.
Aside from the annual press conferences, disclosure of special events submitted to ISE is another method for providing general
information. Our special event disclosures are also published on our web-site simultaneously. In order to help shareholders to use
their rights to obtain information in an efficient way, detailed information is given www.index.com.tr, in the investors.
Assignment of a special auditor is not arranged as an individual right in the Articles of Association. In order to ensure shareholders
to use their rights to obtain information, the principle has been adopted allowing minority shareholders to notify any subjects, they
are doubtful of and request inspection of, to the Auditing Committee, and thus, investigation of such subjects. During the period no
request was made for assignment of a special auditor.
Moreover, in order to help foreign investors to use their rights to obtain information, an English version of the investors section of our
website has been prepared, and company information, financial statements and notes, operation reports, and research reports were
uploaded to this section.
4. Information on General Assembly:
2009 General Assembly of our Company was held on 20.04.2010. The General Assembly resolved the followings unanimously:
- Acceptance of the accounts of the 2009 Balance Sheet and Income Statement,
- Acquittal and discharge of the Board Members and Auditors with respect to the accounts in 2009, and
- Hiring AGD Ba¤›ms›z Denetim ve Dan›flmanl›k SMMM A.fi. for Independent Audit Services to be provided for the 2010 financial
statements,
The Company has a net profit after tax amounting to TRL 15.934.942 given in its financial statements for the year 2009, which
were prepared pursuant to Communiqué of the Capital Markets Board Series XI, No. 29.
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ANNUAL REPORT
- TL 544.647,09, which composes 5% of the net profit, i.e. TL 10.892.941,74 according to the legal records will be retained as
the 1st Issue Reserve Fund,
- The First Dividend will be distributed in amount of gross TL 6.156.117,97 (TL 0,109931 for 1 share with a nominal value of TL
1 in the rate of 10,9931%) and net TL 5.232.700,27 (TL 0,093442 for 1 share with a nominal value of TL 1 in the rate of 9,3442%),
corresponding 40% of the net distributable profit, i.e. TL 15.390.294,91 found by deducting the 1st Issue Reserve Fund in amount
of TL 544.647,09 from TL 15.934.942 , which is the net profit after tax.
- The Second Dividend will be distributed to the Preferred Group A Shareholders in amount of gross TL 461.708,85 (TL 1.451,09
for 1 share with a nominal value of TL 1) and net TL 392.452,52 (TL 1.233,43 for 1 share with a nominal value of TL 1), corresponding
5% of TL 9.234.176,94 remaining after deducting the first dividend, i.e. TL 6.156.117,97 from TL 15.390.294,91, which is the net
distributable profit of the period,
- Starting for profit distribution on 04 May 2010,
- Allocation of the remaining amount as extraordinary reserve funds,
- Election of Mr. Veli Tan Kirtifl and Mr. Haluk fien as the Members of the Auditing Board for a term of office of one year, unanimously.
5. Voting Rights and Minority Rights:
In general, there is no privilege concerning voting rights. However,
• Pursuant to the Article 9 “Board of Directors and its Term of Office” of the Company's Articles of Association, "Half plus one of
the members of the Board of Directors are elected from the candidates nominated by the Group A shareholders.”
• Pursuant to Article 12 "General Assembly" of the Articles of Association, the rights given to the shareholders who represent at least
one-tenth of the principal capital by the Articles 341, 348, 356, 359, 366, 367 and 377 of the Turkish Code of Commerce, shall be
used by shareholders who represent at least one-twentieth of the principal capital.
• There is no company, holding shares in cross-ownership. Pursuant to the above explained provision of the Articles of Association,
the method of minority shares' representation in the board of directors and use of accumulated votes is not applicable.
6. Dividend Distribution Policy and Deadline for Dividend Distribution:
Our Company's Dividend Distribution Policy is to distribute in cash or in bonus share, or partly in cash and partly in bonus share,
provided that it is no less than the minimum amounts stipulated by the Capital Market legislation, considering long-term growth and
strategies, investments and fund requirements, profitability and the expectations of shareholders, excluding the special conditions
required by extraordinary conditions in the economic conditions. Profit distribution for 2010 was done on time on 04 May 2010 as
stated.
7. Transfer of Shares:
The Articles of Association of the Company does not contain any articles limiting the transfer of shares.
SECTION 2 - PUBLIC DISCLOSURE AND TRANSPARENCY
8. Company Information Disclosure Policy
The company information disclosure policy was formed in accordance with Article 20 of the articles of association regulating "Public
Disclosure and Transparency".
Disclosure of information to the public is made pursuant to the relevant provisions of the capital markets legislation.
An information policy for public disclosure is prepared and announced to the public. Information to be disclosed to the public are
submitted to the use of public in a timely, accurate, complete, understandable, interpretable, accessible and equal manner.
Ethical rules of the Company shall be determined by the Board of Directors and submitted to the information of the General Assembly.
Implementations of ethical rules are announced to the public. Company's principles on social responsibility are also included within
these rules.
In use of shareholder's rights, it is complied with the relevant legislation, to which the Company is subject to, this Articles of Association,
and other In-Company regulations. The Board of Directors takes the necessary measures to ensure use of shareholder's rights.
For the purpose of extending the shareholders' right to get information, submission of any information which may affect the use of
rights to the shareholders in electronic media is considered with great care.
Annual operation report, financial statements and reports, dividend distribution suggestion, articles of association amendment proposals,
organisation changes, and other important information regarding the activities of the Company to be kept accessible to shareholders'
inspection in the head office and branches of the Company and in electronic format at the Company website considered with great
care.
Commercial relations with the Group companies and other partners are performed within the scope of market prices.
55
ANNUAL REPORT
Due care shall be given in preparation of the periodical financial statements and statement footnotes to reflect actual financial condition
of the Company, and to ensure that Company Operation Report provides detailed information on the activities of company.
Consultancy activities and Independent Audit Companies are separated. Independent Audit Company is elected for maximum 5
periods. Independence of such companies is strictly protected.
Accordingly, new distributorship agreements were disclosed to the public by the Chairman of the Board and General Managers via
disclosure of special events. Names and duties of people responsible as regards the information policy are given below.
Name & Surname
Title
E-mail address
Telephone No.
N.Erol Bilecik
Chairman of the Board
[email protected]
0-212 331 21 11
Atilla Kayal›o¤lu
General Manager - ‹ndeks
akayal›[email protected]
0-212 331 21 11
Salih Bafl
General Manager - Datagate
[email protected]
0-212 332 15 00
Erhan Do¤an
General Manager - Neteks
[email protected]
0-212 331 23 23
Erol Çetin
General Manager - Neotech
[email protected]
0-212 331 21 71
Our Company's website at www.index.com.tr is used as a communication channel pursuant to the points determined in CMB's
Corporate Governance Principles, for the use of shareholders, investors, intermediary institution analysts, and other stakeholders.
9. Disclosure of Special Events:
The Company has made 23 Disclosures of Special Events in the period between 01.01.2010 – 31.12.2010, and no additional clarification
was asked by CMB or ISE. The Company has duly fulfilled all its liabilities regarding disclosure of special events.
10. Company Website and Contents:
Our Company has a website at the address of www.index.com.tr. Our website includes commercial register information, final status
of partnership and management structure, members of the Board of Directors, Auditing Board, Auditing Committee, information on
general assembly, Company's Articles of Association, periodical financial statements and reports, independent auditor's report, annual
reports, information on public offering, and disclosure of special events made by the Company.
11. Disclosure of the Company's Ultimate Controlling Individual Shareholder/ Shareholders:
Following public offering, our Company's ultimate controlling individual shareholders are given below.
Shareholder's Name
Country
Shares %
Nevres Erol Bilecik
T.C.
41,06 %
12. Disclosure of Insiders:
The list of individuals who can be classified as an insider are as follows.
Members of the Board of Directors
Nevres Erol Bilecik
Salih Bafl
Atilla Kayal›o¤lu
Ayfle ‹nci Bilecik
Halil Duman
Auditors assigned pursuant to the Turkish Code of Commerce
Veli Tan Kirtifl
Haluk fien
56
ANNUAL REPORT
General Manager of the Company and other Managers
Atilla Kayal›o¤lu
General Manager
Halil Duman
Assistant General Manager - Finance
Naim Saraç
Internal Audit Manager
Halim Ça¤layan
Accounting Manager
Birgül Öztürk
Finance Manager
Chartered Accountant
Hakk› Dede
Other Related Company Managers
Tayfun Atefl
Datagate A.fi.
Board Member
O¤uz Gülmen
Despec A.fi.
General Manager
Erhan Do¤an
Neteks A.fi.
General Manager
Erol Çetin
Neotech A.fi.
General Manager
Yi¤it Deniz
Neteks A.fi.
Accounting Manager
SECTION III – STAKEHOLDERS
13. Informing Stakeholders:
Stakeholders are regularly informed by the Company concerning any issues related to themselves. E-mail and the company's website
are essential means of information. Each year at least one meeting is held with the suppliers separately. Regional informational meetings
are made with the vendor channel throughout Turkey. Informational meetings with dinner are made for the employees and their spouses
at least once each year to notify the developments related to the Company.
14. Participation of the Stakeholders in the Management:
There is no special arrangement for participation of the stakeholders in the management. However, within the scope of vendor directed
special channel programs, product supply and sales policies of suppliers are performed in conjunction.
15. Human Resources Policy:
The human resources policy of our Company, which is also published on www.index.com.tr is as following:
Our personnel policy is based on the target of becoming a company admired and appreciated by all our employees.
Essential criteria composing our personnel policy are;
• Ensuring that our employees do not worry about their future,
• Ensuring that the employees have confidence in the managers and the company,
• Measuring the performance of all employees, and managing the success criteria in line with these
measurements,
• Displaying a transparent management,
• Ensuring easy access to management,
• Ensuring that employees have freedom and convenience of expression,
• Caring about work discipline,
• Ensuring that all personnel work not individually but with a team spirit,
• Caring about career planning,
• Organizing social activities,
• Providing efficient working environment and conditions.
The satisfaction of the personnel of our Company is measured via “Personnel Satisfaction Survey” conducted each year, the areas
that need to be improved are determined and corrective steps are taken.
There is no discrimination, under no circumstances, based on ethnic origin, sex, colour, race, religion or other faiths in our Company.
No complaints of discrimination have been filed to the management.
57
ANNUAL REPORT
16. Information on Relations with the Clients and Suppliers:
Achieving customer satisfaction in marketing and sale of products and services is one of our important and indispensable targets.
To achieve it, in-company procedures were prepared and are currently applied. Visits are made to customers and suppliers, and
occasionally customer satisfaction surveys are made to learn their expectations and find solutions. As a result of such works, it was
awarded ISO 9001:2000 in 2004.
Product Supply and Distribution Structure;
The company operates as a main distributor (“broadliner distributor”) in IT industry. It buys IT products from suppliers at certain prices
and maturity periods and subsequently sells the products to the sales channels that will sell them to the end user. The company does
not plan to develop a sales structure that will include direct sales to the end user in the near future.
Suppliers;
The hardware and software suppliers of the company are grouped into two categories. 90% of the business volume of the Company
is achieved with the products of such international companies.
17. Social Responsibility:
We show respect to the society, nature and environment, national values, customs and traditions; in the light of our transparency
principle, we provide reliable information to shareholders and stakeholders, also considering the rights and benefits of our Company,
in a timely, accurate, full, understandable, analysable and easily accessible condition, on the company management, financial and
legal status; we comply with the laws of the Republic of Turkey; we act in accordance with the legislation in force in all our operations
and decisions. During the year, no lawsuits were filed against the Company for environmental issues.
SECTION IV - BOARD OF DIRECTORS
18. The Structure and Composition of the Board of Directors and Independent Members:
Board of Directors
Title
Executive/Non-Executive
Nevres Erol Bilecik
Chairman
Executive
Salih Bafl
Vice Chairman
Non-Executive
Atilla Kayal›o¤lu
Member/General Manager Executive
Ayfle ‹nci Bilecik
Member
Non-Executive
Halil Duman
Member
Executive
There are no independent members in the Board of Directors, and election of independent members was not provided in the Articles
of Association. Each year, in the Ordinary General Assembly meetings, permission is given to the Chairman and Members of the Board
of Directors, pursuant to Articles 334 and 335 of the Turkish Code of Commerce, to perform the works, in person or on behalf of other
people, included in the subject of the Company, and to become partners in companies performing these types of activities, and to
perform other relevant operations. Other affiliates of the Company are represented in the Board of Directors. As these companies
operate in the IT sector but have different specialization areas, it is permitted to the Members of the Board of Directors to perform
tasks in other companies.
19. Qualifications of Board Members:
Minimum and essential qualifications required in the Members of the Board of Directors are regulated in Article 9 "Board of Directors
and Its Term of Office" of the Company's Articles of Association. All Members of the Board of Directors meet the qualifications listed
in CMB's Corporate Governance Principles, Section IV, Articles 3.1.1, 3.1.2 and 3.1.3.
20. Mission, Vision and Strategic Goals of the Company:
Our Company’s mission is to “Continue its leadership by providing service as a main supply centre of IT products for all companies
in the computer channel considering their changing requirements”. This definition has been determined by the Board of Directors and
announced to the general public through the website of the Company.
Our Company’s vision is to “Be an IT Distributor capable of meeting all requirements of the computer channel from one single point.”
Managers each year prepare a business plan and submit to the Board of Directors, which upon approval becomes effective as of the
first week of January. Strategic business plan, income and expenditure budgets, which are prepared at the beginning of December,
are evaluated by the Board of Directors which convenes regularly each month.
58
ANNUAL REPORT
21. Risk Management Mechanism and Internal Control:
Risk management has an important place within the constant activities of our Company. Main starting point of risk management is
identification and follow-up of all risks, which our Company has confronted with or it is probable to confront. Our managers target
to ensure that applications which improve and develop risk management are constantly implemented in the Company. Current and
probable risks of our Company are categorized as follows:
a- Payment Risk: Dealer channel, which is described as regular dealers within the distribution structure, has low capital structure.
This group of dealers, which is considered to have a number of approx. 5,000, is transferred frequently, therefore, their opening and
closing ratio is rather high. The Company makes sales to almost all companies dealing with the trading of computer.
b- Constant Renewal of Product Technologies: The most important feature of the sector we operate in is that technology and prices
of the products are constantly changed and renewed. Companies who fail to adjust their inventory turnover to this change may face
with the risk of loss.
c- High Competition in the Sector and Profit Margins: Manufacturer companies in the sector have a high competition worldwide as
brands. The competition of manufacturer companies reflects to the prices in the national market. For companies which have weak
financing and cost structure, this situation causes an important risk.
d- Exchange Rate Risk: A great part of the IT products are imported from foreign countries or purchased from domestic sources in
foreign currency. When buying products the Company is often credited in foreign currency, and then payments are made in these
currencies. Companies, which do not formulate their sales policy based on product-in-currency, are faced with loss risk when foreign
exchange rate increases.
e- No exclusivity clause in appointing of distributors by the manufacturer companies: In distributorship contracts made with manufacturer
companies there is no reciprocal exclusivity relation. Manufacturer companies, when appointing distributors, may appoint other
distributors as well according to the conditions of the market, and distributor companies may sign distributorship contracts with other
manufacturer companies.
f- Changes made in importation regimes: Changes occasionally made by the Governments in importation regimes effect the importation
positively, but such changes may sometimes have negative effects as well.
Due to the foregoing risks and for controlling all assets and liabilities of the Company, an Internal Audit Department reporting directly
to the Chairman of the Board is established. Further, our current accounts and risk management department investigates our dealers.
These inquiries are intended to reveal current account relations of the dealers with other suppliers, their relations with banks and other
financial institutions and whether they issue any bad cheques or not. Credit Committee: The reports on the computer companies which
completed their first year in the industry and those whose credit line has been extended are drawn up by the risk control analysts and
presented to the credit committee that meets in certain days each week. The credit committee determines credit lines for each company
according to the data from their investigation, past payment data and sales performance. The credit committee determines the working
method, and if required, asks dealers to submit a cheque endorsed by a third party or give a further security in mortgage form. Credit
lines exceeding a certain amount are evaluated at the weekly meetings of the executive committee, and any excess of credit lines is
subject to the approval of the executive committee.
22. Authority and Responsibilities of the Members of the Board of Directors and Managers:
Authority and Responsibilities of the Members of the Board of Directors and Managers are defined in the Articles
of Association with reference to the relevant provisions of the Turkish Code of Commerce.
23. Principles of Activity of the Board of Directors:
The Board of Directors has convened 9 times within the period between 01.01.2010 and 31.12.2010. The agenda and statements
relating to the meeting are passed to the Members of the Board of Directors in advance. Such communication is handled by the
secretary of the Chairman of the Board.
While no resolutions are made in some of the discussed topics, the minutes of the topics which were resolved are not disclosed to
the public. On the other hand, important subjects resolved in the meeting of the Board of Directors are announced to the general
public through Disclosure of Special Events.
24. Prohibitions Concerning Transactions and Competition with the Company:
The required permission was granted by the General Assembly to the Members of the Board of Directors to carry out transactions
and competition with the Company as specified in Articles 334 and 335 of the Turkish Commercial Code.
59
ANNUAL REPORT
25. Ethical Rules:
The Board of Directors of the Company has formulated the ethical rules for the employees. These rules are included in the prospectus
which was published during the public offering of the company, and can be found in the investors section of the company website
at the address of www.index.com.tr.
26. Number, Structure and Independence of Committees Established by the Board of Directors:
Auditing Committee of our Company is composed of Mr. Salih Bafl and Mrs. Ayfle ‹nci Bilecik. The committee met 4 times in 2010
Auditing Committee audited and inspected the accounting system and financial data of the Company, controlled whether the financial
statements reflected the actual financial status, and found out compliance to generally accepted accounting principles and financial
legislation.
There are not independent members in the Board of Directors, therefore, the members of the committee are not independent, either.
Executive members of the Board of Directors do not take office in any committee. At the meeting of the Board of Directors of the
Company held on 29.04.2009, it was resolved to establish a Corporate Governance Committee, and to elect Salih BAfi, who is a
Board Member, as the Chairman of the Committee, and Ayfle ‹nci Bilecik and Halil Duman, who are Board Members, as the members
of the Committee.
27. Remuneration of the Board of Directors:
Members of the Board of Directors do not get any remuneration. The Chairman and Deputy Chairman of the Board of Directors and
President of the Executive Board, also the General Manager and Deputy General Manager get monthly salaries related to their tasks.
The Company did not lend any money, extend any credit, extend a personal credit through a third party, nor provided any guarantees
to or in favour of any Member of the Board of Directors or any Manager of the Company.
60
ANNUAL REPORT
61
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
6. BOARD OF
DIRECTORS'
SUGGESTIONS ON
DIVIDEND DISTRIBUTION
ANNUAL REPORT
63
ANNUAL REPORT
6. Board of Directors' Suggestions on Dividend
Distribution
The Board of Directors has convened at the company head office, and resolved:
a) that a motion would be submit to the Ordinary General Assembly to be held on 06.05.2011 for distribution of the first dividend in
amount of 30% of the net distributable profit of 2010.
b) that if adopted by the Ordinary General Assembly, the amounts of dividends to be distributed for the profit of 2010 would be
determined as following:
- The net profit after tax of the Company is TRL 13,171,469 as given in its consolidated financial statements for the year 2010,
which were prepared pursuant to Communiqué of the Capital Markets Board Series XI, No. 29.
- Set up 1st Issue Reserve Funds as TRL 413.959,12 which is 5% of net profit occurred as TRL 8.279.182,39 in accordance with
Tax Law.
- The First Dividend will be distributed in amount of gross TRL 3.830.021,96 (TRL 0,0683936 for 1 share with a nominal value of
TRL 1 in the rate of 6,83936%) and net TRL 3.255.518,67 (TRL 0,0581346 for 1 share with a nominal value of TRL 1 in the rate
of 5,81346%), corresponding 40% of the net distributable profit which occurred after deduction of 1st Issue Reserve Funds, TRL
413.959,12, from Net profit after tax TRL 13.171.469 and with adding donation TRL 9.230.
- The Second Dividend will be distributed to the Preferred Group A Shareholders in amount of gross TRL 446.835,90 (TRL 1.404,35
for 1 share with a nominal value of TRL 1) and net TRL 379.810,51 (TRL 1.193,70 for 1 share with a nominal value of TRL 1),
corresponding 5% of TRL 8.936.717,92 remaining after deducting the first dividend of TRL 3.830.021,96 from TRL 12.766.739,88,
which is the net distributable profit of the period,
- TRL 147.685,79 will be retained as the 2nd Issue Reserve Fund,
- The distribution of dividend will be started on 17 May 2011,
c) That the remaining amount would be added to the extraordinary reserve funds.
Suggested dividend distribution table is given below.
64
ANNUAL REPORT
65
ANNUAL REPORT
1. Paid-up / Isuued Capital
56,000,000
2. Total Legal Reserve Fund (according to Legal Records)
4,608,765.84
5% of the profit remaining after allocating
If there is preference in divident distribution pursuant to the Article of Association, information on preference
1st issue legal reserves and first dividend
are paid to preferred shareholders
According to
Legal Records
According to CMB
3.
Profit for the Period
4.
Taxes Payable (-)
5.
Net Profit for the Period (=)
6.
Losses from Previous Years (-)
7.
First Issue Legal Reserves (-)
8.
NET DISTRIBUTABLE PROFIT FOR THE PERIOD (=)
9.
Charitable contributions made in the year (+)
10.
Net distributable profit for the period including the charitable c
11,057,588.39
4,347,057.00
2,778,406.00
13,171,469.00
8,279,182.39
0.00
0.00
413,959.12
413,959.12
12,757,509.88
7,865,223.27
9,230.00
ontributions with which the first dividend will be calculated
11.
17,518,526.00
12,766,739.88
First Dividend to Partners
3,830,021.96
Cash
3,830,021.96
Free of charge
0.00
Total
3,830,021.96
12.
Dividends Distributed to Preference Share Owners
13.
Dividends to members of the Board of Directors, personnel, etc.
0.00
14.
Dividends Distributed to Bonus Share Owners
0.00
15.
Second Dividend to Partners
16.
Second Issue Legal Reserve Fund
17.
Statutory Reserves
18.
Special Reserves
19.
EXTRAORDINARY RESERVES
20.
Other Resources Considered for Distribution
-
446,835.90
0.00
147,685.79
0.00
0.00
8,332,966.23
3,440,680
0.00
0
Profit from Previous Year
-
Extraordinary Reserves
-
Distributable pursuant to the Law and the Articles of Association
INFORMATION ABOUT DIVIDEND TO BE DISTRIBUTED(1)
DETAILS OF DIVIDEND PER SHARE
TOTAL AMOUNT
OF DIVIDEND (TRL)
GROUP
DIVIDEND CORRESPONDING WITH 1
SHARE WITH A NOMINAL VALUE OF TRL 1
RATE
%
AMOUNT
GROSS
NET
To the Holders of Preferred Shares (Group A)
446,835.90
1,404.35
140,434.94%
To the Holders of Ordinary Shares (Group B)
3,830,021.96
0.0683936
6.83936%
TOTAL
4,276,857.86
To the Holders of Preferred Shares (Group A)
379,810.51
1,193.70
119,369.70%
To the Holders of Ordinary Shares (Group B)
3,255,518.67
0.0581346
5.81346%
TOTAL
3,635,329.18
RATE OF NET DISTRIBUTABLE DIVIDEND TO THE PROFIT FOR THE PERIOD INCLUDING CHARITABLE CONTRIBUTION
AMOUNT OF
DIVIDEND
DISTRIBUTED
TO SHAREHOLDERS (TRL)
RATE OF NET DIVIDEND DISTRIBUTED TO SHAREHOLDERS TO
THE PROFIT FOR THE PERIOD INCLUDING CHARITABLE CONTRIBUTION (%)
4.276.857,86
SUMMARIZED DIVIDEND
Preferred (Group A)
33,50 %
Total Gross Dividend
Tax Deduction
Total Net Dividend
446,835.90
67,025.38
379,810.51
Ordinary Shares (Group B)
3,830,021.96
574,503.29
3,255,518.67
Total
4,276,857.86
641,528.68
3,635,329.18
66
ANNUAL REPORT
67
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
7. AUDITING BOARD’S
REPORT
ANNUAL REPORT
69
ANNUAL REPORT
7. Auditing Board’s Report
AUDITING BOARD'S REPORT
To the General Assembly of
‹ndeks Bilgisayar istemleri Mühendislik Sanayi ve Ticaret A.fi.
Title
: ‹ndeks Bilgisayar istemleri Mühendislik Sanayi ve Ticaret A.fi.
Head Office
: Ayaza¤a Mah. Cendere Yolu No: 9/1 fiiflli – ISTANBUL
Capital
: TRL 56.000.000
Fields of Activity
: Purchase and sale of computers of any kind, providing technical and software
support and their sales, purchase and sale of computer parts, accessories
and consumables of any kind.
The auditors' names, terms of office, whether
they are partners or personnel of the company,
or not
: Veli TAN K‹RT‹fi, Haluk fiEN: Term of office is 1 year, and they are not
partners or personnel of the company.
Number of the Board of Directors meetings
attended or Auditing Board meetings held
: Attended the Board of Directors Meetings for 2 times.
Scope, dates and consequence of examinations : The legal book records and the documents concerning the semi-annual and
performed on the company's accounts, books
annual balance sheets of the company have been examined. We confirm
and documents
that the mentioned book records and documents reflect the actual situation.
Numbers and conclusions of the counting made
in the shareholding cash office in accordance
with the sub-paragraph 3, paragraph 1, article
353 of the Turkish Code of Commerce
: The company cash office was counted 3 times within the period, and as a
result of the counting, it was seen that the actual cash assets comply with
the corresponding records.
Dates and conclusions of the examinations
performed in accordance with the
sub-paragraph 4, paragraph 1, article 353 of
the Turkish Code of Commerce
: The presence of the guarantees and valuable papers listed in the company's
records was checked, and it was seen that they comply with the corresponding
records.
Complaints and irregularities reported and
measures taken in respect of the same
: No complaints or irregularities have been reported to us.
We have examined the accounts and transactions of ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret Anonim fiirketi for the
accounting period between 01.01.2010 to 31.12.2010 for compliance with the requirements of the Turkish Code of Commerce, the
company's Articles of Association, other relevant legislation, and generally accepted accounting principles and standards.
In our opinion the enclosed balance sheet issued as of 31.12.2010, the contents of which we certify, accurately reflects the true
financial standing of the company as of the same date; and the profit & loss statement for the period between 01.01.2010 and
31.12.2010 accurately and truly reflects the results of business activities during the same period, and the suggestion of profit allocation
is in compliance with the legislation in force and the articles of association of the company.
We kindly submit for your approval the balance sheet and the profit & loss statement and acquittal of the Board of Directors.
Auditors
70
ANNUAL REPORT
71
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
8. INDEPENDENT
AUDIT REPORT
ANNUAL REPORT
73
ANNUAL REPORT
8. Independent Audit Report
INDEPENDENT AUDIT REPORT
To The Board of Directors of
‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret Anonim fiirketi
Introduction
We have audited the accompanying consolidated financial statements of ‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret Anonim
fiirketi, its subsidiaries (together with “Group”) which comprise the consolidated balance sheet as of December 31, 2010 and the consolidated income
statement, consolidated statement of changes in shareholders’ equity and consolidated statement of cash flows for the years then ended, and a
summary of significant accounting policies and other explanatory notes. (Note:2.03) Consolidated financial statements of the Group as of December
31, 2009 were audited by another independent auditing company. The independent auditing company has expressed a positive opinion in the audit
report dated March 8, 2010.
Responsibility of Management in Accordance with Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with financial reporting standards
published by Capital Market Board (CMB). This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation
and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate
accounting policies; and making accounting estimates that are reasonable in the circumstances.
Responsibility of Independent Auditing Company
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International
Standards on Auditing published by Capital Market Board. Those standards require that we comply with ethical requirements and plan and perform
the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. Our audit involves performing procedures
to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment,
including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal
control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements present fairly the consolidated financial position of ‹ndeks Bilgisayar Sistemleri Mühendislik
Sanayi ve Ticaret Anonim fiirketi as of December 31, 2010 and of its consolidated financial performance and its consolidated cash flows for the
year then ended in accordance with financial reporting standards published by Capital Market Board (CMB).
ÇA⁄DAfi BA⁄IMSIZ DENET‹M S.M.M.M. A.fi.
An Independent member of IAPA International
ÖZCAN AKSU
Certified Public Accountant
(Istanbul, April 4, 2011)
74
ANNUAL REPORT
75
‹NDEKS B‹LG‹SAYAR S‹STEMLER‹
MÜHEND‹SL‹K SANAY‹ VE T‹CARET A.fi.
ANNUAL REPORT 2010
9. FINANCIAL
STATEMENTS AND NOTES
ANNUAL REPORT
9. FINANCIAL STATEMENTS AND NOTES
77
ANNUAL REPORT
9. Financial Statements and Notes
Notes to consolidated financial statements for the periods ended 01.01.2010 and 31.12.2010 prepared in accordance with international
financial reporting standards.
INDEKS B‹LG‹SAYAR S‹S. MÜH. SAN. T‹C. Afi.
BALANCE SHEET
(XI-29 CONSOLIDATED )
(Turkish Lira)
ASSETS
Notes
CURRENT ASSETS
Current
31.12.2010
Previous
31.12.2009
506.260.534
405.654.269
Cash and Cash Equivalents
6
26.415.870
2.320.888
Financial Investments
7
100.875
33
10
315.185.436
229.494.807
4.619.012
624.262
10
310.566.424
228.870.545
11
246.748
1.355.562
Trade Receivables
- Receivables from Related Parties
- Other
Other Receivables
- Receivables from Related Parties
10-37
11-37
96.013
1.205.509
- Other
11
150.735
150.053
Inventories
13
127.325.894
138.885.304
Other Current Assets
26
36.985.711
33.597.675
31.871.237
31.092.091
NON-CURRENT ASSETS
Other Receivables
11
56.440
51.844
Financial Investment
7
64.894
64.894
Investment Property
17
124.871
-
Tangible Fixed Assets
18
28.430.858
28.031.126
Intangible Fixed Assets
19
59.139
68.865
Goodwill
20
2.467.577
2.467.577
Deferred Tax Assets
35
667.458
407.785
538.131.771
436.746.360
TOTAL ASSETS
The accompanying policies and explanatory notes are an integral part of the financial statements.
78
ANNUAL REPORT
INDEKS B‹LG‹SAYAR S‹S. MÜH. SAN. T‹C. Afi.
BALANCE SHEET
(XI-29 CONSOLIDATED )
(Turkish Lira)
LIABILITIES
Notes
SHORT -TERM LIABILITIES
Financial Liabilities
Trade Payables
-Due to Related Parties
-Other
Other Financial Liabilities
- Due to Related Parties
- Other
Provision For Tax
Provision For Liabilities
Other Short-Term Liabilities
313.007.623
8
11.424.383
10
10-37
10
11
365.962.360
624.144
365.338.216
13.468.858
4.834.616
8.634.242
22.155.856
265.080.401
6.760.191
11-37
11
35
22
26
8
24
SHAREHOLDERS EQUITY
Parent Company Shareholders' Equity
27
Paid-in Capital
Adjustments regarding Share Capital of Participations (-)
Hedging Funds
Restricted Reserves Assorted from Profit
Previous Years’ Profit / (Loss)
Net Profit / (Loss) for the Period
Minority Interests
27
The accompanying policies and explanatory notes are an integral part of the financial statements.
258.320.210
8.239.654
1.182.299
7.057.355
1.098.634
1.530.656
5.176.795
11.261.656
3.382.919
12.618.137
9.301.841
10.962.332
8.285.360
1.016.481
10.313.062
649.270
120.437.244
112.776.405-
110.656.770
56.000.000
241.113
104.023.844
79.284
5.109.837
TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES
79
Previous
31.12.2009
408.392.686
LONG -TERM LIABILITIES
Finansal Borçlar
K›dem Tazminat› Karfl›l›¤›
Current
31.12.2010
56.000.000
241.113
-
36.055.067
13.171.469
9.780.474
4.183.406
27.664.383
15.934.942
8.752.561
538.131.771
436.746.360
ANNUAL REPORT
INDEKS B‹LG‹SAYAR S‹S. MÜH. SAN. T‹C. Afi.
INCOME STATEMENT
(XI-29 CONSOLIDATED)
(Turkish Lira)2.2007
Notes
Current
01.01.2010
31.12.2010
Previous
01.01.2009
31.12.2009
CONTINUED OPERATIONS
Sales Revenue
Cost of Sales (-)
GROSS PROFIT
Marketing, Sales and Distribution Expenses(-)
General Administration Expenses (-)
Other Operating Income
Other Operating Expenses (-)
28
28
29
29
31
31
OPERATING PROFIT / (LOSS)
1.228.175.766
(1.153.272.537)
74.903.229
(13.493.798)
(14.896.959)
60.687
(374.948)
1.087.422.382
(1.023.117.198)
64.305.184
(11.173.103)
(12.767.710)
353.339
(948.369)
32
46.198.211
40.029.703
33
(67.681.475)
39.769.341
28.286.140
(45.663.848)
18.546.439
(4.347.057)
22.391.633
(4.747.543)
(4.626.551)
279.494
(4.681.623)
(65.920)
17.644.090
Other Comprehensive Income
14.199.382
79.284
79.284
OTHER COMPREHENSIVE INCOME (AFTER TAXES)
14.278.666
17.644.090
Total Comprehensive Income
Distribution of Profit / (Loss) For the Period
14.199.382
Financial Income
Financial Expenses (-)
CONTINUED OPERATIONS PROFIT BEFORE TAXATION
Continued Operations Tax Income / (Expense)
- Tax Expense for the Period
35
- Deferred Tax Income / (Expense)
35
PROFIT FOR THE PERIOD
Change in Hedging Fund
-
17.644.090
1.709.148
Minority Interest
Parent Company Share
Distribution of Total Comprehensive Income for the Period
27
27
Minority Interest
27
1.027.913
13.171.469
14.278.666
1.027.913
Parent Company Share
27
13.250.753
15.934.942
Earnings Per Share
36
0,235205
0,284553
15.934.942
17.644.090
1.709.148
The accompanying notes are integral parts of the consolidated financial statements.
80
ANNUAL REPORT
INDEKS B‹LG‹SAYAR S‹S. MÜH. SAN. T‹C. Afi.
CONSOLIDATED CASH FLOW STATEMENT
(Turkish Lira)
CASH FLOW STATEMENT (TL)
Notes
Current
01.01.2010
31.12.2010
Previous
01.01.2009
31.12.2009
A) CASH FLOW PROVIDED FROM OPERATIONS
Net Profit for the Year
18.546.439
22.391.633
698.376
Adjustments :
18-19
840.617
Change in Provision for Termination Indemnities
24
521.509
323.612
Rediscount on Notes Receivable (+)
10
489.818
(368.166)
Gain (-) or Loss (+) on Sale of Assets
18-19
Depreciation (+)
(16.309)
1.794
1.793.875
570.793
10
438.975
2.124.324
10
(242.705)
(375.794)
Provision for Decrease in Value of Inventories (+)
13
284.547
(223.830)
Rediscount on Notes Payable (-)
10
(626.494)
(166.845)
Increase (+) / Decrease (-) in Provision for Debt
22
Provision for Doubtful Receivables for Current Period (+)
Provision for Nullified Doubtful Receivables (-)
Provision for Decrease in Value of Affiliates (-)
-
-
Interest Expenses (+)
33
13.146.389
9.866.332
Interest Income (-)
32
(8.367.322)
(5.564.708)
-
-
26.809.339
29.277.521
10-11
(85.515.205)
(46.971.198)
13
11.274.863
(58.455.063)
Income from Marketable Securities or Long-term Investments(-)
Operational Income Before Changes in Working Capital:
Increase/Decrease in Trade Receivables /Other Receivables (-)
Decrease in Inventories (+)
Increase in Marketable Securities with Purchase/Sale Purposes(-)
Decrease in Trade Receivables /Other Receivables (-)
10-11
-
-
106.737.658
84.935.249
Increase (-) / Decrease (+) in Other Current Assets
26
(3.388.036)
(3.568.637)
Increase (+) / Decrease (-) in other Liabilities
26
(1.356.481)
5.596.084
Other Cash Flows (+)/(-)
Cash Inflow Provided/(Used) From Operating Activities:
286.070
(452.307)
54.848.208
10.361.649
Termination Indemnities Payment (-)
22
(154.297)
(176.683)
Tax Payment (-)
35
(5.058.573)
(3.899.370)
49.635.338
6.285.596
-
-
Net Cash Inflow Provided/(Used) From Operating Activities:
B) NET CASH USED IN INVESTMENT OPERATIONS
Net Tangible Assets Purchases (-)
Investment property (-)
17
-
-
(125.500)
(898.843)
Tangible Assets Purchases
18-19
(1.265.890)
Cash provided from sale of Tangible and Intangible Assets
18-19
52.206
22.257
(1.339.184)
(876.586)
Capital Increase
-
-
Change in Cash with Issue Premiums
-
-
NET CASH RELATING TO INVESTMENT OPERATIONS
C) CASH FLOW RELATING TO FINANCIAL ACTIVITIES
Change in Short Term Financial Liabilities
8
(10.731.473)
(7.157.785)
Change in Long Term Financial Liabilities
8
(2.027.702)
(1.331.514)
Dividends Payments (-)
Net Interest Income / (Expense)
32-33
Hedging fund
NET CASH RELATING TO FINANCIAL ACTIVITIES
NET CHANGE IN CASH AND CASH EQUIVALENTS
(6.617.827)
-
(4.903.594)
(3.726.004)
79.284
-
(24.201.312)
(12.215.303)
24.094.842
(6.806.293)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD
6
2.320.888
9.127.181
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD
6
26.415.730
2.320.888
The accompanying policies and explanatory notes are an integral part of the financial statements.
81
-
-
Net Profit
-
Other Comprehensive Income
Net Profit
241.113
-
-
-
-
-
-
241.133
The Inflation
Adjustments
Differences
Profit of
Cancelled
Shares
Profit of
Cancelled
Shares
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(926.431)
(6.617.827)
926.431
5.109.837
79.284
79.284
-
-
-
-
-
-
-
-
Foreign Currency
Translation
Reserve
-
27.664.383
4.183.406
-
-
(211.151)
5.066.829
-
22.808.705
Previous year
Profit / (Loss)
36.055.067
-
-
-
-
211.151
-
-
3.972.255
Restricted Reserves
from Profit
15.934.942
-
-
-
-
-
-
Previous year
Profit / (Loss)
27.664.383
Restricted Reserves
from Profit
4.183.406
Foreign Currency
Translation
Reserve
The accompanying policies and explanatory notes are an integral part of the financial statements.
56.000.000
-
Dividends
Not-27
-
Transfers to Reserves
31.12.2009
-
Transfers to Retained Earnings
56.000.000
-
Not-27
Capital
Capital
01.01.2009
Notes
-
-
Other Comprehensive Income
CONSOLIDATED STATEMENT
OF CHANGES IN SHAREHOLDERS’
EQUITY (TRL)
-
-
Dividends
241.113
-
-
Transfers to Reserves
56.000.000
-
-
Transfers to Retained Earnings
Not-27
-
-
Capital
31.12.2010
241.133
56.000.000
Not-27
01.01.2010
The Inflation
Adjustments
Differences
Capital
Notes
CONSOLIDATED STATEMENT
OF CHANGES IN SHAREHOLDERS’
EQUITY (TRL)
8.752.561
1.709.148
15.934.942
15.934.942
-
-
-
-
-
7.043.413
Minority
Interest
9.780.474
1.027.913
-
-
-
-
-
8.752.561
Minority
Interest
-
-
-
5.066.829
-
5.066.829
Net Period
Profit / (Loss)
13.171.469
13.171.469
-
-
-
15.934.942
-
15.934.942
Net Period
Profit / (Loss)
112.776.405
17.644.090
-
-
-
-
-
95.132.315
Total
Equity
120.437.244
14.199.382
79.284
(6.617.827)
-
-
-
112.776.405
Total
Equity
ANNUAL REPORT
INDEKS B‹LG‹SAYAR S‹S. MÜH.SAN.T‹C.Afi.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
(Turkish Lira)
82
Mali Tablolara Ait Dipnotlar
1. ORGANIZATION AND BUSINESS SEGMENTS
‹ndeks Bilgisayar Sistemleri Mühendislik Sanayi ve Ticaret Anonim fiirketi was established in 1989, and the activities of the Company
are comprised of trade of all kinds of “Information Technology” products for the purpose of wholesale trading. The Company is
registered to the Capital Markets Board of Turkey since June 2004 and 15,34% of the Company’s shares are traded on Istanbul Stock
Exchange.
As of December 31, 2010 and December 31, 2009, details regarding to Company’s subsidiaries, which are subject to consolidation,
are as follows:
Company Name
Field Of Operations
Datagate Bilgisayar Malzemeleri A.fi.
Purchasing and Selling of Computer
(Datagate)
and Equipment
Neotech Teknolojik Ürünler Da¤. A.fi.
Purchasing and Selling of Home
(Neotech)
Electronic Products
Teklos Teknoloji Lojistik Hizmetleri A.fi.
Capital
% of
Direct Ownership
% of
Indirect Ownership
10.000.000
59,24
59,24
1.000.000
80,00
80,00
Logistics
5.000.000
99,99
99,99
Neteks ‹letiflim Ürünleri Da¤›t›m A.fi.
Purchasing and Selling of
1.100.000
50,00
50,00
(Neteks)
Network Products
(Teklos)
The financial statements of Datagate Bilgisayar Malzemeleri A.fi., Neotech Teknolojik Ürünler Da¤. A.fi. and Teklos Teknoloji Lojistik
Hizmetleri A.fi. are consolidated according to “the full consolidation method”. The financial statements of Neteks ‹letiflim Ürünleri Da¤›t›m
A.fi. is consolidated according to the proportionate consolidation method”.
The main shareholders of the Company are Nevres Erol Bilecik (%38,63) and Pouliadis and Associates S.A. ( % 35,56) located in
Greece. The average number of employees for the year ended December 31, 2010 is 316.(2009: 289 ) . All personnel are administrative
staff.
The Company’s official address registered in Trade Registry is Ayaza¤a District, Cendere Yolu No: 9/1 Ka¤›thane, ‹stanbul and it has
branches in Ankara, ‹zmir, Diyarbak›r, Elaz›¤ and Atatürk Airport Free Zone.
The Group’s’ subsidiaries as of December 31, 2010 and December 31, 2009 are as follows:
Company Name
Field Of Operations
Capital
% of
Direct Ownership
% of
Indirect Ownership
Datagate Bilgisayar Malzemeleri A.fi.
Purchasing and Selling Computer
10.000.000
59,24
59,24
Neotech Teknolojik Ürünler Da¤. A.fi.
Purchasing and selling Home
1.000.000
80,00
80,00
Teklos Teknoloji Lojistik Hizmetleri A.fi.
Logistics
5.000.000
99,99
99,99
Neteks ‹letiflim ürünleri Da¤›t›m A.fi.
Purchasing and Selling Network
1.100.000
50,00
50,00
‹nfin Bilgisayar Ticaret A.fi.
Purchasing and Selling Computer
50.000
99,80
99,80
Neteks D›fl Ticaret Ltd.fiti. (*)
Purchasing and Selling Network
5.000
-
49,50
and equipment
Electronic Products
Products
and equipment (Export-Import)
Products
(*)Neteks D›fl Ticaret Ltd.fiti is the subsidiary of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. with a rate of 99%. Hereafter, the Company and the
subsidiaries will be referred as (‘The Group’) in the consolidated financial statements and notes to the financial statements.
83
ANNUAL REPORT
2. PRINCIPLES RELATED TO THE PRESENTATION OF THE FINANCIAL STATEMENTS
2.01 Basic Principles For The Presentation
The Group maintains its books of account and prepares its statutory financial statements in accordance with the regulations of Capital
Market Board (CMB) Law, Turkish Commercial Code, Tax Procedural Law and Uniform Chart of Accountants published by Ministry
of Finance.
The accompanying consolidated financial statements of the Group were prepared in accordance with the communique Serie XI, No:29
“Comminuque on Financial Reporting at Capital Markets” which was declared by the CMB dated April 9, 2008 with No:26842.
This communique has become valid for the first interim financial statements after January 01, 2008. Based on 5th clause of this
communique, companies applying International Accounting / Financial Reporting Standards (IAS/ IFRS) , which were accepted by
European Union and financial statements are disclosed in s appropriate to IAS/ IFRS.Turkish Accounting/Financial Reporting Standards
which were published by Turkish Accounting Standards Board, are based and consistent with IAS/ IFRS. Group’s consolidated
financial statements were prepared in accordance with the communique Serie XI, No:29 and s to the consolidated financial statements
were presented according to the format obliged by the CMB with the declaration dated April 14, 2008. For that reason, prior period
financial statements reclassified accordingly.
As of April 4, 2011 the Group’s financial statements were approved and signed by its Board of Directors for the period January 1December 31, 2010. General Assembly has a right to change financial statements.
2.02 Dealing with the Inflation Effects in Hyper-Inflationary Periods
According to the decision, dated March 17, 2005 with No:11/367, made by the Capital Market Board, the inflation accounting has
been no longer effective as of 2005 and the accompanying consolidated financial statements has not been adjusted since January
1,2005. Nonmonetary values, which are in the accompanying consolidated financial statements, exist with valued as of December
31, 2004 in accordance with International Accounting Standards No. 29 “Financial Reporting on Hyper-Inflationist Economies”.
2.03 Consolidation Principles
Subsidiaries are the companies, whose shares are held by the Company directly or indirectly through shares of other companies. As
a result, the Group with or without over 50% of voting right, has the power and authority to direct and control the management and
policies of the subsidiary companies whether through the ownership of voting securities, by contract or otherwise.
Balance Sheet and Income statements of the subsidiaries are consolidated according to “full consolidation method” and book value
and capital of the Group’s subsidiary are adjusted accordingly. Transactions and balances between the Company and Subsidiaries
are eliminated during consolidation. Minority interests show minority shareholders’ share in the subsidiaries’ assets and result of
operations for the related period. These details are to be expressed separately in consolidated Balance Sheet and Income Statement.
If losses related to minority interest are over benefits from shares of a subsidiary and if there is no bounding liability to the minorities,
in general, these losses related with the minorities result against to benefits of the minorities.
Companies under common control of the Group is described as Joint Managing Companies. The Group has significant impact on
financial and operating policies of these companies.
The current shares in the subsidiaries as of December 31, 2010 and December 31, 2009 are as follows:
Company Name
Datagate Bilgisayar Malzemeleri A.fi.
Field Of Operations
Purchasing and Selling Computer
Capital
% of
Direct Ownership
% of
Indirect Ownership
10.000.000
59,24
59,24
1.000.000
80
80
50.000
99,80
99,80
and Equipments
Neotech Teknolojik Ürünler Da¤. A.fi.
Purchasing and Selling Home
Electronic Products
‹nfin Bilgisayar Ticaret A.fi.
Purchasing and Selling Computer
and Equipments (Export-Import)
Teklos Teknoloji Lojistik Hizmetleri A.fi.
Logistics
5.000.000
99,99
99,99
Neteks ‹letiflim Ürünleri Da¤›t›m A.fi.
Purchasing and Selling Network Products
1.100.000
50,00
50,00
Neteks D›fl Ticaret Ltd.fiti. (*)
Purchasing and Selling Network Products
5.000
-
49,50
(*)Neteks D›fl Ticaret Ltd.fiti is the subsidiary of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. with a rate of 99%.
84
ANNUAL REPORT
The financial statements of Datagate Bilgisayar Malzemeleri A.fi., Neotech Teknolojik Ürünler Da¤. A.fi. and Teklos Teknoloji Lojistik
Hizmetleri A.fi. are consolidated for using direct consolidation method, the financial statements of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi.
is consolidated by using partial consolidation method.
Balance Sheets and Income statements of the subsidiaries are consolidated according to “full consolidation method” and “partial
consolidation method”, and book value and capital of the Company’s subsidiaries are adjusted accordingly. Transactions and balances
between the Company and subsidiaries are eliminated during consolidation.
Minority interests show minority shareholders’ equity in the subsidiaries’ assets and result of operations for the related period. These
details are expressed separately in consolidated balance sheet and Profit/Loss Statement. If losses related to minority interest are over
benefits from shares of a subsidiary and if there is no bounding liability to the minorities, in general, these losses related with the
minorities can result against to benefits of the main shareholders.
Financial Information of Companies which are subjected to Partial Consolidation Method
Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. which is joint managing of company are subjected to partial consolidation method. Financial
summary of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi stated as follows
Financial Statement Items
31.12.2010
Current Assets
Fixed assets
42.657.724
197.745
26.285.563
160.931
42.855.469
38.003.364
16.960
4.835.145
42.855.469
107.884.168
5.752.937
26.446.494
23.150.765
8.505
3.287.224
26.446.494
99.640.221
Total Assets
Short Term Liabilities
Long Term Liabilities
Total Equity
Total Liability
Sales
Gross Profit
Operational Profit
Net Profit
2.675.971
1.547.921
31.12.2009
4.740.065
2.095.566
998.033
Companies which are not subjected to Consolidation
Parent and subsidiary companies which are not subjected to consolidation and the subsidiary related with management, auditing,
capital are as follows:
Associate
% of Ownership
TL Amount of Ownership
‹nfin Bilgisayar Ticaret A.fi.
99,80
62.419
Neteks D›fl Ticaret Ltd. fiti.(*)
49,50
2.475
Total Subsidiary Amount
64.894
(*)Neteks D›fl Ticaret Ltd.fiti is the subsidiary of Neteks ‹letiflim Ürünleri Da¤›t›m A.fi. with a rate of 99%.
‹nfin Bilgisayar Ticaret A.fi. and Neteks D›fl Ticaret Limited fiirketi were not consolidated to the fact that they are both insignificant and
do not have material effect on the Group’s consolidated financial statements. These subsidiaries are classified as financial assets
available for sale in consolidated financial statements.
Comparison between financial outcomes of companies which are not subjected to consolidation and financial outcomes of consolidated
financial statements on 31.12.2010 are as follows;
Financial Outcomes of 2010
Companies which are not subjected to consolidation
Consolidated Financial Statements
%
85
Total Asset
Total Equity
Net Sales
Period Income
7.158.065
425.158
28.165.752
78.690
538.131.771
120.437.244
1.228.175.766
13.171.469
1,33%
0,35%
2,29%
0,60%
ANNUAL REPORT
Significant part of items, which are located in total asset and sales,are eleminated during the consolidation eventhough this companies
are subjected to consolidation. Considered other matters when mentioned companies are excluded from the consolidation, are as
follows;
These companies has not got significant assets and liabilities which are out of balance sheet. Moreover these companies has not got
significant assets such as fixed assets etc.
On the lights of above given data all these companies were not subjected to consolidation due to all quantitative and qualitative
evaluations and on the lights of above given data indicate that these companies do not effect to financial outcomes significantly.
2.04 Comparative Information and Adjustment of the Previous Consolidated Financial Statements
The comparative financial statements have been presented to enable to perform the financial position and the performance trend
analysis. All necessary adjustments have been made in prior financial statements to present consistent and comparative financial
statements.
The new items have been added to Group's Statement of Cash Flows in the current period in order to better reporting of the cash
flows of the Group. In parallel with the changes in Statement of Cash-Flows in the current period, the similar classifications are made
to prior periods in order to ensure the comparability of the financial statements. The classifications do not have any effect on the prior
period’s profit / loss, shareholders’ equity, total assets, etc.
2.05 Offsetting
The financial assets and liabilities in the financial statements are offset and the net amount reported in the balance sheet, where there
is a legally enforceable right to offset the recognized amounts, and there is an intention to settle on a net basis or realize the asset
and settle the liability simultaneously.
2.06 Changes in Accounting Policies
The changes to the current accounting policies can be performed if it is necessary or the changes will provide more appropriate and
reliable presentation of the transactions and to the events related financial position, performance and the cash flow of the Group that
affect the financial statements of the Group. If the changes in accounting policies affects the prier periods, policy is applied to the prier
period financial statements as if it is applied before.
There is no any changing in financial accounting policies made in the current period
2.07 Changes in Accounting Estimates and Errors
Accounting estimates are made based on reliable information and using appropriate estimation methods. However, if new or additional
information becomes available or the circumstances, which the initial estimates based on, change, then the estimates are reviewed
and revised, if necessary. If the change in the accounting estimates is only related to a sole period, then only that period’s financial
statements are adjusted. On the other hand, if the amendments are related to the current as well as the forthcoming periods, then
both current and forthcoming periods’ financial statements are adjusted.
In instances where the accounting estimates affect both current and forthcoming periods, then description and monetary value of the
estimate is disclosed in the notes to the financial statements. However; if the effect of the accounting estimate to the financial statement
cannot be determined, then it is not disclosed in the notes to the financial statements.
The Group is applying the accounting estimates to determine the doubtful receivables, the value decrease in fixed assets and inventory,
the useful lives of the fixed assets, contingent liabilities, actuarial assumptions for the termination indemnities, etc. There is no change
in accounting estimates in the current period. Accounting estimates applied by the Group are disclosed below in the related parts of
the footnotes. The Group benefits from past experiences for the accounting estimates.
2.08.01 Income
The Group recognizes income according to the accrual basis, when the Group reasonably determines the income and economic
benefit is probable. Group’s income mainly consists of sales of computer and computer equipments as PC, laptop, motherbord, hard
disk, display adapter. All the sales are operated via dealers and there are not any direct sales to end customers. Net sales is calculated
by deducting sales return and sales discounts from total sales.
Revenue from the sale of goods is recognized when all the following conditions are gratified:
•
•
•
•
•
The significant risks and the ownership of the goods are transferred to the buyer;
The Group refrains the managerial control over the goods and the effective control over the goods sold;
The revenue can be measured reasonably;
It is probable that the the economic benefits related to transaction will flow to the entitiy;
The costs incurred or will be incurred in conjuction with the transaction can be measured reliably.
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ANNUAL REPORT
Interest revenue is accured on a time basis, by reference to the principal outstanding and at the effective interest rate applicaple, which
is the rate that discounts the estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying
amount.
When there is significant amount of cost of financing included in the sales, the fair value is determined by discouting all probable future
cash flows with the yield rate, which is embedded in the cost of financing. The differences between the fair value and the nominal value
is recorded as interest income according to the accrual basis.
2.08.02 Inventories
Inventories are stated either at the lower of acquisition cost or net realizable value. Group’s inventories consist of computer and
computer equipments like PC, laptop, electrical household appliances, network products.
The inventory costing method used by the Group is “First In First Out (FIFO)”. Net realizable value is the estimated selling price in the
ordinary course of business less the estimated costs of completion and the estimated costs neccessary to make the sale.
2.08.03 Tangible Fixed Assets
For Assets acquired in and after 2005, the tangible assets are reflected to the consolidated financial statements by deducting their
accumulated depreciation from their cost. For assets that were acquired before January 01, 2005, the tangible fixed assets is presented
on the consolidated financial statements based on their cost value, which is adjusted according to the inflationary effects as of December
31, 2004. Depreciation is calculated using the straight-line method based on their economic lives. The following rates, determined in
accordance with the economic lives of the fixed assets, are used in calculation of depreciation.
TYPE OF FIXED ASSET
Depreciation rates as of
Depreciation rates as of
December 31, 2010 (%)
December 31, 2009 (%)
Land Improvements
10
10
Buildings
2
2
Machinery, Plant and Equipment
20-10
20-10
Motor Vehicles
25-10
20-10
Furniture and Fixtures
25-10
20-10
Leasehold Improvements
20-10
20-10
Lands are not subject to depreciation since they have unlimited useful lives.
Tangible fixed assets has been revised in terms of impairment each period.
If the carrying value of a tangible fixed asset is more than its expected net realizable value then the carrying value is reduced to its
net realizable value by making the necessary provision.
The profit and loss arisen from fixed asset sales are determined by comparing the net book value with the sales price and the result
is added to the operating profit or loss.
Maintenance and repair expenses are accounted as expense at their realization date. If the maintenance and repair expenses clearly
improve the economic value or performance of the related asset then they are capitalized.
2.08.04 Intangible Assets
Intangible Assets contains acquired assets by sales such as computer software programs and computer software licences. There
is no intangible assets created within the structure of business. Intangible assets acquired before January 1, 2005 are carried at
acquisition costs adjusted for inflation; whereas those purchased in the year 2005 and purchased after 2005 are carried forward at
their acquisition cost less accumulated amortization.
Amortization is calculated using the straight-line method between 5 and 10 years period.
Intangible fixed assets are rewieved in terms of impairment for each balance sheet period. If the carrying value of a tangible fixed asset
is more than its expected net realizable value, then the carrying value is reduced to its net realizable value by making the necessary
provisions. There is no provision for decrease in value of a tangible fixed assets.
2.08.05 Impairment of Assets
Assets which has infinite life are not subjected to amortization. Impairment test is applied for these assets for each year.
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ANNUAL REPORT
Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable.The recoverable amount is the higher of an asset’s fair value less costs to sell and value in
use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are seperately identifiable cash
flows. Apart from the goodwill, non-financial assets that suffered impairment are reviewed for possible reversal of impairment at each
reporting date.
2.08.06 Research and Development Expenses
None.
2.08.07 Borrowings Costs
The borrowing costs are recognized as expense when they are incurred. Borrowing costs that are directly attributable to the acquisition,
construction or production of a qualifying asset shall be capitalized as part of the cost of that asset. The capitalization of borrowing
costs as part of the cost of a qualifying asset shall commence, when expenditures and borrowing costs for the asset are incurred,
continues until that asset becomes available for sale. Expenditures on a qualifying asset include only those expenditures that have
resulted in payments of cash, transfers of other assets or the assumption of interest-bearing liabilities. There are no capitalized borrowing
costs in current period related to qualifying assets.
2.08.08 Financial Instruments
(i) Financial Assets
Investments are recognized and derecognized on transaction date where the purchase and sales of an investment is under a contract,
terms of which require delivery of the investment within the timeframe established by the market concerned and are initially measured
at fair value, net of transaction costs except for those financial assets classified as fair value through profit or loss which are initially
measured at fair value.
Financial assets are classified as “financial assets, whose fair value differences are reflected to the profit or loss”, “financial assets
held to the maturity”, “financial assets available for-sale” and “loans and receivables.”
Prevailing Interest Method
Prevailing interest method is the assessment of financial asset with their amortized cost and allocation of interest income to the relevant
period. Prevailing interest rate is a rate that discounts the estimated cash flow of the financial instruments for the expected life or where
appropriate a shorter period.
Income related to financial assets, except the “financial assets, whose fair value differences are reflected to the profit or loss”, is
calculated by using the prevailing interest rate.
a) Financial Assets Whose Fair Value Differences Are Reflected to the Profit or Loss
“Financial assets whose fair value differences are reflected to the profit or loss”, are the financial assets that are held for trading purposes.
If a financial asset is acquired for trading purposes, it is classified in this category. Also, derivative instruments, which are not exempt
from financial risk, are also classified as “Financial assets whose fair value differences are reflected to the profit or loss”. These financial
assets are classified as current assets.
b) Financial Assets Which Will Be Held to the Maturity
Debt instruments, which the Group has the intention and capability to hold to maturity, and/or have fixed or determinable payment
arrangement are classified as “Investments Held to the Maturity”. Financial asset that will be held to the maturity, are recorded after
deducting the impairment from the cost basis, which has been amortized with prevailing interest method. All relevant income is calculated
using the prevailing interest method.
c) Financial Assets Available-For-Sale
Financial assets, which are “Available-for-Sale” are either financial assets, which will not be held to maturity or financial assets, which
are not held for trading purposes. Financial assets Available-for-Sale are recorded with their fair value if their fair value can be determined
reliably.
Marketable securities are shown at their cost basis unless their fair value can be reliably measured or have an active trading market.
Profit or loss pertaining to the financial assets Available-for-Sale is not recorded on the income statement. The fluctuation in the fair
value of these assets are shown in the statement of shareholders’ equity. Where the investment is disposed of or is determined to be
impaired, the cumulative gain or loss previously recognized is includeded in profit or loss for the period. Provisions recorded in the
income statement pertaining to the impairment of financial asset Available-for-Sale can not be reversed from the income statement
in future periods.
Except equity instruments classified as available-for-sale, if impairment loss decreases in next period and if therein decreasing can
be related to an event occurred after the accounting of impairment loss, impairment loss accounted before, can be cancelled in income
statement.
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ANNUAL REPORT
d) Loans and Receivables
Trade receivables, other receivables, and loans are initially recognized at their fair value. Subsequently, receivables and loans are
measured at amortized cost using the effective interest method. In the case of interest on loans and receivables negligible, registered
value of loan and receivables is accepted as fair value.
Impairment of financial assets
Financial assets, other than those at fair value through profit or loss, are assessed for indication of impairment at each balance sheet
date. Financial assets are impaired, where there is objective evidence that, as a result of one or more events that occurred after the
initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. For financial assets
carried at amortized cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value
of estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of the financial asset is reduced with the impairment loss directly for all financial assets with the exception of
trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is
uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are reversed
against the allowance account. Changes in the carrying amount of the allowance account are recognized in profit or loss.
With the exception of available for sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases
and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized
impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment
is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.
With respect to available-for-sale equity securities, any increase in fair value subsequent to an impairment loss is recognized directly
in equity.
Cash and Cash Equivalents
Cash and cash equivalents are cash, demand deposit and other short-term highly liquid investments, which their maturities are three
months or less from the date as of acquisition, that are readily convertible to a known amount of cash and are subject to an insignificant
risk of changes in value.
(ii) Financial Liabilities
Financial liabilities and equity instruments are classified according to the contractual agreements entered into and the definition of
financial liability and equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of the
Company after deducting all the liabilities. Accounting policies determined for the financial liabilities and the financial instruments based
on equity are explained below.
Financial liabilities are classified as either “financial liabilities whose fair value differences are reflected to the profit /loss” or other financial
liabilities.
a) Financial Liabilities Whose Fair Value Differences Are Reflected to the Profit /Loss
“Financial liabilities whose fair value differences are reflected to the profit /loss” are recorded with their fair value and are re-evaluated
at the end of each balance sheet date. Changes in fair values are recorded on the income statement. Net earnings and/or losses
recorded on the income statement also include interest payments made for this financial liability.
b) Other Financial Liabilities
None.
(iii) Derivative Financial Instruments
The Group has aggrement in foreign currency futures markets. Derivative financial instruments are recognised with its market value
on the date of derivative contracts signed and re-assessed with its market value.
The difference between the fair value as of December 31, 2010 and the cost value of the forward contracts as of December 31, 2010
is recognised under the shareholders’ equity within the scope of “ IAS 39 Hedge Accounting.”
The gain or loss realized from the increase or decrease in the fair value of the derivative instruments which do not meet the conditions
for hedge accounting is recognised in profit or loss.
The fair value is determined by the appropriate one of possible valid market values, otherwise discounted cash flows and option pricing
models. The derivatives with positive fair value is recognised as an asset and with negative fair value is recognised as a liability under
the balancesheet. (Note:7)
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ANNUAL REPORT
2.08.09 Effects of Currency Fluctuations
All transactions, denominated in foreign currencies, are converted into TL by the exchange rate ruling at the transaction date. All foreign
currency denominated monetary assets and liabilities stated at the balance sheet are converted into TL by the exchange rate ruling
at the balance sheet date. Foreign exchange gains and/or losses as a result of the conversions are recorded in the income statement.
Group uses same foreign currency in their sales and purchase transaction. Therefore Group does not contain cuurency risk.
2.08.10 Earnings per Share
Earnings per share in the income statement is calculated by dividing net income by the weighted average number of common shares
outstanding for the period.
In Turkey, companies are allowed to increase their share capital by distributing “bonus shares” from retained earnings. These bonus
shares are deemed as issued shares while calculating the net earnings per share. Accordingly, the retrospective effect for those share
distributions is taken into consideration in determining the weighted-average number of shares outstanding used in this computation.
2.08.11 Subsequent Events
Subsequent events cover all events that occur between the balance sheet date and the publication date of the financial statements.
If there is substantial evidence that the subsequent events existed or arise after the balance sheet date, these events are disclosed
and explained in the notes to the financial statements.
2.08.12 Provisions, Contingent Liabilities and Assets
A provision is recognized when an entity has a present obligation (legal or constructive) as a result of a past event; it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation; and reliable estimate can be made of
the amount of the obligation Where the effect of the time value of money is material, the amount of a provision is the present value of
the expenditures expected to be required to settle the obligation.
The discount rate (or rates) is a pre-tax rate (or rates) that reflect(s) current market assessments of the time value of money and the
risks specific to the liability. The increase in provisions arisen from time differences is recorded as interest expense in case of discounting.
Future events that may affect the amount required to settle an obligation shall be reflected in the amount of a provision where there
is sufficient objective evidence that they will occur. The amount recognized as a provision is the best estimate of the consideration
required to settle the present obligation at the balance sheet date, taking into account the risks and uncertainties surrounding the
obligation.
Contingent liabilities and assets are not reflected to consolidated financial statements but disclosed in the notes to the consolidated
financial statements. The entity recognizes a provision for the part of the obligation, for which an outflow of resources embodying
economic benefits is probable, except in the extremely rare circumstances where no reliable estimate can be made.
2.08.13 Leasing Operations
The Group as Lessee
Financial Leases
Financial leases are descibed which the lessor retains all the risks and benefits pertaining to the goods. Financial leases are taken
into the accounts according to lower current market value or minimum lease payments.
The liability arising from a financial leasing transaction is separated into interest payable and principal debt in order to determine a fixed
interest rate on the remaining balance. The costs and expenses incurred at the initial acquisition of the fixed asset subject to financial
leasing are added to the cost. The fixed assets obtained through financial leasing are subject to depreciation over their estimated useful
lives.
Information of net book value of Group’s assets ,which are subject to lease, stated on Note:18. Information related with Group’s
financial leasing debt stated on Note:8
Operating Leases
Lease agreements in which the lessor retains all the risks and benefits relating to the good are described as operational leasing. Lease
payments made for an operational leasing are recorded as expense according to normal method throughout the lease term.
Group’s Lease agreements as a lessee ,are related with store and office lease in ‹stanbul, Ankara, ‹zmir, Diyarbak›r and vehicle leases.
Annual lease expense is 479.728 TL (2009 : 582.934 TL) as of 2010. Lease payments have been expensed with straight line-method.
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ANNUAL REPORT
The Group as Lessor
Operating Leases
The Group presents assets subject to operating leases in their balance sheet according to the nature of the asset. Lease income from
operating leases is recognized as income according to the normal method. The initial direct costs incurred during operational leasing
are reflected to income statement as expense.
Group’s Lease agreements as a lessor, are related with leasing to small part of the main building where Group’s operating, to other
non-consolidated companies and to another company which is not include the Group, as aoffice and store.
2.08.14 Related Party Disclosures
The partners’ of the Company, Company’s Board of Directors, Company’s management personnel, Company’s other directors, close
family members in the charge of the Company, and other companies directly or indirectly controlled by the Company are considered
as related parties. The transactions with related parties are disclosed in the Note: 37.
2.08.15 Government Grants and Assistance
None.
2.08.16 Investment Property
None.
2.08.17 Taxation and Deferred Tax
Income tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the income statement
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are
never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively
enacted by the balance sheet date.
Deferred tax
Deferred tax is recognized on differences between the carrying amounts of assets and liabilities in the financial statements and the
corresponding tax bases which is used in the computation of taxable profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized
for all deductible temporary differences to the extent that it is probable that taxable profits will be available against whichthose deductible
temporary differences can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from goodwill
or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither
the taxable profit nor the accounting profit.
Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates,
and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences
associated with such investments and interests are only recognized to the extent that it is probable that there will be sufficient taxable
profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled
or the asset realized, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the
Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax
liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax
assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax are recognized as an expense or income to the income statement, except when they relate to items credited
or debited directly to equity, in which case the tax is also recognized directly in the equity, or where they arise from the initial accounting
for a business combination.
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ANNUAL REPORT
In the case of a business combination, the tax effect is taken into account in calculating goodwill or determining the excess of the
acquirer’s interest in the net fair value of the acquirer’s identifiable assets, liabilities and contingent liabilities over cost.
Taxes stated in financial statements contain changes in current and deferred taxes for the period. The Group calculates current period
tax and deferred tax over the period results.
Offsetting Tax Income and Liablities
Corporate tax amounts are offset with prepaid corporate tax as they are related. Deferred tax assets and liabilities are also offset.
Retirement Pay
According to Turkish Labor Law, employee termination benefit is reflected in the financial statements, when the termination indemnities
are deserved. Such payments are considered as being part of defined retirement benefit plan as per IAS No.19 “Employee Benefits”.
Termination indemnity liability is reflected to the financial statements with the amount calculated for value at balance sheet date of lump
pension in the next years by discounting by adequate interest rate. Interest cost added to the lump pension expense is shown as
interest expense in the results of operations.
2.08.19 Statement of Cash Flow
Cash and cash equivalents are stated at their fair values in the balance sheet. The cash and cash equivalents comprises cash in hand,
bank deposits and highly liquid investments. On cash flow statement, the Group classifies period’s cash flows as investment and
financing activities.
Cash inflow provided from operating activities denotes cash inflow provided from main activities of the Group. Cash flow concerned
with investment activities shows cash used and provided from investment activities (asset investments and financial investments).Cash
flow concerned with investment activities represents sources used from financial activities and pay-back of these funds.
2.08.20 Income Accruals
The most of the products sold by the Group has foreign origin. The purchases is made from foreign companies, offices of foreign
companies in Turkey or domestic companies in Turkey. Depending upon the realization of the targets given by the domestic or foreign
companies; a set of payments are received or offsetting the accounts under the name of “rebate”, “risturn”, “sell out”, or “bonus”.
The mentioned amounts is recognised as credit note income accruals in the balancesheet depending upon the realization of the targets
and conditions given by the sellers. The documents prepared by sellers under the name of “rebate”, “risturn”, “sell out”, “bonus”, and
“credit note” (or Invoices prepared by the Group) is collected or offsetted.
2.08.21 Provisions for Warranty
The Group is a distributor of the information technologies in Turkey. The warranties of the products sold is provided by the companies
assigned by the producers. The products submitted to Company from dealers and these products are sent to producers or companies
assigned by the producers for repair and maintenance. After the repair and maintenance, if there is a need to change or give a new
product to customers within the scope of the warranty, the amount of the products are invoiced to producer companies. The Company
has no liability of provisions for warranty.
2.09 New and Revised International Financial Reporting Standards
i) Amendments and interpretations that have become effective after January 01, 2010 are as follows:
• IFRS 2 (Amendment) “Share-based payment” A set of explanations related to share-based payments.
• IFRS 3 (Amendment), “Business Combinations” and IAS 27 (Amendment), “Consolidated Financial Statements and Non-Consolidated
Financial Statements” Regulations has been made related to accounting for conditional value, cost of acquisition, goodwill and examples
related to exchange of shares in subsidiaries are given.
• IFRS 1(Amendment), “First-time Adoption of IFRS” Some exceptions to First-time Adoption of IFRS have been made
• IAS 39 (Amendment), “Financial Instruments: Recognition and Measurement” – Hedging Instruments
• IFRIC 17, “Distributions of Non-cash Assets to Owners”. A set of explanations related to recognition of distribution of non-cash assets
to shareholders.
These changes do not have impact on the financial statements of the Group.
i) The following standards, amendments and interpretations not preferred an early application by the Group and will become
effective after December 31, 2010:
• IAS 24 (Revised) “Related-Party Disclosures” (The amendment is effective for financial period beginning on and after January 01,
2011.) Revision on the related party disclosures related to entities with significant state ownership.
• IFRS 9 “Financial Instruments” (The amendment is effective for financial period beginning on and after January 01, 2013.) Additional
conditions to recognition and measurement of Financial Instruments
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ANNUAL REPORT
• IAS 32 (Amendment) “Financial Instruments’ Presentation” (The amendment is effective for financial period beginning on and after
February 01, 2010.) Some explanations related to right issue offerings in return for the foreign currency amounts recognised as derivative
financial instruments.
• IAS 1 (Amendment) “Presentation of Financial Statements” (The amendment is effective for financial period beginning on and after
January 1, 2011.) Some explanations have been made for presentation of the statement of shareholders’ equity per shareholders’
equity items.
• IFRS 1 (Amendment) (The amendment is effective for financial period beginning on and after July 01, 2010, early adoption is permitted)
Limited exemptions for comparative IFRS 7 notes
• IFRS 7 (Amendment) “Financial Instruments: Disclosures” (The amendment is effective for financial period beginning on and after
January 1, 2011.): Some explanations have been made for the disclosures must be done according to IFRS 7.
• IFRS 7 (Amendment) “Financial Instruments: Disclosures” (The amendment is effective for financial period beginning on and after
July 1, 2011.): Some explanations have been made for the off-balancesheet transactions to be examined more comprehensively.
• IFRIC 9 “Reassesment of Embedded Derivatives” (The amendment is effective for financial period beginning on and after January
01, 2013.)
• IFRIC 14 (Amendment) “Prepayments of a Minimum Funding Requirement” (The amendment is effective for financial period beginning
on and after January 01, 2011.) Some explanations have been made for the permit to recognise as an asset some voluntary prepayments
for minimum funding contributions.
• IFRIC 19 “Extinguishing Financial Liabilities with Equity Instruments” (The amendment is effective for financial period beginning on
and after July 01, 2010.)Some explanations have been made for the recognition of the transactions such as a negotiation between
the company and the creditor for the conditions of the financial liabilities and such a situation that the creditor accept that the debtor
company repay the complete or a part of the financial liability by equity instruments.
Management of the Group has the opinion that the implementations of the standards stated above does not have an important effect
of the Company’s financial statements at subsequent periods.
i) Amendments and interpretations that have become effective after January 01, 2010 are as follows:
• IFRS 2 (Amendment) “Share-based payment” A set of explanations related to share-based payments.
• IFRS 3 (Amendment), “Business Combinations” and IAS 27 (Amendment), “Consolidated Financial Statements and Non-Consolidated
Financial Statements” Regulations has been made related to accounting for conditional value, cost of acquisition, goodwill and examples
related to exchange of shares in subsidiaries are given.
• IFRS 1(Amendment), “First-time Adoption of IFRS” Some exceptions to First-time Adoption of IFRS have been made
• IAS 39 (Amendment), “Financial Instruments: Recognition and Measurement” – Hedging Instruments
• IFRIC 17, “Distributions of Non-cash Assets to Owners”. A set of explanations related to recognition of distribution of non-cash assets
to shareholders.
These changes do not have impact on the financial statements of the Group.
3. BUSINESS COMBINATIONS
None.
4. BUSINESS ASSOCIATIONS
None.
5. REPORTING FINANCIAL INFORMATION BY SEGMENTS AND GEOGRAPHIC AREAS
The Group operates in only one sector, which is related to products of information technologies in only one geographical location.
Due to these facts it is not necessary to disclose any information related to segment reporting. The information related to the production
and sales quantities are disclosed in the relevant note.
6. CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents for the periods December 31, 2010 and December 31, 2009 are as follows:
Account Name
31 December 2010
31 December 2009
32.821
35.603
24.326.634
1.569.999
Financial Assets held until Maturuity (Reverse Repo)
1.000.140
-
Credit card slips
1.056.275
715.286
26.415.870
2.320.888
Cash
Bank (Demand Deposits)
Total
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ANNUAL REPORT
Maturity of credit card slips are 1 or 2 days for the current and prior period.
Maturity of Reverse Repo transactions are 1 day and interest income of TL 140 is accrued. Reverse repo transaction currency is made
in TL and ‹nterest rate of reverse repo transaction is % 5,10.
There is no lien and blocked amounts on cash and cash equivalents as of December 31, 2010 (December 31, 2009 : None.)
Cash and cash equivalents has been indicated as accured interest income deducted from cash and equivalants in Group’s cash
flow statements.
Account Name
31 December 2010
31 December 2009
Cash and Equivalents
26.415.870
2.320.888
Accrued Interest Income (-)
(140)
-
Total
26.415.730
2.320.888
7. FINANCIAL ASSETS & INVESTMENTS
Short- Term Financial Assets & Investments
All short term financial investments consist of stock investments and they are classified as financial assets whose fair value differences
are reflected to profit or loss. Details are shown below;
Account Name
31 December 2010
31 December 2009
214
33
Shares
Assets arised from Derivative Instruments
100.661
-
Total
100.875
33
Groups Stock investments consists of shares which are traded in Istanbul Stock and Exchange Market (IMKB).
181 TL of valuation income which is valuated with closing price on December 31, 2010, is considered as other income.
Group has been made a forward foreign exchange purchase commitments amounted USD 21.126.341 as of December 31, 2010.
The fair value of this contract is TL 3.186.663 as of December 31, 2010. TL 1.556 of revaluation surplus is considered as income
and a mount of TL 99.105 considered as ‘’ hedging fund’’under the shareholder’s equity. Amount of 19.821 Deferred Tax Liabilities
which is related with revaluation surplus, has been offsetting from hedging fund.
Long –Term Financial Assets & Investments
All long term financial investments, are consist of Financial Assets Ready for Sale .
Details of Financial Assets Avaliable for Sale are as follows:
Account Name
Shares
- Listed stocks
- Unlisted stocks
Total
31 December 2010
31 December 2009
64.894
64.894
-
-
64.894
64.894
64.894
64.894
94
ANNUAL REPORT
Unlisted stock investments are as follows;
31 December 2010
Company Name
Share Amount
‹nfin A.fi.
Neteks D›fl Tic. Ltd.fiti.
Total
31 December 2009
Share Amount
Rate (%)
Rate (%)
62.419
99,80
62.419
99,80
2.475
49,50
2.475
49,50
64.894
64.894
Summary of financial information related to unlisted stock investments ;
31 December 2010
Total Asset
Total
Liabilities
Total Equity
Net Sales
Profit for
the period
‹nfin A.fi.
5.488.926
5.147.499
341.427
14.786.251
48.714
Neteks D›fl Tic. Ltd.fiti.
1.669.139
1.585.408
83.731
13.379.501
29.976
Total
7.158.065
6.732.907
425.158
28.165.752
78.690
Company Name
Total Asset
Total
Liabilities
Total Equity
Net Sales
Profit for
the period
‹nfin A.fi.
10.272.466
9.979.753
292.713
17.821.381
47.939
2.013.512
1.959.758
53.754
12.924.449
63.239
12.285.978
11.939.511
346.467
30.745.830
111.178
Company Name
31 December 2009
Neteks D›fl Tic. Ltd.fiti.
Total
8. FINANCIAL LIABILITIES
Short-Term financial liabilities for the years ended are as follows:
31 December 2010
Account Name
Bank Loans
31 December 2009
11.424.242
22.154.762
Payables of Financial Leases
156
3.378
Deferred Financial Leasing Borrowing Cost (-)
(15)
(2.284)
11.424.383
22.155.856
Total
The details of the Short Term Bank Loans are as follows:
31 December 2010
Type
Foreign
Currency
Amount
Amount
in TL
Annual Interest
Rate (%)
Short Term Loans
TL Loans(Short Term)
USD Loans (Short Term)
Total Loans
95
7.110.514
431.388
Faizsiz - 13
10.992.854
3–8
11.424.242
ANNUAL REPORT
31 December 2009
Foreign
Currency
Amount
Type
Amount
in TL
Annual Interest
Rate (%)
Short Term Loans
TL Loans(Short Term)
USD Loans (Short Term)
14.547.600
Total Loans
250.441
Interest free -11.63
21.904.321
2.50-7.82
22.154.762
The details of the Long Term Bank Loans for the years ended are as follows:
Account Name
31 December 2010
31 December 2009
Bank Loans
8.285.360
10.313.062
Total
8.285.360
10.313.062
The details of the Short Term Bank Loans are as follows:
31 December 2010
Foreign
Currency
Amount
Type
Amount
in TL
Annual Interest
Rate (%)
Long Term Loans
TL Loans(Short Term)
USD Loans (Short Term)
5.190.241
Total Loans
261.247
12 / 13
8.024.113
8
8.285.360
31 December 2009
Foreign
Currency
Amount
Type
Amount
in TL
Annual Interest
Rate (%)
Long Term Loans
TL Loans(Short Term)
USD Loans (Short Term)
6.704.308
218.386
Interest free -11.63
10.094.676
7.82
10.313.062
Total Loans
Maturity Information of Bank Loans Liabilities are as follows;
31 December 2010
31 December 2009
0-3 Months
5.594.772
17.083.167
3-12 Months
5.829.471
5.071.595
12-60 Months
7.884.224
7.522.904
401.135
2.790.158
19.709.602
32.467.824
60 Months and above
Total
96
ANNUAL REPORT
Maturity Information of financial lease liabilities are as follows:
31 December 2010
31 December 2009
156
968
-
2.410
156
3.378
0-3 Months
3-12 Months
Total
9. OTHER FINANCIAL LIABILITIES
None.
10. TRADE RECEIVABLES AND PAYABLES
Short-Term trade receivables for the years ended December 31, 2009 and December 31, 2008 are as follows:
Account Name
31.12.2010
31.12.2009
217.070.240
161.033.481
4.619.012
624.262
212.451.228
160.409.219
Receivables
99.446.201
69.302.512
Rediscount on s Receivables (-)
(1.331.005)
(841.186)
5.082.748
4.888.556
(5.082.748)
(4.888.556)
315.185.436
229.494.807
Trade Receivables
Due from Related Parties
Other
Doubtful Receviables
Provision for Doubtful Receviables (-)
Total
The Group has no Long-Term Trade Receviables for the years ended December 31, 2010 and December 31, 2009.
A part of 21.616.698 TL of Total 315.185.436 TL trade receivables are in the scope of guarantee as of December 31, 2010. As of
December 31.2009, A part of 34.269.777 TL of total 229.494.807 TL trade receivables were in the scope of guarantee.
Provision for Doubtful Receivables summarize table is below:
Opening Balance
Recived amount in current period (+)
Exchange Differance
Period Expenses (-)
Period-end Balance
1 January31 December 2010
1 January31 December 2009
(4.888.556)
(3.140.027)
242.705
375.794
2.078
-
(438.975)
(2.124.323)
(5.082.748)
(4.888.556)
Maturity analysis of trade receivable overdue that is not assessed for impairment is as follows:
Up to 3 Months
Between 3- 12 Months
Between 1-5 Years
Total
97
31 December 2010
31 December 2009
744.859
1.209.251
75.791
153.816
-
-
820.650
1.363.067
ANNUAL REPORT
Explanations concerning the nature risk and level of risk of trade receivables are disclosed in Note:38
Details of Trade payables for the year ended are as follows:
Account Name
31.12.2010
31.12.2009
339.132.873
212.094.553
338.508.729
205.334.362
624.144
6.760.191
Notes Payable
28.449.708
53.979.575
Rediscount on Payable
(1.620.221)
(993.727)
365.962.360
265.080.401
Suppliers
Other Suppliers
Due to Related Suppliers
Total
There are not any long-term trade payables for the years ended December 31, 2010. Avarage Maturity of Trade receivables and
payables are under two months.
Compound interest rate of domestic government bonds is used as prevailing interest rate for rediscount of trade receivables and
payables in TL. Also Libor and Eurobor are used for trade receiavbles and payables in USD and EURO.
11. OTHER RECEIVABLES AND PAYABLES
Short-term other receivables for the years ended are as follows;
Account Name
31.12.2010
31.12.2009
1.526
-
-
14.975
149.209
135.078
96.013
1.205.509
246.748
1.355.562
Other Receivables
Deposits and Guarantees Given
Due From Personnel
Non-commercial Receivables Due From Related Parties
Total
Long-term other receivables for the years ended are as follows:
Account Name
31.12.2010
31.12.2009
Deposits and Guarantees Given
56.440
51.844
Total
56.440
51.844
Explanations concerning the nature risk and level of risk of trade receivables are disclosed in Note:38
Short-term other payables for the years ended are as follows:
Account Name
Taxes, Duties Payable and Other Fiscal Liabilities
Social Security Institution Payables
Advances Received
Personnel
Non-commercial Payables Due to Releated Parties
Total
31.12.2010
31.12.2009
4.177.693
3.195.053
311.604
250.798
4.012.373
3.354.910
132.572
256.594
4.834.616
1.182.299
13.468.858
8.239.654
98
ANNUAL REPORT
12. RECEIVABLES AND PAYABLES FROM / TO FINANCE SECTOR OPERATIONS
None.
13. INVENTORIES
Inventories for the periods ended are as follows:
Account Name
Commercial Goods
31.12.2010
31.12.2009
125.235.533
135.921.631
3.695.200
4.283.966
(1.604.839)
(1.320.293)
127.325.894
138.885.304
Goods in Transportation
Decrease in Value of Inventory (-)
Toplam
Products which are invoiced but not actually transfered to inventories are recognised under the “Goods in Transit”.
Provision for Impairment of Inventory:
1 January - 31 December 2010
1 January - 31 December 2009
(1.320.293)
(1.544.123)
118.899
337.416
(403.445)
(113.586)
(1.604.839)
(1.320.293)
Openning Balance (-)
Cancellation of Provision Due to Increase in Net Realizable Value Net(+)
Provision for the Period(-)
Balance at the end of year (-)
The provision for decrease in value of stocks is calculated with increasing percentages for the goods waiting in the inventory more
than 3 months depending upon increase in the inventory turnover rate.
As of December 31, 2010, 7.537.113 TL TL of the inventories is presented with their net realizable value and the remaining balance
is presented with their cost in the the financial statements. (As of December 31, 2009, 9.277.090 TL TL of the inventories is presented
with their net realizable value and the remaining balance is presented with their cost in the the financial statements.)
Explanation
31 December 2010
31 December 2009
Cost
7.537.113
9.277.090
Provision for Decrease in value of Inventories
1.604.839
1.320.293
Net Realizable Value (a)
5.932.274
7.956.797
Inventory presented with its cost value (b)
121.393.620
130.928.507
Total Inventories (a+b)
127.325.894
138.885.304
There is no inventory given as a guarantee for a liability.
Total Amount of Insurances on Assets are disclosed in Note:22.
The information related to inventories recognised as expense in the current period is disclosed in Note:28.
14. BIOLOGICAL ASSETS
None.
15. CONSTRUCTION CONTRACTS IN PROGRESS
None.
16. INVESTMENTS EVALUATED BY EQUITY METHOD
None.
99
ANNUAL REPORT
17. INVESTMENT PROPERTIES
The investment property of the Group consists of a house placed in Çankaya, Ankara. The mentioned property is acquired from a
pledge for a receivable. The Group management estimates the fair value of this property as 125.000 TL. The Group management has
considered the fair value of the properties in the neighbourhood and acquisition of mentioned properties in their estimates.
Cost
Account Name
1 January 2010
Aditions
Sales
Transfer
Buildings
-
125.500
-
-
Total
-
125.500
31 December 2010
125.500
125.500
Accumulated Depreciation
Account Name
1 January 2010
Period Depreciation
Sales
Transfer
31 December 2010
Buildings
-
(629)
-
-
(629)
Total
-
(629)
-
(629)
Net Value
124.871
31 December 2009
None
18. TANGIBLE FIXED ASSETS
The Fixed Assets details for the years ended are as follows:
31 December 2010
Cost
Account Name
01 January 2010
Additions
Disposals
Lands and parcels
17.320.543
-
-
17.320.543
39.204
-
-
39.204
11.786.858
277.037
-
12.063.895
Machinery, Plants&Equipments
1.372.927
40.550
-
1.413.477
Motor Vehicles
1.231.892
517.682
(98.946)
1.650.628
Furniture & Fixtures
4.094.611
415.110
(12.970)
4.496.751
Leasehold improvements
274.115
1.950
-
276.065
Other tangible fixed assets
128.372
-
-
128.372
36.248.522
1.252.329
(111.916)
37.388.935
Land Improvements
Buildings
Total
Transfer
31 December 2010
100
ANNUAL REPORT
Accumulated Depreciation
Account Name
Land Improvements
01 January 2010
Additions
Disposals
Transfer
31 December 2010
(39.204)
-
-
-
(39.204)
Buildings
(3.305.121)
(238.578)
-
-
(3.543.699)
Machinery, Plants&Equipments
(1.307.261)
(11.267)
-
-
(1.318.528)
(531.971)
(237.251)
72.128
-
(697.094)
(2.931.370)
(297.308)
3.891
-
(3.224.787)
(102.469)
(32.296)
-
-
(134.765)
Total
(8.217.396)
(816.700)
76.019
Net Value
28.031.126
Motor Vehicles
Furniture & Fixtures
Leasehold Improvements
(8.958.077)
28.430.858
Other tangible fixed assets consist of art objects. Due to there is no depriciation on art objects, these are not subject to depreciation.
Other Information
The depreciation and amortization expenses are recognised under the operational expenses.
The Amount of mortgage on buildings which are stated in assets is USD 6.686.756 .
Total Amount of Insurances on Assets are disclosed in Note:22.
31 December 2009
Cost
Account Name
Lands and parcels
01 January 2009
Additions
Disposals
Transfer
31 December 2009
17.320.543
-
-
-
17.320.543
39.204
-
-
-
39.204
11.412.201
374.657
-
-
11.786.858
Machinery, Plants&Equipments
1.372.927
-
-
-
1.372.927
Motor Vehicles
1.133.338
304.904
(206.350)
-
1.231.892
Furniture & Fixtures
3.968.677
133.981
(8.047)
-
4.094.611
Leasehold Improvements
197.112
77.003
-
-
274.115
Other tangible assets
128.372
-
-
128.372
35.572.374
890.545
(214.397)
36.248.522
Additions
Disposals
Land Improvements
Buildings
Total
Accumulated Depreciation
Account Name
Lands and parcels
01 January 2009
Transfer
31 December 2009
-
-
-
-
-
(39.204)
-
-
-
(39.204)
Buildings
(3.029.428)
(275.693)
-
-
(3.305.121)
Machinery, Plants&Equipments
(1.296.051)
(11.210)
-
-
(1.307.261)
(602.292)
(118.725)
189.046
-
(531.971)
(2.682.842)
(249.830)
1.302
-
(2.931.370)
(84.566)
(17.903)
-
(102.469)
Total
(7.734.383)
(673.361)
190.348
(8.217.396)
Net Value
27.837.991
Land Improvements
Motor Vehicles
Furniture & Fixtures
Leasehold Improvements
101
28.031.126
ANNUAL REPORT
19. INTANGIBLE FIXED ASSETS
31 December 2010
Cost
Account Name
01 January 2010
Additions
Disposals
Transfer
31 December 2010
Rights
522.419
13.560
-
-
535.979
Total
522.419
13.560
-
-
535.979
Accumulated Depreciation
Account Name
01 January 2010
Period Depreciation
Disposals
Transfer
31 December 2010
Rights
(453.554)
(23.286)
-
-
476.840
Total
(453.554)
(23.286)
-
-
476.840
Net Value
68.865
59.139
31 December 2009
Cost
Account Name
01 January 2009
Additions
Disposals
Transfer
31 December 2009
Rights
514.121
8.298
-
-
522.419
Total
514.121
8.298
-
-
522.419
Transfer
31 December 2009
Accumulated Depreciation
Account Name
01 January 2009
Period Depreciation
Disposals
Rights
(428.538)
(25.016)
-
-
(453.554)
Total
(428.538)
(25.016)
-
-
(453.554)
Net Value
85.583
68.865
20. GOODWILL
Goodwill
31.12.2010
31.12.2009
2.467.577
2.467.577
Additions
-
-
Disposals/ Sales
-
-
Provisions for the value decrease
-
-
2.467.577
2.467.577
Opening Balance
Closing balance
There is no provisions for the value decrease in Goodwill. Group’s goodwill arised from Data Gate Bilgisayar A.fi. which is subsidiary
of Group’s and Neteks Bilgisayar A.fi. which is group’s joint managing company.
Calculated amount of goodwill is revised each balance sheet period. Mentioned companies’ cash amounts are subjected to calculated
present discounted value during to revising. According to evaluation made, discount rate is %12, and rate of growth is %5 which is
used for determining the future cash flows to present value, as of December 2010
102
ANNUAL REPORT
21. GOVERNMENT GRANT AND ASSISTANCE
None.
22. PROVISIONS, CONTINGENT LIABILITIES AND ASSETS
Account Name
December 31, 2010
December 31,2009
Provisions for Price Differences
3.552.295
2.487.557
Provision for Litigations
1.624.500
895.362
Total
5.176.795
3.382.919
December 31, 2010
Provision for Litigations
Provisions for Price Differences
Total
895.362
2.487.557
3.382.919
Additions
1.222.790
3.552.295
4.775.085
Payments
(493.652)
-
(493.652)
(2.487.557)
(2.487.557)
1.624.500
3.552.295
5.176.795
Provision for Litigations
Provisions for Price Differences
Total
18.629
2.793.497
2.812.126
Additions
902.986
2.487.557
3.390.543
Payments
(26.253)
-
(26.253)
-
(2.793.497)
(2.793.497)
895.362
2.487.557
3.382.919
As of January 1, 2010
Cancellation of Provisions
As of December 2010
December 31, 2009
As of January 1, 2009
Cancellation of Provisions
As of December 2009
Price difference invoices are taken from clients for selling products with different prices,prvisions are made.isions Additionally, due to
increase the sales , targets are given to clients. When the clients achieve the targets, turnover premiums, credit note, price differences
invoices etc. are taken from dealers and prvisions are made.
ii) Contingent Assets and Liabilities;
31.12.2010
As of December 31, 2010, for one lawsuit initiated against Group , provision amount 1.624.500 TL is reflected to the financial statements.
31.12.2009
As of December 31, 2009, for one lawsuit initiated against Group, provision amount 895.392TL is reflected to the financial statements.
103
ANNUAL REPORT
iii) Contingent Liabilities and Commitments:
31 December 2010
TRL
USD
EURO
Bailment Given
1.462.250
3.685.500
1.000.000
Guarantee Notes Given
1.586.506
-
-
-
6.686.756
-
Guarantess letters given
3.096.000
11.515.000
7.500.000
Total
6.144.756
21.887.256
8.500.000
TRL
USD
312.750
9.435.500
-
7.699.183
Guarantess letters given
2.854.000
10.515.000
7.100.000
Total
3.166.750
27.649.683
7.100.000
Mortgage
31 December 2009
Bailment Given
Mortgage
EURO
-
iv) Total Guarantees and Mortgages on Assets
None
v) Total Insurance Coverage on Assets:
31.12.2010
Type of Insured Assets
USD
EUR
TL
104.285.000
-
-
-
-
1.376.200
8.818.571
57.545
-
Other
610.000
-
-
Total
113.713.571
57.545
1.376.200
USD
EUR
TL
91.200.000
-
-
-
-
961.839
8.926.446
37.700
-
Other
805.125
-
55.000
Total
100.931.571
37.700
1.016.839
Trade goods
Vehicles
Plants machinery and equipment
31.12.2009
Type of Insured Assets
Trade goods
Vehicles
Plants machinery and equipment
104
105
1.000.000
Bailment (EURO)
-
ii. Total Amount of M&G Given on behalf of other affiliated companies which can not be classified under section B and C.
iii. Total Amount of M&G Given on behalf of the third person that cannot be classified under section C.
Total
-
-
D. Total Amount of other M&G Given
i. Total Amount of M&G Given on behalf of main shareholder
-
C. Total Amount of M&G Given on behalf of the third person liability in order to sustain usual business activities.
Bailment (TL)
3.685.500
-
6.686.756
Bailment (USD)
B. Total amount of M&G Given on behalf of the Subsidiaries and Affiliated Companies subject to full consolidation
Mortgage
Lien
57.399.804
-
-
-
-
-
-
-
9.435.500
-
7.699.183
7.100.000
10.515.000
-
31 December 2009
Foreign Currency
Amount
-
1.462.250
2.049.100
5.697.783
9.209.133
10.337.725
1.586.506
Guarantee notes and cheques(TL)
15.368.250
3.096.000
7.500.000
Guarantee Letter (EUR)
17.802.190
48.190.671
31 December 2010
TL Amount
Guarantee Letter (TL)
11.515.000
-
31 December 2010
Foreign Currency
Amount
Guarantee Letter (USD)
A. Total amount of M&G Given on behalf of the Group
MORTGAGES & GUARANTEES GIVEN BY THE GROUP
60.137.008
-
-
-
-
312.750
14.207.032
14.519.782
11.592.660
2.854.000
15.338.130
15.832.436
45.617.226
31 December 2009
TL Amount
ANNUAL REPORT
vi ) The ratio of Mortgages and Guarantees Given to Shareholders’ Equity is as follows;
ANNUAL REPORT
As of December 31, 2010, the ratio of Mortgages and Guarantees Given to Shareholders’ Equity is 0 %. (0 % of December 31, 2009)
23. COMMITMENTS
None.
24. EMPLOYEE TERMINATION BENEFITS
Account Name
31 December 2010 31 December 2009
Provision for Employment Termination Indemnity
1.016.481
649.270
Total
1.016.481
649.270
Under the Turkish Labor Law, the Group is required to pay employee termination benefits to each employee, who has entitiled to
receive provisions for employee termination benefits in accordance with the effective laws: No: 2422 on March 6, 1981 and No: 4447
on August 25, 1999 of the Social Insurance Act No: 506 and the requirements of the amended Article 60 of the related Act. The
maximum employee termination benefit payable as of December 31, 2010 is 2.517,01 TL. (December 31, 2009: 2.365,16). The
maximum employee termination benefit payable as of January 1, 2011 is 2.623,23 TL and taken into consideration in the calculations
of the Group’s provision for termination indemnities.
Termination indemnity payable is not subject to any legal funding.
Termination indemnity payable is calculated by forecasting the present value of currently working employee’s possible future liabilities.
IAS 19 (“Employee Termination Benefits”) predicts to build up Group’s liabilities with using actuarial valuation techniques in context
of defined benefit plans. According to these predictions, actuarial assumptions used in calculation of total liabilities are as follows.
Base assumption is the inflation parallel increase of maximum liability of each year. Applied discount rate must represent expected
real discount rate after the adjustment of future inflation.
As of December 31, 2010, provisions in financial statement are calculated by forecasting the present value of currently working
employee’s possible future liabilities.Provisions as of December 31, 2010 are calculated with %4,66 reel discount rate based on the
assumptions of % 5,10 inflation rate and % 10 discount rate annually. (31 December 2009: %5,92 reel discount rate).
1 January 2010
31 December 2010
1 January 2009
31 December 2009
January 1
649.270
502.341
Service Costs
109.748
108.164
Actuarial Gains
202.293
66.827
Interest Expences
209.467
148.621
(154.297)
(176.683)
1.016.481
649.270
Payment (-)
Closing Balance
Provision expense for termination indemnities is recognised under the operational expenses.
25. RETIREMENT BENEFIT PLANS
None.
106
ANNUAL REPORT
26. OTHER ASSETS AND LIABILITIES
Other Current Assets for the years ended, are as follows:
Account Name
31 December 2010
Prepaid Expenses for the Following Months
31 December 2009
1.076.036
440.136
Credit Note Income Accrual
17.176.193
15.506.860
Deferred VAT
11.016.348
15.180.738
1.213.692
-
681.336
22.805
5.822.106
2.447.136
36.985.711
33.597.675
VAT Return
Job Advances
Advances Given
Total
Short-term other liablities for the years ended, are as follows:
Account Name
31 December 2010
31 December 2009
Income Relating to Future Months
11.261.656
12.618.137
Total
11.261.656
12.618.137
Income recognised from invoiced but not delivered products are recognised under the “Income Relating to Future Months“ due to the
criterias related with IAS 18 (delivery, transfer of risks, etc.) are not met.
Credit Note Income Relating to Future Months transactions as follows:
Account Name
1 January 2010
31 December 2010
1 January 2009
31 December 2009
Opening Balance
15.506.860
15.855.397
Current period accrual
91.020.591
81.638.173
Collection / Current account transfer(89.351.258)
(81.986.710)
Balance at the end of year
17.176.193
15.506.860
27. SHAREHOLDERS’ EQUITY
i) Minority Shares / Minority Shares Profit - (Loss)
Account Name
31 December 2010
31 December 2009
Minority Shares
9.780.474
8.752.561
Total
9.780.474
8.752.561
31 December 2010
31 December 2009
Minority Shares Profit - (Loss)
1.027.913
1.709.148
Total
1.027.913
1.709.148
Account Name
ii) Capital / Share Capital / Elimination Adjustments
The share capital of the Group is TL 56.000.000 as of December 31, 2010 and the share capital consist of 56.000.000 per-shares
which each of 1 nominal value.
The paid in capital of the Group, which is TL 56.000.000, consists of A Group shares issued to the name as paid-in capital is TL 318,
B Group shares issued to the bear as paid-in capital is TL 55.999.682.
A Group of shareholders have the rights to appoint one more of the half member of the Executive Board. After the initial dividend is
given from the distribution of profit, A group Shareholders has also the rights to get % 5 of the remaining part.
107
ANNUAL REPORT
The Group accepts the Registered Share capital System with the March 17,2005 dated and 11/327 numbered permission of Capital
Market Board and determined the Registered Share Capital ceiling TL 75.000.000. The decision accepted at 2004 Regular Meeting
Shareholders of the Group dated April 27,2005.
The Group’s registered capital is TL 75.000.000. The Group’s application to raise capital from TL 55.000.000 to TL 56.000.000 by
implementing TL 1.000.000 from share of profit of 2006 is approved by committee ruling numbered 25/699 and dated June 28, 2007.
The public offering of shares to be issued with nominal value of TL 1.000.000 has been accepted in the Board’s meeting dated June
28, 2007 and with the number of 25/699. As of July 10, 2007, the increase of the capital is registered and published in the Official
Gazette numbered 6852 and dated July 16, 2007.
The share capital shown in the consolidated balance sheet is the share capital of the Group. The amounts of share capital of the
subsidiaries and the subsidiary account are eliminated mutually.
31 December 2010
Shareholder
31 December 2009
Share Percentage
%
Share Amount
Share Percentage
%
Nevres Erol Bilecik
% 38,63
21.634.440
% 41,06
22.994.220
Pouliadis and Associates S.A.
% 35,56
19.911.119
% 35,56
19.911.119
Public Offer
% 23,44
13.126.987
% 21,01
11.767.207
Other
% 2,37
1.327.454
% 2,37
1.327.454
Total
% 100
56.000.000
% 100
56.000.000
Share Amount
The ultimate controlling party of the Group is Nevres Erol Bilecik and his family members.
iii) Capital Reserves
None.
iv) Restricted Reserves from Profit
Restricted reserves from profits consist of legal reserves.
The legal reserves consist of first and second legal reserves, appropriated in accordance with the Turkish Commercial Code (TCC).
The TCC stipulates that the first legal reserve is appropriated out of historical statutory profits at the rate of 5% per annum, until the
total reserve reaches 20% of the Group’s historical paid-in share capital. The second legal reserve is appropriated at the rate of 10%
per annum of all cash distributions in excess of 5% of the historical paid-in share capital. Under TCC, the legal reserves are not available
for distribution unless they exceed 50% of the historical paid-in share capital but may be used to offset losses in the event that historical
general reserve is exhausted.
v) Previous Years’ Profits / (Losses)
Profits of previous years consist of extraordinary reserves, miscellaneous inflation differences and profits of other previous years.
In accordance with the CMB’s decision numbered 7/242 dated on February 25, 2005; if the amount of net distributable profit based
on the CMB’s requirement on the minimum profit distribution arrangements, which is computed over the net profit determined based
on the CMB’s regulations, does not exceed the net distributable profit in the statutory accounts, the whole amount should be distributed,
otherwise; all distributable amount in the statutory accounts are distributed. However, no profit distribution would be made if any
financial statements prepared in accordance with the CMB or any statutory accounts carrying net loss for the period.
In accordance with the CMB’s decision numbered 2/53 on January 18, 2007, Groups, which prepared their financial statements in
accordance with the CMB standards, are required to distribute at least 20% of their net profit. The distribution, with the approval and
decision via the General Assembly’s resolution, can be made either by cash, bonus issues or cash and bonus shares with a rule that
the distributable amount will not be less than 20 % of the distributable profit.
In accordance with CMB’s decision dated January 27,2010; it is decided not to bring any obligation for any minimum profit distribution
about dividend distribution which will be made for public corporations. The Group management decided to distribute dividens according
to the regulations specified in articles of association of the Group and dividend distiribution policies declared to public.
108
ANNUAL REPORT
Breakdown of Shareholders' Equity for the periods January 01 – December 31, 2010 and January 01 – December 31, 2009 are as
follows:
Account Name
31 December 2010
Share capital
31 December 2009
56.000.000
56.000.000
241.113
241.113
79.284
-
5.109.837
4.183.406
-Legal Reserves
3.962.787
3.036.356
-Profit Reserves of Sales from Affiliates
1.147.050
1.147.050
Previous Years’ Profits
36.055.067
27.664.383
Net Period Loss/ Profit
13.171.469
15.934.942
110.656.770
104.023.844
9.780.474
8.752.561
120.437.244
112.776.405
Shareholders’ Equity Inflation Adjustment Differences
Hedging Funds
Restricted Reserves From Profit
Parent Company Shareholders' Equity
Minority Interests
Total Shareholders’ Equity
In the financial statements prepared according to the standards of the CMB, the Group’s current profits amounted to TL 13.171.469.
The Group’s distributable profit for current period is TL 8.279.182. In the financial statements prepared according to the standards
of the CMB, the Group’s accumulated profits amounted to 49.226.536 TL. The Group’s distributable profit amount is TL 31.703.103.
Group’s dividend which is related previous period profits is limited with this amount. Inflation adjustments on equity, real estates sales
profits which are held in fund for adding the share capital are not take into consideration to total distributable profit.
Result of General board , which belongs to 2009, dated on April 20, 2010 as follows;
Net income after tax is 15.934.942 TL in 2009 Consolidated Financail statements according to CMB’s bulletin of No29. Serial :XI.
Realized profit is TL 10.892.941,74 according to tax legistation. It has been decided that restricting primary reserve, total amount is
544.647,09 TL, which calculated according to %5 of Realized profit (TL 10.892.941,74)
- It has been decided that distrubiting the primary dividend of Gross 6.156.117,97 TL as a cash, ( distributing %10,9931 for 1 nominal
value per share is 0,109931 TL); (Net 5.232.700,27 which is distributing %9,3442 for 1 nominal value per share is 0,093442 TL). The
gross Primary dividend is calulated %40 of 15.390.294,91 TL , as a result of deducting 544.647,09 TL, which is primary reserve,
from 15.934.942 TL, which is tax after net profit.
- It has been decided that distrubiting the the Secondary dividend to A Group preferred shareholder. The distributing the secondary
dividend of of Gross 461.708,85 TL as a cash, ( distributing for 1 nominal value per share is 1.451,09 TL); (Net 392.452,52 which is
distributing for 1 nominal value per share is 1.233,43 TL). The gross Secondary dividend is calulated %5 of 9.234.176,94 TL , as a
result of deducting 6.156.117,97, which is primary dividend, from 15. 390.294,91 TL, which is net period profit.
- It has been decided that amount of 381.782,68 TL made as a secondary reserve.
- Remainin distribution of profit is started on May 04, 2010
- It has been decided that the remaining amount is added to exstraordinary reserves.
109
ANNUAL REPORT
28. SALES AND COST OF SALES
Sales and cost of sales details which belong twelve months accounting period of the Group as of December 31, 2010 and December
31, 2009 are as follows:
1 January 2010
31 December 2010
1 January 2009
31 December 2009
1.220.214.680
1.072.788.369
Foreign Sales
13.816.010
8.400.999
Other Sales
46.717.733
45.200.032
(45.676.817)
(34.275.959)
Sales Discounts (-)
(6.117.768)
(4.304.865)
Other Discounts (-)
(778.072)
(386.194)
1.228.175.766
1.087.422.382
(1.153.272.537)
(1.023.117.198)
74.903.229
64.305.184
Account Name
Domestic Sales
Sales Returns (-)
Net Sales
Cost of Sales (-)
Gross Profit from Business Operations
Quantity of sales related to twelve months accounting period of the Group as of December 31, 2010 and December 31, 2009 are as
follows:
Account Name
1 January 2010
31 December 2010
1 January 2009
31 December 2009
Difference
%
Accessories
183.314
116.752
57%
Computer
512.035
422.887
21%
Storage and Medium Sized Systems
299.107
332.272
(10%)
4.567
5.093
(10%)
24.153
155
15.483%
Network Products
1.213.149
957.731
27%
PC Components (OEM)
3.024.448
3.077.113
(2%)
167.730
69.147
143%
-
2.719
(100%)
Printer and Peripherals
632.341
617.179
2%
Software
543.642
471.978
15%
18.677
-
100%
577.010
757.209
(24%)
Security
Communication Products
Consumer electronics
Consumption
Small house appliances
Other
29. RESEARCH AND DEVELOPMENT, MARKETING, SALES & DISTRIBUTION EXPENSES
Other operating expenses which belong twelve months accounting period of the Group as of December 31, 2010 and December 31,
2009 are as follows:
1 January 2010
31 December 2010
1 January 2009
31 December 2009
Marketing and Selling Expenses (-)
(13.493.798)
(11.173.103)
General Administrative Expenses (-)
(14.896.959)
(12.767.710)
Total Operating Expenses
(28.390.757)
(23.940.813)
Account Name
110
ANNUAL REPORT
30. EXPENSES RELATED TO THEIR NATURE
Expenses Related to Their Nature of the Group as of December 31, 2010 and December 31, 2009 are as follows:
1 January 2010
31 December 2010
1 January 2009
31 December 2009
(28.390.757)
(23.940.813)
(16.270.464)
(12.954.133)
(3.327.649)
(2.501.586)
- Depreciation expenses
(840.615)
(698.377)
- Rental Expense
(479.728)
(582.934)
- Communication Expense
(334.662)
(380.905)
- Travelling Expenses
(359.739)
(252.132)
- Transportation Expenses
(632.137)
(449.898)
- Consultancy and Audit Expenses
(462.234)
(402.161)
- Insurance Expenses
(619.926)
(685.662)
(96.728)
(67.983)
(1.024.701)
(694.444)
- Taxes, Duties, Charges Expenses
(423.101)
(156.380)
- Decrease in value of stocks
(284.547)
-
- Provisions for termination indemnities expenses
(521.508)
(323.612)
- Provisions for doubtful trade receivables
(196.270)
(1.748.529)
(1.222.790)
(902.986)
- Sales and foreign trade expenses
(718.041)
(661.879)
- Other Expenses
(575.917)
(477.212)
(28.390.757)
(23.940.813)
Account Name
Sales, Marketing and Distribution Expenses (-)
- Personnel Expenses
- Logistic and storage expences
- Maintenance and repair expenses
- Advertisement Expense
- Provision for ligitation Expence
Total Operating Expenses
Depreciation and amortisation exspenses and personel expenses are recognised in operational expenses.
31. OTHER OPERATING INCOME / EXPENSE
Other operating Income / Expense which belong twelve months accounting period, of the Group as of December 31, 2010 and
December 31, 2009 are as follows:
Account Name
1 January 2010
31 December 2010
1 January 2009
31 December 2009
25.854
129.508
-
223.831
Other Income
34.833
-
Other Income Total
60.687
353.339
Other Expense Total (-) (*)
(374.948)
(948.369)
Other Income / Expence (Net)
(314.261)
(595.030)
Insurance Compensation Income
Cancellation provision for inventories
(*)Other expenses consist from non-deductibel expenses such as tax, penalty,
motorvehicle taxes and special communication taxes, etc.
111
ANNUAL REPORT
32. FINANCIAL INCOME
Financial income for the periods ended are as follows:
1 January 2010
31 December 2010
Account Name
Interet Income
1 January 2009
31 December 2009
730.520
869.733
181
-
29.200.793
20.518.353
Interest Eliminated From Sales(-)
7.636.802
4.694.975
Rediscount Income
1.620.220
993.725
841.187
1.209.354
40.029.703
28.286.140
Other
Foreign Exchange Gains (-)
Previous Period Rediscount Cancellation
Total Financial Income
33. FINANCIAL EXPENSES
The financial expenses of the Group as of December 31, 2010 and December 31, 2009 are as follows:
1 January 2010
31 December 2010
1 January 2009
31 December 2009
(7.284.186)
(5.754.806)
(52.193.769)
(33.795.758)
Eleminated Interest From Purchases(-)
(5.878.789)
(4.111.526)
Rediscount Expense (-)
(1.331.006)
(841.187)
(993.725)
(1.160.571)
(67.681.475)
(45.663.848)
Account Name
Banking Charges and Interet Expense (-)
Foreign Exchange Loss (-)
Cancellation of Previous Period’s Rediscount
Total Financial Expense
There is no capitalized financial expense of Group for current period.
34. FIXED ASSETS HELD FOR SALE PURPOSES AND DISCONTINUED OPERATIONS
None.
35. TAX ASSETS AND LIABILITIES
The Group’s tax income / (expense) is composed of current period’s corporate tax expense and deferred tax income / (expense)
The tax assets and liabilities of the Group as of December 31, 2010 and December 31, 2009 are as follows:
Account Name
31 December 2010
31 December 2009
Period Tax Income/(Expense)
4.626.551
4.681.623
Prepaid Taxes And Funds (-)
(3.527.917)
(3.150.967)
1.098.634
1.530.656
1 January 2010
31 December 2010
1 January 2009
31 December 2009
(4.626.551)
(4.681.623)
Deferred Tax Income / (Expense)
279.494
(65.920)
Total Tax Income / (Expense)
(4.347.057)
(4.747.543)
Total Tax Payable
Account Name
Period Tax Income/(Expense)
112
ANNUAL REPORT
i) Provision for Current Period Tax
Group calculate their temporary taxes on their quarterly financial profits in Turkey. Corporate income as of the temporary tax periods,
temporary tax rate of 20 % over the corporate income was calculated and prepaid taxes deducted from taxation on income.
According to Turkish Corporate Tax Law, losses can be carried forward to offset the future taxable income for a maximum period of
5 years. On the other hand, such losses cannot be carried back to offset prio years’ profits.
According to Corporate Tax Law’s Article: 24, the corporate tax is imposed by the taxpayer’s tax returns. There is no prosedure for
a final and definitive agreement on tax assessments. Annual corporate tax returns are submitted until the 25th of April following the
closing of the accounting year. Moreover, the tax authorities have the right to examine the tax returns and the related accounting
records within five years.
Effective Corporate Tax Rate:
According to the corporate tax law numbered 5520, which was published in the official gazette dated June 21, 2006, the effective
corporate tax rate was set as 20%.
In Turkey, advance tax returns are files on a quarterly basis. The advance corporate income taxes have been calculated with the
effective corportate tax rate of 20%.
According to Turkish Corporate Tax Law, losses can be carried forward to offset the future taxable income for a maximum period of
5 years. On the other hand, such losses cannot be carried back to offset prio years’ profits.
According to Corporate Tax Law’s Article: 24, the corporate tax is imposed by the taxpayer’s tax returns. There is no prosedure for
a final and definitive agreement on tax assessments. Annual corporate tax returns are submitted until the 25th of April following the
closing of the accounting year. Moreover, the tax authorities have the right to examine the tax returns and the related accounting
records within five years.
Income Withholding Tax:
In addition to corporate tax, Group should also calculate income withholding tax on any dividends and income distributed, except for
resident companies in Turkey receiving dividends from resident companies in Turkey and Turkish branches of foreign companies. The
rate of withholding tax has been increased from 10% to 15% upon the Cabinet decision No: 2006/10731, which was published in
Official Gazette on July 23, 2006.
ii) Deferred Tax
The deferred tax asset and tax liability is based on the temporary differences, which arise between the financial statements prepared
according to CMB’s accounting standards and statutory tax financial statements. These differences usually due to the recognition of
revenue and expenses in different reporing periods for the CMB standards and tax purposes.
31.12.2010
Temporary
Cumulated
Differences
31.12.2010
Deffered
Tax Assets /
(Liabilities)
31.12.2009
Temporary
Cumulated
Differences
31.12.2009
Deffered
Tax Assets /
(Liabilities)
(673.700)
(134.740)
(722.245)
(144.449)
Rediscount Expense
1.331.005
266.201
621.465
124.293
Provision for Termination Indemnities
1.016.480
203.296
625.365
125.073
Provision for Reduced Depreciation from Stock
1.604.840
320.968
1.260.760
252.152
(1.620.220)
(324.044)
(961.270)
(192.254)
1.678.885
335.777
1.214.850
242.970
Account Name
Fixed Assets
Prekont Income
Other
Deferred Tax Assets / (Liabilities)
113
667.458
407.785
ANNUAL REPORT
31 December 2010
31 December 2009
Deferred Tax Asset / Liability at the beginning of the period
407.785
473.705
Deferred Tax Income / (Expense)
279.494
(65.920)
Deferred Tax Asset / Liability at the end of the period
(19.821)
-
Deferred Tax Asset / Liability at the beginning of the period
667.458
407.785
Account Name
Explanation of Unused Tax Advantages:
There is no financial loss transferred to forthcoming periods as of December 31, 2010.
Reconciliation of tax provision as of December 31, 2010 and December 31, 2009 are as follows:
1 January 2010
1 January 2009
31 December 2010 31 December 2009
Reconciliation of Tax Provision
Profits obtained from continuing operations
18.546.439
22.391.633
Income tax rate %20
(3.709.287)
(4.478.327)
(637.770)
(269.216)
(4.347.057)
(4.747.543)
Tax effect:
-Non-taxable income
-Non-deductible Expenses
Deferred Tax Income
36. NET EARNINGS PER SHARE
Earnings per share in the income statement are calculated by dividing net income by the weighted average number of common shares
outstanding for the period. Group’s earnings per share are calculated for the periods are as follows:
1 January 2010
31 December 2010
Account Name
1 January 2009
31 December 2009
Period Profit/ (Loss)
13.171.469
15.934.942
Weighted Average Number of Common Shares Outstanding
56.000.000
56.000.000
0,235205
0,284553
2.070
2.504
0,223446
0,270326
Earnings / (Loss) per Share
Profit for preferred shares
Profit for ordinary shares
37. EXPLANATIONS OF RELATED PARTIES
a) Receivables and Payables of Related Parties:
Receivables
Commercial
31 December 2010
Liabilities
NonCommercial
Commercial
NonCommercial
Shareholders
-
-
-
3.043.727
Homend A.fi.
1.783.661
-
-
112.119
5.957
96.013
-
-
-
-
-
-
2.399.123
-
624.144
-
Neteks D›fl Tic.
292.827
-
-
-
Despec A.fi.
137.444
-
-
1.678.690
4.619.012
96.013
624.144
4.834.616
Desbil A.fi.
Neosoft A.fi.
‹nfin A.fi.
Total
114
ANNUAL REPORT
Receivables
Liabilities
NonCommercial
Commercial
31 December 2009
NonCommercial
Commercial
Shareholders
-
-
-
1.182.299
Homend A.fi.
-
1.077.335
-
-
Desbil A.fi.
-
128.174
-
-
Neosoft A.fi.
-
-
-
-
453.492
-
-
-
-
-
759.468
-
Despec A.fi.
170.770
-
6.000.723
-
Total
624.262
1.205.509
6.760.191
1.182.299
‹nfin A.fi.
Neteks D›fl Tic.
There is no guarantees or mortgages for the related party receivables or payables. There is no provision made for doubtful receivables
for the related party receivables.
The related party balances generally consist from trade transactions. But in some conditions there are cash usages between the related
parties. The balances consist from non-trade transactions are classified as non-trade receivables or payables in the financial statements.
Interest is calculated for the balances and invoiced quarterly. The interest rates for USD is between % 3 and % 4,50 in 2010.
Shareholders current accounts are generally arised from divident debt, and interest is not calculated for these debt.
b) Purchases from Related Parties and Purchases from Related Parties
1 January - 31 December 2010
Sales to
Related Parties
Goods and
Service Sales
Common Cost
Participation
Interest and
Foreign Exchange
Income
Total Expense /
Purchases
-
2.994
10.363
13.357
6.672.779
1.498.753
295.300
8.466.832
270.992
217.816
226.804
715.612
‹nfin A.fi.
9.683.293
5.070
617.698
10.306.061
Neteks D›fl Ltd.fiti.
3.648.161
-
3.550
3.651.711
20.275.225
1.724.633
1.153.715
23.153.573
Desbil A.fi.
Despec A.fi.
Homend A.fi.
Total
Purchases From
Related Parties
Desbil A.fi.
Goods and
Service Purchases
Common Cost
Participation
Interest and
Foreign Exchange
Expense
Total Expense /
Purchases
-
-
20.713
20.713
Despec A.fi.
5.869.015
-
389.459
6.258.474
Homend A.fi.
4.834.305
-
309.094
5.143.399
‹nfin A.fi.
5.431.286
-
461.823
5.893.109
Neteks D›fl Ltd.fiti.
4.611.145
-
10.397
4.621.542
20.745.751
-
1.191.486
21.937.237
Total
115
ANNUAL REPORT
1 January - 31 December 2009
Sales to
Related Parties
Goods and
Service Sales
Desbil A.fi.
Common Cost
Participation
Interest and
Foreign Exchange
Income
Total Expense /
Purchases
-
2.802
9.571
12.373
12.863.898
1.276.599
851.795
14.992.292
10.731
2.802
153.871
167.404
‹nfin A.fi.
8.023.374
4.800
765.743
8.793.917
Neteks D›fl Ltd.fiti.
2.850.108
-
3.518
2.853.626
23.748.111
1.287.003
1.784.498
26.819.612
Despec A.fi.
Homend A.fi.
Total
Purchases From
Related Parties
Goods and
Service Purchases
Desbil A.fi.
Common Cost
Participation
Interest and
Foreign Exchange
Expense
Total Expense /
Purchases
-
-
10.769
10.769
11.062.358
19.944
948.035
12.030.337
-
-
78.577
78.577
‹nfin A.fi.
5.864.858
-
350.534
6.215.392
Neteks D›fl Ltd.fiti.
5.209.632
-
10.868
5.220.500
22.136.848
19.944
1.398.783
23.555.575
Despec A.fi.
Homend A.fi.
Total
c) Benefits and wages provided to Management Staff
Account Name
Short term benefits provided to employees
1 January 2010
31 December 2010
1 January 2009
31 December 2009
2.384.466
2.088.213
Employment Termination Benefits
-
-
Other long term benefits
-
-
2.384.466
2.088.213
Total
Benefits and wages provided to Management Staff consist of general manager wages, assistant general manager wages.
38. NATURE AND LEVEL OF RISKS ARISING OUT OF FINANCIAL INSTRUMENTS
(a) Capital risk management
The Group, while trying to maintain the continuity of its activities in capital management on one hand, aims to increase its profitability
by using the balance between debts and resources on the other hand.
The capital structure of the Group consists of debts containing the credits explained in note 8, cash and cash equivalents explained
in note 6 and resource items containing respectively issued capital, capital reserves, profit reserves and profits of previous years
explained in note 27.
Risks, associated with each capital class, and the capital cost are evaluated by the senior management. It is aimed that the capital
structure will be stabilized by means of new borrowings or repaying the existing debts as well as dividend payments and new share
issuances based on the senior management evaluations.
The Group follows the capital by using debt/total capital rate. This rate is found by dividing the net debt by total capital. The net debt
is calculated by excluding the cash and cash equivalent amounts from the total debt amount (including credits, leasing and commercial
debts as indicated in the balance sheet). Total capital is calculated as resources plus net debt as indicated in the balance sheet.
General strategy of the Group based on resources is not different from the previous years.
116
ANNUAL REPORT
31 December 2010
31 December 2009
Total Debt
417.694.527
323.969.955
Minus (-) Cash and Equivalent
(26.415.870)
(2.320.888)
Net Debt
391.278.657
321.649.067
Total Shareholder’s Equity
120.437.244
112.776.405
Total Share capital
511.715.901
434.425.472
76,46%
74,04%
Account Name
Rate %
The Group is entening into hedging contracts (including derivative financial instruments) for the purpose of diversifing currency fluctuation
risks.
(b) Important Accounting Policies
Significant accounting policies of the Group relating to the financial instruments are stated in the footnote 2.
(c) Market risk
The , due to its activities, is exposed to changes in exchange rates (see article d) and interest rates (see article e), and other risks
(article g). The Group, as it holds the financial instruments, also bears the risk of other party not meeting the requirements of the
agreement.
Market risks seen at the level of Group is measured according to the sensitivity analysis principle. The market risk of the Group incurred
during the current year or the method of handling the encountered risks or the method of measuring those risks are no different from
the previous year.
(c1) Foreign exchange rate risk management
Transactions by foreign currency cause the formation of rate risks. The Group is exposed to rate risk due to the changes in exchange
rates used for exchanging the assets and liabilities from foreign currency to Turkish Lira. The rate risk evolves due to the commercial
transactions to be executed in the future and the difference between actives and passives of the recorded.
The Group is exposed to rate risk depending on the course of change of rate changes because it actually evaluates its accounts as
foreign exchange deposits and has payables and receivables in foreign currency.
Foreign Exchange Rate Sensitivity Analysis Table
Current Period
Previous Period
Profit / Loss
Profit / Loss
Appreciation of
Foreign Exchange
Depreciation of
Foreign Exchange
Appreciation of
Foreign Exchange
Depreciation of
Foreign Exchange
In the event of 10% value change of US Dollar against TL;
1- US Dollar Net Property / Liability
(5.376.668)
5.376.668
(5.727.877)
5.727.877
(5.376.668)
5.376.668
(5.727.877)
5.727.877
2- The part, protected from US Dollar Risk (-)
3- US Dollar Net Effect (1+2)
In the event of 10% value change of Euro against TL;
4- Euro Net Property / Liability
(40.779)
40.779
(622.808)
622.808
(40.779)
40.779
(622.808)
622.808
(5.417.447)
5.417.447
(6.350.685)
6.350.685
5- The part, protected from Euro Risk (-)
6- Euro Net Effect (4+5)
Total
117
ANNUAL REPORT
As of December 31, 2010 total amount of the commercial good inventories is 123.630.694 TL. A significant part of inventories are
purchased or imported in USD. As of December 31, 2009 total amount of the commercial good inventories is 134.601.338 TL. A
significant part of inventories are purchased or imported in USD.
c2 ) Credit Risk and Management
Table of Foreign Exchange Position
Current Period
Account Name
TRL Value
USD
EUR
GBP
226.257.352
142.650.727
2.791.142
-
43.237.733
26.926.709
785.243
-
2b. Non-Monetary Financial Assets
-
-
-
3. Other
-
-
-
269.495.085
169.577.436
3.576.384
1. Trade Receivables
2a. Monetary Financial Assets
4. Current Assets Total (1+2+3)
5. Trade Receivables
6a. Monetary Financial Assets
373
6b. Non-Monetary Financial Assets
-
7. Other
-
241
373
241
-
269.495.457
169.577.677
3.576.384
(291.405.123)
(183.490.699)
(3.771.657)
11. Financial Liabilities
(10.992.996)
(7.110.605)
-
12a. Other Monetary Liabilities
(13.247.695)
(8.564.059)
(3.738)
(199.165.363)
(3.775.395)
8. Fixed Assets Total (5+6+7)
9. Total Assets (4+8)
10. Trade Payables
12b. Other Non-Monetary Liabilities
13. Total Short Term Liabilities (10+11+12)
14. Trade Payables
15. Financial Liabilities
(315.645.814)
(8.024.113)
-
16b. Other Non-Monetary Liabilities
-
18. Total Liabilities (13+17)
(5.190.242)
(8.024.113)
(5.190.242)
-
-
(323.669.927)
(204.355.605)
(3.775.395)
-
19. Net Asset/ (Liability) Position of Derivative Instruments
off the Balance Sheet (19a-19b)
3.287.323
2.126.341
19a. Total Amount of Hedged Assets
3.287.323
2.126.341
19b. Total Amount of Hedged Liabilities
20. Net Foreign Exchange Asset / (Liability) Position (9-18+19)
-
-
16a. Other Monetary Liabilities
17. Total Long Term Liabilities (14+15+16)
-
-
(50.887.147)
(32.651.587)
(199.011)
-
(54.174.470)
(34.777.928)
(199.011)
-
21. Monetary Items Net Foreign Exchange Asset / (liability)
position (1+2a+5+6a-10-11-12a-14-15-16a)
22. Total Fair Value of Financial Instruments Used for
-
the Foreign Exchange Hedge
23. The Amount of Hedged part of Foreign Exchange Assets
23. The Amount of Hedged part of Foreign Exchange Liabilities
3.186.663
2.126.341
-
23. Export
13.816.010
24. Import
472.875.309
118
ANNUAL REPORT
Previous Period
Account Name
TRL Value
1. Trade Receivables
180.541.616
112.923.852
4.866.071
19.306.770
12.263.280
389.737
2b. Non-Monetary Financial Assets
-
-
-
3. Other
-
-
-
199.848.386
125.187.132
5.255.808
-
2a. Monetary Financial Assets
4. Current Assets Total (1+2+3)
5. Trade Receivables
6a. Monetary Financial Assets
USD
EUR
GBP
672
6b. Non-Monetary Financial Assets
-
7. Other
-
446
672
446
-
-
199.849.058
125.187.578
5.255.808
-
(216.064.992)
(133.023.950)
(7.300.296)
-
11. Financial Liabilities
(21.905.416)
(14.548.327)
-
12a. Other Monetary Liabilities
(15.290.751)
(8.952.235)
(838.481)
(156.524.512)
(8.138.778)
-
8. Fixed Assets Total (5+6+7)
9. Total Assets (4+8)
10. Trade Payables
12b. Other Non-Monetary Liabilities
13. Total Short Term Liabilities (10+11+12)
14. Trade Payables
15. Financial Liabilities
(253.261.159)
(10.094.751)
16a. Other Monetary Liabilities
-
16b. Other Non-Monetary Liabilities
-
(6.704.358)
(10.094.751)
(6.704.358)
-
-
(263.355.910)
(163.228.870)
(8.138.778)
-
off the Balance Sheet (19a-19b)
3.850.671
2.557.396
-
-
19a. Total Amount of Hedged Assets
3.850.671
2.557.396
17. Total Long Term Liabilities (14+15+16)
18. Total Liabilities (13+17)
19. Net Asset/ (Liability) Position of Derivative Instruments
19b. Total Amount of Hedged Liabilities
20. Net Foreign Exchange Asset / (Liability) Position (9-18+19)
(59.656.181)
(35.483.896)
(2.882.970)
-
(63.506.852)
(38.041.292)
(2.882.970)
-
21. Monetary Items Net Foreign Exchange Asset / (liability)
position (1+2a+5+6a-10-11-12a-14-15-16a)
22. Total Fair Value of Financial Instruments Used for
the Foreign Exchange Hedge
23. The Amount of Hedged part of Foreign Exchange Assets
23. The Amount of Hedged part of Foreign Exchange Liabilities
3.850.671
-
23. Export
8.400.999
24. Import
444.575.290
119
2.557.396
ANNUAL REPORT
CREDIT TYPES INCURRED IN RESPECT OFFINANCIAL INSTRUMENT TYPES
Receivables
Current Period
Commercial Receivables
Related
Maximum credit risk incurred as of the date of reporting (A+B+C+D+E) (1)
Foot
Note
Other Receivables
Other
Related
310.566.424
96.013
207.175
-
21.166.698
-
-
25.326.774
4.619.012
309.745.773
96.013
207.175
10-11
in value (2)
-
296.209
-
-
10-11
B. Book value of financial assets which conditions are renegotiated, and which
-
524.442
-
-
A. Net book value of financial assets which are undue or which did not decline
otherwise would be counted as overdue or declined in value (3)
6
6
25.326.774
10-11
524.442
C. Net book value of assets, overdue but did not decline in value. (6)
Foot
Note
Other
4.619.012
- The part of maximum risk secured by guarantee etc.
Deposit
at Banks
-
-
-
-
-
5.082.748
-
-
(5.082.748)
-
-
6
10-11
- The part secured by guarantee etc.
6
10-11
D. Net book values of assets declined in value (4)
-
6
-
6
10-11
- Overdue (gross book value)
10-11
- Decline in value (-)
-
-
-
-
- The part of net value secured by guarantee etc.
6
10-11
6
10-11
- Undue (gross book value)
-
6
- Decline in value (-)
- The part of net value secured by guarantee etc.
E. Elements containing credit risk off the balance sheet (5)
Receivables
Previous Period
Commercial Receivables
Related
Maximum credit risk incurred as of the date of reporting (A+B+C+D+E) (1)
- The part of maximum risk secured by guarantee etc.
Foot
Note
Other Receivables
Other
Related
Deposit
at Banks
Foot
Note
Other
1.569.999
624.262
228.870.545
1.205.509
150.053
-
34.269.777
-
-
624.262
227.507.477
1.205.509
150.053
10-11
-
269.589
-
-
10-11
-
1.093.479
-
-
10-11
A. Net book value of financial assets which are undue or which did not decline
in value (2)
1.569.999
6
B. Book value of financial assets which conditions are renegotiated, and which
otherwise would be counted as overdue or declined in value (3)
6
C. Net book value of assets, overdue but did not decline in value. (6)
- The part secured by guarantee etc.
D. Net book values of assets declined in value (4)
- Overdue (gross book value)
-
-
-
-
10-11
- Decline in value (-)
-
4.888.856
-
-
10-11
(4.888.856 )
-
-
10-11
- The part of net value secured by guarantee etc.
- Undue (gross book value)
- Decline in value (-)
- The part of net value secured by guarantee etc.
-
-
-
6
-
1.093.479
-
-
6
6
-
6
10-11
6
10-11
6
10-11
6
E. Elements containing credit risk off the balance sheet (5)
120
ANNUAL REPORT
Current Period (31 December 2010)
Commercial Receivables
Commercial Receivables
1-30 Days Overdue
641.987
-
1-3 Months Overdue
102.873
-
75.791
-
524.442
-
Commercial Receivables
Commercial Receivables
1.112.764
-
96.487
-
153.816
-
1.093.479
-
More than 3 Months Overdue
The part of net value secured by guarantee etc.
Previous Period (31 December 2010)
1-30 Days Overdue
1-3 Months Overdue
More than 3 Months Overdue
The part of net value secured by guarantee etc.
The Group’s credit risk management exposed from trade receivables. Trade receivables mostly consist from receivables from dealers.
The Group has set up an effective control system over its dealers and the risk is monitorized by credit risk management team and
Group Management. The Group has set limits for every dealer and these limits are revised if it is neccessary. The taking adequate
guarantees from dealers is another method for the risk management. There is no significant trade receivable risk for the Group, because
the Group has receivables from a wide range of customers instead of a small number customers and significant amounts. Trade
receivables are evaluated by taking into consideration of Group’s past experience and current economic situation and these receivables
are presented with their net values in the balancesheet after the proper provisions for doubtful receivables are made. The low profit
margin by force of the sectoral conditions make collection and credit risk management policies important and the Group management
show sensivity in these situations. The detailed information about the collection and risk management policies are as follows;
The Group starts executive proceedings and / or litigate for the receivables overdue for a few months. The Group can configure terms
for dealers in difficult situations. The low profit margin by force of the sectoral conditions make collection of receivables important.
There is a risk management team to minimize the risk of collections and the sales are realized by making credibility evaluations. The
sales to new or risky dealers are made in cash collection.
The Group is selling products to a wide range of institutions which are selling or buying computer and its equipments. The capital
structure of the dealers classified as “classic dealers” in the distribution channel is low. It is estimated that there are about 5.000 dealers
in this group in Turkey and in terms of risk management to minimize the receivable risk of Datagate by taking steps and establishing
its own organisation and working system. The steps taken by the Group is as follows;
The sales to new customers which has no experience more than 1 year : The sales to new customers which has no experience more
than 1 year are made in cash collection.
The information team involved in receivable and risk management department consist of 2 staff and this team is monitoring the dealers
continuously.
Credit Committee: The information about the customers which has experience more than 1 year in the sector and the customers
which are demanding an increase for the credit limit are prepared by the information team and presented to credit committee every
week. Credit committee consist of Senior Vice President of Finance, Finance Manager, Accounting Manager, information team staff
and the Sale Manager of related Customer. Credit Committee establish credit limits to related customers by taking into consideration
the information gained from the information team, past payments and sale performances. The Credit Committee determine the
conditions and if it is needed they demand for guarantees, mortgages, etc.
Group sales are widespread on Turkey, therefore it is reduce the concentration risk.
Trade receivables are evaluated by taking into consideration the Group policies and procedures and the trade receivables are shown
with their net value after the provisions for doubtful receivables are made in the financial statements. (Note:10)
121
ANNUAL REPORT
(c3) Management of interest rate risk
Group’s fixed interest financial instruments liabilies are stated in Note: 8. Group’s fixed interest assets (deposit etc.) are stated in
Note: 6
Table of Interest Position
Fixed Interest Financial Instruments
Current Period
Previous Period
1.000.140
-
19.525.078
32.314.574
Current Period
Previous Period
Financial Assets
-
-
Financial Liabilities
-
-
Financial Assets
Financial Liabilities
Floating Rate Financial Instruments
(c4) Liquidity risk management
The Group tries to manage the liquidity risk by maintaining the continuation of sufficient funds and loan reserves by means of matching
the financial instruments and terms of liabilities by following the cash flow regularly.
Liquidity Risk Tables
Prudent liquidity risk management signifies maintaining sufficient cash, the utility of fund sources by sufficient credit transactions and
the ability to close out market positions.
Risk of existing or future possible debt requirements being fundable is managed by maintaining the continuation of availability of
sufficient numbers and high quality credit providers.
The table below indicates the term divisions of derivative and non-derivative financial liabilities of the Group in TL currency.
31.12.2010
Expected Terms
Non-Derivative Financial
Liabilities
Bank Credits
Book Value
Commercial Debts
Other Debts
Expected Terms
Derivative Financial
Liabilities
Shorter than
3 Months
Between
3-12 months
Between
1-5 years
Longer
than 5 year
399.140.961
403.267.462
386.681.131
6.012.865
9.970.175
603.291
19.709.602
22.215.866
5.629.535
6.012.865
9.970.175
603.291
-
-
141
156
156
365.962.360
367.582.581
367.582.581
13.468.858
13.468.858
13.468.858
Issuances of Debt
Instrument
Leasing Liabilities
Cash outflows Total
As Per the Agreement
Book Value
Cash outflows Total
As Per the Agreement
Shorter than
3 Months
Between
3-12 months
Between
1-5 years
Longer
than 5 year
100.660
89.471
89.471
-
-
-
Derivative Cash Inflow(*)
3.287.323
3.287.323
3.287.323
-
-
-
Derivative Cash Outflow
(3.186.663)
(3.197.852)
(3.197.852)
-
-
-
(*)The amount of forward transactions consist of USD 2.125.341. In liability calculation, derivative cash outflow is calculated using exchange rates
valid at the end of term. Derivative cash inflow is calculated using the exchange rate valid on December 31, 2010. Actual profit or loss will arise
at the end of term.
122
ANNUAL REPORT
31.12.2009
Expected Terms
Cash outflows Total
As Per the Agreement
Book Value
Shorter than
3 Months
Between
3-12 months
Between
1-5 years
Longer
than 5 year
305.788.973
309.943.977
291.014.033
6.345.517
11.996.821
587.606
32.467.824
35.626.817
16.699.283
6.343.107
11.996.821
587.606
Issuances of Debt
Instrument
-
-
-
-
-
-
Leasing Liabilities
1.094
3.378
968
2.410
265.080.401
266.074.128
266.074.128
8.239.654
8.239.654
8.239.654
Non-Derivative Financial
Liabilities
Bank Credits
Commercial Debts
Other Debts
Expected Terms
Derivative Financial
Liabilities
Book Value
Cash outflows Total
As Per the Agreement
Shorter than
3 Months
Between
3-12 months
Longer
than 5 year
Between
1-5 years
(20.673)
(20.673)
(20.673)
-
-
-
Derivative Cash Inflow(*)
3.850.671
3.850.671
3.850.671
-
-
-
Derivative Cash Outflow
(3.871.344)
(3.871.344)
(3.871.344)
-
-
-
(*) The amount of forward transactions consist of USD 2.557.396 In liability calculation, deriative cash outflow is calculated using exchange rates
valid at the end of term. Derivative cash inflow is calculated using the exchange rate valid on December 31, 2009. Actual profit or loss will arise
at the end of term.
(c5) Analyses of other Risks
Risks Related to Financial Instruments, Stocks Etc.
Group has no stocks or similar marketable securities evaluated by fair value in the current period.
39. FINANCIAL INSTRUMENTS
The Group considers that the recorded values of financial instruments reflect the fair values.
Aims at financial risk management
The finance department of the Group is responsible for maintaining the access to financial markets regularly and observing and
managing the financial risks incurred in relation with the activities of the Group.The said risks include market risk (including foreign
exchange risk, fair interest rate risk and price risk), credit risk, liquidity risk and cash receiving risk.
Fair Value of Financial Instruments
Fair value is the amount for which an financial instrument could be exchanged except compulsory sale or liqudation process between
willing parties and it is determined with its market value if there is a quoted price.
The Group has determined the estimated values of financial instruments by taking into consideration the present market information
and proper valuation methods. But determination of market information and estimation of fair value require interpretation and discernment.
Consequently the estimations presented are not always the indicators of the values could be realized from a current market transaction.
The methods and assumptions used for the determination of the fair value of the financial instruments are as follows;
Monetary Assets
Balances denominated in foreign currencies are converted into Turkish Lira by the exchange rate rulling at the balancesheet date. It
is predicted that these balances are considered to approximate to their net book value.
Financial instruments in which cash and cash equivalents are included are carried by their cost value and it is predicted that their
net book value are considered to approximate to their fair values due to their short-term maturity.
123
ANNUAL REPORT
It is predicted that the net book value of trade receivables with provisions made for doubtful receivables present their fair values.
Monetary Liabilities
Balances denominated in foreign currencies are converted into Turkish Lira by the exchange rate rulling at the balancesheet date. It
is predicted that these balances are considered to approximate to their net book value.
It is predicted that net book value of bank loans and other monetary liabilities are considered to approximate their fair values due to
their short-term maturity.
It is predicted that the net book value of trade payables present their fair values due to their short-term maturity.
Fair Value Assessment :
The Group has applied the amendments in IFRS 7 related with the financial instruments evaluated by fair value in the balancesheet
effective from the date of January 1, 2009.
The amendment in fair value calculations is disclosed in accordance with the steps of hierarchy for fair value mentioned below;
Level 1: Quoted prices in active markets for identical assets and liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).
Level 3 : Inputs for the asset or liability that are not based on observable market data
It is predicted that net book value of balances are considered to approximate to their fair values.
The Group present its financial investments with their fair values in the financial statements as of December 31, 2010. (Level 2) (Note:7)
It is accepted that the discounted net book value of financial assets such as cash and cash equivalents present thier fair values due
to their short-term maturity.
Trade receivables and payables are measured at their discounted cost using the effective interest method and it is accepted that the
net book value of these balances are considered to approximate their fair values.
40. SUBSEQUENT EVENTS
None.
41. OTHER ISSUES
None.
124
ANNUAL REPORT
Ayaza¤a Mahallesi, Cendere Yolu No:9/1 fiiflli - Istanbul / Turkey
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