2013 Annual Report - Ülker Investor Relations

Transkript

100% Happiness
2013 ANNUAL REPORT
Contents
Key Financial Indicators
In 2013, Ülker increased its
consolidated sales by 17.3% and
its operating profit by 39.5%.
05 Key Financial Indicators
06 Operational Indicators
07 Capital and Shareholder Structure
08 Production Facilities
09 Ülker’s Share Performance on the BIST
10 Message from the Chairman
12 Board of Directors
15 Message from the CEO
16Strategies
18 Current Economic Outlook, Global and Turkish Food Industries
20 Key Developments
22 Production and Capacity
25Investments
26Subsidiaries
30 Human Resources
33 Quality and R&D
38 Social Responsibility
42 Corporate Governance Principles Compliance
Report
53 Risk Management
54 Investor Relations
55 Amendments to the Articles of Association
64 2013 Ordinary General Assembly Meeting Agenda
65 Subsidiary Company Report Results
66 Power of Attorney
67 Dividend Distribution Policy
68 Independent Audit Report
05
Message from the Chairman
2013 was a year
with innovation and
achievements for Ülker.
10
Current Economic Outlook, Global
and Turkish Food Industries
Global economy continued to grow
in low gear in 2013.
18
Production and Capacity
Increasing capacity utilization rates...
22
Human Resources
Ülker sees its employees as its
“biggest capital” and “most
valuable asset”.
30
70 years ago, launching its
operations in a small workshop
in Istanbul Eminönü with
six-seven boilers, a small oven
and three workers, Ülker is the
world’s giant brand in its sector
today. With its innovative vision,
Ülker always freshened its
consumers’ trust as well as its
products.
Getting the outcomes of its
investments in 2013, Ülker
continues to give happier
moments to more consumers in
more locations while continuing
to be among Turkey’s most
famous and most appreciated
top brands.
2
ÜLKER BİSKÜVİ ANNUAL REPORT 2013
Increasing Sales
Increasing sales
volume
SALES VOLUME BY CATEGORY (TonS)
Biscuit
Chocolate
Cake
478,725
2013
158,776
254,889
Biscuit
Chocolate
65,060
13.4%
Cake
422,008
2012
133,784
231,659
56,565
NET SALES BY CATEGORY (TL MILLION)
Biscuit
Chocolate
Cake
Other
2,748
2013
992
Biscuit
1,351
Chocolate
299
Cake
Other
2,344
2012
846
106
1,139
264
95
17.3%
3
Increasing Profit
Increasing
profitability
NET PROFIT (TL MILLION)
NET PROFIT MARGIN (%)
189
2013
167
2012
EBITDA (TL MILLION)
6.9
2013
7.1
2012
EBITDA MARGIN (%)
ADJUSTED EBITDA (Excludes Other
Nonoperating Income & Expenses)
315.1
2013
2012
220.9
11.5
2013
2012
9.4
4
Sustainable Profitability
Successful
results
COMPONENTS OF EBITDA MARGIN IMPROVEMENT (%)
2013 EBITDA Margin
11.5
Better Cost & OPEX Management
2.5
Category Mix Effect
1.3
Distribution Restructuring
3.4
2011 EBITDA margin
4.3
5
Key Financial Indicators
Strong financial
structure
Summary Balance Sheet (TL)
2013
2012
Current Assets
2,128,504,531
2,258,514,250
Non-Current Assets
1,033,447,409
898,093,294
Total Assets
3,161,951,940
3,156,607,544
Short-term Liabilities
1,826,580,192
1,143,105,831
Long-term Liabilities
67,203,301
933,748,301
Shareholders’ Equity
1,129,829,508
957,451,288
138,338,939
122,302,124
3,161,951,940
3,156,607,544
2013
2012
2,748,370,545
2,343,232,826
Gross Profit
633,310,272
505,250,892
Operating Profit
312,603,638
224,166,175
Net Profit
188,648,445
166,968,003
Ratios
2013
2012
Gross Profit Margin (%)
23.0
21.6
6.9
7.1
0.55
0.49
Non-controlling interest
Total Assets
Summary Profit and Loss (TL)
Revenue
Net Profit Margin (%)
Earnings per share (1 TL Nominal)
Operating Profit (TL million)
313
2013
224
2012
2011
Shareholders’ Equity (TL million)
113*
2013
2012
2011
*In line with the reporting prior to the new Announcement of Public Oversight.
Ülker’s operasting profit realized TL 313 million in 2013.
1,268
1,080
1,097
6
Operational Indicators
Increasing
production
capacity
2013 Total Production (Tons)
448,643
Biscuit Production
Chocolate Production
Cake Production
225,485
158,298
64,860
2013 Total Sales (TONS)
478,725
Biscuit Sales
Chocolate Sales
Cake Sales
254,889
158,776
65,060
7
Capital and Shareholder Structure
Solid
future
Ülker’s shareholding structure as of December 31, 2013 is presented below. As of December 31, 2013, 39.81%
of Ülker stock consisted of free-float shares.
Yıldız Holding A.Ş.
Share Value
December 31,
2013, Share
Ratio
Share Value
December 31,
2012, Share
Ratio
166,967.458
48.82%
151,778,531
44.38%
-
-
73,308,031
21.44%
38.888.808
11.37%
48.220.722
14.10%
136,143734
39.81%
68.692.716
20.08%
342,000,000
100.00%
342,000,000
100.00%
Dynamic Growth Fund
Yıldız Holding Subsidiaries and
Ülker Family Members
Free Float
Total
CAPITAL STRUCTURE
48.82%
39.81%
Free Float
11.37%
Yıldız Holding
Subsidiaries
and Ülker Family
Members
For Ülker Biscuits,
2013 was a year full
of innovations and
achievements. We make
our investors happy
with our corporate
procedures and
operational success
while making our
consumers happy with
our quality products.
8
Production Facilities
Production
facilities
Hadımköy, Istanbul Factory
•Cake
•Established in 1992
• Capacity: 45 thousand ton/year
•27 thousand m2 indoor area
Gebze Factory
•Biscuit & cracker
•Capacity: 59 thousand ton/year
Ankara Factory
•Biscuit
•The biggest biscuit production factory
of the Middle East region
Topkapı, Istanbul Factory
•Chocolate
•Capacity: 194 thousand ton/
year
Silivri, Istanbul Factory
•Chocolate, chocolate covered
biscuit
Karaman Factory
•Biscuit, cake, cracker & chocolate
•Ülker branded other products
•Ülker ownership ratio: 44%
9
Ülker’s Share Performance on the Bist
Rising market
value
Ülker’s shares are publicly traded on the BIST National Market under the ticker symbol ULKER.IS. Investors who
sought a long-term investment with consistent returns continued to invest in Ülker. The Company’s share price
stood at TL 15.20 as of December 31, 2013. At year-end, Ülker’s market capitalization totaled TL 5,198 million,
while the market value of its free-float shares had risen to TL 2,070 million.
Company
Reuters & Forex Code
Bloomberg Code
Industry
Ülker Bisküvi
ULKER.IS
ULKER TI
Food
NATIONAL MARKET
BIST ALL
BIST FOOD, DRINK
BIST INDUSTRIAL
BIST DIVIDEND
BIST DIVIDEND 25
BIST NATIONAL
BIST 100
BIST 50
BIST 30
Related BIST Index
As of December 31, 2013
Share Price (TL)
Free-float Ratio (%)
Market Capitalization (TL million)
Share
Performance (%)
TL
USD
2011
(0.8)
(19.0)
15.20
39.81
5,198
2012
103.8
115.9
2013
53.7
30.6
BIST 100 and Ülker
19
ÜLKER
100
BIST-100
17
90
15
80
13
70
11
60
12/25/2013
12/4/2013
11/13/2013
10/23/2013
10/2/2013
9/11/2013
8/21/2013
7/31/2013
7/10/2013
6/19/2013
5/29/2013
5/8/2013
4/17/2013
3/27/2013
3/6/2013
2/13/2013
1/23/2013
1/2/2013
9
10
Message from the Chairman
An innovative
world brand
Achieved year-end results
reveal the correctness
of our strategies and the
success in our practices.
Dear Shareholders,
Given that developments in the global economy and
actions taken by central banks have played a significant
role in shaping the current market environment.
I believe it would be useful to first review the world’s
economy in 2013 before I move on to an evaluation of
the Turkish economy and our business.
The global recession experienced over the last three
years entered a phase of recovery and improvement in
2013, increasing expectations that moderate growth
will be achieved in the coming years. The acceleration
in US gross domestic product (GDP) growth along with
the positive signals in the European economy boost
hopes for 2014.
Looking back at the domestic environment, the Turkish
economy posted stronger growth, as high as 4%,
compared to other nations in the first nine months
of 2013, right after we began the year with new goals
and expectations. Although the US Federal Reserve’s
announcement that it would start to taper its liquidity
injections from July onwards caused some fluctuations
in financial markets, it did not lead to significant cash
outflows from developing countries until the end of the
year. The food and beverage industry in our country
benefited from this positive market environment and
posted its biggest growth in recent years.
11
2013 was full of innovations and new achievements
for Ülker Bisküvi. While our corporate efforts and
operational successes pleased our investors, our high
quality products made our consumers happy.
Quality was the main theme we focused on throughout
the year. In 2013, we did not limit the concept
of quality solely to our products but evaluated all
Company processes and results in different contexts
and from different perspectives, and put a great deal
of effort into doing our job in the best possible way.
These intensive efforts throughout the year
yielded favorable financial results: In 2013, our
Company increased consolidated sales by 17% while
operating profit rose 40%. We owe this success to
our employees and their constant drive to achieve
continuous improvements as well as to our customers’
consumption habits and their unwavering confidence
in Ülker.
Following the block sale, Ülker Bisküvi’s average daily
trading volume increased fivefold when compared with
the period prior to the sale. Further, Ülker Bisküvi was
subsequently included in some of the most credible
stock exchange indices and its market capitalization
increased significantly. All of these developments
clearly demonstrate that we made the right decision.
In 2014, we plan to continue giving top priority
to the quality of our products and all Company
operations as we always do, while responding to our
customers’ needs and demands in a faster and more
effective manner. I believe that in the coming period
our relationship with our stakeholders will further
strengthen. We will continue to listen closely to the
voices of our customers, stakeholders and employees,
value their priorities, and achieve even stronger results
than in previous years by operating in a high quality and
competitive manner.
Respectfully yours,
Another important development in 2013 was the
sale of Yıldız Holding’s 20% stake in Ülker Bisküvi. In
order for Ülker Bisküvi to reach a market capitalization
it well deserves, to become included on well-known
global stock market indices, and to increase the daily
trading volume to a level acceptable for investors,
Yıldız Holding sold its 20% stake in Ülker Bisküvi to 44
international investors on October 4, 2013.
Murat ÜLKER
Chairman
12
Board of Directors
Murat Ülker
Chairman
A graduate of Boğaziçi University, Faculty of Economics
and Administrative Sciences, Department of Business
Administration, Murat Ülker began his professional
career in 1982 and started work as Control
Coordinator with the Group in 1984. He later attended
various training courses (AIB and ZDS) abroad and
worked as a trainee at Continental Baking Company in
the US. Mr. Ülker also worked in the export business
for two years in the Middle East. Subsequently, he
analyzed about 60 factories and facilities operating
in the biscuit, chocolate and food industries in the US
and Europe over a period of three years. Mr. Ülker also
participated in various IESC projects, and spearheaded
many vertical integration related investments. After
serving as Assistant General Manager for Enterprises,
General Manager, Executive Committee Member and
Board Member in various companies of the Group, Mr.
Ülker was appointed Chairman of the Board of Yıldız
Holding in 2000. Mr. Ülker speaks English and German;
his hobbies include sailing and traveling with his family.
He is married and has three children.
Ali Ülker
Deputy Chairman
Ali Ülker graduated from Boğaziçi University, Faculty of
Economics and Administrative Sciences, Department
of Economics and Business Administration. He also
attended various academic programs at IMD, Harvard
and Wharton. Mr. Ülker took part in the De Boccard &
Yorke Consultancy Company’s Internal Kaizen Study
(1992) and the IESC Sales System Improvement and
Internal Organization Project (1997). He began his
professional career in 1985 as a trainee in the Quality
Control Department of Ülker Gıda A.Ş. Later, he served
as trainee, Sales Executive, Sales Coordinator, Product
Group Coordinator and Product Group Manager
between 1986 and 1998 at the chocolate production
facilities and at Atlas Gıda Pazarlama A.Ş. He then
served as General Manager of Atlas Gıda Pazarlama in
1998, Deputy Chairman of the Consumer Group for
Marketing and responsible for Chain Stores in 2000,
General Manager of Merkez Gıda Pazarlama A.Ş. in
2001 and Deputy Chairman of the Organized Retail
Food Group in 2002. In 2005, he was appointed
Chairman of Ülker (Biscuit, Chocolate, Candy) Group.
Mr. Ülker speaks English and German; his hobbies
include fishing, watching movies, reading books, and
playing basketball and billiards.
Mehmet Tütüncü
Board Member - CEO
Mehmet Tütüncü was appointed Chairman of the Food
and Beverages Group in 2005. As of October 2009,
the Gum and Candy companies were incorporated
into the Food Group; Mr. Tütüncü was appointed CEO
for biscuit-chocolate-cake operations in September
2011, in addition to his other duties. Mr. Tütüncü
began his professional career in 1981 as an engineer
at the Ministry of National Education, Construction
Department. From 1983 to 1987, he worked as a
Local Industry Specialist at the Ministry of Industry
and Trade. Between 1987 and 1996, he served as
Production Manager, Business Manager and General
Manager, respectively, at Best Rothmans Entegre
Sigara ve Tütün Sanayi A.Ş. Mr. Tütüncü joined the
Group in 1996 as Facilities Coordinator, and later
served as General Manager of Ülker Bisküvi and Çikolata
production facilities in 1998; in 2000, he became the
Deputy Chairman of the Ülker Group. Mr. Tütüncü is
a graduate of Gazi University, Faculty of Engineering,
Mechanical Engineering Department. In 1987, he
won the IRI scholarship and studied Production,
Quality Control and Maintenance Procedures in Italy.
He also holds a Master of Science degree in the field
of Industrial and Organizational Psychology. From
1993 until 1994, Mr. Tütüncü attended the Business
Administration Training Program at Boğaziçi University
where he studied Marketing Techniques, International
13
Marketing, Factory Organization and Management. He
also completed the Strategic Marketing Program at
Harvard Business School and attended several training
programs at IMD/Switzerland and Insead/Singapore.
Mr. Tütüncü speaks English and is a member of
TÜSİAD (Turkish Industrialists’ and Businessmen’s
Association). Mr. Tütüncü was born in 1958. He is
married and has three children.
Ahmet Özokur
Board Member
Ahmet Özokur studied Business Administration
and Marketing at Indiana University, Department of
Business Administration and at the European Business
School. He began his professional career in 2004 as
Executive Board Member at Hızlı Sistem A.Ş. In 2005,
he was appointed General Manager of Datateknik,
and he was promoted to the position of CEO of
Datateknik Informatics Group within the same year.
Post merger in 2006, Datateknik Informatics Group
became a fully integrated group engaged in systems
integration, distribution of computer components,
software development and distribution, development
of interactive applications, manufacturing and
distribution of Expert branded products; it was a
pioneering and innovative company in its sector. In
2008, with the restructuring of Datateknik Informatics
Group under the umbrella of Yıldız Holding, Mr. Özokur
was appointed Assistant to the Chairman. Within the
same year, he was also appointed Project Leader
at Yıldız Holding Real Estate Investment Group and
Executive Member of Beta Marina İşletmeciliği A.Ş.
Subsequently, Mr. Özokur also served as the General
Manager of Sağlam Real Estate Investment Trust which
eventually merged with SAF REIT. Mr. Özokur has an
interest in aquatic sports. He is married and has two
children.
Mahmut Mahir Kuşculu
Board Member
Mahmut Mahir Kuşculu graduated from Istanbul Erkek
Lisesi, and then from Istanbul University, Faculty of
Economics. He went on to complete his postgraduate
education in marketing in the US. From 1970, Mr.
Kuşculu served as Executive Manager and Board
Member in the family glass industry businesses,
Tamcam A.Ş. and Arsal Cam Sanayii. He founded Kutaş
Dış Ticaret ve Pazarlama A.Ş. in 1982, and Erdem
Dış Ticaret A.Ş. in 1985, while also taking part in the
management of these companies. Mr. Kuşculu has
served on the professional committees of the Istanbul
Chamber of Commerce and the Istanbul Chamber of
Industry for 20 years; also, he has served as a Member
of the Assembly of Istanbul Chamber of Industry for 15
years. Mr. Kuşculu is married and has two children.
Cengiz Solakoğlu
Board Member
Cengiz Solakoğlu graduated from the Istanbul
Academy of Economic and Business Studies in
1964, and began his professional career in sales at
Beko Ticaret A.Ş. He was promoted to Regional Sales
Manager in 1969 and to Sales Director in 1975. After
serving as the General Manager of Beko Ticaret from
1977 to 1983, he was appointed General Manager of
Atılım A.Ş., another Koç Group company. During his
eight year tenure in that position, he pioneered the
efforts to strengthen the Arçelik Authorized Dealer
System. In 1991, Mr. Solakoğlu was appointed Deputy
Chairman of the Consumption Group of Koç Holding;
he was also a Member of the Executive Committee of
the Group between 1996 and 1998. In 2002, he was
appointed Chairman of the Durable Consumer Goods
Group of Koç Holding. Having worked at the Koç Group
continuously for more than 37 years, Mr. Solakoğlu
retired due to the Group’s policy of mandatory
retirement at age 60. He is among the founders of the
Educational Volunteers Foundation of Turkey (TEGV)
and the 1907 Fenerbahçe Association. Mr. Solakoğlu
was named a Leader of Civil Society by Ekonomist
magazine in 2003. He is married and has two children.
14
Board of Directors
Alain Strasser
Board Member
Alain Strasser was born in 1947. After first graduating
from the Departments of Mathematics and Philosophy
in 1964, he obtained an MBA from E.S.C. in Paris in
1968 and a Masters in Economics from the same
university in 1970. Until 1972, he was employed
at Senegal’s Dakar University as an instructor in
management. His career in the private sector began
when he held several positions at Unilever, mainly in
France, in the sales and marketing departments. In
1982, Mr. Strasser, who had become an expert in
homecare products, joined Tambrands, and there
he served as Sales and Marketing Director for France
(1982-83), General Manager for France (198387), General Manager for the United Kingdom
(1987-89), European Division Deputy Head (199093), and International Head (1993-94). After the
acquisition of Tambrands by Procter & Gamble, Mr.
Strasser was appointed to Campell Soup Company
in 1994 as President of Campbell Biscuits Europe.
He was instrumental in the Campbell’s acquisition of
Danone’s Liebig Soup and he served as the President
of Delacre Biscuits and Liebig Soup until 1998.
From 1998 to 2007, Mr. Strasser was employed by
Artal, a Belgian private equity firm, as CEO of Harry’s
SAS, where he actively managed the company’s
restructuring and strategic partnership processes.
Mr. Strasser is still a member on the Boards of several
companies, including SSL in London; Mood Media
and Benedicta in Galapagos; Alpina in France; and
Mankattan in China. Mr. Strasser is married and has
three children.
Duran Akbulut
Board Member (Independent)
Born in the Suşehri district of Sivas in 1937, Mr. Akbulut
completed primary school and junior high school there
before moving to Istanbul. In 1959, he started his
professional career and became a partner in the “Goya”
retail chain. From the 1970s onwards, he served as Board
Member at various Cankurtaran Holding companies
including Esem, Roventa, Adidas; Chairman at Aymasan;
and partner at Adidas and Esem for 28 years. He was a
member of the Turkish Football Federation in 1983, as well
as Board Member at Cercle d’Orient from 1978 until 1994,
which included two years of service as Vice Chairman.
Since 1996, Mr. Akbulut has served as Chairman of Cercle
d’Orient. He is married and has two children.
Prof Dr. Ekrem Pakdemirli
Board Member (Independent)
Born in 1939 in İzmir, Mr. Pakdemirli graduated from
Middle East Technical University, Department of
Mechanical Engineering, and received his master’s
degree from the same institution. He obtained his
PhD from Imperial College in London. During his
career, Mr. Pakdemirli has served as Assistant to the
Undersecretary of State Planning Organization, Vice
President of Dokuz Eylül University, Undersecretary of
Treasury and Foreign Trade, Chief Advisor to the Prime
Minister and Ambassador in the home office. From 1987
until 2002, he was the Member of Parliament for the
province of Manisa for four terms, serving as Minister of
Transportation, Minister of Finance and Customs, Minister
of State, and Deputy Prime Minister. Between 2003 and
2008, Mr. Pakdemirli served as faculty member at Bilkent
and Başkent Universities, and has been a faculty member
of Istanbul Commerce University since 2008. Currently,
he serves as Independent Board Member at Saf REIT and
Sinpaş REIT, as well as Board Member at Albaraka Türk. Mr.
Pakdemirli has had more than 500 articles and 10 books
published to date. He is married and has five children.
15
Message from the Ceo
Operational
profitability
2013 was one of Ülker’s
best years ever in terms
of sales and profits.
Dear Shareholders,
Achieving 4% growth in the first nine months of 2013,
Turkey’s economy once again outperformed that of
other countries around the world. This solid domestic
economic growth had a positive effect on the food and
beverage industry in particular. As the sector leader,
Ülker’s own robust performance made a significant
contribution to the 10% growth achieved in the Turkish
food and beverage industry in 2013.
2013 was one of Ülker’s best years ever in terms of
sales and profits. During the year, our Company’s sales
increased 17%, and we closed the period with
TL 2.75 billion in revenues. In 2013, Ülker’s operating
profit also hit a record high, significantly increasing by
40%, to TL 224 million, up from TL 313 million a year
earlier. This positive change in the income statement
stemmed from the increase in the Company’s sales
volume and revenues, thanks to its simple yet highly
competitive business model. Operating profit also
improved significantly thanks to our ongoing efforts to
reach operational excellence.
With our strong launching strategy, we continued to
create few but strong brands. We focused on new
product launches in 2013. We offered our consumers
new tastes with Laviva in the chocolate category, with
Dore and Saklıköy in the biscuits category and with Islak
Kek in the cake category.
The financial and operational success we had achieved
by year’s end was a gratifying result for our investors,
who have invested in the future of Ülker. The Company’s
steady financial growth over the last eight quarters
shows that a solid financial and operational foundation
has been built to assure a sustainable and profitable
growth trajectory. Our market shares continue to reflect
Ülker’s competitive strength in our categories.
Creating alignment across the value chain to achieve
efficiency and shared objectives is essential for
sustaining this growth. Thanks to our commitment to
being customer-focused, more competitive, more
efficient and more innovative, we believe that we will
continue to create significant value for all our customers
and stakeholders. The results we have achieved also
strengthens our faith and motivation to meet our
2016 targets. As in previous years, I hereby express
my gratitude to our shareholders, business partners,
employees and customers that we have always felt their
support and contribution.
Best regards,
Mehmet TÜTÜNCÜ
CEO
16
Strategies
Increasing brand
investments
Our competitive power in
the categories we operate
continues to be reflected
in our market share
figures as well.
In the area of productivity, we aim to:
•Become the most productive company in all
segments of the industry,
•Boost product quality through operational efficiency
efforts and slash production costs,
•Achieve further efficiency and productivity in
distribution channels and sales points by cutting
sales costs.
In brand investments, we aim to:
•Offer our powerhouse brands to consumers at
reasonable prices,
•Ensure the continuity of our brand investments.
Overall, we aim to:
•Increase our operating profit by achieving higher
sales volumes and revenues in biscuit, chocolate and
cake operations,
•Expand to become a strong regional player,
•Implement and maintain good corporate governance
practices at the highest level,
•Achieve strong results that will satisfy all
stakeholders.
Profit Margin Management
•Decreasing average cost through opportunity
purchases and effective raw material price
management.
17
18
Current Economic Outlook, Global and Turkish Food Industries
Expectation for
positive growth
In parallel to the
developments in the
global markets, in 2013
increasing trend started
in the decreased food
prices.
In 2013, the global economy continued to grow at
a slow pace. While the dynamics of growth began to
change, risks remained. The growth rates in emerging
markets, which have driven global economic growth
in previous years, somewhat decelerated in 2013.
According to projections in the IMF’s October 2013
report, the world economy is expected to have grown
2.9% in 2013, with the highest contribution coming
from developing countries with their projected growth
rate of 4.5%. Meanwhile in 2014, the global economy
is forecast to grow 3.6%, with most of the pickup in
growth expected to be driven by advanced economies.
US economic growth will most likely have an impact on
global growth in 2014. As everyone is now convinced
that the Federal Reserve will end asset purchases
toward the end of 2014, some cash outflows from
developing countries are expected. Europe’s economy
will likely demonstrate positive, though limited, growth
in 2014 and the European Central Bank will possibly
cut interest rates in the second half of the year.
Although food commodity prices had previously been
on the decline due to global market developments,
they began to rise in 2013. By year’s end, prices
of dairy products, oils and cocoa had increased.
Specifically, negative developments in cocoa and oil
production and supply-demand imbalances led to
an upswing in prices. The food price index averaged
212 points in 2013, a drop of 7% compared with the
prior year. The UN Food and Agriculture Organization
(FAO) forecasts that food prices will remain high in the
coming period.
19
The Turkish Economy
The Turkish economy has maintained positive growth
since the last quarter of 2009, and it continued to
grow steadily through third quarter 2013. While most
developed economies experienced downturns due to
global financial crisis, Turkey is ranked second among
OECD countries as of end of third quarter of 2013,
and emerged as the fourth fastest-growing economy
among the G-20 nations.
Rising domestic demand and increased government
spending drove growth in the Turkish economy during
the first and second quarters of the year; in the third
quarter, an increase in private sector spending further
contributed to the country’s economic growth.
Turkey’s economic growth rates for the first three
quarters were 3%, 4.5% and 4.4%, respectively. By the
end of the first nine months of the year, the Turkish
economy had grown 4%, proof that the IMF’s target
of 3.8% for the year, as well as the 3.6% target set
in the government’s Medium Term Fiscal Plan, were
achievable. According to the Medium Term Fiscal
Plan prepared by the Turkish Ministry of Finance, the
country’s growth rate for 2014 is projected at 4%.
Looking back at the economy’s growth drivers,
exports made a relatively low contribution to Turkey’s
economic growth in 2013 when compared with the
prior year. This was mainly due to the decline in foreign
demand caused by the recession in Europe and the
political uncertainty in the Middle East and North
African regions, which are generally seen as alternative
markets to Europe. On the other hand, a strong rise in
consumer lending had a positive effect on domestic
economic growth.
As of third quarter of
2013, Turkish economy
has been ranked as the
second most rapidly
growing economy among
the OECD countries
and has been ranked as
the fourth most rapidly
growing economy among
the G-20 countries.
As of year-end 2012, Turkey’s annual inflation rate
stood at 6.6%; however, due to the increase in foreign
exchange rate and energy costs, inflation had spiked
to 7.4% by the end of 2013. An analysis of the main
consumer spending categories shows that inflation in
the Food and Non-alcoholic Beverages category was
9.7% for the year. In its latest forecast, the Central
Bank of Turkey expects a 6.6% inflation rate in 2014.
20
Key Developments
Increasing
stock value
Average trading volume
of Ülker Bisküvi shares
increased to TL 27 million
between October 5 and
December 31, 2013.
Profit Distribution Policy
On January 18, 2013, the Company’s profit
distribution policy for 2012 and beyond was
established within the framework of Corporate
Governance Principles.
Dividend Distribution in 2013
The Ordinary General Assembly held on March 28,
2013 approved the distribution of TL 150 million in
dividends, as well as the amendments to the Articles
of Association, in accordance with the Capital Market
Law enacted on December 6, 2013, and the Turkish
Commercial Code.
Transfer of Shares
Due to the liquidation of the Dynamic Growth Fund
on July 15, 2013, all assets in the portfolio were
transferred to participation shareholders in proportion
to their existing shareholdings. As a result, 73,308,031
shares of Ülker Bisküvi San. A.Ş., which had belonged
to the Fund, have been transferred to Yıldız Holding
and its subsidiaries. With this transfer, Yıldız Holding,
its subsidiaries and the Yıldız family increased their
stake from 58.49% to 79.90%.
The Sale of Yıldız Holding’s Stake
On the morning of October 4, 2013, it was announced
via Public Disclosure Platform that a block trade would
be carried out with the price per share set at TL 12.60.
With investor demand having reached USD 1.3 billion,
an amount nearly three times the USD 461 million
issue, investors clearly demonstrated their confidence
in the operations and future strategies of Ülker Bisküvi.
As it was impossible to meet all the demand, the
Company sold the shares to 44 foreign institutional
investors.
Between October 5 and December 31, 2013, the
average daily trading volume of Ülker Bisküvi shares
increased to TL 27 million, compared to TL 5 million
from the beginning of the year to October 4, the date
of the sale. On November 8, 2013, MSCI (Morgan
Stanley Capital Index) included Ülker Bisküvi in the
MSCI Turkey index, to be effective as of November 26,
2013.
On December 18, 2013, Borsa Istanbul announced
the inclusion of Ülker Bisküvi shares in BIST-30 for the
period January 2 to March 3, 2014.
21
22
Increasing
capacity
utilization
Biskot Bisküvi, an Ülker
subsidiary, produces
biscuits at 20 different
facilities at its Karaman
Factory.
The Ankara Factory is located on a 110,000 m2 land
parcel, of which 80,000 m2 is covered space. In 2013,
the factory’s actual capacity utilization rate hit 89.9%,
with three work shifts. The factory produced 103,000
tons of biscuits with net sales of 103,000 tons for the
year.
Biscuit
Biskot Bisküvi, an Ülker subsidiary, produces biscuits at
20 different facilities at its Karaman Factory, which had
a capacity utilization rate of 69% in 2013. The factory
produced 87,000 tons of biscuits and recorded net
sales of 87,000 tons for the year.
The Gebze Factory, which has manufactured biscuits
and crackers since 2000, reached a capacity
utilization rate of 88.9% in 2013. During the year, the
factory manufactured 66,000 tons of products and
recorded a net sales volume of 66,000 tons.
Main Brands
Pötibör, Çizi, Krispi, Haylayf, Mavi Yeşil, Hanımeller,
Biskrem, Krim Kraker, Probis, Çokoprens, As Kraker,
İkram, Rondo, Altınbaşak, 9 Kat Tat, Halley, Kat Kat Tat,
Çubuk Kraker, Ülker Kremalı, Dore, Saklıköy, Çokomel,
Rulokat, Ülker Grissini
23
Within 2013, Ülker
Çikolata produced
110,000 tons of goods
at its Topkapı Factory.
Chocolate
As one of the affiliate of Ülker, Ülker Çikolata operates
three facilities with a total covered area of 67,745 m2.
Ülker Çikolata produced 110,000 (2012: 100,000)
tons of goods at its Topkapı Factory in 2013, with net
sales totaling 112,000 (2012: 97,000) tons. The
Company’s 2012 capacity utilization rate stood at
57%.
Ülker subsidiary Biskot produced 28,000 tons of goods
and recorded a net sales volume of 28,000 tons; in
addition, its Silivri facility produced 20,000 tons of
goods with net sales of 19,000 tons.
Main Brands
Cocostar Smart, Alpella, Karsa
24
Cake
Production in Esenyurt
Factory was 35.000 tons
in 2013.
Ülker produces cakes at its Esenyurt Factory,
which was established in 1993 on a covered area of
26,000 m2. The factory’s capacity utilization rate was
91.2% in 2013; the facility produced 32,351 tons and
had net sales of 35,000 tons.
One of Ülker’s subsidiaries, Biskot produced 30,000
tons of goods and recorded net sales of 30,000 tons
in 2013.
Main Brands
Dankek, Kekstra, Ülker Ev Kek, Halk and Karsa
25
Investments
Stronger
sector position
The consolidated
total of expansion
and modernization
investments was about
TL 78 million.
In 2013, Ülker further reinforced its robust market
position with new capital investments that included
new installations in the factories, capacity increases,
modifications to production lines, productivity
upgrades, and improvements in hygienic conditions
and warehousing processes.
Ülker’s capital expenditures aim to further solidify
the Company’s dominant market position, increase
consumer satisfaction, improve product quality,
and to make its cost structure more competitive by
increasing operational efficiency.
Throughout the year, Ülker invested in the installation
of new facilities, capacity increases, renovations,
modifications to production lines, efficiency increases,
and improvements in the areas of hygiene and
warehousing. The consolidated total of expansion and
modernization investments was about TL 78 million.
26
Subsidiaries
Restructuring for
the objectives
Subsidiaries and Financial Investments
(Current situation)
Biskot Bisküvi Gıda
Sanayi ve Ticaret A.Ş.
Production
Ülker Çikolata
Sanayi A.Ş.
Production
İstanbul Gıda Dış
Ticaret A.Ş.
Marketing/Trade
Atlas Gıda Pazarlama
Sanayi ve Ticaret A.Ş.
Marketing/Trade
Birleşik Dış Ticaret A.Ş.
Marketing/Trade
Rekor Gıda
Pazarlama A.Ş.
Marketing/Trade
G New Inc.
Investment
Godıva BelgIum BVBA
Production
Reform
PazaRlama
Marketing/Trade
27
Biskot Bisküvi Gıda and Ülker Çikolata
Biskot Bisküvi Gıda
Thanks to the merger of AGS-Anadolu Gıda San. ve
Tic. A.Ş., a cakes producer, with Biskot Bisküvi Gıda
San. ve Tic. A.Ş. at 2011 year-end, the Company
attained a larger production volume. Biskot Bisküvi
Gıda operates in a covered space of 111,549 m2 and
has approximately 5,000 employees; the Company
is one of the most important industrial companies
and employers in its operating region. In 2013, Biskot
Bisküvi Gıda Sanayi ve Ticaret A.Ş.’s production
volume of biscuits, chocolates and cakes totaled
165,000 tons at the factories; the Company had a
total production capacity 228,000 tons. Its product
portfolio consists of petit-beurre biscuits, fingers,
biscuits for babies, crackers, cream-filled biscuits,
sandwich biscuits, wafers, cakes, chocolate-covered
bars, chocolate wafers, chocolate-covered cakes,
rulokat, çokomel, chocolate cream, special biscuits,
chocolate eggs with toys, and giftable chocolates.
Ülker Çikolata
In 2011, Ülker acquired a majority stake in Ülker
Çikolata, previously jointly held by Yıldız Holding. Ülker
Çikolata produces solid chocolate, chocolate covered
products, chocolate cream, giftable chocolates and
powder cocoa under the. The Company is the market
leader in its sector and operates the facilities located
in Topkapı/Istanbul with a total covered area of
67,745 m2. The Company has a total production
capacity of 190,000 tons; its average capacity
utilization rate was 57% for the reporting year.
Currently, Ülker Çikolata produces 189 different
products and 48 sub-brands.
28
Subsidiaries
İstanbul Gıda ve Birleşik Dış Tic.
İstanbul Gıda
İstanbul Gıda achieved 2013 with a double-digit
growth compared to the the previous year. The
Company achieved a comparable level of revenue
despite having transferred its non-essential
businesses such as dairy, beverages, and personal
care to other companies under the Holding. With a
strong sales and distribution network, İstanbul Gıda
exports Ülker products to more than 80 countries
in the Europe and the Middle East, as well as the
Turkic Republics, Africa, the Far East, the US, and
Europe. The Company closed the year near amount
of the previous year in terms of sales amount. The
Company’s workforce numbered 80 employees as of
year-end 2013.
Birleşik Dış Tic.
2013 was a year of success for Birleşik Dış Ticaret
A.Ş. as the Company’s strategy to focus on its main
product categories of biscuits, chocolates, and cakes
proved effective. As a result of the solid performance
of its sales organization, the Company improved
organizational and regional efficiency and boosted
productivity. With a strong sales and distribution
network, Birleşik Dış Ticaret exports Halk and Karsa
branded Ülker products to countries in the Balkans and
the Middle East, as well as the Turkic Republics, the US,
Europe, Africa and the Far East.
Rekor Gıda
Rekor Gıda maintained its operations thereby
increasing its sales and distribution network in 2013
compared to the previous years with the Halk, Ülker
and Ona branded products. Quite a wide range of
products and categories all over the country, the
Company has 76 Traditional Channels and operates
with two Modern Channels. As of year-end 2013,
Rekor Gıda employed 83 personnel.
Godiva
Godiva Chocolatier Inc., in which Ülker Bisküvi has
a 19% stake, is the owner of the Godiva brand, the
world’s leading brand of premium chocolate and
chocolate coated products. In 2008, Yıldız Holding
acquired Godiva Chocolatier Inc. for USD 850 million,
the largest overseas acquisition by a Turkish company.
Over the last five years, Godiva has truly been a
success story.
Since that time, Godiva has reached 32 thousand
points of sale across the world, and has achieved more
than 10% sales growth each year. The Company’s
2013 revenue totaled USD 750 million. After entering
new markets such as Australia, China, Indonesia,
Korea, Macau, Saudi Arabia and Turkey, Godiva has
become a true global brand with international sales
rising to 52% of the Company’s total, up from 43% five
years earlier.
In the coming years, Godiva plans to focus on further
expansion in China, Middle East, Russia and Turkey.
The Company aims to open 50 new stores every year
and reach sales of USD 1 billion by the year 2016.
29
30
Human Resources
Effective
organization
With the effective human
resources practices, it
is aimed to increase the
competitive power of
Ülker in domestic and
foreign markets.
In line with Ülker’s vision to “become a food and
beverage company which always pleases its
consumers, customers, employees and shareholders,
and makes them smile,” Ülker’s global vision and
an innovative and sustainable human resource
management system, by:
•Developing and empowering employees, and
reinforcing their loyalty to the Company,
•Establishing a highly competent, effective and
flexible organization,
•Embracing a performance culture that reflects the
Company’s values.
Ülker shapes its human resources practices in line
with Yıldız Holding Values and Yıldız Holding Human
Resources Strategies, which are expressed as:
“Our Customers Come First!”; “We Are Number 1
in Quality!”; “We Are Competitive!”; “We Achieve
Together!”; “We Are Results Oriented!” and “We Are
Driven By Change!” The Company aims to increase its
competitive advantages in both domestic and foreign
markets via effective human resources practices,
which aim to achieve superior quality in all business
processes, high levels of motivation and loyalty among
employees, and a culture of collaboration.
As in previous years, the Company organized a series
of events in 2013 to increase the level of motivation
of the entire workforce, encourage social interaction
among employees and foster their loyalty toward the
Company:
•The Company held the Traditional Ülker Picnic to
provide an opportunity for staff members and their
families to socialize and spend time with each other
in a fun-filled environment outside of work.
•The Company organized employee celebrations on
special commemorative days, such as International
Day of Persons with Disabilities, International
Women’s Day, and the like.
•Within the April 23rd National Sovereignty and
Children’s Festival events, the Company enabled the
children of employees to attend the April 23rd Film
Festival sponsored by Ülker.
•In support of the “Brain Box” initiative, the Company
organized campaigns that focused on issues such
as productivity, energy efficiency, occupational
health and safety, quality etc.; then, Ülker rewarded
and implemented the best ideas submitted by
personnel.
•During the month of Ramadan, Ülker organized iftar
(breaking the fast) dinners attended by employees
together with senior management. A festive spirit
was shared among personnel at the ceremonies
organized to exchange greetings and well wishes.
•The Company organized sports activities (football,
bowling and table tennis tournaments and swimming
etc.) to encourage employees to enjoy themselves
and socialize.
•Ülker organized special visits during major life
events of personnel, including marriages, births
and funerals. In addition, the Company celebrated
employee birthdays with congratulatory greetings
and small gifts.
31
•Ülker renovated the libraries at the Company’s
factories and enriched the collections with local and
foreign books and periodicals in order to support the
cultural development of personnel and increase their
access to knowledge resources. In addition, staff
members received access to electronic resources
(contracted services of Yıldız Holding) on company
computers.
•The Company arranged price discounting with
various companies (tutoring schools, driving
courses, supermarkets, hospitals, gas stations, and
the like) for employees, to enhance their social lives
and help them meet their needs for basics such as
food, health, education, and transportation.
•In 2013, Ülker employee teams participated and
competed in football, table tennis and bowling
tournaments organized by Yıldız Holding as part of
the Yıldız Cup.
•In addition to the Prestige Club, which was
established as a hobby and events group within Yıldız
Holding, Ülker established a Photography Club, an
Excursion Club, a Culinary Club, and a Diving Club.
The Company encouraged employees to participate
in these clubs and improve their skills in their
respective areas of expertise by attending various
training programs and taking club-related trips.
•Yıldız Holding declared 2013 as the “The Year of
Quality” and carried out several different activities
under the slogan, “Our Goal is Zero Errors.” Ülker
factories also undertook various initiatives and
events as part of this quality movement. Senior
managers participated in these events, which
included stand-up comedy performances and other
shows.
Ülker is committed to supporting its employees,
viewed as “the Company’s most important capital
and asset,” not only to reach business targets and
enhance competitiveness, but also for their own
personal development. Support for the personal
and professional development of staff members is
given through training and development programs,
so that they can maintain top performance in their
jobs and help prepare Ülker, as well as themselves,
for the future. Ülker offers personnel various training
opportunities in a diverse range of topics that include:
In line with the Human Resources Planning program,
initiated across Ülker companies in 2011 and
further enhanced with various measures in 2013,
Ülker developed a backup system for managerial
positions to ensure the continuity of the Company’s
success. In addition, the Company devised Individual
Development Plans to ensure the career development
of personnel. In order to create a “feedback culture”
within the framework of the Human Resources Planning
and Performance Management Process initiatives, the
Company actively encouraged managers to provide
feedback to employees. As a result, personnel became
better prepared for career opportunities that may
arise in the future at Ülker. Additionally, the Company
first announced and shared information about new job
openings to employees within the Group.
With its superior quality standards, Ülker has created
“Happy Moments” for the Turkish people since 1944;
and the Company is committed to developing its
human capital in line with its future goals and in keeping
with the principle of continuity of service.
32
Human Resources
Rising
motivation
Breakdown by Age (2013*) (%)
Breakdown by Seniority (2013*) (%)
7
45 and above
16.4
More than 10 years
50.7
Between
31-44
18.6
Between
6-10
years
42.3
30 and
below
Breakdown by Education (2013*) (%)
2.9
Associate
Degree
5.8
Bachelor’s Degree and Higher
39.3
High
School
52
Primary School
* The data refers to December 31, 2013.
65
5 years
and less
33
Quality and R&D
High standards
in production
Ülker Chocolate factory
manufactures all of its
products in compliance
with “Gold Product
Standards”.
Biscuit and Cake Quality Assurance
Ülker factories in Esenyurt, Gebze and Ankara
manufacture biscuit and cake products at “gold
standard” consumer specifications. From raw material
to the end product, Ülker production always meets the
prescribed requirements and standards. In addition,
results of raw material analyses performed by accredited
laboratories were requested from suppliers and regularly
recorded in 2013.
Within the scope of defined analysis methods and
procedures, the Company also carried out routine
process controls, critical control point (CCP) checks,
shelf life analyses, scoring, as well as supervision of
equipment, workplace and employee hygiene. In
addition, Ülker conducts a 12-month shelf life analysis of
the products.
To set production standards of Ülker products, and
to determine the differences in similar products
manufactured by competitors, the Company carried
out 21 consumer checks including field controls and
benchmarking in 2013 on select products including
Çay Saati Mozaik, Albeni Kaplamalı Kek, Alpella, 8 Kek
Çikolata-muz Hindistan cevizli and Pötü Meyveli, Ülker
Çizi, Hanımeller, Çokodamla, Rondo, Ülker Çubuk and
Ülker Susamlı Çubuk, Ülker Halley, Ülker Çizi, Mavi Yeşil
Limon Lifli, Ülker Çubuk Kraker, Çiziviç, Haylayf, Rondo
Sade Kremalı, Fındıklı Gofret.
Ülker provided training sessions to its own employees
and the employees of its contractors on the topics
of Quality, Food Safety, Occupational Safety and
Health, Environment Management Systems and Energy
Management Systems, and Allergenic Substances.
Ülker always aims to meet consumer expectations at
the highest level possible and to consistently increase
customer satisfaction. Therefore, the Company
continuously solicits consumer feedback and takes any
corrective action that is required. In addition, inspections
and analyses are conducted in collaboration with
suppliers to prevent any quality-related problems at the
source. To this end, the Company initiated the project
for setting up the Food Quality and Safety Chain from
the Supplier to Consumer (AIB - American Institute of
Bakery), and conducted factory inspections on a weekly
basis. To reach sustainable quality and ensure employee
compliance with Ülker principles and values, Company
personnel completed AIB Awareness and Internal
Inspection trainings, and internal inspection teams were
set up in the three factories. The teams carry out internal
food safety inspections in all sections of the each factory
on a monthly basis.
In order to ensure food safety and quality standards
of Ülker products from the raw material supplier to the
end-product warehouse, food safety inspections were
conducted at supplier premises, distributors and AIB/
Quality Units in various locations throughout the year.
Ülker products were also checked through field visits by
the sales team and all observations were reported to
factory management.
34
Quality and R&D
High quality
production
Ülker consistently produces “Delicious, Healthy and
Trusted” products of superior quality, in compliance
with existing laws and regulations, and under stringent
hygienic conditions. Accordingly, the Company holds the
following quality certifications:
•ISO 9001:2008 Quality Management System
(Esenyurt, Gebze, Ankara)
•ISO 22000 Food Safety Management System
•ISO 14001 Environment Management System
(Gebze, Ankara)
•OHSAS 18001 Occupational Health and Safety
Management System (Esenyurt, Gebze, Ankara)
•BRC (Achieved Grade: A) (Gebze, Ankara)
•IFS (Higher Level) (Gebze, Ankara).
Biscuit and Cake R&D
Ülker offers innovative products that appeal to traditional
taste buds both in Turkey and around the world. The
ethical principles of the Company’s R&D practices are:
•To use scientific methods and techniques to research,
locate and report facts;
•To show concern for humankind, the environment
and the public good by adhering to existing laws and
regulations as well as to the principles and goals of the
Group;
•To always give priority to consumers’ needs and
expectations;
•To ensure food safety-high quality-price-variety
optimization in all products;
•To act according to the principle, “We will never offer
our consumers a product that we would not consume
ourselves, or give to our children.”
Biscuit and Cake R&D Unit implemented numerous
projects in 2013. The Company carried out many
R&D related projects in rapid succession in line with
corporate and consumer-focused strategies in a wide
range of areas including new product development,
current product improvement, cost cutting, quality
enhancement, alternative raw material approval and
technical/technological support. Ülker assessed these
projects in terms of business, consumer and technology,
and prioritized those that were most innovative. In order
to continue to bolster its culture of innovation, the
Company planned a variety of new R&D initiatives for the
future.
One of the key steps of the quality drive initiated
in 2013 in line with Ülker’s quality road map is the
establishment of the specification center. For this
purpose, the Company revised quality specifications of
all product categories in terms of business, consumer
and technology, and defined and launched new
specifications. The Biscuit and Cake R&D Unit completed
138 projects in 2013; of these, 39 yielded new products
and 18 resulted in significant improvements to existing
products.
The following products were rolled out as a result of
Biscuit and Cake R&D activities:
Saklıköy Klasik, Saklıköy Yulaflı, Saklıköy Fındıklı Kremalı,
Saklıköy Sütlü Kremalı, Mini 8 Kek Çilekli, Mini 8 Kek Muzlu,
Pöti Havuçlu Tarçınlı, 8 Kek Double Çikolatalı, Mini Pöti
Çikolatalı, Çay Saati Islak Kek, Ev Kek Mozaik, Ev Kek
Üzümlü, Atıştırmalık Probis, Çizi Mini, Dore Bisküvi, Mini
çizi, Mini Biskrem, Mavi Yeşil Mısır ve Pirinç Çıtırı.
35
Chocolate Quality Assurance
Ülker Chocolate factory manufactures all of its products
in compliance with “Gold Product Standards,” a
consumer product standard. From raw materials to
end products, all production processes meet the
requirements prescribed in the Gold Product Standards
specifications.
From raw material to the end-product, Ülker production
always meets the prescribed requirements and
standards. In addition, iresults of raw material analyses
performed by accredited laboratories were requested
from the suppliers and regularly recorded in 2013.
Specifications related to raw materials and packaging
are currently being updated within the specification
standards project, which is carried out by the Company’s
Quality Center. In addition, Ülker conducts a 12-month
shelf life analysis of the products.
Ülker Çikolata provided training sessions to its own
employees and the employees of its contractors on the
topics of Quality, Food Safety, Occupational Safety and
Health, Environment Management Systems and Energy
Management Systems, and Allergenic Substances.
Ülker always aims to meet consumer expectations at
the highest level possible and to consistently increase
customer satisfaction.
A packaging control laboratory was set up at Ülker’s
Chocolate factory. Additionally, another laboratory was
set up to bring together all packaging materials quality
controllers in a single area.
Therefore, the Company continuously solicits consumer
feedback and takes any corrective action that is required.
In addition, inspections and analyses are conducted
in collaboration with suppliers to prevent any qualityrelated problems at the source.
Ülker Çikolata, too, started to cooperate with AIB
(American Institute of Bakering) in August 2011, to
set up a food quality and safety chain from supplier to
consumer. Ülker Çikolata conducts internal food safety
inspections in all sections of the factory on a monthly
basis. The first AIB audit of 2013 was conducted in
May 2013 without notice, and the Company passed
the audit successfully with a score of 820 points. The
Ülker Çikolata facility scored 845 points at the audit
in late 2013, and inspectors found nothing that could
jeopardize food safety. Internal food safety inspections
continue across the factory according to a set schedule.
In addition, all of the Company’s coated, molded,
cream and powder products successfully passed
the halal inspection conducted by LRQA-HELALDER
on December 12, 2013, and Halal Certificates were
received.
36
Quality and R&D
Continuous
progress for taste
Ülker Çikolata consistently produces “Delicious, Healthy
and Trusted” products of superior quality, in compliance
with applicable laws and regulations, and under stringent
hygienic conditions. Accordingly, the Company holds the
following quality certifications:
•ISO 9001:2008 Quality Management System
•ISO 22000 Food Safety Management System
•ISO 14001 Environment Management System
(Gebze, Ankara)
•OHSAS 18001 Occupational Health and Safety
Management System (Esenyurt, Gebze, Ankara)
•BRC (Achieved Grade: A) (Gebze, Ankara)
•IFS (Higher Level) (Gebze, Ankara).
•LRQA-HELALDER Certificate
Chocolate R&D
Thanks to its experienced and new entrant strong R&D
personnel, Ülker Çikolata continued to develop new
products compliant with the Company’s high quality
standards in 2013, and took its innovative and customeroriented approach to even higher levels.
Thanks to its great taste and visual appeal, Laviva, launched
in the last quarter of 2013, deserves its place among the
leading products of Ülker Çikolata. The Company added
several new products to its portfolio, including milky and
bitter finger 12 g and the Sylvester variant under the Smart
brand. Ülker maintained its strong market position and
competitive advantage by further improving its Çokonat,
Metro, Çokokrem Golden and long baton products.
In 2013, Ülker Çikolata continued to conduct routine
tests and analyses in areas such as raw materials and
packaging; the Company also carried out evaluations on
semi-manufactured and finished products, to guarantee
consistent quality standards and reliable production, free
of human error. Without compromising the quality of its
chocolate products, Ülker pursued alternative raw materials
to achieve higher profits.
In addition, results of raw-material analyses performed by
accredited laboratories were requested from the suppliers
and recorded. Within the scope of defined analysis
methods and procedures, the Company carried out routine
process controls, critical control point (CCP) checks, shelf
life analyses, scoring, as well as supervision of equipment,
workplace and employee hygiene.
In 2013, the Company once again reviewed all of its
business processes to resolve any shortcomings and
make existing processes more effective. As part of this
continuous improvement process, the OOS system was put
into use in order to monitor product recipes and production
processes more easily. Furthermore, the Company initiated
efforts to improve hygiene and shelf layouts to increase
efficiency at the laboratories and the test facilities.
To ensure product safety and hygiene, in 2013, Ülker
Çikolata organized training sessions on Employee
Hygiene, Environment, Management Systems, and
Allergenic Substances. The Company always aims to meet
consumer expectations at the highest level possible and
to consistently increase customer satisfaction. As such,
the Company constantly solicits consumer feedback and
takes any corrective action that is required. In addition,
inspections and analyses are conducted in collaboration
with suppliers in order to prevent quality-related problems
at the source. Ülker Çikolata inspected distributor
warehouses located in various cities in order to ensure that
its products reach end consumers in a hygienic manner.
37
38
Social Responsibility
For healthy and
happy generations
Also in the future, Ülker
aims to maintain its
corporate responsibility
projects for the children.
Ülker’s social responsibility approach
Ülekr shapes its social responsibility initiatives mainly
around children, inspired by the words of its founder
Sabri Ülker: “Everyone has the right to a happy
childhood, no matter where they live.”
Ülker’s social responsibility projects for youth mainly
focus on two areas: culture and arts. To date,
250 thousand young people have participated in
various sports activities, thanks to the Company’s
“Football for Children” initiative, which is carried out
in collaboration with the Turkish Football Federation,
and the Basketball Festivals organized by the Turkish
Basketball Federation. Ülker Children’s Film Festival,
now an annual tradition, has opened the door to the
magical world of movies for some 750 thousand
youngsters. Ülker Children’s Art Workshop, which aims
to introduce children to arts at a young age, debuted
in 2011 as part of the Art Beat Istanbul contemporary
art platform. In 2012, young visitors enjoyed the
event “Fifty Years of Urban Walls: A Burhan Doğançay
Retrospective and Contemporary Istanbul.” To date,
7 thousand children learned about contemporary art
thanks to the Ülker Children’s Art Workshop. In the
future, Ülker plans to continue carrying out youthfocused social responsibility initiatives in the areas of
sports, culture and arts.
Culture-Arts
Sociable individuals who can dream and express
themselves
Ülker Children’s Film Festival
Ülker Children’s Film Festival, which was initiated in 2008,
is the very embodiment of Ülker’s approach to social
responsibility and its focus on the concept of “Children First.”
Ülker’s now annual Children’s Film Festival stems from
the idea that large numbers of youngsters across
Turkey should receive the same gift at the same time.
As this gift is offered on a very special day, April 23rd
National Sovereignty and Children’s Day, the Ülker
brand becomes part of a festival memory for many
of the country’s young people. Since 2008, the Film
Festival has reached some 912 thousand people,
of whom 750 thousand were youngsters, and has
opened the doors to a new dream world every year.
2008
33 cities, 123 theaters
1,300 screenings
125,000 children
80,000 gifts
2009
1,345 screenings
130,000 children
130,000 gifts
2010
1,580 screenings
140,000 children
140,000 gifts
2011
785 screenings
110,000 children
110,000 gifts
2012
785 screenings
155,000 children
135,000 gifts
2013
785 screenings
155,000 children
140,000 gifts
39
40
Social Responsibility
Football and
winning the future
The Environment
Ülker does not limit its relationship with society at large
to production only, but also offers its resources to the
public by implementing social responsibility initiatives
that focus on environmental issues. The best example
of these efforts is the “Prevent” project carried out
in collaboration with TEMA Foundation. Ülker is one
of the founders of TEMA Foundation, which was
established to protect agricultural lands in Turkey
against neglectful destruction. Under the “Prevent”
initiative implemented by TEMA, Ülker contributed
to the development of three villages in Turkey. The
project was studied by a group of students from Yale
University, and aims to bring Turkish villages to a level
matching European standards through years-long
efforts. The Holding was publicly recognized by TEMA
Foundation for all of its efforts in fighting erosion,
primarily under the “Prevent” project.
Environmental education to 250 thousand children
Ülker integrates environmental protection into its
social responsibility efforts. For example, to date,
250 thousand children have been provided with
environmental education at several events, including
the “Football for Children” initiative, which is carried out
in collaboration with the Turkish Football Federation,
and the Basketball Festivals organized by the Turkish
Basketball Federation. The Holding aims to raise the
environmental awareness of future generations.
Ülker and Football Infrastructure Projects
More physical activity, more vigor, more health for
the younger generation
Through its football infrastructure initiatives,
Ülker aims to:
•Increase physical activity in the lives of the country’s
youth and make a significant difference in their
general welfare,
•Contribute to the physical, social and cultural
development of young people,
•Enhance sports investments in a way to touch
children’s lives, as part of the Company’s social
responsibility approach.
Since 2007, the Company has reached some 250
thousand children through several social responsibility
projects carried out in collaboration with relevant
federations.
Duration
Number of
Children Reached
Football Training
Centers
6 years
59,000
Football Villages
7 years
4,000
Football Festivals
5 years
162,000
U20 Grassroots
Festivals
2 months
1,700
Grassroots Day
4 years
14,100
Basketball Festival
7 years
7,000
Project
Total
247,800
41
Football Training Centers
In addition to the events held at certain times of the year
to meet specific needs, all youth aged between 6 and 12
years can enroll for free at the Football Training Centers,
which remain open nine months a year and five days a
week. These centers provide youngsters with training
in football, fair play, environmental awareness and
balanced nutrition.
At the 50 Football Training Centers, trainers with TFF E
licenses designated by the provincial representatives
of the National Football Federation give three days
of training during weekdays, a total of 900 hours
per month, for nine months a year. On weekends,
participants receive a total of eight hours of training per
month, as part of a four-week program.
•Five children from the Van Football Village, the first
ever Football Village, were selected for the National
U15 Football Team.
•Ten players from the 2008 Sinop Football Village
were selected for the U15 Girls’ National Team,
which represented Turkey at the First Youth Olympic
Games held in Singapore in 2010.
•Enes Ünal (born 1997), who received training at the
2009 Sakarya Football Village, became the youngest
goal scorer ever after he scored for Bursaspor versus
Galatasaray.
U20 Grassroots Festivals
During April and May 2013, Ülker hosted Grassroots
Festivals in Antalya, Bursa, Gaziantep, Istanbul,
Kayseri, Rize and Trabzon.
Football Villages
The TFF-Ülker Football Villages project aims to
bring together talented children from across the
country in a football-focused social environment in
order to support their social, cultural and personal
development.
Grassroots Day
Youth from cities across Turkey can participate in the
Football Day for Children, which has been celebrated
annually for the past four years. To date, about
14,100 players and trainers have had the pleasure to
participate in this event.
A total of 43 Football Villages have been held over a
seven year period:
•2007 - Van
•2008 - Sinop, Isparta, Bolu and Sivas
•2009 - Malatya, Sakarya (2), Sinop, Trabzon,
Erzincan, Kütahya, Zonguldak
•2010 - Kocaeli, Trabzon, Malatya, Sakarya, Sivas,
Sinop and Erzurum
•2011 - Sinop, Gümüşhane, Bolu and Karabük
Ovacık (2)
•2012 - Sinop, Sakarya, Kocaeli, Isparta, Erzurum,
Nevşehir, Gümüşhane and Riva
•2013 - Izmir, Sakarya, Rize, Balıkesir, Sinop,
Erzurum, Nevşehir, Elazığ, Isparta and Yozgat
Children’s Football and Basketball Festivals
For the past six years, the Company has organized
Basketball Festivals in collaboration with the Turkish
Basketball Federation; to date, 6 thousand children
have been hosted at these events. In 2013, Basketball
Festivals were held in a number of cities, including
Ankara, Izmir, Konya, Çanakkale and Nevşehir.
•Children of the World
•Ülker extended its focus on youth to the 2010
FIBA World Championship, and contributed to the
Children of the World project.
42
Corporate Governance Principles Compliance Report
1. Corporate Governance Principles: Compliance
Statement
The Company has provided in detail below the
assessment and findings on the level of compliance with
the Corporate Governance Principles and our comments
on the potential improvement areas related to compliance
in scope and quality.
The Company also plans to implement those principles
that have not been implemented yet as soon as possible,
although there have not been any conflicts of interest
among shareholders due to the limited number of
corporate governance principles implemented to date.
Pursuant to Capital Markets Board Communiqué and
Article 17 of the Capital Market Law No: 6362, dated
December 6, 2012, and II-17.1 Corporate Governance
Communique released on 1.3.2014 issuance of a
“Corporate Governance Compliance Report” and
compliance with specified Corporate Governance
Principles have become mandatory for companies traded
on Borsa Istanbul (BIST). Accordingly, the Company has
resolved that the requirements imposed by the CMB be
strictly followed, and the Company has also completed
all the work necessary for compliance with the other
principles specified in the Communiqué.
The Company has also disclosed the following Corporate
Governance Principles Compliance Report to the public
via the website: www.ulkerbiskuvi.com.tr.
PART I – SHAREHOLDERS
2. Investor Relations Unit
The Company’s relations with shareholders are handled
by the Investor Relations Unit and coordinated by the
Financial Affairs Department. The Unit processes any
and all written or online inquiries submitted by our
shareholders and attends all local and international
investor conferences.
Contact information for the Investor Relations Department
follows:
İlhan Turan Usta
Director of Financial Affairs
Davutpaşa Cad. No:10 34015 Topkapı/Istanbul
[email protected] +90 212 567 68 00
Özgür Kalyoncu
Investor Relations Manager
Kısıklı Mah. Ferah Cad. No: 1 B
Çamlıca Üsküdar/Istanbul
[email protected]
+90 216 524 25 56
The Investor Relations Unit holds meetings with local
and international investors and participates in investor
conferences in Turkey and abroad. As a result, the Investor
Relations Unit meets directly with various domestic and
international investors.
Relations with shareholders are coordinated by the
Financial Affairs Department. The Financial Affairs
Department manages the public disclosures as required
to the BIST, the Capital Markets Board, and the Central
Registry Agency and other communications with these
agencies. In addition to organizing the ordinary and
extraordinary general assembly meetings, the Investor
Relations Unit may organize other ad-hoc meetings held
at the request of shareholders.
3. Shareholders’ Right to Information
Except for information considered either commercial
secret or insider information, all written or verbal requests
from our investors for information in the period were met.
We provided our shareholders with all the information
as required under their rights as shareholders via the
annual report, material disclosures, and replies to
individual inquiries. In accordance with Article 1524 of
the Turkish Commercial Code No: 6102, dated January
13, 2011, the Company has also shared all necessary
information and announcements with shareholders on
its corporate website, www.ulkerbiskuvi.com.tr, under
the section “Investor Relations,” subsection “News and
Announcements.”
Auditing principles and procedures are described in Article
20 of the Company’s Articles of Association. In 2013,
shareholders did not call for any private audits.
4. General Assembly Meetings
Pursuant to Article 1527 of the Turkish Commercial Code
No. 6102 dated January 13, 2011, which stipulates that
online participation in general assembly meetings, making
proposals and statements online, and online voting shall
have the same legal effects in all aspects as participating
and voting in any general assembly meeting in person;
and that all companies traded on the stock exchange are
43
required to set up and maintain a system allowing online
participation in general assembly meetings and voting; the
online general assembly convenes on the same date and
with a parallel agenda as the physical general assembly.
The amount of contributions and donations made by the
Company during the fiscal period have been discussed at
the General Assembly meeting as a separate agenda item
and shareholders have been informed about same.
The Ordinary General Assembly of 2012 was convened on
March 28, 2013.
Prior to the General Assembly meeting, the Company
shared with the shareholders the meeting agenda, a
sample proxy form, informational document, balance
sheet, profit-loss statements, independent auditor’s
report and footnotes, auditor’s report, Board of Directors’
resolution on profit distribution, the annual report, and
the resolution on the selection of an independent audit
company, via the corporate website, www.ulkerbiskuvi.
com.tr.
The 2012 Ordinary General Assembly of the Company
convened at Barcelo Eresin Topkapı Hotel at Millet Caddesi
No:186 Topkapı – ISTANBUL with the participation of
shareholders representing almost 86% of the paid-in
capital of TL 342,000,000. No stakeholders or media
representatives were present at the meeting.
The invitation for the General Assembly, which stated
the date and agenda of the meeting, was published in the
Turkish Trade Registry Gazette No. 8272 dated
March 6, 2013 and in the daily Dünya Newspaper dated
March 6, 2013 and on the Ülker Bisküvi Sanayi A.Ş.
website: www.ulkerbiskuvi.com.tr as specified by law and
the Articles of Association within the prescribed time limit.
The Company makes the financial statements and
reports, including the annual report, dividend proposal,
memo on the proposed agenda to be discussed at the
General Assembly, and other supporting documents for
items of the agenda, the current version of the Articles of
Association, and proposed amendments to the Articles
of Association, if any, and the rationale thereof available
for review by our shareholders at the headquarters and
branches of the Company starting from the date of the
invitation for the General Assembly.
Amendments to the Articles of Association related to the
cancellation of the privileges of registered shares in terms
of presenting candidates to the Board of Directors, as
pursuant to the Turkish Commercial Code No: 6102 and
Capital Market Law No: 6362, and the relocation of the
Head Office have been approved. With this amendment,
all privileges have been revoked.
Items on the agenda are expressed in an unbiased and
detailed manner at the General Assembly and shall be
clear and intelligible. Shareholders are provided with
equal opportunity to express their opinions, and raise any
questions to create a healthy atmosphere for discussion.
No shareholder asked any question at the 2011 General
Assembly nor made any suggestions except for those
related to the items in the agenda.
5. Voting and Minority Rights
According to the Articles of Association, each share carries
the right to one vote.
Any shareholder, who is entitled to attend General
Assembly meetings, may attend the meetings via electronic
communication means in accordance with Article 1527 of
the Turkish Commercial Code. Pursuant to the Regulation
on the General Assembly of Joint Stock Companies to be
Held via Electronic Means, the Company may set up an
electronic General Assembly system or procure any system
developed for this purpose so that shareholders are able
to attend, express their views, make suggestions, and cast
their votes via electronic communication means. Pursuant
to the relevant provision in the Articles of Association,
shareholders and their proxies are allowed to exercise their
respective rights at any General Assembly meeting, under
the referenced regulations via the electronic system set up
for this purpose.
The Company does not grant any privileges to share
groups or other shares. None of our shareholders controls,
or is controlled by, the Company. Cumulative voting is not
practiced in the Company.
As per Article 27 of the Company’s Articles of Association,
shareholders representing one-twentieth (1/20) of the
share capital can exercise minority rights.
The Articles of Association do not contain any provision
prohibiting voting by proxy, who is not a shareholder of the
Company.
44
6. Dividend Rights
Our Board of Directors has adopted the profit distribution
policy in accordance with the Corporate Governance
Principles published by the CMB:
The Company distributes profit in accordance with the
Turkish Commercial Code, Capital Market Law, Tax Law,
other applicable legislation and the articles related to profit
distribution in the Company’s Articles of Association.
The Board of Directors’ profit distribution proposal,
which complies with the Company’s profit distribution
policy and the Capital Markets Board’s Corporate
Governance Principles, is included in the annual report
and is submitted for the approval of shareholders at the
General Assembly; detailed information on the history of
profit distribution and capital increases is disclosed to the
general public via the corporate web site.
The Company has set its profit distribution policy in
accordance with the Capital Market Law and Articles of
Association, taking into consideration the Company’s
operational performance, financial situation and market
developments. Starting from the earnings of fiscal year
2012, the Company will distribute a minimum of 70% of
its net distributable profit for each accounting period in
cash, upon the proposal of the Board of Directors and the
approval of the General Assembly, with any changes made
by these entities, in accordance with Turkish legislation,
and after due consideration of the Company’s cash flow
requirements.
This policy will be reviewed each year by the Board of
Directors, taking into account any negative developments
in domestic and global economic conditions, the
situation of current projects and the Company’s financial
resources.
In accordance with the profit distribution policy, dividends
are equally distributed to all shares in the relevant
accounting period, and no privileges are granted.
Again, the Articles of Association provides for advanced
dividend payment, but the Company has not made any
advanced dividend payment so far.
Shareholders were informed of the Company’s profit
distribution policy at the General Assembly, and the profit
distribution policy has been disclosed to the public and
included in our annual reports, and is also available on the
Company’s website.
7. Share Transfer
Following the approval of the amendments to the Articles
of Association at the Ordinary General Assembly meeting
held on March 28, 2013, the Company shall not issue any
registered shares.
PART II – PUBLIC DISCLOSURE AND TRANSPARENCY
8. Company’s Disclosure Policy
The Company’s Information Policy is implemented in
accordance with CMB legislation and rules specified in the
relevant Communiqué. The Company has drafted a written
document on its public disclosure and information policies,
which is made available to shareholders and the public
on the Company’s website upon the approval by Board
of Directors. In addition, it is our basic principle that any
information which is already in the public domain is made
available to any person inquiring for such information.
In the case of any inquiry for information by any
shareholder, the Company provides a written or verbal
reply. In the event there is any material change during the
period, a related material change disclosure is promptly
made. The annual report is prepared in a manner to
ensure public access to all kinds of information regarding
the Company’s activities.
Material Event Disclosure
The Company has made 27 material event disclosures in
accordance with CMB regulations between January and
December 2013. All material event disclosures have been
made within prescribed time limits.
9. Company’s Website and Contents Thereof
The Company website at www.ulkerbiskuvi.com.tr is
available in Turkish and English. The following information
is available for the purpose of disclosure to our
shareholders:
•Company’s Vision
•Code of Conduct
•Information on the Board of Directors and Executive
Management
•Company’s Shareholding Structure
45
•Organizational Chart
•Social Responsibility
•Registration Information and Company Profile
•Articles of Association
•Financial Statements and Notes
•Annual Reports
•Material Event Disclosures
•Report on Compliance with Corporate Governance
Principles
•Information on the General Assembly (Agenda,
Proceedings, List of Attendees and Proxy Form
Template)
•Company’s Information Policy
•Committees
•News and Announcements (Invitations to the General
Assembly, and the like)
•List of Corporate Insiders
•Ratings Reports
•Ülker on the BIST (Ratios and Charts related to the
Company’s Shares)
•List of Monitoring Analysts and Investor Presentations
10. Annual Report
The Company’s annual reports are prepared in Turkish
in accordance with the Capital Markets Board (CMB)
Communiqué on Corporate Governance Principles
Compliance Report and the Regulation on the
Determination of the Minimum Content of Companies’
Annual Reports issued by the Turkish Ministry of
Customs and Trade on August 28, 2012, and published
in the Official Gazette Issue: 28395. The Company’s
annual reports are submitted for the approval of the
Board of Directors and then published on the website
www.ulkerbiskuvi.com.tr, under the section “Investor
Relations,” subsection “Annual Reports.”
The Company has taken every action and measure
to prevent insider trading; an online list of Company
executives and other individuals/institutions that provide
services to the Company, who have the opportunity to
access to non-public information that may have material
impact on the value of the shares, is maintained and
regularly updated. The list of Company executives and
other individuals/institutions that provide services to the
Company, who have the opportunity to access to nonpublic information that may have material impact on the
value of the securities, as specified in the annual report
follows.
Name-Surname
Murat Ülker
Ali Ülker
Ahmet Özokur
Mehmet Tütüncü
Mahmut Mahir Kuşçulu
Cengiz Solakoğlu
Alain Strasser
Duran Akbulut
Ekrem Pakdemirli
Halil Cem Karakaş
Şener Astan
Mustafa Tercan
Emre Şehsuvaroğlu
İhsan Saribaş
Bora Yalinay
Hüseyin Avni Metinkale
Naci Yekta Caymaz
Sadettin Atilla
İbrahim Taşkin
Hafize Nurtaç Ziyal
Title
Chairman
Member of Board of Directors
Holding CFO
Vice Presidency (Biscuit-Cakes)
Chairmanship of Holding Finance
Chairmanship of Internal Audit
Holding Directorship Budgeting and Internal Planning
Group CFO
General Manager of Holding
General Directorate of Information Technologies
General Directorate of Supply Chain
General Directorate of Legal Affairs
General Directorate of M&A Business Development
and Investor Relations
Zuhal Şeker Tucker
General Directorate of Corporate Communication
İlhan Turan Usta
Finance Directorate
Yasemin Hocaoğlu
Chairmanship of Board of Directors
Gülay Çuğu Bal
Finance Directorate
Muhammed Satilmiş
General Directorate of Facility
Nazif Solmaz
General Directorate of Ankara Facility
İdiris Can
General Directorate of Trade
Murat Bora Dal
General Directorate of Internal Audit
Bahar Erbengi
Directorship of Corporate PR and Advertising
Esra Angin Arslan
Chairmanship of Ülker Group
Bingül Altinkaynak
Mehmet Akif Ersoy
Fulya Erkmen Sunter
Selda Şenkul
Abdullah Topbaş
Serra Karapinar
Can İnci
Burak Kazanciyan
Büşra Özdemir
Nihan Baştak
Sales & Marketing Directorate
Nihal Gül
Sales & Marketing Directorate
Serkan Karadağ
General Directorate of Internal Audit
Nagihan Şengül Karpuz
Holding Tax Coordinator
Talat Çallak
Corporate Transactions
Murat Sorkun
General Directorate of Financial Standards
Serkan Asliyüce
Özgür Kalyoncu
Investor Relations
Kerim Beytekin
Erdal Atak
Finance Directorate
Akif Ziya Arican
Tax Coordinator
Levent Taşçi
Cem Kütük
General Directorate of M&A
Business Development and Investor Relations
Mesut Emre Yalçin
Fatma Tanla Dağtekin
Emir Erçel
İlter Oktay
Muhammet Raşit Dereci
Leyla Şen
Directorship of Corporate PR and Advertising
Bariş Öner
Yusuf Gümüş
Murat Karababa
İrem Sadikoğlu
Ayyüce Baştan
Hasan Riza Bayar
Erkan Taşdemirci
Finance Directorate
Ahmet Temizyürek
Tax Coordinator
Muhammet Mustafa Gül
Abdullah Çakar
Can Öngör
Finance Directorate
Can Koreş
Finance Directorate
Nesrin Özel
Melis Egeryilmaz
Sezen Öztürk
Ahmet Nihat Koçak
General Directorate of Management Accounting and
Planning
Tarik Öztürk
Planning
Aynur Dal
Planning
Burçin Çokyılmaz
Planning
46
Name-Surname
Caner Özdurak
Cihangir Çimenoğlu
Mehmet Arikan
Fatih Karaca
Murat Kiliç
Ayşe Ertükoğlu
Gülnur Canan Başaran
Burcu Ateş
Ayşegül Özfindik
Sezgin Selimoğullari
Murat Demirkol
Bayram Erol
Evren Bayraktaroğlu
Duygu Hoçalar
Emrah Ebeperi
Zeynep Sinem Ülker
Fatma Buket Uğur
Semra Ahçioğlu
A. Erdem Topçu
Mustafa Yağiz
E.Emre Terzi
Kadir Damar
Günceli Çakmakçi
Safiye Ayyildiz
Elif Başman
Günseli Çakmakçi
Babür Kaan Şener
Mehmet Daim Dursun
Erdem Sari
Can İnanli
Ahmet Murat Yalnizoğlu
Salim Alyanak
Muratcan Aksoy
Mert Tüten
Cemal Öztaş
Yakup Babaoğlu
Murat Ülker
Ali Ülker
Ahmet Özokur
Mehmet Tütüncü
Mahmut Mahir Kuşculu
Cengiz Solakoğlu
Alain Strasser
Duran AKBULUT
Ekrem PAKDEMİRLİ
Halil Cem Karakaş
Şener Astan
Mustafa Tercan
Emre Şehsuvaroğlu
İhsan Sarıbaş
Bora Yalınay
Hüseyin Avni Metinkale
Naci Yekta Caymaz
Sadettin Atilla
İbrahim Taşkın
Hafize Nurtaç Ziyal
Zuhal Şeker Tucker
İlhan Turan Usta
Yasemin Hocaoğlu
Gülay Çuğu Bal
Muhammed Satılmış
Nazif Solmaz
İdiris Can
Murat Bora Dal
Bahar Erbengi
Esra Angın Arslan
Bingül Altınkaynak
Mehmet Akif Ersoy
Fulya Erkmen Sünter
Selda Şenkul
Abdullah Topbaş
Serra Karapinar
Can İnci
Burak Kazanciyan
Büşra Özdemir
Nihan Baştak
Title
Planning
Finance Directorate
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Consultant
Başaran Nas Bağımsız Denetim ve. Serbest
Muhasebeci Mali Müşavirlik A.Ş.
Chairman of the Board of Directors
Board Member
Board Member
Board Member
Board Member
Board Member
Board Member
Board Member
Board Member
Office of Holding CFO
Vice President (Bakery Products)
Head of Financial Affairs Group
Head of Audit
Holding Financial Coordinator
Group CFO
Holding’s Headquarters
General Director IT
General Director of Supply Chain
Legal Affairs Department
General Director of M&A Business Development and
General Director of Investor Relations
General Director of Corporate Communication
Financial Affairs Director
Executive Assistant
Financial Standards Department
Office of Ülker Group President
Ankara Factory General Manager
Trade Department
Internal Audit Director
Corporate PR and Advertisement Department
Director
Office of Food Group President
Assistant of Holding Financial Affairs Coordination
Assistant of Chairman of Board of Directors
Assistant of Chairman of Board of Directors
Executive Assistant
Executive Assistant
Executive Assistant
Executive Assistant
Marketing Director
Name-Surname
Nihal Gül
Serkan Karadağ
Nagihan Şengül Karpuz
Talat Çallak
Murat Sorkun
Serkan Asliyüce
Özgür Kalyoncu
Kerim Beytekin
Erdal Atak
Akif Ziya Arican
Levent Taşçi
Cem Kütük
Mesut Emre Yalçin
Fatma Tanla Dağtekin
Emir Erçel
İlter Oktay
Muhammet Raşit Dereci
Leyla Şen
Bariş Öner
Yusuf Gümüş
Murat Karababa
İrem Sadikoğlu
Ayyüce Baştan
Hasan Riza Bayar
Erkan Taşdemirci
Ahmet Temizyürek
Muhammet Mustafa Gül
Abdullah Çakar
Can Öngör
Can Koreş
Nesrin Özel
Melis Egeryilmaz
Sezen Öztürk
Ahmet Nihat Koçak
Tarik Öztürk
Aynur Dal
Burçin Çokyilmaz
Caner Özdurak
Cihangir Çimenoğlu
Mehmet Arikan
Fatih Karaca
Murat Kiliç
Ayşe Ertükoğlu
Gülnur Canan Başaran
Burcu Ateş
Ayşegül Özfindik
Sezgin Selimoğullari
Murat Demirkol
Bayram Erol
Evren Bayraktaroğlu
Duygu Hoçalar
Emrah Ebeperi
Zeynep Sinem Ülker
Fatma Buket Uğur
Semra Ahçioğlu
A. Erdem Topçu
Mustafa Yağiz
E.Emre Terzi
Kadir Damar
Günceli Çakmakçi
Safiye Ayyildiz
Elif Başman
Günseli Çakmakçi
Babür Kaan Şener
Mehmet Daim Dursun
Erdem Sari
Can İnanli
Ahmet Murat Yalnizoğlu
Salim Alyanak
Muratcan Aksoy
Mert Tüten
Cemal Öztaş
Yakup Babaoğlu
Title
Marketing Director
Internaş Audit Coordinator
Tax Coordinator
Financial and Corporate Affairs Group Manager
Strategic Finance Manager
Financial Control Manager
Investor Relations Manager
Finance Manager
Accounting Manager
CPA – Tax Manager
Corporate Affairs Manager
M&A Business Development Manager
Financial Standards Manager
Tax Manager
Financial Standards and Consolidation Manager
Corporate Communication Manager
Senior Legal Adviser
Legal Adviser
Strategic Finance Manager
Financial Standards Manager
Corporate Affairs Manager
Financial Standards and Risk Manager
CMB IFRS Executive
Certified Public Accountant
Corporate and Financial Affairs Assistant Specialist
Project Manager
Food Group Project Manager
Budget and Analysis Manager
Legal Record Manager
Consolidation Specialist
Financial Control Specialist
Financial Control and Analysis Specialist
Financial Control and Analysis Specialist
Legal Record Specialist
Strategic Finance Specialist
Legal Adviser
Chief Accountant
Internal Audit Manager
Senior Audit
Senior Audit
Senior Audit
Senior Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
Internal Audit
IT Audit
IT Audit
IT Audit
Senior Tax Audit
Consultant
Independent Audit (Başaran Nas Bağimsiz Denetim
ve Serbest Muhasebeci Mali Müşavirlik A.Ş.)
47
PART III – STAKEHOLDERS
11. Information to Stakeholders
In the event there is not any regulation in laws or
contracts regarding rights of stakeholders, the
Company endeavors to protect their rights in good
faith and within means available to the Company
with due consideration given to the reputation of the
Company.
In addition, all employees have access to internal
circulars and memos through the Company’s Intranet
and receive certain important announcements
through e-mail.
There are no restrictions that prevent stakeholders
from contacting the Corporate Governance
Committee or the Audit Committee about any
Company transactions they deem either unethical
or contrary to regulations. Stakeholders may contact
these committees by any communication means they
prefer.
12. Participation of Stakeholders in Management
According to the Articles of Association, the Board
of Directors has at least seven members who are
elected by the General Assembly upon nomination by
shareholders of different share classes in accordance
with the Articles of Association. The Board of Directors
has nine members, including three independent
directors.
The Company does not have any practices related to
stakeholders’ participation in management.
13. Human Resources Policy
The main purpose of the Company’s human resources
policy is to build a team of high performance
employees by improving and developing the human
capital on the basis of the things done so far.
The human resources policy adopted by the Company
is fundamentally that of Yıldız Holding’s, and is available
at www.ulkerbiskuvi.com.tr. The Company has never
received any complaints that its human resources
policy is discriminatory.
14. Code of Conduct and Social Responsibility
Information on the corporate social responsibility
activities of the parent company, Yıldız Holding, is
available in our annual reports and on the website:
www.ulkerbiskuvi.com.tr. Keenly aware of our social
responsibility, the Company takes utmost care to
adopt policies that support environmental, sports,
educational, and health care related projects. The
Code of Conduct is also available in a related section
on the website. The Company observes the continuity
of service quality and standard at all phases of
production and maintains trade secrets of customers
and suppliers as confidential. Customer satisfaction is
one of the main principles of our Company.
Ülker Bisküvi, since its inception, has been a part
of a Group of companies that produce quality and
healthy products; respect their employees; uphold the
rights of their partners and shareholders, and of their
suppliers and customers; comply with all applicable
laws; recognize social values; and have social
responsibility. In addition, the Group of companies’
management philosophy pursues the highest level
of respect and trust among executives, employees,
suppliers, and customers; achieves employee
cooperation and high performance of personnel;
maintains dignity, consistency and a sense of
responsibility in its approach; all the while continually
striving to improve this management philosophy.
The Code of Conduct as adopted by Yıldız Holding
is generally abided by all Group companies and is
disclosed to the public within the scope of the Group’s
information policy and is available to our shareholders
on the website: www.ulkerbiskuvi.com.tr.
PART IV – BOARD OF DIRECTORS
15. Structure, Organization, and Independent
Members of the Board of Directors
The Company’s Board of Directors is composed
of nine members, three of whom are independent
members.
The Board of Directors comprises executive and
non-executive members, and a majority of the
Board’s members are non-executive members. Nonexecutive members include independent members,
who satisfy all of the criteria set out in the Capital
Market Law, who have the capacity to perform their
duties with impartiality, and who can devote their time
48
to monitor the functioning of the Company and to fulfill all the responsibilities vested to them as independent
members. Details of the Company’s Board of Directors are as follows:
Name-Surname
Position
Status
Term of Office
Chairman of Board Directors
Non-executive
10.05.201110.05.2014
Vice Chairman of Board of
Directors
Non-executive
10.05.201110.05.2014
Ahmet ÖZOKUR
Member
Executive
10.05.201110.05.2014
Mehmet TÜTÜNCÜ
Member
Executive
10.05.201110.05.2014
Murat ÜLKER
Ali ÜLKER
Mahmut Mahir KUŞCULU
Member
Non-executive
10.05.201110.05.2014
Cengiz SOLAKOĞLU
Member
Non-executive
10.05.201110.05.2014
Alain STRASSER
Member (Independent)
Non-executive
10.05.201110.05.2014
Duran AKBULUT(*)
Non-executive
09.08.201209.08.2015
Ekrem PAKDEMİRLİ(*)
Non-executive
09.08.201209.08.2015
(*) Elected by the General Assembly convened on August 9, 2012.
The Chairman of the Board of Directors and the
General Manager are two different persons. The
Company’s CEO is Mr. Mehmet Tütüncü.
Mr. Ekrem Pakdemirli, Mr. Duran Akbulut and Mr. Alain
Strasser serve as independent board members. There
are no female members on the Company’s Board of
Directors.
The report on the two independent Board candidates
and their compliance with independence criteria
has been presented to the Board of Directors. Board
membership of these presented candidates have been
approved unanimously at the Extraordinary General
Assembly meeting held on August 9, 2012.
Murat Ülker- Chairman of Board of Directors
Murat Ülker began his professional career at the Group
in 1982 after graduating from Boğaziçi University,
Faculty of Economics and Administrative Sciences,
Department of Business Administration. He is married
with three children. He is fluent in English and German.
Ali Ülker- Member
Born in 1969, Ali Ülker is married with three children.
He is fluent in English and German. His hobbies include
fishing, watching movies, reading books, and playing
basketball and billiards.
Mehmet Tütüncü- Member
Mehmet Tütüncü was appointed Chairman of the Food
and Beverages Group in 2005. As of October 2009,
the Gum and Candy companies were incorporated into
the Food Group. He was born in 1958 and is married
with three children. He likes to travel and collect small
hand-crafted boxes.
Ahmet Özokur-Member
In 2005, Ahmet Özokur was appointed General
Manager of Datateknik, and he was promoted to the
position of CEO of Datateknik Informatics Group within
the same year. On January 4, 2010, he was appointed
General Manager of Sağlam Real Estate Investment
Trust. Mr. Özokur’s interests include aquatic sports. He
is married with one child.
49
Mahmut Mahir Kuşculu - Member
Mahmut Mahir Kuşçulu graduated from Istanbul
Erkek High School, and subsequently from Istanbul
University, Faculty of Economics. He then received his
master’s degree in marketing in the US. He founded
Kutas Dis Ticaret ve Pazarlama A.Ş. in 1982 and
Erdem Dis Ticaret A.Ş. in 1985, and served as director
and manager at both enterprises. Mr. Kuşçulu has
served on the professional committees of the Istanbul
Chamber of Commerce and the Istanbul Chamber of
Industry for 20 years. He has been a member of the
Assembly of the Istanbul Chamber of Industry for 13
years. Mr. Kuşçulu is married with two children.
Cengiz Solakoğlu - Member
Having worked at Koc Group continuously for 37 years,
Cengiz Solakoğlu retired due to the Group’s policy for
mandatory retirement at age 60. He is among the
founders of the Educational Volunteers Foundation
of Turkey (TEGV) and the 1907 Fenerbahçe
Association. Mr. Solakoğlu was named a Leader of Civil
Society by Economist magazine in 2003. He is married
with two children.
Duran Akbulut - Member (Independent)
Duran Akbulut was born in the town of Susehri in Sivas
in 1937. He completed his primary and secondary
education in Susehri, Sivas before moving to Istanbul.
He is married with two children.
Prof. Dr. Ekrem Pakdemirli - Member
(Independent)
Dr. Ekrem Pakdemirli was born in Izmir in 1939. He
received a BSc in Mechanical Engineering from Middle
East Technical University where he also completed
his post graduate studies. He then studied at London
Imperial College where he received his PhD. He taught
at Bilkent and Baskent Universities between 2003 and
2008. He has been a member of the faculty of Istanbul
Commerce University since 2008. He is also a Board
member of Albaraka Turk. To date, he has published
more than 500 papers and 10 books. He is married
with five children.
Alain Strasser - Member (Independent)
Alain Strasser was born in 1947. He received a BSc
degree in mathematics and philosophy in 1964. In
1982, Mr. Strasser, who had become an expert in
homecare products, joined Tambrands, and there
he served as Sales and Marketing Director for France
(1982 - 1983), General Manager for France
(1983 - 1987), General Manager for the United
Kingdom (1987 - 1989), European Division Deputy
Head (1990 - 1993), and International Head
(1993 - 1994), respectively.
The common Statement of Independence of the
independent Board members follows:
STATEMENT OF INDEPENDENCE
“I have been elected as an independent Board member
by the Extraordinary General Assembly of Ülker Bisküvi
Sanayi Anonim Şirketi convened on July 9, 2012 in
accordance with the criteria specified in the Corporate
Governance Principles published by the Capital
Markets Board and henceforth I hereby declare that:
Neither I nor my spouse, or any blood or non-blood
relatives within the third degree of relationship have
had, directly or indirectly, within the last five years,
any employment, equity, or otherwise material
business relationship with the Company or any of its
related parties, or any entity where a shareholder of
the Company, which holds, directly or indirectly, 5%
or more share in Company, is related with respect to
management or equity;
I have not, within the last five years, been employed
by any company, in particular those which audited,
rated, or consulted with the Company, which carried
out whole or part operation and organization of the
Company in accordance with agreed terms, nor have I
become a Board member of such companies;
I have not, within the last five years, been a
shareholder, employee, or Board member of a
company which significantly provides services and
products to the Company,
I do not hold more than 1% of the share capital of
the Company, and that none of these shares are
preferential;
I have all the professional education, knowledge, and
experience that are necessary for me to fulfill my
duties as a member;
50
I have solid professional ethical standards, dignity,
and experience to make a positive contribution to the
Company’s operations, to enable me to maintain my
impartiality in the cases of conflicts of interest among
shareholders of the Company and to freely make my
decisions by taking into account rights of stakeholders;
and
I am able to devote my time to the Company’s affairs,
to closely attend to the functioning of the Company’s
operations and to fully perform the duties vested to
me.”
Name-Surname
The internal and external Group duties of each Board
member assumed on behalf of the Company and
rationale thereof are disclosed for the information
of the General Assembly where the election of each
Board member is discussed.
There is not any separate committee designated. The
duties of a nomination committee are performed by
the Corporate Governance Committee.
Title
Outside Group Duty
Chairman of the Board of
Directors
Chairman of the Board of Directors of Group companies
Vice Chairman of the
Board of Directors
Member of the Board of Directors of Group companies
Ahmet ÖZOKUR
Member
Mehmet TÜTÜNCÜ
Member
Mahmut Mahir KUŞCULU
Member
Cengiz SOLAKOĞLU
Duran AKBULUT
Member
Member
Ekrem PAKDEMİRLİ
Alain STRASSER
Member
Member
Chairman of the Executive Board of Büyük Kulüp
Member of the Board of Directors of Albaraka Türk Katılım
Bankası
-
Murat ÜLKER
Ali ÜLKER
16. Rules of Conduct of the Board of Directors
The Company’s Board of Directors held 20 meetings
between January and December 2013. Due
consideration was given when setting the meeting
dates and times so that each and every member is able
to attend the meeting. The Board of Directors meets
regularly and as often as necessary to conduct its
business and affairs effectively.
The Board of Directors shall convene once a month
when it is deemed necessary due to the Company
operations and transactions. The Board of Directors
must also convene when it is deemed necessary by
the Chairman or one-third of the Board members.
The meetings of the Board of Directors may be held at
the headquarters of the Company or at a convenient
location in the city where the headquarters is located or
in another city by resolution of the Board of Directors.
The Board of Directors may, upon resolution,
determine whether or not they will have a distribution of
responsibilities among the Board members.
An invitation for the meeting must made by a
seven-day prior notice and include the agenda and
documentation related to the call for the meeting.
In principle, members participate in a Board of
Directors meeting in person. However, it is possible
that Board members may participate in a Board
of Directors meeting by means of electronic
communication. Written stipulations of a member who
does not participate in a Board meeting but submits
his/her comments on the agenda in writing shall be
presented to the other members.
Any discussion and resolution of Board of Directors
must be recorded in written minutes, which must
be signed by each member present at the meeting
and then recorded in the book of resolutions. Any
member with a dissenting vote must also state his/
her rationale for his/her dissenting vote before signing
the minutes of that meeting. Minutes of meetings
and related documents and correspondence related
51
therewith shall be regularly archived by the Secretariat
of the Board of Directors. The Board of Directors shall
meet with a quorum of at least more than one-half of
the number of members and resolve by a majority of
members present at the meeting. In the event there
is a tie in the votes, the voted issue shall be discussed
at the next meeting. The proposal shall be deemed
rejected if it is not approved by a majority vote at the
next meeting. Each Board member has one voting right
regardless of his/her title and area of duty.
The names, duties and responsibilities of members
of the Board of Directors are clearly specified in
the Articles of Association which is available on our
website: www.ulkerbiskuvi.com.tr.
While carrying out their responsibilities, the members
of the Board Directors are furnished all the information
necessary for them to fully perform their duties and act
prudently and in good faith.
No objection has been raised against any resolution
adopted by the Board of Directors during 2013.
Nor has there been any material transaction with
respect to related party transactions which were
presented to independent members for approval.
Any material information which must be disclosed to
the public is promptly disclosed after the end of each
meeting.
17. Number, Structure, and Independency of
Committees Formed by the Board of Directors
Audit Committee:
The Audit Committee, which was established by
a resolution of the Board of Directors on May 22,
2006, was restructured by a resolution of the Board
of Directors dated August 5, 2008 in accordance
with Communiqué No. 22 Serial No.: X of the Capital
Markets Board. The Audit Committee ensures that
the Company’s financial and operational functions
are monitored in a reliable manner. The purpose of
the Committee, which reports directly to the Board
of Directors, is to oversee the Company’s accounting
system, audit and disclosure of financial information,
and the functioning and effectiveness of the internal
audit system. This Committee meets as necessary,
but at least four times each year. The new members of
the Audit Committee as selected by the resolution of
the Board of Directors dated October 15, 2012 are as
follows:
Name
Duran Akbulut
Ekrem
Pakdemirli
Title
Position with
Company
Chairman of Board Member
Committee (Independent)
Board Member
Corporate Governance Committee:
The Company established a Corporate Governance
Committee by resolution of the Board of Directors
dated August 5, 2008 in accordance with the
Corporate Governance Principles published by the
Capital Markets Board. This Committee reports
directly to the Board of Directors and meets as
necessary but at least three times each year. The
new members of the Audit Committee as selected by
resolution of the Board of Directors dated October 15,
2010 are as follows:
Name
Duran Akbulut
Alain Strasser
Hafize Nurtaç
Ziyal
Title
Position with
Company
Chairman of
Committee
Board Member
(Independent)
Member
Board Member
(Independent)
Member
General Director
of M&A Business
Development and
Investor Relations
52
Risk Committee:
The Company established a Risk Committee in
accordance with the Corporate Governance Principles
published by the Capital Markets Board. This
Committee reports directly to the Board of Directors
and meets as necessary. The new members of the
Audit Committee as selected by resolution of the
Board of Directors dated October 16, 2012 are as
follows:
Name
Ekrem
Pakdemirli
Necdet Buzbaş
Position with
Title
Company
Chairman of Board Member
Committee (Independent)
Member
Any independent member may be a member of more
than one committee, but s/he may be selected
as chairman of only one committee. The Board of
Directors may appoint an independent member as a
committee member for more than one committee in
accordance with the Corporate Governance Principles.
18. Risk Management and Internal Audit Mechanism
The Company’s activities with regard to risk
management are carried out by the Risk Committee.
The Company is also audited regularly by the
auditing units of Yıldız Holding A.Ş., which is the
majority shareholder of the Company, and an
independent audit firm. The findings of these audits
are communicated to the members of the Audit
Committee and to the Board of Directors. The
business flows, and procedures of the Company,
and authorities and responsibilities of employees are
controlled within the framework of risk management
and are subject to continuous monitoring and checks.
19. Strategic Objectives of the Company
Mission, Vision, and Strategic Objectives of the
Company
The Company and all subsidiaries of Yıldız Holding were
founded on the philosophy that “every person has
the right to a nice childhood regardless of the country
s/he lives in.” The vision of Ülker Bisküvi is to further
strengthen and advance its brand reputation, which is
the most preferred brand by consumers particularly
in bakery products, and become one of the top five
companies in Turkey within the next 10 years.
The vision and mission of Yıldız Holding and our
Company is disclosed to the public and is available on
the websites: www.ulker.com.tr and www.ulkerbiskuvi.
com.tr.
20. Remuneration
Remuneration of each member of the Board is
determined separately by the General Assembly
depending on the financial position of the Company
at that time. The General Assembly has resolved that
each Board member is paid TL 2,599.21 per month in
2012 and each independent member who was elected
on August 9, 2012 be paid TL 5,304.50 per month.
No loan was extended to any member or executive
officer during the period, nor extended, directly or
through a third party, any personal loan or given any
collateral on their behalf, such as a surety.
Principles for remuneration regarding interests of
executive management and the Board of Directors are
explained in detail on the website: www.ulkerbiskuvi.
com.tr.
53
Risk Management
Corporate Risk Management efforts include
determining potential incidents that may affect Ülker
Bisküvi, managing risks in line with the Company’s
risk taking profile, and providing an acceptable level
of assurance for the Company to achieve its goals.
Corporate Risk Management is a systematic process
which is utilized in devising strategies, implemented
across the Company and impacted by the Company’s
Board of Directors, senior management as well as all of
its employees.
As a result of proper Risk Management, Companies are
able to:
•Sustain profitability and growth,
•Minimize revenue fluctuation,
•Make healthier decisions about risks,
•Identify opportunities and threats in a better way
•Sharpen the competitive edge,
•Utilize resources more efficiently,
•Comply with laws and regulations,
•Improve the quality of Corporate Governance.
While a potential risk may present a negative factor
which must be taken under control, for companies
that implement Corporate Risk Management it creates
important opportunities. In the past, risks were
managed by individual departments; however, in
line with the changes in the overall risk management
concept, risks are now tackled as a whole and
assessed on the basis of each company. Previously,
risk assessment was carried out by the internal
audit departments of companies, measurements
were evaluated in a subjective manner, and risk
management functions were unstructured and
inconsistent. However, at companies which adopt
the principles of Corporate Risk Management, a risk
committee ensures effective risk management as
imposed by the Board of Directors, and thus risks can
be properly measured. Additionally, risk management
is structured to cover all management systems of
companies.
As a company engaged in production and sales
activities in various countries, Ülker Bisküvi is aware
of the necessity to monitor risks and take necessary
measures, especially about risks arising from currency
and interest rates, raw material prices, partnerships
and new investments, which have become even more
important with the latest developments.
The Company’s risk management activities are carried
out by the Risk Committee. Furthermore, Ülker
Bisküvi is also audited regularly by the audit units of
Yıldız Holding A.Ş., the parent company, and also by
independent auditors. The findings of these audits
are reported to the members of the Audit Board as
well as to Board members. The Company’s workflows,
procedures, and the authorities and responsibilities
of employees have been placed under control,
and subjected to constant supervision within the
framework of risk management.
54
Investor Relations
The Ülker Bisküvi Investor Relations Department
always seeks to establish more effective, transparent,
equal and timely communications with investors. The
Company strives to carry out such processes in strict
compliance with applicable laws, rules and regulations,
and on par with global best practices.
In 2013, Ülker Bisküvi held a total of 293 meetings in
Turkey and overseas (including the meetings held at
the Head Office) with 281 investors and 12 analysts.
(Number of meetings in 2012: 255.) The Company
also participated in conferences and road shows
in New York, Boston, Chicago, London, Frankfurt,
Edinburgh, Warsaw, Amsterdam, Stockholm and
Copenhagen. At these conferences and meetings,
Ülker Bisküvi provided information to shareholders and
prospective investors, and regularly received requests
for information.
The number of analysts covering Ülker Bisküvi totaled
14 in 2013. As a result of all activities, announcements
and projections shared with investors throughout
2013 along with the share sale, Ülker Bisküvi shares
outperformed the BIST 100, BIST 50 and BIST
Food and Beverage indices by a wide margin.
Ülker Bisküvi hosted teleconferences and webcasts
for informational purposes and to respond to the
questions of investors and analysts on the days after
the announcement of quarterly financial results
on the Public Disclosure Platform. The Company’s
phone numbers and email address were announced
on the corporate website, www.ulkerbiskuvi.com.
tr, on the day of the meetings. Investors and analysts
showed significant interest in the teleconferences
and webcasts, and submitted questions about Ülker
Bisküvi’s strategies, restructuring efforts, market share
and growth targets.
The Investor Relations Unit is in charge of establishing
the Company’s information disclosure policy and
ensuring that this policy is adopted across the
organization.
The main responsibilities of the Unit are as follows:
a) To ensure that shareholders’ records are kept in a
secure, safe and an up-to-date form,
b) To respond to shareholders’ written requests
for information in writing, except that information
undisclosed to the public, or classified as confidential
or commercial secret,
c) To ensure that General Assembly meetings are held
in conformity with applicable rules and regulations,
Articles of Association, and other internal regulations,
d) To prepare the documents that may be useful to
the shareholders at the General Assembly meetings,
e) To keep record of voting results and ensure that the
reports of the results are delivered to the shareholders,
f) To oversee and monitor all matters related to
applicable legislation and the Company’s information
disclosure policy.
55
Amendment to the Articles of Association
Current Version
New Version
4 – Registered Office and Branch Offices:
Article 4 - The registered office of the Company is
at Davutpasa Caddesi No.: 10, Topkapı in the district
of Zeytinburnu, Istanbul. In the event of a change
of address of the registered office, the new address
shall be registered before the Trade Registry Office
and announced in the Turkish Trade Registry Gazette,
and the change of address shall also be notified to the
Ministry of Customs and Commerce and to the Capital
Markets Board. Any notice sent to the registered
address of the Company shall be deemed to have
been made to the Company. The Company’s failure to
have its new address registered within the prescribed
time limit although it has moved from its registered
address, which is already announced to the public,
shall be considered as grounds for termination of the
Company. The Company may establish branches or
facilities either at home or abroad, provided that the
Company should notify the Ministry of Customs and
Commerce and the Capital Markets Board.
4 - Registered Office and Branch Offices:
Article 4 - The registered office of the Company is at
Kısıklı Mahallesi Ferah Caddesi No: 1 Büyük Çamlıca in
the town of Üsküdar in the city of Istanbul. In the event
of a change of address of the registered office, the new
address shall be registered before the Trade Registry
Office and announced in the Turkish Trade Registry
Gazette, and the change of address shall also be
notified to the Ministry of Customs and Commerce and
to the Capital Markets Board. Any notice sent to the
registered address of the Company shall be deemed
to have been made to Company. The Company’s
failure to have its new address registered within the
prescribed time limit although it has moved from
its registered address, which is already announced
to the public, shall be considered as grounds for
termination of the Company. The Company may
establish branches or facilities either domestically or
abroad, provided that the Company notify the Ministry
of Customs and Commerce and the Capital Markets
Board.
II. Capital and Shares
II. Capital and Shares
1 – Capital of the Company:
Article 7 - The Company has adopted the registered
capital system as per the provisions of the Capital
Market Law No. 2499 as amended by Law No. 3794,
and has started to implement this system on the basis
of permission no. 2/24 dated January 16, 2004 of
the Capital Markets Board. The registered capital of the
Company is TL 500,000,000 (five hundred million)
divided into 50,000,000,000 (fifty billion) shares
with a nominal value of 1 (one) Turkish kuruş each.
Capital of the Company:
Article 7 - The Company has adopted the registered
capital system as per the provisions of the Capital
Market Law No. 6362, and has started to implement
this system on the basis of the permission of the
Capital Markets Board. The registered capital of the
Company is TL 500,000,000 (five hundred million)
divided into 50,000,000,000 (fifty billion) shares
with a nominal value of 1 (one) Turkish kuruş each.
The previous capital of the Company was TL
268,600,000 (two hundred sixty-eight million
and six hundred thousand) and now it has been
increased by TL 73,400,000, which is equivalent to
7,340,000,000 shares, through private placement
with premium on issued shares. This capital increase
has been implemented by setting off of all sums
owed by the Company to existing shareholders on
the condition of revocation of dividend privileges and
interests granted to shareholders upon full restriction
The permission for the registered capital cap granted
by the Capital Markets Board is valid for five (5) years
between 2013 and 2017. Even if this registered
capital cap has not yet been satisfied by the end of
2017, the Board of Directors must obtain the General
Assembly’s authorization to apply for an extension of
time for a previous or a new cap authorization upon
the permission of the Capital Markets Board. In the
event of failure to obtain such authorization and loss of
eligibility for a registered capital system, the Company
shall be removed from the system by the Capital
Markets Board.
56
of pre-emption rights granted to existing shareholders
and disqualifying bearer shareholders for the purpose
of application of Article 9, paragraph (d) of Article 34
of the previous version of the Articles of Association
before amendment, and Class A and Class B bearer
shareholders for the purposes of application of
paragraph (d) of Article 34 of the previous version
of the Articles of Association. Accordingly, 22,171
pre-emptive shareholders are now given Class C
shares equivalent to TL 29,350,020, 1,486 Class A
bearer shareholders Class C shares equivalent to TL
29,525,607, and 731 Class B registered shareholders
Class C shares equivalent to TL 14,524,373. Previous
731 Class B shares have been converted into Class C
shares, as all dividend privileges previously granted to
this class of shares have been abrogated, and there
is not any other kind of privileges left. Since all the
privileges granted to Class D shares are still valid (as
per Article 11 of these Articles of Association), this
class of shares has been renamed as Class B.
The capital of the Company, which is now increased,
is divided into 34,200,000,000 (thirty-four billion
two hundred million) shares with a nominal value of 1
Turkish kuruş each. The issued capital of the Company
is TL 342,000,000 (three hundred and forty-two
million) and is composed of 34,199,996,297 Class
C bearer shares, 1,486 Class A bearer shares, and
2,217 Class B registered shares. The issued capital of
the Company is fully paid up.
Securities to be issued out of the Company’s fund
shall be distributed to existing shareholders pro rata to
their respective shareholding percentage at no cost.
The Board of Directors may issue shares in the form
of share certificates representing multiple shares.
Although the nominal value of each share was TL
1,000 it has been changed to 1 Turkish kuruş pursuant
to Law No. 5274 Amending the Turkish Commercial
Code. As a result of this change, the total number
of shares has decreased, and each shareholder will
receive one (1) share with a nominal value of 1 Turkish
kuruş in return for 10 shares with a nominal value of
TL 1,000 each. All vested rights of shareholders with
respect to such exchange shall be reserved. All shares
representing the capital of the Company shall be
tracked through appropriate records in accordance
with the guidelines for registration of shares.
The issued capital of the Company is TL 342,000,000
(three hundred and forty-two million) divided into
34,200,000,000 (thirty-four billion two hundred
million) bearer shares with nominal value of 1 Turkish
kuruş each, and is fully paid up. There is not any
difference between shares in terms of privileges or
classes.
The Board of Directors shall be entitled, at its
discretion, to increase the issued capital by issuing new
shares up to the registered upper limit of the capital,
and to adopt resolutions in relation to limitation of
subscription rights of shareholders, as well as in
relation to issuance of premium stocks in accordance
with the provisions of the Capital Market Law.
Securities to be issued out of the Company’s fund shall
be distributed to existing shareholders pro rata to their
respective shareholding percentage at no cost.
All shares representing the capital of the Company
shall be tracked through appropriate records in
accordance with the guidelines for registration of
shares.
57
3 - Transfer of Bearer Shares:
Article 9 - In principle, any bearer share may be
transferred. Transfer shall become valid if an endorsed
share certificate is delivered to the transferee, and
the transfer is registered in the share ledger. Without
prejudice to Article 418 of the Turkish Commercial
Code, the Company may refrain from recording a
share transfer in the share ledger without stating a
cause.
3 - Transfer of Bearer Shares:
Article 9 - ABROGATED
III. Management
III. Management
A – Board of Directors
A – Board of Directors
Members
Article: 11 - The Board of Directors consists of executive
and non-executive members. The Corporate Governance
Principles of the Capital Markets Board shall be abided by
with respect to the number and the qualifications of the
independent members of the Board of Directors and the
structure and organization of the Board of Directors.
Directors
Article: 11 - The Board of Directors consists of executive
and non-executive members. The Corporate Governance
Principles of the Capital Markets Board shall be abided by
with respect to the number and the qualifications of the
independent members of the Board of Directors and the
structure and organization of the Board of Directors.
Without prejudice to the first paragraph of this article, the
affairs of the Company shall be executed and represented
by a Board of Directors which consists of at least seven
members to be elected by the General Assembly in
accordance with the Turkish Commercial Code and the
conditions specified below.
Without prejudice to the first paragraph of this article, the
affairs of the Company shall be executed and represented
by the Board of Directors which consists of at least seven
members to be elected by the General Assembly in
accordance with the Turkish Commercial Code and the
conditions specified below.
Four members are nominated by simple majority of Class
A shareholders, one member by simple majority of Class B
shareholders, and rest of the members are nominated in
accordance with general provisions. As a rule, each Board
member must have basic knowledge of the legal rules on
actions and disposals regarding the fields of activities of
the Company, training and experience in management of a
company, and the ability to review the financial statements
and reports of the Company, and at least one-third of
members must have a university degree.
As a rule, each member must have the basic knowledge of
the legal rules on actions and disposals regarding the fields
of activities of the Company, training and experience in
management of a company, and the ability to review the
financial statements and reports of the Company, and at
least one-third of the members must have a university
degree.
The Board of Directors shall elect a Chairman and a Vice
Chairman from among its members to fully exercise its
powers and fully perform its responsibilities. It is important
that the Chairman of the Board of Directors and General
Manager of the Company are not the same person. The
Board of Directors may, as it deems necessary, delegate
part of its powers and certain parts of its responsibilities to
the Company to executive management, who shall also
be responsible for monitoring of the implementation of
The Board of Directors shall elect a Chairman and a Vice
Chairman from among its members to fully exercise its
powers and fully perform its responsibilities. It is important
that the Chairman of the Board of Directors and General
Manager of the Company are not the same person. The
Board of Directors may, as it deems necessary, delegate
part of its powers and certain parts of responsibilities to
the Company to executive management, who shall be
also responsible for monitoring of the implementation of
resolutions of the Board of Directors.
58
resolutions taken by the Board of Directors.
The Chairman of the Board of Directors shall be
responsible for convening the Board of Directors for
meeting and proper functioning of discussions and
causing any resolution adopted to be recorded in minutes.
It exercises this responsibility through the Secretariat of
the Board of Directors. The Vice Chairman of the Board of
Directors shall undertake the powers and responsibilities
that are delegated to him/her by the Chairman of the
Board of Directors, s/he shall preside over meetings of
the Board to which the Chairman cannot attend for any
reason, and s/he shall assist the Chairman in performing
his/her duties.
The Chairman of the Board of Directors shall be
responsible for convening the Board of Directors for
meeting and proper functioning of discussions and
ensuring that any resolution made to be recorded in
the minutes. It exercises this responsibility through the
Secretariat of the Board of Directors. The Vice Chairman
of the Board of Directors shall undertake the powers
and responsibilities that are delegated to him/her by the
Chairman of the Board of Directors, s/he shall preside
over meetings of the Board to which the Chairman
cannot attend for any reason, and s/he shall assist the
Chairman in performing his/her duties.
In the case of vacancy in the Board of Directors for any
reason whatsoever, the Board of Directors shall appoint
a member, who has the necessary qualifications, and
who will act as a member until the approval for the next
the General Assembly, in accordance with paragraph
one above. A newly appointed member shall complete
the remaining term of office of the replaced member.
The scope of right to information on the affairs of the
Company, and to examine statutory books or documents
of the Company granted to the Chairman of the Board of
Directors or member, may at any time be expanded by a
resolution of the Board of Directors.
In the case of a vacancy in the Board of Directors for any
reason whatsoever, the Board of Directors shall appoint
a member, who has the necessary qualifications, and
who will act as a member until the approval for the next
the General Assembly, in accordance with paragraph one
above. A newly appointed member shall complete the
remaining term of office of the replaced member.
7 – Management and Representation of the Company:
Article 17 – Without prejudice to the first paragraph of
Article 12 Duties and Powers of the Corporate Governance
Principles in Part III of these Articles of Association,
the Board of Directors shall manage and represent the
Company before any third party. The method of valid
representation of the Company before any third party shall
be determined by the Board of Directors. Any document
given or any agreement executed by the Company shall be
valid if it bears signatures of any two members underneath
the common seal of the Company, unless otherwise
agreed.
7 – Management and Representation of the Company:
Article 17 – Without prejudice to the first paragraph
of Article 12 Duties and Powers of the Corporate
Governance Principles in Part III of these Articles of
Association, the Board of Directors shall manage and
represent the Company before any third party. The
method of valid representation of the Company before
any third party shall be determined by the Board of
Directors. Any document given or any agreement
executed by the Company shall be valid if it bears
signatures of any two Board members underneath the
common seal of the Company, unless otherwise agreed.
The Board of Directors may delegate whole or part of
its representation powers and duties to one or more
executive members of the Board of Directors or to any
executive(s), who is/are executive(s) of the Company
or not in accordance with Article 319 of the TCC.
Executives may at any time be appointed for the duration
longer than the term of office of a member. The Board of
Directors may designate a committee or committees for
execution of certain activities.
The Board of Directors may delegate the whole or part
of its representation powers and duties to one or more
executive members of the Board of Directors or to any
executive(s), who is/are executives(s) of the Company
or not in accordance with Article 370 of the TCC.
Executives may at any time be appointed for a duration
longer than the term of office of a Board member.
The Board of Directors may designate a committee or
committees for execution of certain activities.
59
The Board of Directors shall determine the powers of
executives and whether or not they individually or jointly
represent the Company. Any resolution of the Board of
Directors in that regard shall be recorded and disclosed.
The Board of Directors shall determine the powers of
executive management and whether or not they are
individually or jointly represent the Company. Any
resolution of the Board of Directors in that regard shall
be recorded and disclosed.
B – Auditors
1 – Election:
Article 20 - The General Assembly shall elect two or
three auditors for a maximum of three years among
the shareholders or from outside. The auditors shall
constitute a board. The General Assembly shall set and
determine remuneration payable to auditors.
Auditors
Article 20 - The Company shall be audited by an
auditor to be elected by the General Assembly in
accordance with the Turkish Commercial Code, and
the Capital Market Law and applicable regulations.
The Turkish Commercial Code shall apply for election,
dismissal, termination of contract for service, and the
procedures and principles of internal audit.
The independent audit firm which will perform the
independent audit of the financial statements of the
Company shall be appointed by the General Assembly
upon the proposal of the Board of Directors, or
the General Assembly shall authorize the Board of
Directors to appoint one. The same independent audit
firm may be retained continuously and/or for ad-hoc
audits for the duration determined in accordance
with applicable capital market laws and regulations.
The Company is not allowed to procure consulting
services from the same independent audit firm, or
from personnel who are employed by this firm, or from
any consultant firm which is, directly or indirectly,
controlled with respect to management or capital by
the same independent audit firm. This also applies
to any consultancy service provided by real person
partners and executives of the independent audit firm.
2 – Duties:
Article 21 - Auditors are obliged to perform the duties
specified in Article 353 of the Turkish Commercial
Code. In addition, auditors have the power and
responsibility to call the General Assembly and to
take all actions that the General Assembly may deem
necessary for the good management and protection of
the interests of the Company, to determine the agenda
for the General Assembly, and to prepare the report
specified in Article 354 of the Turkish Commercial
2 – Duties:
Article 21 - ABROGATED
60
Code. Auditors must promptly exercise these powers
in the event of contingencies. Auditors shall be jointly
held liable for the failure of performing their duties in
accordance with applicable laws and these Articles of
Association.
C – General Assembly
1 – Form of Meetings:
Article 22 – The General Assembly may have either
ordinary or extraordinary meetings. The ordinary
General Assembly shall convene at least once a year
within three months following the end of a fiscal period.
The General Assembly shall discuss matters specified
in Article 369 of the Turkish Commercial Code and
resolve as necessary.
C – General Assembly
1 – Form of Meeting:
Article 22 – The General Assembly may have either
ordinary or extraordinary meetings. The ordinary
General Assembly shall convene at least once a year
within three months following the end of a fiscal period
and resolve as necessary.
An extraordinary General Assembly shall convene
when and if it deems necessary for the business of the
Company and in accordance with relevant provisions
of the Turkish Commercial Code and these Articles of
Association and resolve as necessary.
An extraordinary General Assembly shall convene
when and if it deems necessary for the business of the
Company and in accordance with relevant provisions
of the Turkish Commercial Code and these Articles of
Association and resolve as necessary.
It is appropriate for the Board members and auditors
to participate in the General Assembly. In addition, any
person who assumes any responsibility with respect to
any matter included in the agenda, and who is required
to provide information with respect to any matter
included in the agenda must be present at the General
Assembly.
The venue for meetings held by the General Assembly
is the principal place of business of the Company. The
General Assembly may convene at another convenient
place in the locale where the Company’s principal
place of business or branch office is located. This shall
be indicated in an invitation and announcement for the
General Assembly.
Also, background information on nominated Board
members is provided to the General Assembly.
Also, background information on nominated Board
members is provided to the General Assembly.
All General Assembly meetings shall be open to
the public, unless otherwise agreed by the General
Assembly. However, any person present at the General
Assembly, who does not possess a shareholder or
proxy entrance pass, is not permitted to speak or vote
at the General Assembly.
The General Assembly shall exercise the powers
and perform its duties mandated by the Turkish
Commercial Code, the Capital Market Law, and other
relevant laws and regulations.
61
3 – Appointment of Proxies:
Article 24 - A shareholder may be represented at
the General Assembly by a proxy, who may be a
shareholder or a person outside the Company. A
proxy who is also a shareholder of the Company is
entitled to vote on behalf of the shareholder, whom
s/he represents in addition to his/her voting right in
accordance with the relevant communiqué of the
Capital Markets Board. The form of proxy shall be
determined and announced by the Board of Directors
in accordance with the relevant provisions of the
Capital Markets Board.
3 – Appointment of Proxies:
Article 24 - A shareholder may be represented
at the General Assembly by a proxy, who may be
a shareholder or a person outside the Company,
provided that all requirements for representation
through proxies set out by the Capital Markets Board
are complied with. A proxy who is also a shareholder
of the Company is entitled to vote on behalf of the
shareholder, whom s/he represents in addition to his/
her voting right. Without prejudice to appointment
of proxies implemented via the Electronic General
Assembly System, a power of attorney to be given to a
proxy must be in writing.
4 – Announcement:
Article 25 - Without prejudice to paragraph 4
of Article 37 of the Turkish Commercial Code,
announcements related to the Company shall be
made by a 21-day prior publication to be made in a
newspaper of the location where the principal place of
business of the Company is registered in accordance
with relevant regulations, including the Corporate
Markets Board. The invitation to the General Assembly
shall be made by at least a three-week prior notice
to be given before the meeting date by any means of
communication, including electronic communications,
so that it is received by as many shareholders as
possible. In addition to invitations for the General
Assembly meeting and disclosures and notices that
the Company is required to publish in accordance with
applicable regulatory requirements specified in the
Corporate Governance Principles published by the
Capital Markets Board, these shall be published on the
4 – Announcement:
Article 25 - Announcements related to the Company
shall be made by a 21-day prior publication to
be made in a newspaper of the location where
the principal place of business of the Company is
registered in accordance with relevant regulations,
including paragraph 4 of Article 37 of the Turkish
Commercial Code and the Corporate Governance
Principles published by the Capital Markets Board.
An invitation to the General Assembly shall be made
by at least three-week prior notice to be given before
the meeting date by any means of communication,
including electronic communications, so that it is
received by as many shareholders as possible. In
addition to invitations for the General Assembly and
disclosures and notices that the Company is required
to publish in accordance with applicable regulations
and requirements specified in the Corporate
Markets Board, these shall also be published on the
5 – Form of Exercising the Right to Vote:
Article 26 - Voting at the General Assembly shall be
made by a show of hands. However, a secret ballot
must be held upon the request of one-twentieth of
the shares represented by shareholders present at the
General Assembly.
5 – Form of Exercising the Right to Vote:
Article 26 - Voting at the General Assembly shall be
held in accordance with the provisions of the Turkish
Commercial Code and regulations of the Capital
Markets Board.
Participating in the General Assembly by Electronic
Communication Means:
Any shareholder who is entitled to attend a meeting
held by the General Assembly may attend the meeting
held by the General Assembly by an electronic
communication means in accordance with Article
1527. Pursuant to the regulation on the General
62
Assembly convened by electronic communication
means, the Company may set up an e-General
Assembly system or procure any system which is
developed for this purpose so that any shareholder
is able to attend, express his/her views, make
suggestions, and cast his/her vote by an electronic
communication means. At any meeting held by the
General Assembly, shareholders and their proxies shall
be allowed to exercise their respective rights under the
referenced regulations via the system to be so set up.
V. Distribution of Profit, Reserve Fund
1 – Distribution of Profits:
Article 33 - The net end-of period income less
overhead and miscellaneous depreciation expense
of the Company, and any sums which the Company
must pay or set aside and compulsory taxes that the
Company is required to pay, as shown in the balance
sheet of the Company shall be reduced by losses from
previous periods, if any, and is distributed as follows:
a) 5% of profit as shown in the balance sheet, in
accordance with paragraph one of Article 466 of the
Turkish Commercial Code (TCC).
b) First dividend in the amount and at the rate to be
determined by the Capital Markets Board shall be
set aside for shareholders. The first dividend, which
must be set aside under applicable laws, shall be
equally distributed among all outstanding shares as
of the current period regardless of date of issue and
acquisition thereof.
c) No resolution on distribution of profit among
Board members as well as officers, employees, and
workers of the Company, and foundations pursuing
various objectives and similar real and legal entities
and on setting aside another reserve or carrying any
undistributed profit to next year’s balance sheet shall
be made unless all legal reserves and the first dividend
for shareholders as per these Articles of Association
are set aside, and the first dividend has been paid.
d) Rules of distribution of profit specified in above
subsection (b) shall apply if the General Assembly
approves distribution of remaining profit.
e) One-tenth of the net of the second dividend, which
is approved by the General Assembly for distribution
to shareholders and other stakeholders, less a
profit share in amount of 5% of paid-in capital to be
distributed to shareholders in accordance with subparagraph 3 of Article 466 of the TCC shall be set aside
as reserve.
V. Distribution of Profit, Reserve Fund
1 – Determination and Distribution of Profit:
Article 33 – The Company shall comply with the
Turkish Commercial Code and the capital market
regulations with respect to any distribution of profit.
The net end-of-period income less overhead and
any sums which the Company must pay or set aside,
such as miscellaneous depreciation expense and
compulsory taxes that the Company is required to
pay, as shown in the balance sheet of the Company,
which is prepared in accordance with applicable capital
market regulations, shall be reduced by losses from
previous periods, if any, and is distributed as follows:
Legal reserve fund:
a) 5% of the profit as shown in the balance sheet, in
accordance with paragraph one of Article 519 of the
Turkish Commercial Code (TCC).
First Dividend:
b) A first dividend in the amount and at the rate to be
determined by the General Assembly in accordance
with the Turkish Commercial Code and Capital Markets
Board shall be set aside by adding up any donation,
if any, which was made during the period, to the
remainder of the net profit.
c) The General Assembly shall have the right to
determine any profit distribution payable to Board
members, officers, employees, and workers of the
Company, and foundations pursuing various objectives
and similar real and legal entities once the above sums
have been deducted.
Second Dividend:
d) The General Assembly shall be entitled to distribute
the remainder of net profit less the sums specified
in subsections (a), (b), and (c) above in part or
63
f) Pursuant to the Capital Market Law, a dividend
advance may be distributed. The General Assembly
shall determine, upon proposal by the Board of
Directors, when and how profit is to be distributed
among shareholders in accordance with the Capital
Market Law and other relevant laws. Distributions of
profits made in accordance with these Articles of
Association cannot be revoked.
whole as the second dividend, or to carry such sum to
the balance sheet as end-of-year profit, or add such
sum to legal or voluntary reserves, or set it aside as
contingency reserve.
e) One-tenth of the portion of net profit, which is
approved by the General Assembly for distribution
to shareholders and other stakeholders, less a profit
share in the amount of 5% of paid-in capital to be
distributed to shareholders shall be added into the
general legal reserve in accordance with the Turkish
Commercial Code.
f) No resolution on distribution of profit among
Board members as well as officers, employees, and
workers of the Company, and foundations pursuing
various objectives and similar real and legal entities
and on setting aside another reserve or carrying any
undistributed profit to next year’s balance sheet shall
be made unless all legal reserves have been set aside
and the first dividend for shareholders as per these
Articles of Association are distributed in cash or inkind in the form of the Company’s shares.
g) The dividend, which must be set aside under
applicable laws, shall be equally distributed among all
outstanding shares as of the current period regardless
of date of issue and acquisition thereof.
The General Assembly shall determine, upon proposal
by the Board of Directors, when and how an agreed
distribution of profit will be made.
Pursuant to the Capital Market Law, a dividend
advance may be distributed.
Capital Markets Board regulations on distribution
of profit shall be complied with in full. The General
Assembly shall determine, upon proposal by the Board
of Directors, when and how an agreed distribution of
profit will be made
4 - Legal Provisions during Liquidation:
Article 38 - The termination and liquidation of the
Company, the manner and course of actions of the
liquidation process, and powers and liabilities of
liquidators are specified in Article 44 and 449 of the
Turkish Commercial Code.
4 - Legal Provisions during Liquidation:
Article 38 - The termination and liquidation of
the Company, the manner and course of actions
of the liquidation process, and the powers and
responsibilities of liquidators shall be determined in
accordance with relevant provisions of the Turkish
Commercial Code.
64
2013 Ordinary General Assembly Meeting Agenda
1. Opening and appointing the Chairman,
2. Presenting and negotiating 2013 Annual Report,
3. Presenting and negotiating 2013 Independent External Audit Report,
4. Presenting, negotiating and approving 2013 Financial Statements,
5. Acquaintance of the member of the Board of Directors and Auditors separately,
6. Determining the way to use the Company’s profit, and determining the percentage of profit
and dividend shares to be distributed,
7. Presenting the Company Auditor recommended by Board of Directors to the approval of
General Assembly,
8. Election of the members of the Board of Directors,
9. Informing the General Assembly about the donations made by the Company within the year,
10. Informing the General Assembly about the details of Collaterals, Pledges and Mortgages given
by the Company within 2013,
11. Determining the remunerations of the Members of the Board of Directors,
12. Informing the General Assembly about the transactions made with the “Related Parties” in
accordance with the Capital Markets Board’s Corporate Governance Principles and other
related regulations,
13. Authorizing the members of the Board of Directors to perform the written transactions
stated in the Articles 395 and 396 of the Turkish Code of Commerce.
65
Subsidiary Company Report Results
Pursuant to Article 199 of Turkish Commercial Code
No. 6102, which is effective as of July 1, 2012, the
Board of Directors of Ülker Bisküvi Sanayi A.Ş. must
report on the Company’s relationships with its majority
shareholder and subsidiaries thereof in the previous
period to be prepared in the first quarter of the current
period and incorporate conclusions of the report
into the annual report. Information on transactions
conducted by Ülker Bisküvi Sanayi A.Ş. with its related
parties are provided in note 32 of the financial
statements. In the report prepared by the Board of
Directors of Ülker Bisküvi Sanayi A.Ş., it is stated that:
“It has been concluded on the basis of the events and
circumstances known to us as of the date when the
transaction or measure was taken or omitted, that
for each transaction conducted with the majority
shareholders of Ülker Bisküvi Sanayi A.Ş. and affiliates
of majority shareholders in 2013, an appropriate
counteraction has been taken, that there has not been
any action, which may damage the Company, taken
or omitted to be taken, and that within that framework
there has been no action or measure which requires an
adjustment to be made.”
66
Power of Attorney
POWER OF ATTORNEY
ÜLKER BİSKÜVİ SANAYİ ANONİM ŞİRKETİ
I hereby appoint ………………………. whose information is given below, as my proxy to represent myself, to vote, to
submit proposals and to sign the necessary documents in accordance with my below specified opinions at the
Ordinary General Assembly Meeting which will be held on Thursday 27th of March 2014, at 14:00, in the address
of Barcelo Eresin Topkapı Oteli, Millet Caddesi No:186 Topkapı Fatih / İSTANBUL
Proxy’s (*);
Name Surname / Trade Name:
TR Identification No/ Tax No, Trade Register and Number with Central Registration System number:
(*) For the proxies of foreign nationality, it is obliged to submit the mentioned information or if any, the equivalents.
The scope of the proxy has to be specified by selecting one of the (a), (b) or (c) options for the sections 1 and 2.
1. Regarding the issues on the agenda of the General assembly;
a) The proxy is authorized to vote in accordance with his/her own opinion.
b) The proxy is authorized to vote in accordance with the proposals of the Company management.
c) The proxy is authorized to vote in accordance with the following instructions.
Instructions:
In case the shareholder selects the option (c), the instructions specific to the general assembly agenda item,
are given upon choosing one of the options (accept and decline) given under the agenda item; and in case the
option “decline” is selected the instructions are given upon specifying the dissenting opinion (if ANY) on the
minutes of proceedings of the general assembly.
Agenda Items (*)
Accept Decline Dissenting Opinion
1.
2.
3.
(*) Issues on the agenda of the General Assembly are specified one by one. If the minority has another draft resolution, this is specified
separately provided that the proxy vote is not given.
2. Special instruction regarding particularly the issue of the protection of the minority rights and the other possible
issues that may come up in General Assembly meeting:
a) The proxy is authorized to vote in accordance with his/her own opinion.
b) The proxy is not authorized represent in these issues.
c) The proxy is authorized to vote in accordance with the following special instructions.
SPECIAL INSTRUCTIONS; Special instructions, if ANY, which will be given to the proxy by the shareholder are
specified here.
B) Selecting one of the following options the shareholder specifies the shares which will be represented by the proxy.
1. I do authorize the proxy to represent my shares specified below.
a) Class and rank:*
b) Number/Group**
c) Quantity-Nominal Value:
ç) Whether privileged in voting or not:
d) Registered or Bearer Shares:*
e) Ratio of the total shares of the shareholder to rights to vote:
*For dematerialized shares, these details are not required.
** For dematerialized shares, “Group” data (if ANY) will be specified instead of “Number”.
2. I do approve that the proxy will represent all my shares specified on the list, prepared by the CRA (Central
Registry Agency) the day before the General Assembly date, regarding the shareholders who can attend the
general assembly representation.
NAME SURNAME or TRADE NAME (*) OF THE SHAREHOLDER
TR Identification No/ Tax No, Trade Register and Number with Central Registration System number:
Address:
(*) For the proxies of foreign nationality, it is obliged to submit the mentioned information or if any, the equivalents.
SIGNATURE
67
Dividend Distribution Policy
The Company distributes its profit in line with the Turkish
Commercial Code, Capital Market Law, Tax Law, other applicable
legislation and the article on profit distribution in the Articles of
Association.
The Board of Directors’ profit distribution proposal in accordance
with the profit distribution policy and the Capital Markets Board’s
Corporate Governance Principles is included in the annual
report, submitted for the approval of shareholders at the General
Assembly, and detailed information on the history of profit
distribution and capital increases is disclosed to the general
public via the corporate web site.
The Company has set its profit distribution policy in accordance
with Capital Market Law and Articles of Association, taking into
consideration the Company’s operational performance, financial
situation and market developments. Starting from the earnings
of the fiscal year 2012, the Company will distribute a minimum
of 70% of its net distributable profit for each accounting period
in cash, upon the proposal of the Board of Directors and the
approval of the General Assembly, with any changes made by
these entities, in accordance with Turkish legislation, and after
due consideration of the Company’s cash flow requirements.
This policy will be reviewed each year by the Board of Directors,
in parallel with any negative developments in national and global
economic conditions, and the situation of current projects and
the Company’s financial resources.
According to the profit distribution policy, the dividend is equally
distributed to all shares in the accounting period and no shares
enjoy any privilege.
1. Paid-in/Issued Capital (TL)
2. Total Legal Reserves (According to Legal Requirements)
Information regarding privileges in profit distribution according to Articles of Association, if any
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Profit for the Period
Taxes Payable (-)
Net Profit for the Period (=)
Losses from Previous Years (-)
First Legal Reserves (-)
Emission Premium Correction (+)
NET DISTRIBUTABLE PROFIT FOR THE PERIOD (=)
Donations During the Year (+)
Net Distributable Profit plus Donations, for the calculation of the
First Dividend
First Dividend to Shareholders
- Cash
- Bonus
- Total
Dividend to Privileged Shareholders
Dividend to Board Members and Employees
Dividend to Redeemed Shareholders
Secondary Dividend to Shareholders (Bonus)
Secondary Legal Reserves
Statutory Reserves
Special Reserves
EXTRAORDINARY RESERVES
Other Resources Payable
- Previous Year's Profit
- Extraordinary Reserves
-Other Distributable Reserves as per the Legal Requirements and
Articles of Association
INFORMATION REGARDING THE DISTRIBUTED PROFIT SHARE
DIVIDEND PER SHARE
GROUP
TOTAL DIVIDEND AMOUNT (TL)
GROSS
NET
-
133,000,000.00
113,050,000.00
According to the CMB
240,434,188.00
(51,785,743.00)
188,648,445.00
0.00
0.00
0.00
188,648,445.00
553,178.22
342,000,000.00
(109.644.348,60)
According to Legal
Requirements (LR)
192,714,728.38
(16,367,093.03)
176,347,635.35
0.00
0.00
0.00
176,347,635.35
189,201,623.22
133,000,000.00
133,000,000.00
0.00
133,000,000.00
0.00
2,113,921.99
0.00
0.00
11,801,392.20
0.00
0.00
41,733,130.81
0.00
0.00
0.00
29,432,321.17
0.00
0.00
0.00
0.00
0.00
DIVIDEND PER SHARE WITH NOMINAL VALUE OF TL 1
AMOUNT (TL)
RATE (%)
0.3888889
38.8889
0.3305556
33.05556
RATIO OF DISTRIBUTED DIVIDEND TO NET DISTRIBUTABLE PROFIT PLUS DONATIONS
DIVIDEND DISTRIBUTED TO SHAREHOLDERS THE RATIO OF THE DIVIDEND DISTRIBUTED TO THE SHAREHOLDERS TO NET
(TL)
DISTRIBUTABLE PROFIT PLUS DONATIONS (%)
135,113,921.99
71.41
68
Independent Audit Report
CONVENIENCE TRANSLATION INTO ENGLISH OF INDEPENDENT AUDITOR’S REPORT
ON THE ANNUAL REPORT ORIGINALLY ISSUED IN TURKISH
INDEPENDENT AUDITOR’S REPORT ON THE ANNUAL REPORT
ÜTo the Board of Directors
Ülker Bisküvi Sanayi A.Ş.,
1. As part of our audit, we have assessed whether the financial information and the assessment and explanations
of the Board of Directors presented in the annual report of Ülker Bisküvi Sanayi A.Ş. (“the Company”) prepared
as of 31 December 2013 are consistent with the audited financial statements as of the same date.
2. Management is responsible for the preparation of the annual report in accordance with “the Communique on
Determining the Minimum Contents of Company Annual Reports”.
3. Our responsibility is to express an opinion on whether the financial information provided in the annual report is
consistent with the audited financial statements on which we have expressed our opinion dated 5 March 2014.
Our assessment is made in accordance with the principles and procedures for the preparation and issuing
of annual reports in accordance with Turkish Commercial Code No. 6102 (“TCC”). Those principles and
procedures require that an audit is planned and performed to obtain reasonable assurance whether the financial
information provided in the annual report are free from material misstatement regarding the consistency of such
information with the audited financial statements and the information obtained during the audit.
We believe that the assessment we have made is sufficient and appropriate to provide a basis for our opinion.
4. Based on our opinion, the financial information and the assessment and explanations of the Board of
Director’s in the accompanying annual report of Ülker Bisküvi Sanayi A.Ş. are consistent with the audited financial
statements as at 31 December 2013.
Başaran Nas Bağımsız Denetim ve
Serbest Muhasebeci Mali Müşavirlik A.Ş.
a member of
PricewaterhouseCoopers
Mert Tüten, SMMM
Partner
Istanbul, 5 March 2014
ÜLKER BİSKÜVİ SANAYİ A.Ş.
AND ITS SUBSIDIARIES
CONVENIENCE TRANSLATION
INTO ENGLISH OF
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2013
TOGETHER WITH INDEPENDENT AUDITOR’S
REPORT
(ORGINALLY ISSUED IN TURKISH)
CONVENIENCE TRANSLATION INTO ENGLISH OF
INDEPENDENT AUDITOR’S REPORT
ORIGINALLY ISSUED IN TURKISH
INDEPENDENT AUDITOR’S REPORT
To the Board of Directors of Ülker Bisküvi Sanayi A.Ş.;
Introduction
1. We have audited the accompanying consolidated balance sheet of Ülker Bisküvi Sanayi A.Ş. (the “Company”) and its Subsidiaries (collectively referred to as the “Group”) as
at 31 December 2013 and the related consolidated statement of profit or loss, consolidated statement of other comprehensive income, consolidated statement of changes in
equity and consolidated statement of cash flows for the year then ended and a summary of significant accounting policies and explanatory notes.
Management’s responsibility for the financial statements
2. Group’s management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Turkish Accounting Standards
published by the Public Oversight Accounting and Auditing Standards Authority (“POA”) and for such internal controls as management determines is necessary to enable the
preparation of consolidated financial statements that are free from material misstatement, whether due to error and/or fraud.
Independent auditor’s responsibility
3. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. Our audit was conducted in accordance with standards on auditing
issued by the Capital Markets Board of Turkey. Those standards require that ethical requirements are complied with and that the audit is planned and performed to obtain
reasonable assurance whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend
on our professional judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to error and/or fraud.
In making those risk assessments; the Group’s internal control system is taken into consideration. Our purpose, however, is not to express an opinion on the effectiveness of
internal control system, but to design procedures that are appropriate for the circumstances in order to identify the relation between the consolidated financial statements
prepared by the Group and its internal control system. An audit includes also evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the Group’s management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained during our audit is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
4. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Ülker Bisküvi Sanayi A.Ş. and its Subsidiaries
as at 31 December 2013 and their financial performance and cash flows for the year then ended in accordance with the Turkish Accounting Standards (Note 2).
Reports on independent auditor’s responsibilities arising from other regulatory requirements
5. In accordance with Article 402 of the Turkish Commercial Code (“TCC”); the Board of Directors submitted to us the necessary explanations and provided required
documents within the context of audit, additionally, no significant matter has come to our attention that causes us to believe that the Company’s bookkeeping activities for the
period 1 January – 31 December 2013 is not in compliance with the code and provisions of the Company’s articles of association in relation to financial reporting.
6. Pursuant to Article 378 of Turkish Commercial Code no. 6102, Board of Directors of publicly traded companies are required to form an expert committee, and to run and
to develop the necessary system for the purposes of: early identification of causes that jeopardize the existence, development and continuity of the company; applying the
necessary measures and remedies in this regard; and, managing the related risks. According to subparagraph 4, Article 398 of the code, the auditor is required to prepare a
separate report explaining whether the Board of Directors has established the system and authorized committee stipulated under Article 378 to identify risks that threaten or
may threaten the company and to provide risk management, and, if such a system exists, the report, the principles of which shall be announced by the POA, shall describe the
structure of the system and the practices of the committee. This report shall be submitted to the Board of Directors along with the auditor’s report. Our audit does not include
evaluating the operational efficiency and adequacy of the operations carried out by the management of the Company in order to manage these risks. As of the balance sheet
date, POA has not announced the principles of this report yet so no separate report has been drawn up relating to it. On the other hand, the Company formed the mentioned
committee on 21 August 2009 and it is comprised of two members.
The committee has met one time during the year for the purposes of early identification of risks that jeopardize the existence of the company and its development, applying the
necessary measures and remedies in this regard, and managing the risks, and has submitted the relevant reports to the Board of Directors.
Other matter
7. The consolidated financial statements of the Group as of 31 December 2012 and for the year then ended were audited by another audit firm whose audit report dated 6
March 2013 expressed an unqualified opinion.
Başaran Nas Bağımsız Denetim ve
Serbest Muhasebeci Mali Müşavirlik A.Ş.
a member of
PricewaterhouseCoopers
Mert Tüten, SMMM
Partner
Istanbul, 5 March 2014
CONVENIENCE TRANSLATION INTO ENGLISH OF CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN TURKISH
ÜLKER BİSKÜVİ SANAYİ A.Ş. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2013
(Amounts expressed in Turkish Lira (TL) unless otherwise stated.).
CONTENTS
PAGE(S)
CONSOLIDATED BALANCE SHEET
72-73
CONSOLIDATED STATEMENT OF INCOME AND STATEMENT OF COMPREHENSIVE INCOME
74-75
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
CONSOLIDATED STATEMENT OF CASH FLOW
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1
NOTE 2
NOTE 3
NOTE 4
NOTE 5
NOTE 6
NOTE 7
NOTE 8
NOTE 9
NOTE 10
NOTE 11
NOTE 12
NOTE 13
NOTE 14
NOTE 15
NOTE 16
NOTE 17
NOTE 18
NOTE 19
NOTE 20
NOTE 21
NOTE 22
NOTE 23
NOTE 24
NOTE 25
NOTE 26
NOTE 27
NOTE 28
NOTE 29
NOTE 30
NOTE 31
NOTE 32
NOTE 33
NOTE 34
NOTE 35
ORGANIZATION AND OPERATIONS OF THE GROUP
BASIS OF PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS
BUSINESS COMBINATIONS.
SEGMENTAL INFORMATION
CASH AND CASH EQUIVALENTS
FINANCIAL INVESTMENTS
FINANCIAL LIABILITIES
OTHER FINANCIAL LIABILITIES
TRADE RECEIVABLES AND PAYABLES
OTHER RECEIVABLES AND PAYABLES
INVENTORIES
INVESTMENT PROPERTIES
TANGIBLE ASSETS
INTANGIBLE ASSETS
GOVERNMENT GRANTS AND INCENTIVES
PROVISIONS, CONTINGENT ASSETS AND LIABILITIES
COMMITMENTS
EMPLOYEE BENEFITS
PREPAID EXPENSES
EMPLOYEE BENEFITS
OTHER ASSET AND LIABILITIES
SHAREHOLDERS’ EQUITY
REVENUE AND COST OF SALES
RESEARCH AND DEVELOPMENT EXPENSES, MARKETING, SELLING AND DISTRIBUTION
EXPENSES, GENERAL ADMINISTRATIVE EXPENSES
EXPENSES BY NATURE
OPERATING INCOME/EXPENSES
INVESTMENT INCOME/EXPENSES
FINANCIAL INCOME
FINANCIAL EXPENSES
TAX ASSET AND LIABILITIES (INCLUDING DEFERRED TAX ASSET AND LIABILITIES
EARNINGS PER SHARE
BALANCES AND TRANSACTIONS WITH RELATED PARTIES
NATURE AND LEVEL OF RISKS DERIVED FROM FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS
EVENTS AFTER THE BALANCE SHEET DATE
76
77-78
79-132
79-80
80-97
97
98
98
98-99
99-100
101
101
102
102-103
103
103-105
105-106
106
106-108
108
109
110
110
110
111-112
113
113
113-114
114
115
115
115
115-118
118
118-121
121-129
130-132
132
72
AS AT 31 DECEMBER 2013
ASSETS
Current Assets
Cash and Cash Equivalent
Financial Investments
Trade Receivables
-Due from related parties
-Other trade receivables
Other Receivables
-Other receivables
Inventories
Prepaid Expenses
Current Income Tax Assets
Other Current Assets
Non-Current Assets
Other Receivables
-Other Receivables
Investment Properties
Tangible Assets
Intangible Assets
Prepaid Expenses
Deferred Tax Assets
Other Non-Current Assets
TOTAL ASSETS
(*)
Notes
Audited
Current Period
2013
Restated(*)
Audited
Previous
Period
2012
5
6
2.128.504.531
1.164.383.158
611.476
2.258.514.250
1.267.728.071
2.963.016
9-32
9
446.815.319
201.954.749
433.197.344
163.955.235
10-32
10
11
19
21
3.417.357
16.860.567
198.321.733
47.436.206
1.879.695
46.824.271
131.398.216
8.463.471
186.149.155
16.142.125
4.071.798
44.445.819
6
1.033.447.409
464.661.239
898.093.294
326.344.908
161.464
10.035.000
532.558.107
791.589
20.991.312
4.244.512
4.186
125.282
30.460.000
524.302.908
674.439
12.121.201
4.060.370
4.186
3.161.951.940
3.156.607.544
10
12
13
14
19
30
Restatement effects has been explained in Note 2 “Comparative Information and Restatements of Prior Period Consolidated Financial Statements”.
The accompanying notes form an integral part of these consolidated financial statements.
73
AS AT 31 DECEMBER 2013
LIABILITIES
Current Liabilities
Short Term Financial Liabilities
Short Term Portion of Long Term Financial Liabilites
Trade Payables
-Due to related parties
-Other trade payables
Employee Benefit under Liabilities
Other Payables
-Due to Related Parties
-Other Payables
Financial Instruments
Current Income Tax Liabilities
Short Term Provisions
-Provisions for employee benefits
-Other Short Term Provisions
Other Current Liabilities
Non-Current Liabilities
Long Term Financial Liabilites
Long Term Provisions
Deferred Tax Liabilites
Other Non-Current Liabilities
Equity Attributable To Equity Holders’ of the Parent
Share Capital
Inflation Adjustments to Share Capital
Other comprehensive income/expense not to be reclassified to
profit or loss
-Actuarial losses
-Investment propertiy valuation fund
Other comprehensive income/expense to be reclassified to profit
or loss
-Financial assets revaluation fund
Restricted Reserves Appropriated from Profits
Retained Earnings
Net Profit for the Period
Non Controlling Interest
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
(*)
Notes
Audited
Current
Period
2013
Restated(*)
Audited
Previous
Year
2012
7
7
1.826.580.192
150.942.003
1.098.791.211
1.143.105.831
133.999.730
480.427.663
247.377.711
223.771.841
15.198.264
10-32
10
8
30
273.321.957
235.142.437
17.716.822
86.857
344.940
11.471.653
18
16
21
14.273.061
8.699.625
15.789.626
11.644.939
11.990.240
11.664.440
7
67.203.301
9.851.176
933.748.301
886.525.280
18
30
21
23.380.797
33.935.757
35.571
20.283.290
26.753.898
185.833
22
1.268.168.447
1.129.829.508
342.000.000
108.056.201
1.079.753.412
957.451.288
342.000.000
108.056.201
(1.307.850)
5.231.735
(1.912.682)
20.637.311
254.670.905
126.205.350
106.324.722
188.648.445
138.338.939
123.114.916
73.181.956
125.405.583
166.968.003
122.302.124
3.161.951.940
3.156.607.544
9-32
9
20
253.281
4.805.214
409.549
1.562.959
74
CONSOLIDATED STATEMENT OF INCOME
Notes
Revenue
Cost of Sales (-)
GROSS PROFIT FROM OPERATIONS
Research and Development Expenses (-)
Marketing, Sales and Distribution Expenses (-)
General Administrative Expenses (-)
Other Operating Income
Other Operating Expenses (-)
OPERATING PROFIT FROM MAIN OPERATION
Income from Investment Activities
Expenses from Investment Activities (-)
OPERATING PROFIT BEFORE FINANCE INCOME AND EXPENSES
Financial Income
Financial Expenses (-)
PROFIT BEFORE TAX
Tax Charge
Tax on Income (-)
Deferred Tax Income/(Expense)
PROFIT FOR THE PERIOD
Distribution of the Profit for the Period
Non-Controlling Interest
Equity holders of the Parent
Earnings per share
(*)
23
23
24-25
24-25
24-25
26
26
27
27
28
29
30
31
Audited
Current
Year
2013
Restated (*)
Audited
Previous
Year
2012
2.748.370.545
(2.115.060.273)
633.310.272
(13.396.585)
(262.511.713)
(94.030.049)
134.856.075
(85.624.362)
312.603.638
230.266.350
(23.589.386)
519.280.602
52.271.455
(292.435.753)
279.116.304
(51.785.743)
(51.860.071)
74.328
227.330.561
2.343.232.826
(1.837.981.934)
505.250.892
(8.900.058)
(226.945.293)
(96.295.271)
188.514.812
(137.458.907)
224.166.175
100.283.773
(78.301.595)
246.148.353
62.129.715
(64.742.988)
243.535.080
(47.961.146)
(31.304.716)
(16.656.430)
195.573.934
38.682.116
188.648.445
0,55
28.605.931
166.968.003
0,49
75
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME FOR THE YEAR ENDED
Audited
Current
Year
2013
Restated (*)
Audited
Previous
Year
2012
227.330.561
195.573.934
(14.747.639)
(15.415.613)
817.330
17.343.033
22.081.916
(1.586.355)
(149.356)
(3.152.528)
Items to be Reclassified Under Profit and Loss
Change in Revaluation Funds of Financial Assets
Tax Income/(Expense) Related to Other Comprehensive Income to be
Reclassified Under Profit and Loss
131.531.094
138.453.783
52.736.148
55.511.735
(6.922.689)
(2.775.587)
OTHER COMPREHENSIVE INCOME
116.783.455
70.079.181
TOTAL COMPREHENSIVE INCOME
344.114.016
265.653.115
Distribution of Total Comprehensive Income
Non-Controlling Interest
Equity holders of the Parent
38.710.326
305.403.690
29.015.158
236.637.957
Other Comprehensive Income:
Items not to be Reclassified Under Profit and Loss
Change in Revaluation Funds of Investment Property
Actuarial Losses
Tax Income/(Expenses) Related to Other Comprehensive Income not to be
Reclassified Under Profit and Loss
(*)
Effects of restatements are explained in the Note 2 (Comparative Information and Restatements of Prior Period Consolidated Financial Statements)
-
Transfer to retained earnings and reserve
108.056.201
254.670.905
-
-
-
-
131.555.989
123.114.916
123.114.916
-
-
-
-
49.961.862
73.153.054
5.231.735
-
-
-
-
(15.405.576)
20.637.311
20.637.311
-
-
-
-
20.637.311
-
Financial
Investment
Assets
Valuation Property Valuation
Fund
Fund
(1.307.850)
-
-
-
-
604.832
(1.912.682)
(1.912.682)
-
-
-
-
(929.219)
(983.463)
Actuarial
Loss
Other Comprehensive Income Not
To Be Reclassified Under Profit
And Loss
-
126.205.350
-
236.637.957
(1.769.169)
-
125.405.583
125.405.583
654.701.498
305.403.690
957.451.288
957.451.288
-
(1.769.169)
-
-
188.648.445
106.324.722
113.944.609
1.568.954
15.405.576
1.129.829.508
-
1.568.954
15.405.576
- (150.000.000) (150.000.000)
188.648.445
166.968.003
166.968.003
53.023.394 (166.968.003)
-
-
-
-
73.181.956
73.181.956
(73.400.000)
-
- (280.000.000) (280.000.000)
-
166.968.003
1.002.582.500
Equity
Retained
Earnings/
Attributable to
(Accumulated Equity Holders of
the Parent
Loss)
658.005.477 (174.126.746)
Net Profit
for the
Period
3.303.979 (658.005.477)
-
-
-
-
69.877.977
Restricted
Reserves
Appropriated
from Profits
Accumulated
Profit
(**)
(*)
-
265.653.115
1.097.250.691
Total
Euqity
344.114.016
1.079.753.412
1.079.753.412
-
(1.665.893)
138.338.939
-
-
-
1.268.168.447
-
1.568.954
15.405.576
(22.673.511) (172.673.511)
38.710.326
122.302.124
122.302.124
-
103.276
(1.484.501) (281.484.501)
-
29.015.158
94.668.191
Non
Controlling
Interest
In previous years Atlas Gıda Pazarlama Tic. A.Ş. was a 100% subsidiary of Ülker Çikolata San. A.Ş. Disclosure is related to Ülker Çikolata San. A.Ş.’s acquisitions of Atlas Gıda San. Tic. A.Ş. at 15 November 201.
(note 3)
On 18 February 2013, the Group acquired 100% stake in Reform Gıda Paz. San. ve Tic. A.Ş., from Yıldız Holding A.Ş. “transaction under common control” and the Company has started to consolidate Reform
Gıda A.Ş. since 1 January 2013. Public Oversight Accounting and Auditing Standards Authority (“POA”) Turkish Accounting Standards Boards has published pricipal related with transaction under common control
in official journal as of 21 July 2013. In accordance with the publication transaction under common controls have to perform in accordance with “Pooling of interest Method” by restating previous year financials. The
Group has decided to does not restate previous year financials by considering company size and monetary value of purchased company. (Note 1)
342.000.000
-
-
Transactions under common control(**)
As of 31 December 2013
-
-
Sales of investment property
-
-
Dividend paid
-
108.056.201
-
342.000.000
As of 1 January 2013
108.056.201
-
-
-
-
-
108.056.201
Total comprehensive income
342.000.000
-
-
Transactionsunder common control (*)
Transfer to retained earninsg and reserve
As of 31 December 2012
-
73.400.000
-
268.600.000
Dividend paid
Capital increase
Total comprehensive income
As of 1 January 2012
Inflation
Share Adjustments to
Capital Share Capital
Accumulated
Other
Comprehensive
Income To Be
Reclassified
Under Profit And
Loss
76
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’
EQUITY FOR THE YEAR ENDED 31 DECEMBER 2013
77
CONSOLIDATED STATEMENT OF CASH FLOWS
Notes
CASH FLOWS FROM OPERATING ACTIVITIES
Net profit for the Period
Adjustments to reconcile net profit/(loss) to net cash provided by
operating activities
-Depreciation expenses of tangible assets
-Effect of change in usefull life
-Amortization expenses of intangible assets
-Losses from sale of investment property
-Revaluation of investment property
-Goodwill imparement
-Allowance for doubtful receivables
-Reversal of allowance for doubtful receivables
-Provision for employment benefits
-Provision for unused vacation
-Performance premium provision
-Provision for lawsuits
-Reversal for sales return
-Loan expense accrual
-Discount expense (income)
-Change in foreign currency and interest expense of financial liabilities
-Gain on sale of derivative financial instruments
-Gain on sale of tangible and intangible assets (net)
-Gain on sale of subsidiary share (net)
-Reversal of provision for inventory imparement
-Rent income
-Dividend income
-Change in foreign currency from invesment activity
-Interest Income
-Tax Provision
Net Operating cash flows provided before changes in working capital
-Decrease in trade receivables
-Increase in trade receivables from related parties
-Increase in inventories
-Decrease in other receivables and other current assets
-Increase in trade payables
-Increase in trade payables to related parties
-Increase in other payables and liabilities
Net cash generated from operations
-Taxes paid
-Employment termiantion benefit paid
-Unused vacation paid
-Performance premium paid
-Lawsuits provision paid
-Collections from doubtful trade receivables
Net cash generated from operating activities
13
14
13
12
12
9
9
18
18
18
16
16
27
11
27
27
27
30
30
18
18
18
16
9
Audited
Current
Year
2013
Restated (*)
Audited
Previous
Year
2012
227.330.561
195.573.934
51.519.567
266.387
(6.632.229)
3.526.906
(220.000)
37.454
(201.484)
11.010.330
5.904.252
7.928.849
13.979
(3.075.479)
(8.192.232)
1.665.624
172.804.077
(8.101.398)
(15.098.740)
(4.357.387)
(7.373.538)
(434.426)
(149.280.945)
(37.794.133)
51.785.743
293.031.738
(38.068.353)
(15.070.255)
(7.815.191)
(48.723.096)
11.181.664
26.044.056
1.332.677
221.913.240
(41.951.377)
(7.166.143)
(4.448.796)
(6.756.183)
(343.801)
108.647
161.355.587
47.462.702
294.094
(823.000)
1.534.035
3.511.894
(890.539)
10.201.687
4.964.152
5.442.225
2.448.540
(11.302.271)
7.942.949
(1.527.003)
(32.895.648)
(2.636.234)
(4.058.563)
(542.032)
6.218.309
(6.974.552)
(579.296)
56.343.920
(59.402.548)
47.961.146
268.267.901
123.348.833
(137.193.060)
(31.153.088)
16.127.967
17.551.224
33.815.965
(7.128.448)
283.637.294
(37.684.220)
(10.371.616)
(4.398.128)
(4.824.006)
(218.306)
290.734
226.431.752
78
CONSOLIDATED STATEMENT OF CASH FLOWS
Notes
CASH FLOWS FROM INVESTING ACTIVITIES
-Acquisitions of tangible assets
-Acquisitions of intangible assets
-Proceeds from sales of tangible and intangible assets
-Proceeds from sales of investment properties
-Change in non-trade receivables from related parties
-Rent income
-Dividend income
-Interest received
-Change in financial assets
Net cash generated from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
-Loan repayment
-Proceeds from sales of derivative financial instruments
-Loans acquired
-Change in leasing liabilities
-Dividends paid
-Interest paid
-Changes in non-trade payables to related parties
Net cash used in financing activities
NET CHANGE IN CASH AND CASH EQUIVALENTS
13
14
12
10-32
27
27
Audited
Current
Year
2013
Restated (*)
Audited
Previous
Year
2012
(77.769.003)
(149.765)
41.875.605
17.118.094
277.261.804
7.373.538
434.426
37.794.133
2.351.540
306.290.372
(40.602.588)
(348.537)
7.308.392
394.566.592
6.974.552
579.296
59.402.548
5.781.593
433.661.848
(582.689.780) (705.223.400)
7.691.849
250.772.377 1.265.559.036
(7.015.992) (17.375.092)
22 (172.673.511) (281.484.501)
(66.909.391) (51.405.440)
(166.424)
(4.138.087)
(570.990.872)
205.932.516
(103.344.913)
866.026.116
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD
5 1.267.728.071
401.701.955
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD
5 1.164.383.158 1.267.728.071
79
1. ORGANIZATION AND OPERATIONS OF THE GROUP
Ülker Bisküvi Sanayi A.Ş. and its subsidiaries (“Group”), comprises of the parent Ülker Bisküvi Sanayi A.Ş. (“the Company”),
seven subsidiaries in which the Company owns the majority share of the capital or which are controlled by the Company (2012:
six).
Ülker Bisküvi Sanayi A.Ş. was established in 1944. The Company’s core business activities are manufacturing of biscuits,
chocolate, chocolate coated biscuits,wafers and cakes.
Ülker Bisküvi Sanayi A.Ş. which is registered at the Capital Market Board, merged under its own title with Anadolu Gıda Sanayi A.Ş.,
whose shares have been quoted on İstanbul Stock Exchange since 30 October 1996, as of 31 December 2003.
The headquarters of Ülker Bisküvi Sanayi A.Ş. is located Kısıklı Mah. Ferah Cad. No:1 Büyük Çamlıca Üsküdar/Istanbul.
As of 31 December 2013, the total number of people employed by the Group is 9.218 which contains 519 employees who
worked as subcontractors (31 December 2012: 8.627, subcontractor: 608).
The ultimate parent and the controlling party of the Group is Yıldız Holding A.Ş. The ultimate parent of Yıldız Holding A.Ş. is
managed by Ülker family.
As of 31 December 2013 and 2012, the names and percentages of the shareholders holding more than 10% of the Company’s
share capital are as follows:
2013
Name of the Shareholders
Dynamic Growth Fund (*)
Yıldız Holding A.Ş. Subsidiaries and Ülker Family
Other
(*)
Share
166.967.458
38.888.808
136.143.734
342.000.000
2012
Percentage
%48,82
%11,37
%39,81
%100,00
Share
151.778.531
73.308.031
48.220.722
68.692.716
342.000.000
Percentage
%44,38
%21,44
%14,10
%20,08
%100,00
Dynamic Growth Fund has transferred all assets in its portfolio to the holders of fund participation certificates due to its liquidation.
As of 31 December 2013 and 2012, the details of the subsidiaries in terms of direct and effective share of ownership and
principal business activities are as follows:
Subsidiaries
Biskot Bisküvi Gıda Sanayi ve Ticaret A.Ş. (*)
Ülker Çikolata Sanayi A.Ş.
İstanbul Gıda Dış Ticaret A.Ş.
Atlas Gıda Pazarlama Sanayi ve Ticaret A.Ş.
Birleşik Dış Ticaret A.Ş.
Reform Gıda Paz. San. ve Tic. A.Ş.(**)
Rekor Gıda Pazarlama A.Ş. (*)
2013
Ratio of
Direct
Ownership
%
%43,5
%91,7
%83,8
%98,3
%70,0
%100,0
-
Ratio of
Effective
Ownership
%
%43,9
%91,7
%91,4
%98,3
%79,2
%100,0
%43,9
2012
Ratio of
Direct
Ownership
%
%43,5
%91,7
%83,8
%98,3
%70,0
-
Ratio of
Effective
Ownership
%
%43,9
%91,7
%91,4
%98,3
%79,2
%43,9
Nature of
Operations
Manufacturing
Manufacturing
Sales&Marketing
Trading
Sales&Marketing
Trading
Sales&Marketing
Whilst the Group has 43.9% effective ownership share in Biskot Bisküvi Gıda Sanayi ve Ticaret A.Ş and Rekor Gıda Pazarlama A.Ş, full consolidation method has
been used due to the fact that the Group has majority of the voting rights. Group, has total control over the business of its subsidiaries by voting right with respect to
the law declaration of intention of its minorities. Depending on the performance results of its subsidiaries, group has right over parameter proceeds and has the right to
control the operations of its subsidiaries.The Group has the contingency to use its power over its subsidiaries to effect the proceeds.
(**)
Reform Gıda Paz. San. ve Tic. A.Ş. which was acquired from Yıldız Holding A.Ş. on 18 February 2013 fully consolidated with scope of transaction under common
controls in the consolidated financial statements as of 1 January 2013.
(*)
80
Biskot Bisküvi Gıda Sanayi ve Ticaret A.Ş. manufactures and sells similar products with those of Ülker Bisküvi Sanayi A.Ş, on the
other hand İstanbul Gıda Dış Ticaret A.Ş., Birleşik Dış Ticaret A.Ş., Birleşik Dış Ticaret A.Ş. and Rekor Gıda Pazarlama A.Ş are
involved in domestic and international sales and marketing of products of the above mentioned companies and other food
products purchased from the domestic market. The sales and marketing operations of chocolate and cocoa covered products
of Ülker Çikolata Sanayi A.Ş.
Dividend Paid:
Group has paid a dividend of TL 172.673.511 in the current year. Dividend paid per share as of 31 December 2013 is 0,50. (31
December 2012: 0,82)
Approval of financial statements:
The Board of Directors has approved the financial statements and given authorization for the issuance on 5 March 2014. The
General Assembly has the authority to amend the financial statements.
2. BASIS OF PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS
2.1 Basis of the presentation:
Basis of the presentation and Significant Accounting Policies
The accompanying consolidated financial statements are prepared in accordance with Communiqué Serial II, No:14.1,
“Principles of Financial Reporting in Capital Markets” (“the Communiqué”) published in the Official Gazette numbered 28676 on
13 June 2013. According to Article 5 of the Communiqué, consolidated financial statements are prepared in accordance with
the Turkish Accounting Standards issued by Public Oversight Accounting and Auditing Standards Authority (“POAASA”). TAS
contains Turkish Accounting Standards, Turkish Financial Reporting Standards (“TFRS”) and its addendum and interpretations
(“IFRIC”).
The consolidated financial statements of the Group are prepared as per the CMB announcement of 7 June 2013 relating
to financial statements presentations. Comparative figures are reclassified, where necessary, to conform to changes in the
presentation of the current year’s consolidated financial statements.
In accordance with the CMB resolution issued on 17 March 2005, listed companies operating in Turkey are not subject to inflation
accounting effective from 1 January 2005. Therefore, the consolidated financial statements of the Group have been prepared
accordingly.
The Group maintain their books of accounts and prepare their statutory financial statements in accordance with the Turkish
Commercial Code (“TCC”), tax legislation, the Uniform Chart of Accounts issued by the Ministry of Finance and principles
issued by CMB. The foreign subsidiaries maintain their books of account in accordance with the laws and regulations in force
in the countries in which they are registered. These consolidated financial statements have been prepared under historical
cost conventions except for financial assets and financial liabilities which are carried at fair value. The consolidated financial
statements are based on the statutory records, which are maintained under historical cost conventions, with the required
adjustments and reclassifications reflected for the purpose of fair presentation in accordance with TAS.
Functional and presentation currency
Financial statements of each subsidiary of the Group are presented in the currency of the primary economic environment in
which the entities operate (its functional currency). The results and financial position of the each subsidiary are expressed in
Turkish Lira, which is the functional and presentation currency of the Group.
81
As of 31 December 2013, foreign currency rates declared by Central Bank of Republic of Turkey are 1 Euro = TL 2,9365, 1
USD = TL 2,1343 (2012: 1 Euro = TL 2,3517, 1 USD = TL 1,7826). For the period between January 1,2013 and December
31,2013, average foreign currency rates declared by Central Bank of Republic of Turkey are 1Euro = TL 2,5290, 1 USD = TL
1,9033 (2012: 1Euro = TL 2,3041, 1 USD = TL 1,7922).
Consolidation
(a) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the group has control. The group controls an entity when
the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the
group. They are deconsolidated from the date that control ceases.
Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated.
Unrealised losses are also eliminated. When necessary, amounts reported by subsidiaries have been adjusted to conform with
the group’s accounting policies.
(b) Changes in ownership interests in subsidiaries without change of control
Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is,
as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the
relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to
non-controlling interests are also recorded in equity.
(c) Disposal of subsidiaries
When the group ceases to have control any retained interest in the entity is re-measured to its fair value at the date when control
is lost, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes
of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts
previously recognised in other comprehensive income in respect of that entity are accounted for as if the group had directly
disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income
are reclassified to profit or loss.
Offsetting
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable
right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability
simultaneously.
2.2 Changes in the Accounting Policies:
Accounting policy changes are applied retrospectively and the previous year financial statements are arranged.
82
Comparative Information and Restatement of Prior Period Consolidated Financial Statements
In order to allow the determination of financial position and performance, the Group’s consolidated financial statements are
prepared in comparison with the previous period. In order to comply with the presentation of consolidated financial statements
the current period when deemed necessary, comparative information is classified, and describes important differences. The
Group consolidated financial statements, to conform to current period financial statements for prior periods have made some
reclassifications. The nature of the classifications, and amounts due are as follows:
ASSETS
Current Assets
Cash and Cash Equivalent
Trade Receivables
-Other trade receivables
Other Receivables
-Other receivables
Inventories
Prepaid Expenses
Current Income Tax Assets
Other Current Assets
Non-Current Assets
Other Receivables
-Other Receivables
Investment Properties
Tangible Assets
Intangible Assets
Prepaid Expenses
Deferred Tax Assets
Other Non-Current Assets
TOTAL ASSETS
Impact of change in
Previously
the POA format of
reported financial statements
2.258.514.250
1.267.728.071
2.963.016
-
Restated
2.258.514.250
1.267.728.071
2.963.016
433.197.344
163.727.576
227.659
433.197.344
163.955.235
131.398.216
8.463.471
186.149.155
64.887.401
16.142.125
4.071.798
(20.441.582)
131.398.216
8.463.471
186.149.155
16.142.125
4.071.798
44.445.819
898.093.294
326.344.908
-
898.093.294
326.344.908
125.282
30.460.000
524.302.908
674.439
4.060.370
12.125.387
3.156.607.544
12.121.201
(12.121.201)
-
125.282
30.460.000
524.302.908
674.439
12.121.201
4.060.370
4.186
3.156.607.544
83
LIABILITIES
Current Liabilities
Short Term Financial Liabilities
Short Term Portion of Long Term Financial Liabilites
Trade Payables
-Due to related parties
-Other trade payables
Employee Benefit under Liabilities
Other Payables
-Other Payables to Related Parties
-Other Payables
Financial Instruments
Current Income Tax Liabilities
Short Term Provisions
-Other Short Term Provisions
Other Current Liabilities
Non-Current Liabilities
Long Term Financial Liabilites
Long Term Provisions
Deferred Tax Liabilites
Equity Attributable To Equity Holders’ of the Parent
Share Capital
Inflation Adjustments to Share Capital
Valuation Funds
Other comprehensive income/expense not to be reclassified
to profit or loss
-Actuarial losses
-Investment property valuation fund
Other comprehensive income/expense to be reclassified to
profit or loss
-Financial asset valuation fund
Restricted Reserves Appropriated from Profits
Retained Earnings
Net income for the period
Non Controlling Interest
TOTAL LIABILITIES
Previously
Reported
Impact of change in
the POA format of
financial statements
1.143.105.831
614.427.393
(480.427.663)
480.427.663
Restated
1.143.105.831
133.999.730
480.427.663
247.377.711
223.718.564
53.277
15.198.264
247.377.711
223.771.841
15.198.264
253.281
4.805.214
409.549
1.562.959
-
253.281
4.805.214
409.549
1.562.959
11.990.240
21.839.896
16.721.024
(345.301)
(9.849.656)
(5.056.584)
933.748.301
886.525.280
-
11.644.939
11.990.240
11.664.440
933.748.301
886.525.280
20.283.290
26.753.898
185.833
(143.752.227)
20.283.290
26.753.898
185.833
1.079.753.412
957.451.288
342.000.000
108.056.201
-
(1.912.682)
20.637.311
(1.912.682)
20.637.311
73.181.956
125.405.583
166.968.003
122.302.124
3.156.607.544
123.114.916
-
123.114.916
73.181.956
125.405.583
166.968.003
122.302.124
3.156.607.544
1.079.753.412
957.451.288
342.000.000
108.056.201
143.752.227
84
Comparative Information and Restatement of Prior Period Financial Statements
In accordance with CMB decision dated 7 June 2013 and the numbered 20/670, the reclassifications were made by Group in
the consolidated balance sheet statements for the year ended 31 December 2012 are as follow:
Classifications within the current assets are as follow:
• Income accrual amounting to TL 227.659 that is presented under other current assets in the previous year consolidated
financial statement is classified in other trade receivables.
• Prepaid expenses amounting to TL 16.425.125 that is presented under other current assets in the previous year consolidated
financial statement is classified as a separate line.
• Current income tax asset amounting to TL 4.107.798 that is presented under other current assets in the previous year
consolidated financial statement is classified as a separate line.
Classifications within the non current assets are as follow:
• Prepaid expenses amounting to TL 12.121.201 that is presented under other non current assets in the previous year
consolidated financial statement is classified as a separate line.
Classifications within the current liabilities are as follow:
• Borrowings amounting to TL 480.427.663 that is presented under short term financial liabilities in the previous year
consolidated financial statement is classified in short term portion of long term financial liabilities as a separate line,
• Expense accrual amounting to TL 55.277 that is presented under other current assets in the previous year consolidated
financial statement is classified in other trade payables.
• Employee benefits amounting to TL 15.198.264 that is presented under short term provisions and other short term liabilities
in the previous year consolidated financial statement is classified employee benefits under liabilites as a separate line.
Classifications within the equity are as follow:
• Valuation funds of investment property and financial assets amounting to TL 143.752.227 that is presented under valuation
fund in the previous year consolidated financial statement is classified under investment property valuation fund amounting to
TL 20.637.311 and financial assets valuation fund amounting to TL 123.114.946 as two separate lines, respectively.
85
Comparative Information and Restatement of Prior Period Financial Statements
31 December 2012 Statement of Income
Impact of change in
Previously
Classified
the POA format of
reported export income financial statements
Sales Revenue
2.340.639.227
2.593.599
Cost of Sales (-)
(1.837.981.934)
GROSS PROFIT
502.657.293
Research and Development Expenses (-)
(8.900.058)
Marketing, Sales and Distribution Expenses (-) (226.945.293)
General Administrative Expenses (-)
(96.295.271)
Other Operating Income
48.423.387 (2.593.599)
Other Operating Expenses (-)
(16.893.938)
OPERATING PROFIT
202.046.120
Income from Investing Activities
Expenses from Investing Activities (-)
OPERATING PROFIT BEFORE FINANCE
INCOME AND EXPENSES
202.046.120
Finance Income
249.162.549
Finance Expenses (-)
(207.673.589)
PROFIT BEFORE TAX
243.535.080
Tax Charge
(47.961.146)
Current Tax Charge
(31.304.716)
Deferred Tax (Loss)/Income
(16.656.430)
195.573.934
-
Restated
2.343.232.826
- (1.837.981.934)
505.250.892
(8.900.058)
(226.945.293)
(96.295.271)
142.685.024
188.514.812
(120.564.969)
(137.458.907)
224.166.175
100.283.773
100.283.773
(78.301.595)
(78.301.595)
(187.032.834)
142.930.601
-
246.148.353
62.129.715
(64.742.988)
243.535.080
(47.961.146)
(31.304.716)
(16.656.430)
195.573.934
In accordance with CMB decision dated 7 June 2013 and the numbered 20/670, the reclassifications were made by Group in
the consolidated balance sheet statements for the year ended 31 December 2012 are as follow:
• Income from exchange rate differences amounting to TL 102.612.459 which is caused by valuation trade receivables and
payables, losses from exchange rate differences amounting to TL 81.428.469, financial income arising from credit sales
amounting to TL 47.240.129, financial expense arising from credit purchases amounting to TL 35.974.952, discount income
amounting to TL 4.749.655 and discount expense amounting to TL 3.222.652 that are presented under financial income/
expense in the previous year consolidated financial statements are classified other operating income/expenses.
• Rent income amounting to TL 6.794.552, profit from the sales of tangible asset amounting to TL 4.119.663 and loss from the
sales of tangible asset amounting to TL 61.104 that are presented under other operating income/expense in the previous year
consolidated financial statement are classified income from investing activities.
• Income from exchange rate differences amounting to TL 21.791.066 which is caused by borrowings, dividend income
amounting to TL 579.290, interest income amounting to TL 63.493.102, gain on sale of securities amounting to TL
3.326.094, valuation of investment property amounting to TL 823.000, loss on sale of financial asset amounting to TL
105.505 and losses from exchange rate amounting to TL 78.134.986 that are presented under financial income/expense in
the previous year consolidated financial statement are classified income from investing activities. 2.3 Changes and Errors in Accounting Estimates:
Change and errors in accounting estimates are applied retrospectively and the previous year financial statements are arranged.
If the changes in the accounting policies are related only to one period then they are applied in the current year; if they are related
with the future period, then they are applied both in the current period and future periods. The Group’s subsidiary of Biskot
Biskuvi Gıda San. ve Tic. A.Ş. changed its estimation of useful lives of tangible assets in the current year. If the Group did not
make changes in accounting estimates, total depreciation expense would have been higher amounting to TL 6.632.229 in the
consolidated financial statements for the year ended 31 December 2013.
86
2.4 New and Revised International Financial Reporting Standards:
a. New standarts, amendments and interpretations are applied to annual reporting period ended December 31,2013 of the
consolidated financial statements that is as follow;
- Amendment to IAS 1, ‘Financial statement presentation’, regarding other comprehensive income; is effective for annual
periods beginning on or after 1 July 2012. The main change resulting from these amendments is a requirement for entities to
group items presented in ‘other comprehensive income’ (OCI) on the basis of whether they are potentially reclassifiable to
profit or loss subsequently (reclassification adjustments). The amendments do not address which items are presented in
OCI.
- Amendment to IAS 19, ‘Employee benefits’; is effective for annual periods beginning on or after 1 January 2013. These
amendments eliminate the corridor approach and calculate finance costs on a net funding basis.
- Amendment to IFRS 1, ‘First time adoption’, on government loans;; is effective for annual periods beginning on or after 1
January 2013. This amendment addresses how a first-time adopter would account for a government loan with a belowmarket rate of interest when transitioning to IFRS. It also adds an exception to the retrospective application of IFRS, which
provides the same relief to first-time adopters granted to existing preparers of IFRS financial statements when the requirement
was incorporated into IAS 20 in 2008.
- Amendment to IFRS 7, ‘Financial instruments: Disclosures’, on asset and liability offsetting¸; is effective for annual periods
beginning on or after 1 January 2013. This amendment includes new disclosures to facilitate comparison between those
entities that prepare IFRS financial statements to those that prepare financial statements in accordance with US GAAP.
- Amendment to IFRSs 10, 11 and 12 on transition guidance¸; is effective for annual periods beginning on or after 1 January
2013. These amendments provide additional transition relief to IFRSs 10, 11 and 12, limiting the requirement to provide
adjusted comparative information to only the preceding comparative period. For disclosures related to unconsolidated
structured entities, the amendments will remove the requirement to present comparative information for periods before IFRS
12 is first applied.
- Annual improvements 2011; is effective for annual periods beginning on or after 1 January 2013.These annual improvements,
address six issues in the 2009-2011 reporting cycle. It includes changes to:
• IFRS 1, ‘First time adoption’
• IAS 1, ‘Financial statement presentation’
• IAS 16, ‘Property plant and equipment’
• IAS 32, ‘Financial instruments; Presentation’
• IAS 34, ‘Interim financial reporting’
- IFRS 10, ‘Consolidated financial statements’; is effective for annual periods beginning on or after 1 January 2013. The
objective of IFRS 10 is to establish principles for the presentation and preparation of consolidated financial statements when
an entity controls one or more other entity (an entity that controls one or more other entities) to present consolidated
financial statements. It defines the principle of control, and establishes controls as the basis for consolidation. It sets out
how to apply the principle of control to identify whether an investor controls an investee and therefore must consolidate the
investee. It also sets out the accounting requirements for the preparation of consolidated financial statements.
- IFRS 11, ‘Joint arrangements’;; is effective for annual periods beginning on or after 1 January 2013. IFRS 11 is a more realistic
reflection of joint arrangements by focusing on the rights and obligations of the arrangement rather than its legal form. There
are two types of joint arrangement: joint operations and joint ventures. Joint operations arise where a joint operator has rights
to the assets and obligations relating to the arrangement and therefore accounts for its interest in assets, liabilities, revenue
and expenses. Joint ventures arise where the joint operator has rights to the net assets of the arrangement and therefore equity
accounts for its interest. Proportional consolidation of joint ventures is no longer allowed.
87
- IFRS 12, ‘Disclosures of interests in other entities’; is effective for annual periods beginning on or after 1 January 2013. IFRS 12
includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special
purpose vehicles and other off balance sheet vehicles.
- IFRS 13, ‘Fair value measurement’; is effective for annual periods beginning on or after 1 January 2013. IFRS 13 aims to
improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value
measurement and disclosure requirements for use across IFRSs. The requirements, which are largely aligned between IFRS
and US GAAP, do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is
already required or permitted by other standards within IFRSs or US GAAP.
- IAS 27 (revised 2011), ‘Separate financial statements’; is effective for annual periods beginning on or after 1 January 2013.
IAS 27 (revised 2011) includes the provisions on separate financial statements that are left after the control provisions of IAS
27 have been included in the new IFRS 10.
- IAS 28 (revised 2011), ‘Associates and joint ventures’; is effective for annual periods beginning on or after 1 January 2013.
IAS 28 (revised 2011) includes the requirements for joint ventures, as well as associates, to be equity accounted following the
issue of IFRS 11.
- IFRIC 20, ‘Stripping costs in the production phase of a surface mine’ is effective for annual periods beginning on or after 1
January 2013. This interpretation sets out the accounting for overburden waste removal (stripping) costs in the production
phase of a mine. The interpretation may require mining entities reporting under IFRS to write off existing stripping assets to
opening retained earnings if the assets cannot be attributed to an identifiable component of an ore body.
b. New standards and amendments will be applied for periods beginning on or after 1 January 2014 that is as follow;
- Amendment to IAS 32, ‘Financial instruments: Presentation’, on asset and liability offsetting is effective for annual periods
beginning on or after 1 January 2014.These amendments are to the application guidance in IAS 32, ‘Financial instruments:
Presentation’, and clarify some of the requirements for offsetting financial assets and financial liabilities on the balance sheet.
- Amendments to IFRS 10, 12 and IAS 27 on consolidation for investment entities is effective for annual periods beginning on or
after 1 January 2014. These amendments mean that many funds and similar entities will be exempt from consolidating most
of their subsidiaries. Instead, they will measure them at fair value through profit or loss. The amendments give an exception to
entities that meet an ‘investment entity’ definition and which display particular characteristics. Changes have also been made
IFRS 12 to introduce disclosures that an investment entity needs to make.
- Amendment to IAS 36, ‘Impairment of assets’ on recoverable amount disclosures is effective for annual periods beginning on
or after 1 January 2014. This amendment addresses the disclosure of information about the recoverable amount of impaired
assets if that amount is based on fair value less costs of disposal.
- Amendment to IAS 39 ‘Financial Instruments: Recognition and Measurement’-‘Novation of derivatives is effective for annual
periods beginning on or after 1 January 2014. This amendment provides relief from discontinuing hedge accounting when
novation of a hedging instrument to a central counterparty meets specified criteria.
- IFRIC 21, ‘Levies’ is effective for annual periods beginning on or after 1 January 2014. This is an interpretation of IAS 37,
‘Provisions, contingent liabilities and contingent assets’. IAS 37 sets out criteria for the recognition of a liability, one of which
is the requirement for the entity to have a present obligation as a result of a past event (known as an obligating event). The
interpretation clarifies that the obligating event that gives rise to a liability to pay a levy is the activity described in the relevant
legislation that triggers the payment of the levy.
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New standards, comments and changes has been published by International Accounting Standards Board (IASB) but
hasn’t been published by POA.
The new standards, comments and changes on the current TFRS standards has been published by TASB but yet to be come
into effect for the current reporting period.However the new standards, comments and changes hasn’t been adjusted or
published to TFRS by POA because of this changes can not be a part of TFRS. Company will conduct the neccecarry changes in
its period end financial statements and disclosures after the standards and comments has been published in TFRS.
- IFRS 9 ‘Financial instruments’ – classification and measurement; is effective for annual periods beginning on or after 1 January
2015. This standard on classification and measurement of financial assets and financial liabilities will replace IAS 39, ‘Financial
instruments: Recognition and measurement’. IFRS 9 has two measurement categories: amortised cost and fair value. All
equity instruments are measured at fair value. A debt instrument is measured at amortised cost only if the entity is holding it to
collect contractual cash flows and the cash flows represent principal and interest. For liabilities, the standard retains most of
the IAS 39 requirements. These include amortised-cost accounting for most financial liabilities, with bifurcation of embedded
derivatives. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value
change due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement, unless
this creates an accounting mismatch. This change will mainly affect financial institutions.
- Amendments to IFRS 9,‘Financial instruments’, regarding general hedge. These amendments to IFRS 9, ‘Financial instruments’,
bring into effect a substantial overhaul of hedge accounting that will allow entities to better reflect their risk management
activities in the financial statements.
- Amendment to IAS 19 regarding defined benefit plans;; is effective for annual periods beginning on or after 1 July 2014. These
narrow scope amendments apply to contributions from employees or third parties to defined benefit plans. The objective
of the amendments is to simplify the accounting for contributions that are independent of the number of years of employee
service, for example, employee contributions that are calculated according to a fixed percentage of salary.
Annual improvements 2012; is effective for annual periods beginning on or after 1 July 2014. These amendments include
changes from the 2010-12 cycle of the annual improvements project, that affect 7 standards:
- IFRS 2, ‘Share-based payment’
- IFRS 3, ‘Business Combinations’
- IFRS 8, ‘Operating segments’
- IAS 16, ‘Property, plant and equipment’ and IAS 38,‘Intangible assets’
- IFRS 9, ‘Financial instruments’, IAS 37, ‘Provisions, contingent liabilities and contingent assets’
- IAS 39, Financial instruments – Recognition and measurement’.
Annual improvements 2013; is effective for annual periods beginning on or after 1 July 2014. The amendments include changes
from the 2011-2-13 cycle of the annual improvements project that affect 4 standards
- IFRS 1, ‘First time adoption’
- IFRS 3, ‘Business combinations’
- IFRS 13, ‘Fair value measurement’
- IAS 40, ‘Investment property’
2.5 Summary of Significant Accounting Policies
The accounting policies applied in preparation of the accompanying financial statements are as follows. This accounting policy
was applied in a consistent manner unless otherwise settled.
Revenue:
Most of the revenue is generated from sale of biscuit, chocolate, chocolate coated biscuit, wafer and cake.
Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for goods
supplied, stated net of discounts, returns and value added taxes.
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Sales of goods
Revenue generated from biscuit, chocolate, chocolate coated biscuit, wafer and cake is recognized when all the following
conditions are satisfied:
• The Group has transferred to the buyer the significant risks and rewards of ownership of the goods,
• The Group retains neither continuing managerial involvement to the degree usually associated with no ownership or effective
control over the goods sold,
• The amount of revenue can be measured reliably,
• It is probable that the economic benefits associated with the transaction will flow to the entity, and
• The costs incurred or to be incurred in respect of the transaction can be measured reliably.
Sales discounts are granted at the point of sale based on a percentage and are recorded as a reduction of revenue in the period of
the sale. Sale discount percentages vary depending on the product sold.
Interest Income
Interest income is recognised using the effective interest method. When a loan and receivable is impaired, the group reduces the
carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate
of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loan and receivables is
recognised using the original effective interest rate.
Dividend Income
Dividend income is recognised when the right to receive payment is established.
Rent Income
Rent income from real estates is accounted by the linear method during the respective rent agreement.
Inventories:
Inventories are stated at the lower of cost and net realizable value. Costs, including an appropriate portion of fixed and variable
overhead expenses, are assigned to inventories held by the method most appropriate to the particular class of inventory, with
the majority being valued on weighted average basis. Net realizable value represents the estimated selling price less all estimated
costs of completion and costs necessary to make a sale. When the net realizable value of inventory is less than cost, the inventory
is written down to the net realizable value and the expense is included in statement of income/(loss) in the period the writedown or loss occurred. When the circumstances that previously caused inventories to be written down below cost no longer exist
or when there is clear evidence of an increase in net realizable value because of changed economic circumstances, the amount
of the write-down is reversed. The reversal amount is limited to the amount of the original write-down.
Tangible Assets:
Tangible assets are stated at the historical cost less accumulated depreciation. Historical cost includes expenditure that is
directly attributable to the acquisition of the items. Subsequent costs are included in the asset’s carrying amount or recognised
as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to
the group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other
repairs and maintenance are changed to the income statement during the financial period in which they are incurred.
Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost or
revalued amounts to their residual values over their estimated useful lives, In every reporting period, the scrap value and useful
lives of tangible fixed assets are reviewed and necessary adjustments are made.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognized within
‘Gain or losses from investing activities’ in the income statement.
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Leases:
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating
leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income
statement on a straight-line basis over the period of the lease.
The group leases certain property, plant and equipment. Leases of property, plant and equipment where the group has
substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s
commencement at the lower of the fair value of the leased property and the present value of the minimum lease payments.
Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance
charges, are included in other long-term payables. The interest element of the finance cost is charged to the income statement
over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
The property, plant and equipment acquired under finance leases is depreciated over the shorter of the useful life of the asset
and the lease term.
Business Combinations:
Group recognizes assets and liabilities that are subject to business combinations involving entities under common control, at
carrying value in the consolidated financial statements.
For the annual reporting period after 31 December 2012, business combination involving entities under common control
accounted by using pooling of interest retrospectively, based on the decision is taken by POA. While the using pooling of interest,
the financial statements are adjusted as business combination is realized at the beginning of the reporting period when common
control transaction is occured and the financial statements presented comparetively at the beginning of the reporting period
occurred common control.
Neither goodwill nor income from acquisition is not realized as a result of these transactions. Positive/negative differences arising
after the net-off of investment in associate against the stake in purchased entity’s share capital, are directly recognized as “
Effect of business combinations under common control “ in retained earnings.
Investment Property:
Investment properties are properties held to earn rentals and/or for capital appreciation, including property under construction
for such purposes. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial
recognition, investment properties are stated at fair value.
A property interest that is held by a lessee under an operating lease may be classified and accounted for as investment property
if, and only if, the property would otherwise meet the definition of an investment property and the lessee uses the fair value
model for the asset recognised. This classification alternative is available on a property-by-property basis. However, once
this classification alternative is selected for one such property interest held under an operating lease, all property classified as
investment property shall be accounted for using the fair value model. When this classification alternative is selected, any interest
so classified is included in the disclosures required.
An investment property is derecognized upon disposal or when the investment property is permanently withdrawn from use and
no future economic benefits are expected from disposal. Any gain or loss arising on derecognition of the property (calculated as
the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period
in which the property is derecognized.
Intangible Assets:
The intangible assets are carried at cost of acquisition, less accumulated amortization and any impairment loss. The estimated
useful life and amortization method are reviewed at the end of each annual reporting period, with the effect of any changes in
estimate being accounted for on a prospective basis.
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Impairment of Assets:
If initial recognition value in an asset is greater than estimated net releasable value, the value of asset should be recorded at
recoverable value. If any indicators and changes which are not been recorded at recoverable value, any impairment in tangible
fixed asset depreciation should be reviewed. The impairment depreciation expense should be adjusted the different between
initial recognition value in asset over recoverable value. The recoverable value in an asset is higher than value between the
cost reduced at fair value and usage value. The asset to estimate in any impairment should be categorized at sub-cash flow
statements. Estimated impairment in any tangible fixed assets are reviewed as to whether reverse and value of impairment.
Financial Assets:
Classification
The group classifies its financial assets in the following categories: at fair value through profit or loss, loans and receivables,
and available for sale. The classification depends on the purpose for which the financial assets were acquired. Management
determines the classification of its financial assets at initial recognition.
(a) Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category
if acquired principally for the purpose of selling in the short term. Derivatives are also categorised as held for trading unless they
are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months,
otherwise they are classified as non-current.
(b) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period.
These are classified as non-current assets. The group’s loans and receivables comprise `trade and other receivables’ and `cash
and cash equivalents’ in the balance sheet (notes 2.14 and 2.15).
(c) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the
other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it
within 12 months of the end of the reporting period.
Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the group commits to
purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried
at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognised at fair value,
and transaction costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash
flows from the investments have expired or have been transferred and the group has transferred substantially all risks and rewards
of ownership.
Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value.
Loans and receivables are subsequently carried at amortised cost using the effective interest method.Gains or losses arising from
changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are presented in the income statement
within ‘other (losses)/gains – net’ in the period in which they arise.
Dividend income from financial assets at fair value through profit or loss is recognized in the income statement as part of other
income when the group’s right to receive payments is established.
Changes in the fair value of monetary and non-monetary securities classified as available for sale are recognized in other
comprehensive income.
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When securities classified as available for sale are sold or impaired, the accumulated fair value adjustments recognized in equity
are included in the income statement as ‘Gains and losses from investment securities’.
Interest on available-for-sale securities calculated using the effective interest method is recognised in the income statement
as part of other income. Dividends on available-for-sale equity instruments are recognised in the income statement as part of
other income when the group’s right to receive payments is established.
Cash and cash equivalents
In the consolidated statement of cash flows, cash and cash equivalents includes cash in hand, deposits held at call with
banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. In the
consolidated balance sheet, bank overdrafts are shown within borrowings in current liabilities.
Financial Liabilities
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual
arrangements entered into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract
that evidences a residual interest in the assets of the Group after deducting all of its liabilities. The accounting policies adopted for
specific financial liabilities and equity instruments are set out below Financial liabilities are classified as either financial liabilities at
FVTPL or other financial liabilities.
Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL where the financial liability is either held for trading or it is designated as at FVTPL.
Financial liabilities at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss
recognised in profit or loss incorporates any interest paid on the financial liability.
Other financial liabilities
Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. Other financial
liabilities are subsequently measured at amortized cost using the effective interest method, with interest expense recognised on
an effective yield basis.
The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments
through the expected life of the financial liability, or, where appropriate, a shorter period.
Derivative financial instruments and hedge accounting
The Group is exposed to currency and interest rate risks arising from its operations. The Group uses derivative financial
instruments (mainly uses interest swap contracts) to hedge its financial risks associated with specific firm commitments and
interest rate fluctuations of its expected future transactions.
The most important source of the interest rate risk is bank loans. Group’s policy is to turn the floating rate bank loans to fixed
rates. The Group classifies these transactions as financial instruments designated at fair value through profit/loss. Differences
due to the measurement of the fair value of trading derivative instruments are included in the income statement.
Foreign Currency Transactions:
In preparing the consolidated financial statements of the Group, transactions in currencies other than TL (foreign currencies)
are recorded at the rates of exchange prevailing on the dates of the transactions. At balance sheet, monetary items denominated
in foreign currencies are retranslated at the rates prevailing on the balance sheet date.
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Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the
date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency
are not retranslated.
Exchange differences are recognized in profit or loss in the period in which they arise except for:
• Exchange differences which relate to assets under construction for future productive use, which are included in the cost of
those assets where they are regarded as an adjustment to interest costs on foreign currency borrowings,
• Exchange differences on transactions entered into in order to hedge certain foreign currency risks.
• Exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither
planned nor likely to occur, which form part of the net investment in a foreign operation, and which are recognized in the foreign
currency translation reserve and recognized in profit or loss on disposal of the net investment.
Earnings Per Share:
Earnings per share disclosed in the accompanying consolidated statement of income is determined by dividing net income by the
weighted average number of shares in existence during the year concerned.
In Turkey, companies can raise their share capital by distributing “bonus shares” to shareholders from retained earnings. In
computing earnings per share, such “bonus share” distributions are assessed as issued shares. 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.
Events After Balance Sheet Date:
Subsequent events cover any events which arise between the reporting date and the balance sheet date, even occurred after any
declaration of the net profit for the period or specific financial information publicly disclosed. The Group adjusts its consolidated
financial statements if such subsequent events arise which require to adjust financial statements.
If the non-adjusting events that occured after balance sheet date, effect economic decisions to user of financial statements, the
non-adjusting events will disclose the notes of the consolidated financial statements.
Provisions, Contingent Liabilities and Contingent Assets:
Provisions
Provisions should be adjusted in consolidation financial statements if amount of estimated liability is reliable, economic benefit
resources occurred from those liabilities and there are any liabilities arise from previous period as proved as legally. If estimated in
future liability on operational loss as legally, a provision should not been adjusted.
Provision amount is valued by the present value of the estimated expenses carry out value of the liabilities with respect to the
current market assessment of the time value of money and before tax rates which reflects the risks unique to debt.
Contingent assets and liabilities
Possible assets or obligations that arise from past events and whose existence will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the Group are not included in the consolidated
financial statements and treated as contingent assets or liabilities (Note 16).
Related Party Disclosures:
Related parties in consolidated financial statements: A related party is a person or entity that is related to the entity that is
preparing its consolidated financial statements.
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(a) A person or a close member of that person’s family is related to a reporting entity if that person:
• has control or joint control of the reporting entity,
• has significant influence over the reporting entity,
• is a member of the key management personnel of the reporting entity or of a parent of the reporting entity.
(b) An entity is related to a reporting entity if any of the following conditions applies:
• The entity and the reporting entity are members of the same group (which means that each parent, subsidiary and fellow
subsidiary is related to the others).
• One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which
the other entity is a member).
• Both entities are joint ventures of the same third party.
• One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
• The entity is a post-employment benefit plan for the benefit of employees of either the reporting entity or an entity related
to the reporting entity. If the reporting entity is itself such a plan, the sponsoring employers are also related to the reporting
entity.
• The entity is controlled or jointly controlled by a person identified in (a).
• A person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the
entity (or of a parent of the entity).
Related party transactions: A related party transaction is a transfer of resources, services or obligations between a reporting
entity and a related party, regardless of whether a price is charged.
Government Grants and Incentives:
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received
and the group will comply with all attached conditions.
Government grants relating to costs are deferred and recognised in the income statement over the period necessary to match
them with the costs that they are intended to compensate.
Government grants relating to property, plant and equipment are included in non-current liabilities as deferred government
grants and are credited to the income statement on a straight-line basis over the expected lives of the related assets.
Current and deferred income tax
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet
date in the countries where the company and its subsidiaries operate and generate taxable income. Management periodically
evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It
establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
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Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their
carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from
the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability
in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit
or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the
balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax
liability is settled.
Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against
which the temporary differences can be utilised.
Deferred income tax liabilities are provided on taxable temporary differences arising from investments in subsidiaries, associates
and joint arrangements, except for deferred income tax liability where the timing of the reversal of the temporary difference is
controlled by the group and it is probable that the temporary difference will not reverse in the foreseeable future. Generally the
group is unable to control the reversal of the temporary difference for associates. Only were there is an agreement in place that
gives the group the ability to control the reveral of the temporary difference not recognised.
Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries,
associates and joint arrangements only to the extent that it is probable the temporary difference will reverse in the future and
there is sufficient taxable profit available against which the temporary difference can be utilised.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against
current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net
basis.
Employee Benefits/Retirement Pay Provision:
Benefits such as bonus, allowance for heating, marriage allowance, leave of absence, religious holidays, education incentive,
birth and death allowance are provided to the Group employees. Moreover, under the Turkish law and union agreements, lump
sum payments are made to employees retiring or involuntarily leaving the Group. Such payments are considered as being part of
defined retirement benefit plan as per IAS 19 (revised): “Employee Benefits.” The provision has been calculated by estimating
the present value of the future probable obligation of the Group arising from the retirement of employees. The principal
assumption is that the maximum liability for each year of service will increase parallel with inflation.
Thus, the discount rate applied represents the expected real rate after adjusting for the anticipated effects of future inflation.
The retirement benefit obligation recognised in the balance sheet represents the net present value of the total due to retirement
of all employees. Recognised actuarial gains and losses are presented in the income statement.
Cash Flow Statement:
In statement of cash flow, cash flows are classified according to operating, investment and finance activities.
Cash flows from operating activities reflect cash flows generated from the manufacturing and marketing of biscuit, chocolate,
chocolate coated biscuit, wafer and cake.
Cash flows from investment activities express cash used in investment activities (direct investments and financial investments)
and cash flows generated from investment activities of the Group.
Cash flows relating to finance activities express sources of financial activities and payment schedules of the Group.
Cash and cash equivalents comprise cash on hand and demand deposits and other short-term highly liquid investments which
their maturities are three months or less from date of acquisition and that are readily convertible to a known amount of cash and
are subject to an insignificant risk of changes in value.
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Capital and Dividends
Ordinary shares are classified as equity New shares and export option related with marginal costs, less collection of tax effect
presented under equity. The dividend distribution, accounted liabilities in the consolidated financial statements on the approval
date of dividend distribution by shareholder.
2.6 Significant Accounting Estimates and Assumptions
Assumptions, estimations and decisions made for the preparation of the consolidated financial tables are evaluated regularly and
attributed to events with conceivable evidence with respect to past knowledge and circumstances.
Significant accounting estimation and assupmtions
Group, has estimation and assumptions related to future term. Accounting assumptions which rarely accrue gives identical
outcome with the realised results. Assumptions and estimations that can lead to significant adjustments on the carrying value of
the assets and liabilities in the following reporting period are as follow:
Useful life of tangible assets:
Group has calculated the depreciation amounts regarding the useful lives specified in note 13The Group’s subsidiary Biskot
Biskuvi Gıda San. ve Tic. A.Ş. changed its estimation of useful lives of tangible assets in the current year. As a result of such
change 31 December 2013 reduced by the depreciation expense for the year ending TL 6.632.229.
Impairment of inventories
In the current year, a provision has been provided for inventories that are not expected to be used and are slow moving. In the
current year, the Group has also provided provision for inventories with net realizable values lower than costs. Based on the
analysis, TL 4.790.533 impairment provision has been provided for inventories (2012: TL 9.147.920).
Doubtful receivables provision
In the current year, a provision has been provided for receivables that are not expected to be collectible and those that have not
been collected for long time. As of 31 December 2013, a provision for TL 6.222.135 of the trade receivables has been provided
for as doubtful receivable provision (2012: TL 6.494.812).
Deferred taxes:
The Group recognizes deferred tax assets and liabilities based upon temporary differences arising between the financial
statements as reported for IFRS purposes and financial statements prepared in accordance with the tax legislation. These
differences arise from the differences in accounting periods for the recognition of income and expenses in accordance with IFRS
and tax legislation. Group has deferred tax assets resulting from tax loss carry-forwards and deductible temporary differences, all
of which could reduce taxable income in the future.
Fully or partial recoverability of tax assets are estimated based on available current evidences. The main factors which are
considered include future earnings potential; cumulative losses in recent years; expiration dates of both loss carry-forwards and
other tax assets; the carry-forward period associated with the deferred tax assets; future reversals of existing taxable temporary
differences; tax-planning strategies that would, if necessary, be implemented, and the nature of the income that can be used to
realize the deferred tax asset. As a result of the assessment made, the Group has recognized deferred tax assets amounting to TL
4.244.512 in certain entities because it is probable that taxable profit will be available sufficient to recognize deferred tax assets
in those entities (2012: TL 4.060.370).
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Fair values of derivative instruments and other financial instruments
The Group determines the fair values of its financial instruments without an active market using various market information for
similar transactions, similar instruments with fair values and discounted cash flow analysis. Discounted cash flow analysis is
applied with 7.1% discount rate for G New and 8.2% discount rate for Godiva Belgium which are Group’s financial investments.
A change in discount rate by 1%, changes fair value of G New and Godiva Belgium amounting TL 9.346.245.
2.7 Summary of Financial Information Related to Subsidiaries:
Summary of financial statements related to Ülker Çikolata San. A.Ş. and Biskot Biskuvi Gida San. Tic. A.Ş. in accordance with IFRS
12 are as follow:
Ülker Çikolata Sanayi A.Ş.
Total assets
Total liabilities
Total shareholders’ equity
2013
524.274.137
191.757.162
332.516.975
2012
702.402.546
397.437.237
304.965.309
Revenue
Net profit for the year
938.529.940
102.014.897
776.035.799
96.405.681
86.196.051
40.669.970
(276.589.084)
114.236.669
172.835.073
(145.703.603)
Total assets
Total liabilities
2013
530.351.621
334.809.498
195.542.123
2012
449.093.617
273.151.994
175.941.623
Revenue
Net profit for the year
826.796.780
48.909.255
669.230.767
35.330.541
98.755.296
(3.557.102)
(13.885.092)
11.862.000
(32.520.410)
40.670.230
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
Biskot Bisküvi Gıda Sanayi ve Ticaret A.Ş.(*)
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
(*)
Summary of financial information include consolidation adjustments.
3. BUSINESS COMBINATIONS
Reform Gıda Paz. San. ve Tic. A.Ş. which was acquired from Yıldız Holding A.Ş. on 18 February 2013 was fully consolidated with
scope of transaction under common controls in the consolidated financial statements as of 1 January 2013.
Atlantik Gıda Pazarlama ve Ticaret A.Ş which was fully consolidated in the consolidated financial statements in the previous years
was transferred on 15 November 2012 and consolidated under Ülker Çikolata Sanayi A.Ş.
98
4. SEGMENTAL INFORMATION
The Group’s core business activities are manufacturing and marketing of biscuit, chocolate coated biscuit, wafer, cake and
chocolate. The reports reviewed routinely by the decision makers of the Group comprise consolidated financial information of
Ülker Bisküvi Sanayi A.Ş. and its subsidiaries.
Since the Group has operations in only one area and the decision makers use the consolidated financial information, segmental
reporting in accordance with TFRS 8 have not been provided in the these consolidated financial statements.
5. CASH AND CASH EQUIVALENTS
2013
25.443
9.056.986
1.154.745.091
555.638
1.164.383.158
Cash
Demand deposits
Time deposits (*)
Cheques received
(*)
2012
3.797
13.917.225
1.252.969.855
837.194
1.267.728.071
Time deposits consist of overnight amounting to TL 1.150.297.129 (31 December 2012: TL 1.249.169.924).
Details of time deposits are shown below;
Currency Type
TL
USD
EUR
Effective Interest
Rate (%)
%8,94
%1,86
%0,2
Maturity
Ocak-Şubat 2014
Ocak 2014
Ocak 2014
2013
145.138.421
686.297.216
323.309.454
1.154.745.091
Currency Type
TL
USD
EUR
Effective Interest
Rate (%)
%8,32
%2,49
%2,90
Maturity
Ocak 2013
Ocak 2013
Ocak 2013
2012
117.859.499
819.293.160
315.817.196
1.252.969.855
Short Term Financial Investments:
Available for sale financial assets
2013
611.476
611.476
2012
2.963.016
2.963.016
Long Term Financial Investments:
Available for sales financial assets
2013
464.661.239
464.661.239
2012
326.344.908
326.344.908
6. FINANCIAL INVESTMENTS
Long Term Available for Sale Financial Investments
G New, Inc
Godiva Belgium BVBA
BİM Birleşik Mağazalar A.Ş.
Other
Share %
%19,23
%19,23
%0,20
2013
148.876.952
289.715.942
25.825.951
242.394
464.661.239
Share %
%19,23
%19,23
%0,20
2012
124.240.079
175.584.561
26.140.536
379.732
326.344.908
99
Available for sale financial assets are presented at their fair values. The difference of TL 254.670.905 (2012: TL 123.114.916)
in the fair values of such assets has been presented in other comprehensive income under equity.
As the expected value gaps for available for sale financial assets of TL 242.394 (2012: TL 379.732) that are not traded in an
active market are high and expected values are not reliably measured, these have been presented at historical cost in these
consolidated financial statements.
7. FINANCIAL LIABILITIES
Short Term Borrowings
Short Term Portion of Long Term Borrowings
Long Term Borrowings
Short Term Borrowings
Bank Loans
Short Term Portion of Long Term Borrowings
Bank Loans
Financial Lease Payables
Long Term Borrowings
Bank Loans
Financial Lease Payables
2013
2012
150.942.003
1.098.791.211
9.851.176
1.259.584.390
133.999.730
480.427.663
886.525.280
1.500.952.673
2013
150.942.003
150.942.003
2012
133.999.730
133.999.730
2013
1.093.534.286
5.256.925
1.098.791.211
2012
472.373.355
8.054.308
480.427.663
2013
9.788.823
62.353
9.851.176
2012
882.244.318
4.280.962
886.525.280
Details of Group’s syndication loans are as follows;
Participation loan consists of two credit trenches which are USD 138.280.000 and EUR 134.850.000 14 international banks
joined the participation. Effective interest rate for both credit trenches is libor + 3,4% and the maturity date is November 2014.
Principal payments of the loans are paid with interest, semi-annually at the end of the period.
The covenants which belong to participation credits are as follows;
a) Leverage: The ratio of the consolidated net loan at the end of the balance sheet date to the consolidated EBITDA in the valid
period should not be over the ratio of 3 to 1.
b) Interest Coverage: Consolidated interest coverage ratio of the Group for the balance sheet date should be at least 3 to 1.
In current year, the consolidated financial statements of the Group comply with the covenants of the bank loan agreement.
100 ÜLKER BİSKÜVİ ANNUAL REPORT 2013
2013
Currency Type
TL
EUR
USD
Maturity
Spot
February 2014-November 2014
February 2014-April 2015
Effective
Interest Rate (%)
Spot
2.89%
3,92%
Maturity
Spot
April 2013-April 2015
January 2013-December 2014
Effective
Interest Rate (%)
Spot
3,95%
3,22%
Short Term
4.370.289
783.805.171
456.300.829
1.244.476.289
Long Term
9.788.823
9.788.823
Short Term
2.170.443
17.477.202
586.725.440
606.373.085
Long Term
371.921.590
510.322.728
882.244.318
2013
2012
1.244.476.289
9.788.823
1.254.265.112
606.373.085
874.404.926
7.839.392
1.488.617.403
2013
2012
5.376.313
(119.388)
5.256.925
8.491.321
(437.013)
8.054.308
2013
2012
69.587
(7.234)
62.353
4.382.782
(101.820)
4.280.962
2013
2012
5.256.925
62.353
5.319.278
8.054.308
4.231.026
49.936
12.335.270
2012
Currency Type
TL
EUR
USD
Repayment schedule of financial borrowings is as follows:
To be paid within 1 year
To be paid within 1-2 years
a) The detail of short term financial lease payables is as follows:
Short-Term Financial Lease Payables
Financial lease payables
Deferred financial lease payables costs (-)
b) The detail of long term financial lease payables is as follows:
Long-Term Financial Lease Payables
Deferred financial lease payables costs (-)
Repayment schedule of financial lease payables is as follows:
To be paid within 1 year
As of 31 December 2013 TL 3.469 of financial lease payables are due to Fon Finansal Kiralama A.Ş., which is a related party
(2012: TL 736.602).
101
8. OTHER FINANCIAL LIABILITIES
2013
2012
-
409.549
409.549
2013
2012
446.815.319
446.815.319
433.197.344
433.197.344
175.211.204
34.664.418
(6.222.135)
(1.698.738)
201.954.749
124.901.079
47.033.200
(6.494.812)
(1.484.232)
163.955.235
648.770.068
597.152.579
Short term derivative financial liabilities
9. TRADE RECEIVABLES AND PAYABLES
Due from Related Parties
Due from related parties (Note 32)
Other Trade Receivables
Trade receivables
Discount of trade receivables
Notes receivables
Provision for doubtful receivables
Total Short Term Trade Receivables
Trade receivables are disclosed at discounted net realizable value using the effective yield method. Net realizable value has been
calculated over discount rate of 8% (2012: 8%) based on the Group’s cash sales. The provision for trade receivables is provided
for based on the estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience.
The movement of the allowance for doubtful receivables as of 31 December 2013 and 2012 is as follows;
Opening balance
Charge for the period
Provisions reversal
Collections
Closing balance
2013
2012
(6.494.812)
(37.454)
201.484
108.647
(6.222.135)
(4.164.191)
(3.511.894)
890.539
290.734
(6.494.812)
Description on the level and nature of the risks related to trade receivables is given in note 33.
Short Term Trade Payables
Due to related parties (Note 32)
Trade payables
2013
2012
273.321.957
235.142.437
508.464.394
247.377.711
223.771.841
471.149.552
Trade payables are disclosed at discounted net realizable value using the effective yield method. Net realizable value has been
calculated over discount rate of 8% (2012: 8%) based on the Group’s cash sales.
10. OTHER RECEIVABLES AND PAYABLES
2013
2012
3.417.357
16.860.567
20.277.924
131.398.216
8.463.471
139.861.687
6.886.001
318.056
352.662
8.872.318
431.530
16.860.567
5.558.315
21.018
567.352
2.316.786
8.463.471
Other Long Term Receivables
2013
2012
Deposits and guarantees given
161.464
161.464
125.282
125.282
2013
2012
86.857
344.940
431.797
253.281
4.805.214
5.058.495
2013
2012
79.436.010
8.341.511
101.979.209
2.771.255
10.584.281
(4.790.533)
198.321.733
68.702.310
6.564.795
102.881.574
8.582.907
8.565.489
(9.147.920)
186.149.155
Other Receivables
Due from related parties (Note 32)
Short term other receivables
Other Short Term Receivables
VAT receivables
Deposits and guarantees given
Receivables from personnel
Receivables from tangible sales
Other
Other Payables
Non-trade payables to related parties (Note 32)
Other short term payables
Description on the level and nature of the risks related to trade receivables is given in note 33.
11. INVENTORIES
Details of inventory are as follows;
Raw materials
Work in progress
Finished goods
Trade goods
Other inventories
Allowance for impairment on inventory (-)
Inventory is presented on cost value and allowance for impairment is booked for inventory valuing lower than cost.
103
The movement of allowance for impairment on inventory for the periods ended on 31 December 2013 and 31 December 2012
are below:
Opening balance
Charge fort he year
Used allowance
Closing balance
2013
(9.147.920)
(240.539)
4.597.926
(4.790.533)
2012
(2.929.611)
(6.218.309)
(9.147.920)
2013
30.460.000
220.000
(20.645.000)
10.035.000
2012
7.555.084
22.081.916
823.000
30.460.000
12. INVESTMENT PROPERTIES
Opening balance
Transfer to investment properties
Valuation fund classified under equity
Net gain from fair value adjustments classified profit or loss
Disposal
Closing balance
The fair value of the Group’s investment properties at 31 December 2013 has been calculated on the basis of a valuation
carried out at that date by 6 December 2013 and 18 December 2012,by independent valuers not related to the Group. EVA
Gayrimenkul Değerleme Danışmanlık A.Ş. is one of the accredited independent valuers by Capital Markets Board of Turkey, and
has appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The valuation, which
conforms to International Valuation Standards, based on market evidence of transaction prices for similar properties.
The rent income earned by the Group from its investment properties amounting to TL 581.968 (2012: TL 178.461) within the
current period. Direct operating expenses arising from the investment properties in the current period amounting to TL 94.132
(2012: 134.757 TL).
The Group has sold the warehouse that is located Bayrampaşa/İstanbul, amounting to TL 17.118.094 as of 30 July 2013.
13. TANGIBLE ASSETS
Movement of tangible assets between 1 January 2013 and 31 December 2013 is as follows:
Cost
Land
Land improvements
Buildings
Machinery, plant and
equipment
Vehicles
Furniture and fixture
Leasehold
improvements
Other tangible assets
Construction in
progress
Disposal
Addition in
accordance with
consolidation
Transfers
(Note 14)
31 December
2013
8.376.659
6.247.149
251.413.316
- (5.000.000)
218.343
311.242 (12.649.602)
-
18.529
3.629.014
3.376.659
6.484.021
242.703.970
680.430.113
1.134.736
43.157.448
22.939.760 (10.838.263)
26.909
(52.591)
1.810.320 (1.475.205)
3.201.591
-
38.625.881
760.017
734.359.082
1.109.054
44.252.580
-
-
16.013.470
1.396
1 January
2013
19.655.248
1.396
12.654.101
1.023.070.166
Addition
1.488.838
-
(5.130.616)
-
50.973.591
(932.995)
77.769.003 (36.079.272)
- (43.267.229)
19.427.468
3.201.591
(233.788) 1.067.727.700
Disposal
Addition in
accordance with
consolidation
Transfers
31 December
2013
(2.254.779)
(308.929)
(61.205.894) (7.376.112)
1.418.179
-
-
(2.563.708)
(67.163.827)
(386.987.793) (34.389.867)
(1.040.694)
(59.590)
(36.847.749) (1.842.131)
5.385.082
49.025
1.414.115
(817.420)
-
- (416.809.998)
(1.051.259)
- (37.275.765)
(10.428.953)
(910.709)
(1.396)
(498.767.258) (44.887.338)
1.036.022
9.302.423
(817.420)
- (10.303.640)
(1.396)
- (535.169.593)
Accumulated
Depreciation
Land improvements
Buildings
equipment
Vehicles
Furniture and fixture
Leasehold
improvements
Net Value
1 January Charge for the
2013
Period
524.302.908
532.558.107
From depreciation and amortization expenses, TL 46.489.626 (2012: TL 42.184.241) is included in cost of goods sold, TL
247.693 TL (2012: TL 153.758) is included in research and development expenses, TL 2.237.258 (2012: TL 1.781.298) is
included in marketing and selling expenses and TL 2.811.377 (2012: TL 3.637.499) is included in general and administrative
expenses.
There are not any fixed assets acquired through financial leasing in the current period. There are not any mortgage or collateral on
tangible assets in the current period.
Movement of tangible assets between 1 January 2012 and 31 December 2012 is as follows:
Cost
Land
Land improvements
Buildings
equipments
Vehicles
Furniture and fixtures
Leasehold improvements
Constructions in progress
1 January
2012
Addition
9.566.659
6.022.168
255.837.155
224.981
851.159
626.368.027
1.721.090
43.753.923
21.356.289
2.502
37.162.602
1.001.790.415
Disposal
Transfer to
investment
property
Transfers
(Note 14)
31 December
2012
(610.333)
(6.051.329)
(1.190.000)
1.386.664
8.376.659
6.247.149
251.413.316
14.715.785 (5.175.805)
(586.354)
1.752.779 (2.676.437)
251.717
(81.836)
(1.484)
22.806.167
(13.838)
40.602.588 (9.146.087)
44.522.106
680.430.113
1.134.736
327.183
43.157.448
(4.114.104)
2.243.182
19.655.248
378
1.396
- (47.300.830)
12.654.101
(10.165.433)
(11.317) 1.023.070.166
105
Accumulated
Depreciation
1 January
2012
Charge for the
Period
Leasehold improvements (1.963.682)
(291.097)
Buildings
(55.406.480) (7.353.375)
equipments
(352.463.520) (37.190.667)
Vehicles
(1.558.321)
(68.490)
(37.417.246) (1.776.207)
Leasehold improvements (10.999.708)
(782.192)
(2.206)
(674)
(459.811.163) (47.462.702)
Net Value
Disposal
Transfer to
investment
property
Transfers
31 December
2012
239.390
1.314.571
-
(2.254.779)
(61.205.894)
2.666.394
586.117
2.345.704
57.169
1.484
5.896.258
1.295.778
2.610.349
- (386.987.793)
(1.040.694)
- (36.847.749)
- (10.428.953)
(1.396)
- (498.767.258)
541.979.252
524.302.908
There are not any fixed assets acquired through financial leasing in the prior period. There are not any mortgage or collateral on
tangible assets in the prior period.
The estimated useful lives of tangible assets are as follow:
Useful Life
25 – 50 years
10 – 50 years
4 – 15 years
4 – 10 years
4 – 10 years
3 – 10 years
5 – 10 years
Buildings
Land improvements
Machinery, plant and equipments
Vehicles
Leasehold improvements (*)
Leasehold improvements consists of the expenses made for property. In the condition of the useful life is longer than the rent period the property is amortized
based on rent period. On the other hand, the useful life is shorter than the rent period the property is amortized based on its useful life. The useful lives of leasehold
improvements in the scope of the term 31 December 2013 and 2012 are between 5 to 10 years.
(*)
14. INTANGIBLE ASSETS R
Movement of intangible assets between 1 January 2013 and 31 December 2013 is as follows:
Cost
Rights
Other intangible assets
Accumulated Amortization
Rights
Net Value
1 January
2013
1.895.364
1.047.549
2.942.913
Addition
31.099
118.666
149.765
Disposal
(27.871)
(27.871)
Transfers
(Note 13)
230.657
3.131
233.788
31 December
2013
2.157.120
1.141.475
3.298.595
1 January
2013
(1.535.567)
(732.907)
(2.268.474)
Charge of the
Period
(132.766)
(133.621)
(266.387)
Disposal
27.855
27.855
Transfers
-
31 December
2013
(1.668.333)
(838.673)
(2.507.006)
674.439
791.589
Movement of intangible assets between 1 January 2012 and 31 December 2012 is as follows::
Cost
Rights
Accumulated Amortization
Rights
1 January
2012
1.672.642
910.417
2.583.059
Addition
222.722
125.815
348.537
Transfers
11.317
11.317
31 December
2012
1.895.364
1.047.549
2.942.913
1 January
2012
(1.338.752)
(635.628)
(1.974.380)
Charge of the
Period
(196.815)
(97.279)
(294.094)
Transfers
-
31 December
2012
(1.535.567)
(732.907)
(2.268.474)
Net Value
608.679
674.439
The intangible assets are amortized on a straight-line basis over their estimated useful lives.
Useful Life
2 – 15 years
2 – 12 years
Rights
15. GOVERNMENT GRANTS AND INCENTIVES
Export operations and other foreign exchange activities performed under fundamentals and methods indentified by Ministry
of Finance and Undersecretariat of foreign trade are exempt from stamp duty and transaction stamps. Government grants are
given for supporting foreign fair attendance with respect to the Credit Coordination Committee’s decision at 16 December 2004
with number 2004/11 which is prepared with respect to the decision Government Grants for Export. Group is also benefiting
from tax incentive for export of the agricultural products with. respect to the Credit Coordination Committee’s decision of 20/6
“Export return on Agricultural Products” 2000/5.
Group is benefiting from the energy and employment support incentives with respect to the “Law related with change in grants for
investment and employment support, decision number 5084” effective from 6 February 2004 and published in formal journal,
with the intention of applying insurance and tax premium incentives, supplying energy support and acquiring free of charge land
and property for investments in order to increase investments and employment.
Group has received government incentives amounting TL 14.994.642 in current year(2012: TL 16.672.352). This benefit,
regarded as government incentives, is explained in note 2. In current year the amount related to law 5084; TL 1.383.386 is from
exports of argicultural product grants, TL 10.405.731 is from employment grants, TL 3.205.525 is from other grants. (2012:
TL 222.032 from energy grants, TL 9.156.281 from employment grants, TL 7.294.039 from other grants).
Incentive of TL 135,000,000 has been approved by T.C Ministry of Economy at 19 November 2013 with respect to the
expansion and product diversification investment of Ülker Bisküvi San. A.Ş Gebze Factory. The investment is planned to complete
until 11 November 2017.
16. PROVISIONS, CONTINGENT ASSETS AND LIABILITIES
Short Term Debt Provisions
Provisions for returns
Provisions for lawsuits
Other
2013
2.568.884
3.772.686
2.358.055
8.699.625
2012
5.644.363
4.102.508
2.243.369
11.990.240
107
Movement of the legal case provisions for December 2013 and 2012 is as follows:
2013
4.102.508
1.106.882
(1.092.903)
(343.801)
3.772.686
Opening balance
Charge for the period
Reversal of provisions
Payment/relinquishment (-)
2012
1.872.274
3.407.068
(958.528)
(218.306)
4.102.508
A significant portion of the legal case provision as of 31 December 2013 and 2012 is related to legal filings made by the
personnel.
a) Guarantees Given
(Balances denominated in foreign currencies have been presented in their original currency)
A) CPM’s given in the name of own legal personality
2013
2012
TL
USD
TL
USD
60.003.938
64.900 103.588.583
802.858
B) CPM’s given on behalf of the fully consolidated companies
-
-
-
-
C) CPM’s given on behalf of third parties for ordinary course of
business
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
64.900 103.588.583
802.858
D) Total amount of other CPM’s given
i. Total amount of CPM’s given on behalf of the majority
shareholder
ii. Total amount of CPM’s given on behalf of the group companies
which are not in scope of B and C
iii. Total amount of CPM’s given on behalf of third parties which are
not in scope of C
Total
60.003.938
b) Lawsuits Filed by and Against to the Group
ba) As of 31 December 2013;
Lawsuits filed by the Group:
Compensation litigations
Foreclosure litigations
Tax litigations (*)
Action of debts
Penalty litigations
Main part of tax litigations consist of litigations related to VAT receivables.
(*)
TL
230.000
17.286.710
10.467.551
75.674
921.392
28.981.327
USD
7.100.000
3.404.577
10.504.577
EUR
107.252
107.252
Lawsuits filed againist to the Group (*):
Action of debts
TL
931.145
67.066
3.106.117
4.104.328
USD
400.000
400.000
A provision of TL 3.772.686 has been provided for various court cases filed against the Group. For the rest of the lawsuits no provision was recognised because no
cash outflow is projected (2012: TL 4.102.508).
(*)
bb) As of 31 December 2012;
Lawsuits filed by the Group:
Tax litigations (*)
Action of debts
Penalty litigations
(*)
TL
260.000
18.303.490
5.439.855
73.131
11.875
24.088.351
USD
7.100.000
3.404.577
10.504.577
TL
2.517.308
342.642
1.558.514
4.418.464
USD
400.000
400.000
Main part of tax litigations consist of litigations related to VAT receivables.
Lawsuits filed againist to the Group:
Action of debts
Operational Leasing Agreements
The operating leases of the Company cover a one year period. All operational leasing agreements include a clause allowing the
re-arrangement of the terms of the lease had the lessee renewed the contract under the current market conditions. The lessee
does not have a right to purchase the asset at the end of the term.
Group’s rental income from its operational leasing agreements for assets leased is TL 7.298.438 during the current year.
(2012: TL 6.072.534). In the current year operational leasing expenses are TL 2.808.924 (2012: TL 1.826.690). Due to
non-cancellable rent agreements, the Group’s rental revenue to be received in the future periods is TL 6.638.301 (2012: TL
6.963.629) and are all to be realized in a one year period. Due to non-cancellable rent agreements, the Group’s rent payments
to be incurred in the future periods is TL 1.474.344 (2011: TL 2.215.193) and are all payable in a one year period.
17. COMMITMENTS
The Group’s export commitments amount to USD 306.631.805 as of 31 December 2013 (2012: USD 321.050.247).
The average period of export commitments are 2 years. If the export commitments will not fulfiled,the Groupe will loss the tax
advantage. All of export commitments in 2012 have been realized and there is not any issue for export commitments in 2013.
109
18. EMPLOYEE BENEFITS
Short Term Liabilities for Employee Benefits
Unused vacation accrual
Performance premium accrual
2013
7.658.170
6.614.891
14.273.061
2012
6.202.714
5.442.225
11.644.939
Movement of Unused Vacation Provision
Opening balance
Decrease in period
Increased in period
Closing balance
2013
6.202.714
(4.448.796)
5.904.252
7.658.170
2012
5.636.690
(4.398.128)
4.964.152
6.202.714
Movement of Performance Premium Provision
Opening balance
Cash payments in period
Increased in period
Closing balance
2013
5.442.225
(6.756.183)
7.928.849
6.614.891
2012
4.824.006
(4.824.006)
5.442.225
5.442.225
Long Term Liabilities for Employee Benefits
2013
2012
Provision for employee termination benefits
23.380.797
23.380.797
20.283.290
20.283.290
Under Turkish Labor Law, the Company is required to pay employment termination benefits to each entitled employee. Also,
employees are entitled to be paid their retirement pay provisions who retired by gaining right to receive retirement pay provisions
according to of the prevailing 506 numbered Social Insurance Law’s Article 60, as amended by 6 March 1981 dated, 2422
numbered and 25 August 1999 dated, 4447 numbered laws. Some transition provisions related to the pre-retirement service
term was excluded from the law since the related law was changed as of 23 May 2002. The amount payable consists of one
month’s salary limited to a maximum of TL 3.254,44 for each period of service as of 31 December 2013 (2012: TL 3.033,98).
The liability is not funded, as there is no funding requirement. The provision has been calculated by estimating the present value
of the future probable obligation of the Group arising from the retirement of employees. TAS 19 requires actuarial valuation
methods to be developed to estimate the entity’s obligation under defined benefit plans. Accordingly, the following actuarial
assumptions were used in the calculation of the total liability:
The principal assumption is that the maximum liability for each year of service will increase parallel with inflation. Thus,
the discount rate applied represents the expected real rate after adjusting for the anticipated effects of future inflation.
Consequently, in the accompanying financial statements as at 31 December 2013, the provision has been calculated by
estimating the present value of the future probable obligation of the Group arising from the retirement of the employees. The
provisions at the respective balance sheet dates have been calculated assuming an annual inflation rate of 7.4% and a discount
rate of 11.2%, resulting in a real discount rate of approximately 3.57% (2012: 3.57%). The maximum liability is revised
semiannually. The basis considered in calculating the provisions is the amount of maximum liability of TL 3.438,22 which
became effective as of 1 January 2013. As of 2013 year end, the probability of resignation of employees is 3.9% (2012: 3.6%).
Movement of provision for employee termination benefits is as below;
Opening balance
Services cost
Interest cost
Actuarial gain/loss
Cash payments in period
Closing balance
2013
2012
20.283.290
10.286.217
724.113
(746.680)
(7.166.143)
23.380.797
18.866.864
9.636.391
565.296
1.586.355
(10.371.616)
20.283.290
19. PREPAID EXPENSES
Short Term Prepaid Expenses
Advance given
Prepaid expenses
Other
2013
45.588.569
101.662
1.745.975
47.436.206
2012
14.354.145
1.361.684
426.296
16.142.125
Long Term Prepaid Expenses
Advance given
Prepaid expenses
2013
20.903.238
88.074
20.991.312
2012
12.087.943
33.258
12.121.201
2013
2012
11.360.308
6.356.514
17.716.822
10.194.957
5.003.307
15.198.264
2013
2012
44.300.846
2.271.062
252.363
46.824.271
41.365.810
3.002.094
77.915
44.445.819
2013
2012
7.794.298
7.733.719
261.609
15.789.626
5.996.958
5.367.066
300.416
11.664.440
2013
2012
35.571
35.571
185.833
185.833
20. EMPLOYEE BENEFITS
Payables to personel
Social security premiums payable
21. OTHER ASSET AND LIABILITIES
Other Current Asset
VAT carried forward
Other VAT
Other asset
Other Current Liabilites
Advance received
Tax and fund payable
Other liabilities
Other non-current liabilities
111
22. SHAREHOLDERS’ EQUITY
a) Capital Structure
The composition of the Company’s paid-in share capital as of 31 December 2012 and 2011 is as follows:
2013
Shareholders
Yıldız Holding A.Ş. Subsidiaries and Ülker Family
Dynamic Growth Fund
Other
Amount
166.967.458
38.888.808
136.143.734
342.000.000
2012
Share
%48,82
%11,37
%39,81
%100,00
Amount
151.778.531
73.308.031
48.220.722
68.692.716
342.000.000
Share
%44,38
%21,43
%14,10
%20,09
%100,00
b) Valuation Fund
Financial Asset Valuation Fund:
Financial Asset Valuation Fund is generated from the valuation of available for sale instruments with their fair values. When a financial
asset valued at its fair value is disposed, the related portion in the valuation fund is directly recognized in that period’s profit and
loss. When a financial instrument is revalued and a decrease in value is observed, the related portion in the valuation fund is directly
recognized in that period’s profit and loss.
As of 31 December 2013 the Group has a financial asset valuation fund of TL 254.670.905 (2012: TL 123.114.916).
Investment Property Valuation Fund:
Properties accounted as fixed assets in previous periods, might be transferred to investment property due to changes in usage
patterns. In this way in 2012, Group classified some of the real estate properties as investment property and preferred to book
under fair value method. Accordingly, the increase in the fair value amounting to TL 22.904.916 during the first transfer, has
been accounted as the increase in the fair value under equity. In the following period, the increase in fair value due to the increase
in the fair value of real estate amounting to TL 220.000 in 2013 and TL 823.000 in 2012 have been accounted under the
income statement. As of 30 July 2013, the disposal of valuation fund amounting to TL 15.405.576 has been realized due to
sales of investment property.
c) Restricted Reserves Appropriated from Profit
Restricted reserves appropriated from profit are composed of legal reserves. Legal reserves comprise of first and second legal
reserves, appropriated in accordance with the Turkish Commercial Code. 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 historical paid-in share capital. The
second legal reserve is appropriated after the first legal reserve and dividends, at the rate of 10% per annum of all cash dividend
distributions. According to the Turkish Commercial Code, legal reserves can be only used to offset losses unless they exceed the
50% of paid-in capital. Other than that, legal reserves must not be used whatsoever.
In accordance with the CMB’s requirements which were effective until 1 January 2008, the amount generated from the firsttime application of inflation adjustments on financial statements, and followed under the “accumulated loss” item was taken into
consideration as a reduction in the calculation of profit distribution based on the inflation adjusted financial statements within
the scope of the CMB’s regulation issued on profit distribution. The related amount that was followed under the “accumulated
loss” item could also be offset against the profit for the period (if any) and undistributed retained earnings and the remaining loss
amount could be offset against capital reserves arising from the restatement of extraordinary reserves, legal reserves and equity
items, respectively.
In addition, in accordance with the CMB’s requirements which were effective until 1 January 2008, at the first-time application
of inflation adjustments on financial statements, equity items, namely “Capital issue premiums”, “Legal reserves”, “Statutory
reserves”, “Special reserves” and “Extraordinary reserves” were carried at nominal value in the balance sheet and restatement
differences of such items were presented in equity under the “Shareholders’ equity inflation restatement differences” line item in
aggregate. “Shareholders’ equity inflation restatement differences” related to all equity items could only be subject to the capital
increase by bonus issue or loss deduction, while the carrying value of extraordinary reserves could be subject to the capital
increase by bonus issue; cash profit distribution or loss deduction.
112
However, in accordance with the CMB’s Decree Volume: XI; No: 29 issued on 1 January 2008 and other related CMB’s
announcements, “Paid-in capital”, “Restricted reserves” and “Premium in excess of par” should be carried at their registered
amounts in statutory records. Restatement differences (e.g. inflation restatement differences) arising from the application of
the Decree should be associated with:
-“Capital restatement differences” account, following the “Paid-in capital” line item in the financial statements, if such
differences are arising from “Paid-in Capital” and not added to capital;
-“Retained earnings/Accumulated loss”, if such differences are arising from “Restricted reserves” and “Premium in excess of par”
and has not been subject to profit distribution or capital increase.
Other equity items are carried at the amounts valued according to the CMB’s Financial Reporting Standards.
Capital restatement differences can only be included in capital.
Profit Distribution:
Publicly listed companies distribute dividends in accordance with the requirements of CMB as explained below: In accordance
with the Capital Markets Board’s (the “Board”) Decree issued on 23 January 2013, in relation to the profit distribution of
earnings derived from the operations, minimum profit distribution is not required for listed companies, and accordingly, profit
distribution should be made based on the requirements set out in the Board’s Communiqué Serial:II, No: 19.1 “Principles of
Dividend Advance Distribution of Companies That Are Subject To The CMB Regulations”, terms of articles of corporations and
profit distribution policies publicly disclosed by the companies.
Furthermore, based on the afore-mentioned decree, companies that are required to prepare consolidated financial statements
should calculate their net distributable profits, to the extent that they can be recovered from equity in their statutory records, by
considering the net profit for the period in the consolidated financial statements which are prepared and disclosed in accordance
with the Communiqué Serial: XI, No: 29.
The Group realized dividend payments TL 172.673.511 (2012: TL 281.484.501) in the current period.
Legal Reserves and Share Issuance Premiums which are considered as legal reserves under the Turkish Commercial Code No:
466, have been presented at their values in legal books. Thus, the inflation adjustment differences from the valuation studies
for IFRS purposes for those as of the balance sheet date that have not been subject to profit distribution or capital increase have
been presented under retained earnings.
Resources Available for Profit Distribution:
The Group has in its legal books a profit for the period of TL 356.215.080 (2012: TL 436.125.813) that can be utilized for
profit distribution. The Group has sufficient funds for profit distribution in the statutory financial statements
d) Retained Earnings
Details of retained earnings are as follows:
Retained earnings
Extraordinary reserves
Inflation restatement differences of shareholders’ equity accounts other than
capital and legal reserves
Other reserves
2013
(477.354.121)
365.002
2012
(611.542.752)
149.700.462
(17.305.173)
600.619.014
106.324.722
(17.305.173)
604.553.046
125.405.583
e) Non-Controlling Interest/Non-Controlling Interest Profit or Loss
The amount of non-controlling interest as of 31 December 2013 is equal to TL 138.338.939 (2012: TL 122.302.124). The
minority share of TL 38.682.116 on operating results for the current year has been presented separately from the profit for the
same period in these consolidated statements of income. (2012: TL 28.605.931).
113
23. REVENUE AND COST OF SALES
a) Revenue
The detail of operating income is as follows:
Domestic sales
Export sales
Sales return and dicsounts (-)
Sales Income (net)
2013
3.058.811.904
557.937.303
(868.378.662)
2.748.370.545
2012
2.628.870.326
461.642.086
(747.279.586)
2.343.232.826
2013
(1.576.628.424)
(258.315.953)
(136.420.175)
(45.810.137)
1.776.716
(902.365)
(2.016.300.338)
(98.759.935)
(2.115.060.273)
2012
(1.431.481.600)
(193.690.700)
(116.619.058)
(42.184.241)
2.070.626
39.822.024
(1.742.082.949)
(95.898.985)
(1.837.981.934)
b) Cost of Sales
Raw material used
Personnel expenses
Production overheads
Depreciation and amortization expenses
Change in work-in-progress inventories
Chenge in finished goods inventories
Cost of merchandises sold
Cost of trade goods sold
Cost of sales
24. RESEARCH AND DEVELOPMENT EXPENSES, MARKETING, SELLING AND DISTRIBUTION EXPENSES, GENERAL
ADMINISTRATIVE EXPENSES
Research and development expenses
Marketing, selling and distribution expenses
General administrative expenses
2013
2012
(13.396.585)
(262.511.713)
(94.030.049)
(369.938.347)
(8.900.058)
(226.945.293)
(96.295.271)
(332.140.622)
2013
2012
(2.412.237)
(8.437.857)
(247.693)
(2.298.798)
(13.396.585)
(2.429.009)
(4.022.197)
(153.758)
(2.295.094)
(8.900.058)
25. EXPENSES BY NATURE The detail of operating expenses is as follow:
Research and Development Expenses
Personnel expenses
Material used
Other
114
Marketing, Selling and Distribution Expenses
Personnel expenses
Outsource expenses
Rent expenses
Other
General Administration Expenses
Personnel expenses
Operating expenses (*)
Condultancy expense
Tax, duties and levies
Other
Total Operating Expenses
2013
2012
(28.067.702)
(216.691.685)
(2.237.258)
(1.920.198)
(13.594.870)
(262.511.713)
(25.604.285)
(188.158.156)
(1.781.298)
(2.983.451)
(8.418.103)
(226.945.293)
2013
(39.973.213)
(36.920.199)
(2.811.377)
(504.584)
(956.465)
(12.864.211)
(94.030.049)
2012
(41.774.853)
(38.900.006)
(3.637.499)
(318.985)
(1.212.395)
(10.451.533)
(96.295.271)
(369.938.347)
(332.140.622)
The operating expenses of the Group mainly comprise management support, information technology and administration expenses that are charged by Yıldız
Holding.
(*)
26. OPERATING INCOME/EXPENSES
The detail of operating income is as follow:
Foreign exchange gains
Financial income on credit sales
Rediscount income
Services income
Provision no longer required
Other income (*)
(*)
2013
75.578.871
38.056.154
3.150.950
2.073.227
1.852.487
14.144.386
134.856.075
2012
102.612.459
47.240.129
4.749.655
3.348.575
1.193.561
29.370.433
188.514.812
2013
(49.406.297)
(25.165.375)
(4.706.685)
(1.144.336)
(5.201.669)
(85.624.362)
2012
(81.428.469)
(35.974.952)
(3.222.652)
(6.345.676)
(10.487.158)
(137.458.907)
Other income consist of other miscellaneous expenses.
The detail of operating expense is as follow:
Foreign exchange losses
Financial expense from dated acquisition
Redicount expenses
Provision expenses
Other expenses (*)
(*)
Other expenses consist of other miscellaneous expenses.
115
27. INVESTMENT INCOME/EXPENSES
The detail of investment income is as follow:
Foreign exchange gains
Interest income
Gain on sales of tangible assets
Rent income
Dividend income
Other income
2013
168.508.740
37.794.133
15.933.425
7.373.538
434.426
222.088
230.266.350
2012
21.791.066
63.493.102
4.119.663
6.974.552
579.296
3.326.094
100.283.773
2013
(19.227.795)
(4.361.591)
(23.589.386)
2012
(78.134.986)
(61.104)
(105.505)
(78.301.595)
2013
52.271.455
52.271.455
2012
62.129.715
62.129.715
2013
2012
(291.086.539)
(1.349.214)
(292.435.753)
(53.910.050)
(10.832.938)
(64.742.988)
The detail of investment expenses is as follow:
Foreign exchange losses
Loss on sales of tangible assets
Loss on slaes of financial assets
28. FINANCIAL INCOME
Foreign exchange gain
29. FINANCIAL EXPENSES
Foreign exchange and interest losses from financing
Other
30. TAX ASSET AND LIABILITIES (INCLUDING DEFERRED TAX ASSET AND LIABILITIES
The Group accounts deferred tax assets and liabilities for temporary timing differences rooted from differences between legal
financial statements and financial statements prepared in accordance with TFRS. The differences in question are caused
generally by the fact that some profit and loss accounts come up in different periods in legal financial statements and financial
statements prepared in accordance with TFRS. These differences are specified below.
Turkish tax legislation does not permit a parent company and its subsidiary to file a consolidated tax return. Therefore, deferred
tax positions of the firms with deferred tax assets is netted against those with deferred tax liabilities and reflected on a separateentity basis.
The rate applied in the calculation of deferred tax assets and liabilities are %5,%10 and 20% (2012:%5, %,10 and 20%).
116
Deferred tax bases:
Deferred tax assets
2013
2012
Useful life and valuation differences on tangible and
intangible assets
Valuation differences of investment properties
Valuation differences of marketable securities
Profit margin elemination on inventories
Discount of trade receivables/payables (net)
Allowance of employee termination benefits
Provision of doubtful receivables
Previous year losses
Provision for legal case
Derivative financial liabilities
Other
(272.145)
(954.861)
(23.380.797)
(5.813.744)
(14.867.955)
(3.772.686)
(15.742.974)
(64.805.162)
(375.220)
(163.265)
(20.283.291)
(6.105.319)
(14.883.860)
(4.102.505)
(409.550)
(23.106.902)
(69.429.912)
Deferred tax liabilites
2013
2012
143.786.202
9.349.692
268.551.100
421.686.994
142.065.713
28.892.100
130.017.014
1.104.578
302.079.405
Deferred tax assets/liabilities:
Deferred tax assets
2013
2012
Useful life and valuation differences on tangible and
intangible assets
Valuation differences of investment properties
Valuation differences of marketable securities
Profit margin elemination on inventories
Discount of trade receivables/payables (net)
Allowance of employee termination benefits
Provision of doubtful receivables
Previous year losses
Provision for legal case
Other
Movement of Deferred Tax Liabilities:
Opening balance
Taxes netted from funds transfereed under equity
Deferred tax expense
Closing balance
(54.429)
(190.973)
(4.676.160)
(1.162.749)
(2.973.591)
(754.537)
(3.148.595)
(12.961.034)
(75.044)
(32.654)
(4.056.658)
(1.221.064)
(2.976.772)
(820.502)
(81.910)
(4.621.381)
(13.885.985)
Deferred tax liabilities
2013
2012
28.757.239
467.485
13.427.555
42.652.279
2013
22.693.528
7.072.045
(74.328)
29.691.245
28.413.142
1.444.605
6.500.851
220.915
36.579.513
2012
108.983
5.928.115
16.656.430
22.693.528
117
The Group calculated deferred tax assets of TL 14.867.955 for deductible financial losses in the consolidated financial
statements for the current year (2012: TL 14.883.860). The maturities of these losses are as follows:
2014
2015
2016
2017
2018
Toplam
2013
3.060.807
6.616.884
5.190.264
14.867.955
2012
1.224.677
4.084.417
4.740.990
4.833.776
14.883.860
Corporate Tax
The Company and its Turkish subsidiaries are subject to Turkish corporate taxes. Provision is made in the accompanying financial
statements for the estimated charge based on the Group’s results for the period.
Corporate tax is applied on taxable corporate income, which is calculated from the statutory accounting profit by adding
back non-deductible expenses, and by deducting dividends received from resident companies, other exempt income and
investment incentives utilized.
The effective tax rate in 31 December 2013 is 20% (2012: %20).
In Turkey, advance tax returns are filed on a quarterly basis. The advance corporate income tax rate is 20% in 2013
(2012: %20).
Losses are allowed to be carried five years maximum to be deducted from the taxable profit of the following years. However,
losses occurred cannot be deducted from the profit occurred in the prior years retroactively.
In Turkey, there is no procedure for a final and definitive agreement on tax assessments. Companies file their tax returns between
1st-25th of April following the close of the accounting year to which they relate. The companies with special accounting periods,
file their tax returns between 1st-25th of fourth month after fiscal year end. Tax authorities may, however, examine such returns
and the underlying accounting records and may revise assessments within five years.
Income withholding tax
In addition to corporate taxes, companies should also calculate income withholding taxes and funds surcharge on any dividends
distributed, except for companies receiving dividends who are Turkish residents and Turkish branches of foreign companies.
Income withholding tax applied in between 24 April 2003 – 22 July 2006 is 10% and commencing from 23 July 2006, this rate
has been changed to 15% upon the Council of Ministers’ Resolution No: 2006/10731. Undistributed dividends incorporated in
share capital are not subject to income withholding tax.
Since the Group did not assume any investment incentives, it has used 20% corporate tax rate.
Provision for taxation as of 31 December 2013 and 2012 is as follows:
Current year corporate tax provision
Prepaid tax and funds
Taxation in the balance sheet
2013
(51.860.071)
40.388.418
(11.471.653)
2012
(31.304.716)
29.741.757
(1.562.959)
118
2013
2012
51.860.071
(74.328)
51.785.743
31.304.716
16.656.430
47.961.146
2013
2012
279.116.304
%20
243.535.080
%20
55.823.261
48.707.016
652.721
(64.131)
(4.626.108)
-
4.099.390
(2.439.055)
(1.272.808)
(1.133.397)
51.785.743
47.961.146
Current year corporate tax provision
Deferred tax income/loss
Taxation in the income statement
The reconciliation of provision for taxation as of 31 December 2013 and 2012 are as follows:
Reconciliation of taxation:
Profit before taxation and non-controlling interest
Effective tax rate
Calculated tax
Ayrılan ile hesaplanan vergi karşılığının mutabakatı:
-Non-deductible expenses
-Dividend and other non-taxable income
-Other non-deductible gains/losses
-Consolidation adjustments
Taxation in the income statement
31. EARNINGS PER SHARE
A summary of the Group’s weighted average number of shares outstanding as of 31 December 2013 and 2012 and computation
of earnings per share set out here as follows:
Weighted average number of shares existing during the period
Net Profit
Earnings per share (TL 1 per value each)
2013
2012
34.200.000.000
188.648.445
0,55
34.200.000.000
166.968.003
0,49
2013
446.815.319
3.417.357
450.232.676
2012
433.197.344
131.398.216
564.595.560
32. BALANCES AND TRANSACTIONS WITH RELATED PARTIES
a) The detail of receivables from related parties is as follows:
Trade receivables
Non-trade receivables
Trade receivables from related parties are mainly composed of sales transactions and approximate maturity is 2 months. Nontrade receivables are loans given to related parties, and interest is received as monthly based on effective market interest rate.
The interest rate used in 31 December 2013 is 8% for TL, 4% for foreign currencies (2012: 8% for TL, 4% for foreign currencies).
119
The detail of trade and non-trade receivables from related parties is as follow:
2013
Trade
Principle Shareholders
Non-Trade
2012
Trade
Non-Trade
-
905.012
-
123.077.866
Other Companies Controlled by the Principle Shareholders
220.716.160
Horizon Hızlı Tük. Ür. Paz. Sat. ve Tic. A.Ş. (*)
Pasifik Tük. Ürün. Satış Ve Ticaret A.Ş.
131.726.060
Teközel Gıda T.Sağ. Mrk. Hiz. San. Tic. A.Ş.
39.587.999
Eksper Gıda Paz. San. ve Tic. A.Ş.
8.902.164
Hamle Company Ltd. (Kazakhistan)
5.875.462
Hero Gıda Sanayi ve Ticaret A.Ş.
4.065.122
KBF Limited
2.868.176
GF Lovell
179.940
Other
32.894.236
446.815.319
2.321.999
190.346
3.417.357
201.853.482
116.892.120
28.694.568
6.773.630
42.315.570
7.217.513
1.439.703
2.291.071
25.719.687
433.197.344
8.320.350
131.398.216
Atlas Gıda Pazarlama Sanayi ve Ticaret A.Ş. and Atlantik Gıda Paz. ve Tic. A.Ş. have discountinued their operations and handed over the marketing and trading
activities in the traditional channel at 1 March 2012 and 1 April 2012 respectively to Horizon Hızlı Tüketim Ürünleri Pazarlama Satış ve Tic. A.Ş. which is under parent
company Yıldız Holding A.Ş.
(*)
The Group’s trade receivables from related parties mainly arise from sales to Horizon Hızlı Tüketim Ürünleri Pazarlama Satış ve
Tic. A.Ş. and Pasifik Tük. Ürün. Satış ve Ticaret A.Ş. those make the sale and distribution of products throughout Turkey.
b)The detail of payables to related parties is as follow:
Payables to related parties are due to purchases and approximately matured in 2 months.
2013
273.321.957
86.857
273.408.814
Trade payables
Non-trade payables
2012
247.377.711
253.281
247.630.992
The detail of trade and non-trade payables is as follows:
2013
Trade
Non-Trade
2012
Trade
Non-Trade
9.796.437
-
3.933.850
-
Önem Gıda San. ve Tic. A.Ş.
166.622.151
Besler Gıda ve Kimya San. Tic. A.Ş.
51.189.561
Marsa Yağ San. ve Tic. A.Ş.
18.007.874
Ak Gıda San. ve Tic. A.Ş.
7.138.768
Northstar Innovation A.Ş.
4.645.202
PNS Pendik Nişasta San. A.Ş.
2.722.927
Other
13.199.037
273.321.957
86.857
86.857
157.649.340
59.013.476
848.768
4.590.798
2.481.546
2.636.117
16.223.816
247.377.711
253.281
253.281
Other than those described above, as of 31 December 2013 the Group has TL 3.469 financial leasing payable to Fon Finansal
Kiralama A.Ş (2012: 736.602 TL).
c)The detail of purchases from and sales to related parties is as follows:
2013
2012
Purchases
Sales
734.588.256
501.569
Besler Gıda ve Kimya San. ve Tic. A.Ş.
176.732.028
55.417.406
Ak Gıda San. ve Tic. A.Ş.
38.593.469
59.764
Pendik Nişasta San. A.Ş.
19.963.502
CCC Gıda San. ve Tic. A.Ş.
14.585.155
430.023
Örgen Gıda San. ve Tic. A.Ş.
6.243.090
330
Hero Gıda San. Tic. A.Ş.
35.330.569
Teközel Gıda Tem. Sağ. Mark. Hizm. A.Ş.
156.078.808
Pasifik Tüketim Ürünleri Satış ve Tic. A.Ş.
542.515.493
Eksper Gıda Paz. San. ve Tic. A.Ş.
30.644.680
Hüner Pazarlama San. ve Tic. A.Ş.
- 1.194.744.992
Horizon Hızlı Tük. Ür. Paz. Sat. ve Tic. A.Ş.(*)
Other
45.573.662
25.957.602
1.091.696.568 1.986.263.830
Purchases
Sales
590.132.596
4.705.144
213.683.840
41.810
2.461.218
33.821.619
53.873
14.282.743
9.291.125
6.975.058
146.426
27.380.290
3.466
127.460.679
450.332.586
22.768.146
19.648.258
66.053
914.157.476
66.508.514
16.583.383
937.372.658 1.583.131.645
Atlas Gıda Pazarlama Sanayi ve Ticaret A.Ş. and Atlantik Gıda Paz. ve Tic. A.Ş. transferred their marketing and trading activities in the traditional channel to Horizon
Hızlı Tüketim Ürünleri Pazarlama Satış ve Tic. A.Ş. within the structure of Yıldız Holding A.Ş. respectively, on March 1, 2012 and July 1, 2012.
(*)
The Group mainly acquires raw materials from Besler Gıda ve Kimya Sanayi ve Ticaret A.Ş, which produces vegetable oil and
margarine, Önem Gıda San. ve Tic. A.Ş, Pendik Nişasta San. A.Ş and Ak Gıda Sanayi ve Tic. A.Ş. The Group sells its products
mainly to two companies which conduct sales and distribution operations of the Group. These firms are Horizon Hızlı Tüketim
Ürünleri Pazarlama Satış ve Tic. A.Ş and Pasifik Tük. Ürün. Satış Ve Ticaret A.Ş..
The detail of income and expenses pertaining to interest, rent and services arising from transactions with related parties is as
follows:
For the twelve month period ended on 31 December 2013;
Other Companies
Hero Gıda Sanayi ve Tic.A.Ş.
Horizon Hızlı Tük. Ür. Paz. Sat. ve Tic.
A.Ş. (*)
Seher Gıda Paz. San. Tic. A.Ş.
İzsal Gayrimenkul Geliştirme A.Ş.
Natura Gıda San. ve Tic. A.Ş.
Other
Rent
Income
Rent
Expenses
120.722
(14.419)
1.800
576.878
(255)
52.722
(81.376)
870.852
(5.000)
(5.238)
3.730
100.788
355.246
- (932.266)
366.756
154.722
(4.022)
2.604.216 (1.042.576)
Service
Income
Service
Expenses
Interest
Income
Interest
Expenses
2.497.606 (102.991.122) 220.588.848 (2.629.638)
2.045.559
415.245
(365.814)
(9.143)
-
-
945.072
(540.342)
4.632.411
(111.887)
4.189
(613.967)
23.324
(1.615.407)
851
(1.594)
48.361 (12.435.899)
19.083
(16.328)
(378.852)
429.118
(419.417)
84.409
1.066.617
(5.170.217) 12.674.833
(114.044)
12.123.247 (124.056.022) 233.352.279 (3.357.649)
121
For the twelve month period ended on 31 December 2012;
Principle Shareholder
Other Companies
Hero Gıda Sanayi ve Tic.A.Ş.
Horizon Hızlı Tük. Ür. Paz. Sat. ve Tic. A.Ş.
SCA Yıldız Kağıt ve Kişisel Bakım Üretim A.Ş.
İzsal Gayrimenkul Geliştirme A.Ş.
Natura Gıda San. ve Tic. A.Ş.
Other
Rent
Income
Rent
Expenses
Service
Income
57.820
(5.066)
1.488.100
Service
Expenses
Interest
Income
Interest
Expenses
(85.737.633) 54.627.598 (29.529.269)
2.701.949
(316.558)
145.311
587.956
(85.293)
46.384
(838.779)
2.143.289
(4.629.612)
224.746
(5.962)
3.621.773
(220.942)
2.834.451 (4.656.538)
(4.475)
3.499.825
(1.300.221)
5.440.622
1.456
5.825
(4.578.707)
- (1.068.953)
(414.024)
350.712
348.287
(1.900.115)
224.700
(132.590)
4.031.026
(7.019.430)
2.808.782
(565.905)
1.405.840 (2.055.825) 23.906.430 (106.247.670) 60.270.831 (34.751.712)
Atlas Gıda Pazarlama Sanayi ve Ticaret A.Ş. and Atlantik Gıda Paz. ve Tic. A.Ş. transferred their marketing and trading activities in the traditional channel to Horizon
Hızlı Tüketim Ürünleri Pazarlama Satış ve Tic. A.Ş. within the structure of Yıldız Holding A.Ş. respectively, on March 1, 2012 and July 1, 2012.
(*)
Benefits provided to board members and key management personnel:
Short term benefits provided to key management personnels and board members
2013
16.541.995
16.541.995
2012
15.160.264
15.160.264
33. NATURE AND LEVEL OF RISKS DERIVED FROM FINANCIAL INSTRUMENTS
Additional Information on Financial Instruments
(a) Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximizing the
return to stakeholders through the optimization of the debt and equity balance.
The capital structure of the Group consists of debt, which includes the borrowings disclosed in Note 7, cash and cash equivalents
disclosed in Note 5 and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained
earnings as disclosed in Note 22.
The management of the Group considers the cost of capital and the risks associated with each class of capital. The management
of the Group aims to balance its overall capital structure through the payment of dividends, new share issues and the issue of new
debt or the redemption of existing debt.
The Group controls its capital with the liability/total capital ratio.Net liability is divided by total capital in this ratio. Cash and cash
equivalents are subtracted from total loans to calculate the net liability. The shareholder’s equity is added to net liabilities to
calculate the total capital.
Net liability/Total capital ratio as of 31 December 2013 and 2012 are as follows:
2013
1.259.584.390
(1.164.383.158)
95.201.232
1.129.829.508
1.225.030.740
%8
Total financial liabilities
Negative: Cash & cash equivalent
Net liabilities
Total capital
Net liabilities/Total shareholders’ equity
2012
1.500.952.673
(1.267.728.071)
233.224.602
957.451.288
1.190.675.890
%20
b) Financial Risk Factors
The risks of the Group, resulted from operations, include market risk (including currency risk, fair value interest rate risk and price
risk), credit risk, liquidity risk and cash flow interest rate risk. The Group’s risk management program generally seeks to minimize
the effects of uncertainty in financial market on financial performance of the Group.
Risk management is implemented by finance department according to the policies approved by Board of Directors. The Group’s
finance department provides services to the business, co-ordinates access to domestic and international financial markets,
monitors and manages the financial risks relating to the operations of the Group through internal risk reports which analyses
exposures by degree and magnitude of risks. The written procedures are formed by Board of Directors to manage the foreign
currency risk, interest risk, credit risk, use of derivative and non-derivative financial instruments and the assessment of excess
liquidity.
(b)-1 Credit Risk Management
Credit Risk of Financial Instruments
2013
Receivabels
Trade Receivables
Other Receivables
Related Party
Third Party
Related Party
Third Party
Deposit in Bank
446.815.319
201.954.749
3.417.357
-
108.951.703
-
446.815.319
201.454.052
3.417.357
B. Net book value of financial assets that are renegotiated, if
not that will be accepted as past due or impaired
-
-
-
-
-
C. Carrying value of financial assets that are past due but not
impaired
-The part under guarantee with collateral etc
-
451.438
451.438
-
-
-
-
49.259
6.271.394
(6.222.135)
49.259
-
-
-
-
-
-
-
-
Maximum net credit risk as of balance sheet date (*)
-The part of maximum risk under guarantee
with collateral etc (**)
A. Net book value of financial assets that are neither past due
nor impaired
D. Net book value of impaired assets
-Past due (gross carrying amount)
-Impairment (-)
-The part of net value under guarantee with collateral etc
-Not past due (gross carrying amount)
-Impairment (-)
-The part of net value under guarantee with collateral etc.
E. Off-balance sheet items with credit risk
(*)
Items that increase the credit reliability, such as; letter of guarantees received, are not taken into account in the calculation.
Guarantees include letter of guarantees, guarantee notes and mortgages.
(**)
17.022.031 1.163.802.077
-
-
17.022.031 1.163.802.077
123
Credit Risk of Financial Instruments
2012
Receivabels
Trade Receivables
Other Receivables
Related Party
Third Party
Related Party
Third Party
Deposit in Bank
433.197.344
163.955.235
131.398.216
-
118.117.379
-
433.197.344
162.779.868
131.398.216
B. Net book value of financial assets that are renegotiated, if
not that will be accepted as past due or impaired
-
-
-
-
-
C. Carrying value of financial assets that are past due but not
impaired
-The part under guarantee with collateral etc.
-
801.635
801.635
-
-
-
-
373.732
6.868.544
(6.494.812)
373.732
-
-
-
-
-
-
-
-
Maximum net credit risk as of balance sheet date (*)
-The part of maximum risk under guarantee
with collateral etc. (**)
A. Net book value of financial assets that are neither past due
nor impaired
D. Değer düşüklüğüne uğrayan varlıkların net defter değerleri
-Past due (gross carrying amount)
-Impairment (-)
-The part of net value under guarantee with collateral etc
-Not past due (gross carrying amount)
-Impairment (-)
-The part of net value under guarantee with collateral etc.
8.588.753 1.266.887.080
-
-
8.588.753 1.266.887.080
E. Off-balance sheet items with credit risk
(*)
Items that increase the credit reliability, such as; letter of guarantees received, are not taken into account in the calculation.
Guarantees include letter of guarantees, guarantee notes and mortgages.
(**)
Aging of the past due receivables are as follows:
2013
Past due 1-30 days
Past due 1-3 months
Past due 3-12 months
Past due 1-5 years
Past due more than 5 years
Total past due receivables
The part under guarantee with collateral
Trade Receivables
273.398
178.040
451.438
451.438
Receivables
Other Receivables
-
Total Receivables
273.398
178.040
451.438
451.438
2012
Past due 1-30 days
Past due 1-3 months
Past due 3-12 months
Past due 1-5 years
Past due more than 5 years
Total past due receivables
The part under guarantee with collateral
Trade Receivables
54.171
22.205
725.259
801.635
801.635
Receivables
Other Receivables
-
Total Receivables
54.171
22.205
725.259
801.635
801.635
Collaterals held for the trade receivables that are past due but not impaired as of balance sheet date are as follows:
Guarantees Received
Collaterals
2013
Fair Value
2012
Fair Value
451.438
451.438
750.000
51.635
801.635
Collaterals held for the trade receivables that are past due and impaired as of balance sheet date are as follows:
2013
Fair Value
49.259
Guarantees Received
2012
Fair Value
373.732
When one part of the financial instrument does not fulfill its obligations, that results in a financial loss risk to the Group and that
risk is defined as credit risk. Group’s credit risk is basically related to its trade receivables. The balance shown in the balance sheet
is the net amount that is obtained when doubtful receivables are written off according to the Group management’s previous
experiences and current economic conditions. Group’s non-trade receivables from related parties are mostly due to Yıldız
Holding.
(b)-2 Liquidity risk management
The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities by
continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. The
funding risk of the current and prospective debt demands is managed by maintaining the availability of lenders with high quality
and in sufficient number.
Liquidity risk charts
The following table presents the maturity of Group’s non-derivative financial liabilities. The table includes both interest and
principal cash flows.
Contractual maturity analysis
2013
Total cash outflow
according to
contract
Carrying value
(I +II+ III)
Less than 3
months (I)
3-12
months (II)
1-5 years
(III)
1.254.265.112 1.283.805.043 254.781.942 1.019.141.924
5.319.278
5.445.900
5.372.898
3.415
508.464.394
511.693.887 444.474.845
67.219.042
431.797
514.535
418.439
96.096
1.768.480.581 1.801.459.365 705.048.124 1.086.460.477
9.881.177
69.587
9.950.764
Non-derivative financial liabilities
Bank borrowing
Financial lease liabilities
Trade payables
Other payables
Total liabilities
125
The expected maturities are same as the maturities per contracts.
2012
Total cash outflow
according to
contract
Carrying value
(I +II+ III)
Less than 3
months (I)
3-12
months (II)
1-5 years
(III)
Non-derivative financial liabilities
Bank borrowing
Financial lease liabilities
Trade payables
Other payables
Total liabilities
1.488.617.403 1.536.111.361 218.195.652
12.335.270
12.874.103
2.687.781
471.149.552
475.681.523 403.695.468
5.058.495
6.059.478
1.060.252
1.977.160.720 2.030.726.465 625.639.153
415.343.489 902.572.220
5.803.540
4.382.782
71.986.055
4.999.226
498.132.310 906.955.002
The expected maturities are same as the maturities per contracts.
2013
Carrying value
Total cash
outflow
according to
contract
(I+II+III)
Less than 3
months (I)
3-12
months (II)
1-5 years
(III)
409.549
409.549
409.549
409.549
409.549
409.549
-
-
Total liabilities
(b)-3 Market risk management
The Group, is subject to financial risks related with the foreign exchange currency rates ((b)-3.1) and interest rates ((b)3.2).
Market risk management is also measured based on sensitivity analysis.
In the current year, the Group’s market risk management method or its market risk exposure have not changed when compared
to prior year.
(b)-3.1 Foreign currency risk management
Transactions in foreign currencies expose the Group to foreign currency risk.
This risk mainly arises from fluctuation of foreign currency used in conversion of foreign assets and liabilities into Turkish Lira.
Foreign currency risk arises as a result of trading transactions in the future and the difference between the assets and liabilities
recognized. In this regard, the Group manages this risk with a method of netting foreign currency denominated assets and
liabilities. The management reviews the foreign currency open position and provides measures when needed.
The Group is mainly exposed to foreign currency risk in USD, EUR, GBP, CHF and DKK.
The foreign currency denominated assets and liabilities of monetary and non-monetary items are as follows:
2013
TL Equivalents
(Fonksiyonel
para birimi)
USD
EUR
1. Trade Receivables
2a. Monetary Financial Assets
2b. Non-Monetary Financial Assets
3. Other
4. CURRENT ASSETS
7. Other
8. NON-CURRENT ASSETS
153.318.398
1.018.500.873
610.376
2.436.185
1.174.865.832
25.398
5.358.025
5.383.423
58.327.991
324.964.420
285.984
757.657
384.336.052
11.900
11.900
9. TOTAL ASSETS
1.180.249.255
10. Trade Payables
11. Financial Liabities
12a. Other Monetary Financial Liabilities
12b. Other Non-monetary Financial
Liabilities
13. CURRENT LIABILITIES
14. Trade Payables
15. Financial Liabilities
Liabilities
17. OTHER NON-CURRENT LIABILITIES
18. TOTAL LIABILITIES
19. Net foreign currency liability position
pozisyonu
20. Net foreign currency asset/liability
position of monetary items (1+2a+5+6a10-11-12a-14-15-16a)
(114.623.773)
CHF
GBP
DKK
9.328.182
110.617.650
277.050
120.222.882
1.814.527
1.814.527
- 409.170
6.289
23.450
6.289 432.620
8.448
8.448
8.167
14.147
22.314
-
384.347.952
122.037.409
6.289 441.068
22.314
30.731.446
1.245.362.925
522.895
12.063.339
367.526.290
-
1.652.674
156.973.119
171.939
6.543
7.530
33.020
-
-
7.574.597
1.284.191.863
9.851.176
-
3.187.260
382.776.889
-
261.131
159.058.863
3.354.734
-
14.073
-
1.485
34.505
-
-
9.851.176
-
3.354.734
-
-
-
1.294.043.039
382.776.889
162.413.597
14.073
34.505
-
(113.793.784)
1.571.063 (40.376.188) (7.784) 406.563
22.314
(114.623.773)
3.714.682 (42.206.634) (7.784) 399.600
8.167
127
2012
TL Equivalents
(Fonksiyonel
para birimi)
USD
3. Other
4. CURRENT ASSETS
7. Other
8. NON-CURRENT ASSETS
79.422.283
1.267.283.958
530.463
4.684.173
1.351.920.877
236.908
3.575.021
3.811.929
9. TOTAL ASSETS
10. Trade Payables
11. Financial Liabities
Liabilities
13. CURRENT LIABILITIES
14. Trade Payables
15. Financial Liabilities
Liabilities
17. OTHER NON-CURRENT LIABILITIES
18. TOTAL LIABILITIES
19. Net foreign currency liability position
pozisyonu
20. Net foreign currency asset/liability
position of monetary items (1+2a+5+6a10-11-12a-14-15-16a)
(174.133.921)
EUR
CHF
GBP
DKK
31.717.906
519.425.765
297.578
876.786
552.318.035
132.900
15.000
147.900
9.435.421
- 241.279
145.118.437 15.754
16.626
1.323.020
3.437
155.876.878 15.754 261.342
1.465.983
35.088
1.465.983
35.088
7.047
7.047
-
1.355.732.806
552.465.935
157.342.861 15.754 296.430
7.047
13.212.287
612.203.994
9.135.509
4.308.356
329.680.604
5.041.034
2.173.391 11.911
10.424.523
62.494 1.233
61.783
-
699.721
-
5.291.185
639.842.975
886.525.280
-
2.837.861
341.867.855
286.564.023
-
96.591
12.756.999 13.144
159.755.178
-
1.833
63.616
-
699.721
-
886.525.280
286.564.023
159.755.178
-
-
-
1.526.368.255
628.431.878
172.512.177 13.144
63.616
699.721
(170.635.452) (75.965.943) (15.169.316)
2.610 232.814 (692.674)
(174.133.921) (74.317.446) (17.861.728)
2.610 196.122 (692.674)
The Group’s import and export totals for the twelve month periods are presented below:
2013
2012
Total exports
557.937.303
461.642.086
Total imports
72.422.195
40.111.885
Foreign currency sensitivity
The Group is exposed to foreign exchange risk arising primarily from USD and EUR.In the table below, the foreign currency
sensitivity of the Company arising from 10% change in US dollar and EUR rates. 10% is the rate used when reporting to senior
management of the Company. This rate is the anticipated rate change of the Company’s senior management. Sensitivity analysis
includes only the monetary items in foreign currency at year end and shows the effect of 10% increase in USD and in EUR foreign
currency rates. Negative value implies the effect of 10% increase in USD and in EUR foreign currency rates against TL on the
decrease in the net profit.
1-US Dollar net asset/liabilities
2-Part of hedged from US Dollar risk (-)
3-US Dollar net effect (1 +2)
4-Euro net asset/liability
5 – Part of hedged from Euro risk (-)
6-Euro net effect (4+5)
Total(3 + 6)
2013
2012
Income/Expense
Income/Expense
Appreciation of Depreciation of Appreciation of Depreciation of
foreign currency foreign currency foreign currency foreign currency
If US Dollar appreciated against TL by 10%
792.825
(792.825) (13.247.828)
13.247.828
792.825
(792.825)
(13.247.828)
13.247.828
If Euro appreciated against TL by 10%
(12.393.978)
12.393.978
(4.200.543)
4.200.543
(12.393.978)
12.393.978
(4.200.543)
4.200.543
(11.601.153)
11.601.153
(17.448.371)
17.448.371
(b)-3.2 Interest risk management
Financial liabilities based on fixed and floating interest rates expose the Company to interest rate risk. The related risk is
controlled by interest rate swap agreements and floating interest rate agreements by balancing the fixed and floating interest rate
borrowings. Risk strategies are reviewed periodically considering the interest rate expectations and predetermined interest risks;
which aims to establish optimum interest risk management regarding the balance sheet position and the interest expenses.
Interest rate sensitivity
Sensitivity analysis is determined based on the interest rate risk that the non-derivative instruments exposed to on the balance
sheet date and is kept fixed during the reporting period. The Company management expects a fluctuation of 1% in Euribor
interest rates. 1% increase or decrease is used in reporting the interest rate risk to the key management personnel and represents
management’s assessment of the reasonably possible change in interest rates.
On the reporting date if Euribor/Libor interest rates had been 1% higher/lower and all other variables were held constant:
Net income of the Group would have been decreased by TL 8.143.945 (Net profit in 2012 would have been decreased by TL
8.055.402). This is mainly attributable to the Group’s exposure to interest rates on its variable rate borrowings. In case of 1%
decrease in Euribor interest rate, the net profit of the company for the current period would have increased with the same rate.
129
The financial instruments that are sensitive to interest rate are as follows:
Interest Position Table
Fixed interest rate financial instruments
2013
2012
Financial Assets
Cash and Cash Equivalents
Other Receivables
1.154.745.091
17.022.031
1.252.969.855
8.588.753
Borrowings
Other Payables
436.516.669
5.319.278
344.940
551.932.260
12.335.270
4.805.214
3.417.357
131.398.216
817.748.443
86.857
936.685.143
253.281
Floating interest rate financial instruments
Financial Assets
Non-trade receivables from related parties
Borrowings
Non-trade payables to related parties
(b)-3.3 Price risk
The Group is exposed to price risk due to the fluctuations in exchange rate and interest rate. The investigation on market
information is examined and followed through appropriate valuation method regarding price risk by the Group. In current year,
there have not been any changes compared to prior year in the market risk that the Group is exposed to or the administration or
calculation methods of these risks.
(b)-3.4 Equity investments price sensitivity
The sensitivity analysis presented below has been prepared based on the equity investments price risks exposed.
As of reporting date, assuming that all other variables are held constant and when the values used in the valuation method
increase/decrease by 10%:
As of 31 December 2013, as long as the equity investment are classified as available for sale and not disposed of or they are not
impaired the net profit/loss will not be affected.
The other funds in the shareholders’ equity will increase/decrease by TL 2.582.595 (2011: increase/decrease of TL
2.613.567). This situation is the result of the changes in the fair value of available for sale securities.
(*)
163.955.235
564.595.560
-
1.267.728.071
-
-
Borrowings and
receivables
Financial assets at
amortized cost
-
-
201.954.749
450.232.676
-
1.164.383.158
-
-
Borrowings and
receivables
Financial assets at
amortized cost
The management of Groups considers that the carrying values of the financial assets reflect their fair values.
Financial liabilities
Trade payables
Payable to related parties
2012
Financial Assets
Trade receivables
Due from related parties
Financial investments
Trade payables
Payable to related parties
2013
Financial Assets
Trade receivables
Due from related parties
Financial investments
Categories and fair values of financial instruments
34. FINANCIAL INSTRUMENTS
-
329.307.924
Available for sale
financial assets
-
465.272.715
Available for sale
financial assets
1.500.952.673
223.771.841
247.630.992
409.549
-
Financial liabilities at
amortized cost
1.259.584.390
235.142.437
273.408.814
-
Financial liabilities at
amortized cost
1.500.952.673
223.771.841
247.630.992
409.549
1.267.728.071
163.955.235
564.595.560
329.307.924
Carrying value
1.259.584.390
235.142.437
273.408.814
1.164.383.158
201.954.749
450.232.676
465.272.715
Carrying value
7
9
32
8
5
9
32
6
Notes
7
9
32
5
9
32
6
Notes
131
Derivative Financial Instruments
The Group entered into interest rate swap agreement to control part of its borrowings by replacing floating interest rate with fixed
interest rate swaps. Floating interest rate of the loan is hedged by the result of the change in six month Libor interest. The notional
value of the swap contract is USD 93.000.000. As of December 31, 2013, the Group has not got any swap contract related to
interest rate. (2012:TL 409.549).
Fair value of financial instruments
The fair values of financial assets and financial liabilities are determined as follows:
• First level: The fair value of financial assets and financial liabilities are determined with reference to actively traded market
prices.
• Second level: Other than market prices specified at first level, the fair value of financial assets and financial liabilities are
evaluated with reference to inputs that used to determine directly or indirectly observable price in market.
• Third level: The fair value of financial assets and financial liabilities are evaluated with reference to inputs that used to determine
fair value but not relying on observable data in the market.
Level classifications of financial assets at fair value are as follows:
Level of fair value
as of reporting date
Level 2
TL
2013
Level 1
TL
611.476
-
611.476
-
-
-
Fair value difference through comprehensive income
statement
-Shares
464.418.845
25.825.951
-
438.592.894
Total
465.030.321
26.437.427
-
438.592.894
Financial assets
Fair value difference through
profit and loss
-Held for trading
Level 3
TL
Level of fair value
as of reporting date
Level 2
TL
2012
Level 1
TL
2.963.016
531.435
2.431.581
-
Fair value difference through comprehensive income
statement
-Shares
325.965.176
26.140.536
-
299.824.640
Total
328.928.192
26.671.971
2.431.581
299.824.640
(409.549)
(409.549)
-
(409.549)
(409.549)
-
Financial assets
Fair value difference through profit and loss
-Held for trading
Level 3
TL
Year beginning and year and reconciliations of financial assets and liabilities valued at 3rd level are below:
Opening balance
Total gain/loss
-Classified under the comprehensive income
Closin balance
35. EVENTS AFTER THE BALANCE SHEET DATE
None.
2013
2012
299.824.640
255.906.906
138.768.254
438.592.894
43.917.734
299.824.640
Davutpaşa Cad. No: 10 Topkapı - Istanbul - TURKEY
Tel: +90 212 567 68 00 Fax: +90 212 613 90 90
www.ulker.com.tr www.ulkerbiskuvi.com.tr

2013 Annual Report - Ülker Investor Relations

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