Yukarı
KOÇ HOLDİNG ANNUAL REPORT 2014
  • Koç Holding: Turkey’s leading investment holding company
    Koç Holding is Turkey’s leading investment holding company and Koç Group is Turkey’s largest industrial and services group in terms of revenues, exports, taxes paid, share in Borsa İstanbul’s market capitalization and employment generation.
  • Leader and global player
    Koç Group focuses on sustainable and profitable growth with consistent leadership positions in Turkey as well as in the region with the aim of becoming an important player worldwide.
  • Creating value for its stakeholders for 89 years
    Becoming ever stronger over the past 89 years despite economic volatility in Turkey, Koç Jolding’s main objective is to create value for its stakeholders.
“The customer is the focus of everything we do.

To be “the best” is our ultimate goal.

Our most important asset is our people.

Creation of wealth for continuous development is our key objective.

Honesty, integrity and superior business ethics are the foundations of our behavior.”

Vehbi Koç
Founder
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to read
Honorary Chairman’s
Message.
“Koç Holding utilizes its years of experience and its organizational tradition to meticulously analyze the present. It evaluates current data in light of historical experiences and it strives to make the best decisions by drawing on lessons from the past.”
Rahmi M. Koç
Honorary Chairman
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to read
Chairman’s Statement.
“Our goal is to carry Koç Group ever forward by capitalizing on it's existing strengths, accurately reading the spirit of the time and turning change into opportunity.”
Mustafa V. Koç
Chairman
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to read
CEO’s Letter.
“Our strong growth has reinforced our leadership at home and abroad.

Maintaining our pioneering role with investments in technology and innovation is one of Koç Group's most important priorities.”
Osman Turgay Durak
CEO

Our Strategy

Be active in those sectors where we create differentiation and have a competitive advantage

EXECUTION POWER

We combine our strong management philosophy with international partnerships and our superior competitive advantages with long-term strategies.
Minimize sector and geographic risks through a diversified portfolio structure

RISK MANAGEMENT

Our robust balance sheet and diversified portfolio structure minimize sectoral and geographical risks. We are focused on efficiency and sustainable profitability.
Make the most of our brand strengths and technological competence

SUSTAINABLE GROWTH

With the highest R&D spending in Turkey, we combine innovation with an extensive product range and enhance our competitiveness by offering our customers outstanding service quality.
Derive maximum benefits from economies of scale by being the market leader or a close second in every business we operate

LEADERSHIP

We are leaders in sectors with high growth potential and low penetration levels with the strong brands we have created.
Click here to download Energy section.
  • We work diligently to meet the energy demand of our nation, undertaking major investment projects and contributing to the national economy…

    US$

    3 BILLION

    Residuum Upgrade Project Investment
    US$

    1 BILLION

    Annual contribution to decreasing the current account deficit
  • Extensive investments that pave the way for the future

    Enhancing the country’s production power

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  • The unrivaled leader in customer satisfaction for 9 consecutive years

    Fastest growing company in the fuel oil distribution sector

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  • A brand closed identified with the LPG product

    A Company that creates awareness with an environmentalist approach, investments and social responsibility projects in the least embraced areas

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  • ENTEK

    Koç Group’s power generation company, Entek, currently has a total installed capacity of 364 MW. This includes two natural gas combined cycle plants with a total capacity of 300 MW (in Kocaeli and Bursa), one 2 MW gas motor-based cogeneration facility (Istanbul Koç University) and three hydroelectric power plants with a total capacity of 62 MW (two in Karaman and one in Samsun).

    With the addition of 5,500 MW generation capacity in 2014, Turkey’s total installed capacity grew to 69,516 MW, of which 38,191 MW is owned and operated by the private sector.

    As of year-end 2014, Entek has a 1.1% share in total installed capacity and 0.95% in total electricity generation of the private sector. As of year-end 2014, consolidated revenue stood at TL 395 million.

    Total installed capacity of 364 MW

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  • DEMİR EXPORT

    Demir Export is one of the largest and most well established mining companies in Turkey. The Company mines and sells coal, iron ore, copper and chromite concentrates from 13 mining operations in various parts of Turkey as of 2014.

    In 2014, the equipment necessary for the Eynez East Underground Coal Project in Soma, Manisa was transported on site and preparation on the first longwall production panel was completed. Some 40,000 tons of coal extracted in the construction phase was sold. Demir Export, in line with its slogan “our most important underground asset is our workforce,” is about to complete this fully mechanized coal mine investment, the first of its kind in Turkey, with the highest standards of work safety.

    The Environmental Impact Assessment (EIA) report of the Bakırtepe Gold Mine Project, which was previously recalled, was revised and a favorable EIA report was obtained in December 2014. In line with corporate social responsibility principles, the scope of the technical analysis was enhanced in due consideration of their social impact within the scope of the new EIA report. The investment in the mine is targeted to be completed and the first gold extracted in 2015.

    One of Turkey’s largest and most well established mining companies

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Click here to download Automotive section.
  • We have pioneered the creation of the Turkish automotive market and its export drive towards global markets, thus representing the nation In the world arena with our exellence in production and R&D…

    23%

    Market share of Koç Holding Automotive Companies, which are industry leaders
    TL

    3.5 BILLION

    Investments of Koç Holding Automotive Companies
  • Turkey’s trade powerhouse

    Turkey’s youngest commercial vehicle range

    Turkey’s automotive company with the largest production capacity

    Export champion of the Turkish automotive sector

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  • Major investments in the Turkish automotive sector

    Light commercial vehicle market leader in Turkey

    Producer of Doblo, Turkey’s bestselling light commercial vehicle/p>

    The only Turkish company to produce both passenger cars and light commercial vehicles

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  • First and only award-winning R&D center in the tractor sector

    Technology leader of the agricultural sector for 60 years

    Oldest manufacturing company in the Turkish automotive sector

    Record production with 46 thousand tractors

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  • Turkey’s first electrical bus manufacturer

    Prime contractor to develop Turkey’s main battle tank

    Top brand in the 25-plus passenger bus segment for 5 consecutive years

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  • OTOKOÇ OTOMOTİV

    Otokoç Otomotiv operates under the Otokoç, Birmot, Avis, Budget and Otokoç Sigorta (Insurance) brands at 169 locations. The Company provides sales and after-sales services for Ford, Ford Trucks and Volvo under the Otokoç brand and for Fiat, Alfa Romeo, Lancia and Jeep under the Birmot brand.

    Otokoç Otomotiv accounted for 32% of Ford retail sales in Turkey in 2014, 32% of Fiat, 42% of Alfa Romeo, Lancia and Jeep, and 47% of Volvo. The Company has an 8% share in the overall market, with 62 thousand vehicle sales. As for second-hand vehicle sales, the Company became the market leader among corporate brands with a sales figure of 20 thousand units. In short-term car rentals, Avis increased its turnover by 24% and Budget by 36%. In operational leasing, the Company’s turnover grew by a remarkable 28% and its fleet reached 20,764 cars. In the car rental business, the Company started to operate in Kazakhstan as the third international investment, after Azerbaijan and Northern Iraq.

    Otokoç’s Ford Trucks Plaza investment in İstanbul Sultanbeyli opened in the final quarter of the year. The dual dealership in Kütahya was completed for Ford and Fiat brand vehicles. Otokoç Ankara moved to its new facilities. The dual dealership in İstinye, which sells Ford, Fiat and Volvo brand vehicles, reached the premium dealership standards. Additionally, the showroom and service sections of Otokoç Tarsus were doubled in area. The number of Avis offices has reached 86 and that of Budget has risen to 47.

    Long-established history that has added value to the Turkish automotive sector since 1928

    Market leader for 40 years with Turkey’s first car rental company AVIS

    Only company to provide car rental services ranging from 1 hour to 47 months

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Click here to download Consumer Durables section.
  • The company that has introduced many firsts in consumer durables to the Turkish people. The company that proudly owns the fastest growing brands in global markets thanks to its innovative products...

    BEKO

    Fastest growing white goods brand in the European market for the last 7 years
    US$

    4 BILLION

    Total sales of white goods
  • The World is the Target Market; Arçelik is a Global Player

    Arçelik sharpens its competitive edge with a brand-driven growth strategy

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  • Strong technological infrastructure with an innovative approach

    Broad service network

    Leader in domestic market with more than 50% share

    Established in 2000 with a production capacity of 300 thousand units, Arçelik-LG today boasts a capacity of 1.5 million units and 791 personnel. Indirectly, the Company creates employment for around 1,000 individuals in the supply industry.

    Arçelik-LG is the largest air-conditioner manufacturer in the Middle and Near East, and Europe. Its innovative approach, strong technological infrastructure and extensive distribution and service network help the Company to maintain leadership in the domestic market with a share of over 50%. The Company currently exports half of its production to over 50 countries, mainly in Europe, the Middle East, Africa and the CIS.

    In 2014, at the 3rd R&D Centers Summit organized by the Ministry of Science, Industry and Technology, the Company’s R&D Center received the top prize in air-conditioning.

Click here to download Banking and Insurance section.
  • We work day and night to provide the best products and services to our customers and expand our service network in the finance sector…

    TL

    195 BILLION

    Yapı Kredi consolidated asset size

    20.8%

    Market share in credit cards*, sector leader
  • Yapı Kredi’s 70th anniversary was marked by the start of the Bank’s growth strategy aimed at strenghtening its market position and achieving long-term sustainable profitability.

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  • Yapi Kredi's Subsidiaries

    Yapı Kredi has many financial subsidiaries, each a leader in its respective sector, which support the Bank’s performance. Yapı Kredi Leasing, the leader in financial leasing transaction volume, held an 18.3% market share. Yapı Kredi Factoring, having led in factoring receivables league, had a market share of 16.9% in 2014. Yapı Kredi Portföy Yönetimi (Asset Management) ranked 2nd in investment funds with an 18.0% market share. Yapı Kredi Yatırım was the 2nd largest securities house in Turkey with a 7.4% market share in equity transaction volume.

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  • KOÇ FİNANSMAN

    Koç Finansman is Turkey’s first consumer finance company. It provides loans for the purchase of all kinds of goods and services. It operates mainly in the automotive sector, but also in the service sector and the housing loan market and it provides insurance brokerage services. In 2013, Koç Finansman extended loans totaling TL 1,427 million and its loan portfolio grew to TL 1,731 million.

    Koç Finansman’s legal infrastructure was laid through Financial Leasing, Factoring and Financing Companies Law No. 6361 passed on 13 December 2012.

    The Company’s credit rating efforts resulted in a 2013 rating of (National) short-term (TR) A1 and long-term (TR) A.

    Basing its strategies on the theme “Build the Future,” Koç Finansman is progressively expanding its range of products and business areas. It aims to diversify its lending areas and to improve its service quality in all areas in need of financing.

    Click here for details.

Click here to download Other Lines of Business section.
  • We offer innovative products and rapidly increase the number of service points that touch consumer’s lives, with utmost concern for customer satisfaction…

    73%

    Tat Gıda’s revenue share in tomato products

    5,255

    Berth capacity of Setur Marina, leading Turkey’s marina sector
  • Fresh, modern and healthy initiatives

    Leading brands and new products

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  • DÜZEY

    Founded in 1975, Düzey increased sales revenues 16% in 2014.

    Düzey has made improvements to the distribution system it launched in 2003 and is arguably the most efficient means of marketing and distributing. Düzey distributes the Koç Group brands Tat, SEK and Pastavilla, as well as Landlite energy-saving light bulbs, Ekin Bakliyat grain, Rest cleaning supplies, Prenses sugar, Şölen Tea and Sony batteries. The Company has established its own sales teams in large urban areas with high growth potential.

    In 2011, Düzey expanded its domestic distribution portfolio to include the Nutella and Kinder brands. In parallel to the new brands it is authorized to distribute, Düzey has developed its logistics and technological infrastructure.

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    39-year deep-rooted history

    16% growth in 2014

  • SETUR

    Setur, with its services and products, leads the tourism sector since 1973.

    Duty-free shops

    Setur’s duty free operations continue in 23 centers (7 airports,

    6 land border gates, 9 seaports and 1 diplomatic store) with 619 personnel.

    Istanbul Sabiha Gökçen Airport store, with approximately

    3,500 square meters of selling space, is the biggest store of Setur. The “exclusive” Setur store at Atatürk Airport, with its new concept Burberry store and MontBlanc eyewear and watch store, began to provide services at two different points in 2014.

    Moreover, Setur added Ayvalık Port and Gaziantep Airport stores to its existing store portfolio in 2014.

    Accessible tourism for everyone

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  • SETUR MARİNALARI

    Setur Marinas provides world-class restaurant, market, shopping and technical maintenance services to yachters at its ten marinas in Kalamış and Fenerbahçe, Yalova, Ayvalık, Çeşme, Kuşadası, Marmaris, Finike, Kaş, Antalya and Mytilene. Setur Marinas has 5,512 berths, of which 5,255 are in Turkey and 257 are abroad. It leads the Turkish marina sector with a 24% market share and it had a 100% occupancy rate in 2014.

    10 marinas

    World-class service

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  • DİVAN

    The Divan Group operates 18 hotels, 1 residence, 19 patisseries, 42 bakeries, 13 restaurants, 2 stadium concessions and 3 catering units. The Group creates synergy and implements its growth strategy by gathering hotel management, production, banquet organization and cafe-restaurant management under one roof.

    In the domestic market where international hotel chains operate with many sub-brands, the Group has created sub-brands under the “Divan” name such as Divan Suites, Divan Express, Divan Residence and Managed by Divan.

    The 65-room Divan Suites Batumi opened in May 2014, the 108-room Divan Suites Gaziantep in August 2014, and the 140-room Divan Suites Güneşli in September 2014. Divan Express Eskişehir, with 110 rooms, started operations in November 2014. The Divan Residence Gaziantep hotel opened its doors in February 2014, followed by the Divan Residence Güneşli G-Plus in September 2014.

    DİVAN: “The Best Moments, The Best Taste”

    DİVAN: “A Gourmet Journey”

    DİVAN: “A Brand Personalized for You”

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  • KOÇTAŞ

    Koçtaş leads Turkey’s DIY (Do It Yourself) market, with 43 stores and a total sales area of 234,000 m2 serving more than 11 million customers. Meanwhile, the number of Koçtaş Fix stores increased to six. The Fix format aims at greater proximity to customers to meet their simpler, on the spot repair and maintenance needs.

    While Koçtaş brand awareness among Turkish consumers was 100%, it achieved the highest customer loyalty in the sector, rising 5.4 points above the sector average on the customer satisfaction index.

    Launched 3 new stores in 2014

    Served more than 11 million customers

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  • RMK MARİNE

    Joining Koç Group in 1997, RMK Marine realizes construction projects for tankers, off-shore vessels, tugboats, military ships and superyachts in Tuzla. RMK Marine is the only Turkish private sector shipyard to hold AQAP 2110 NATO Quality Management System certification, confirming that it meets “NATO Quality Assurance Requirements for Design, Development and Production”.

    Largest warship project

    RMK Marine has completed the construction of the largest warship project awarded to the private sector in Turkey. The last of four search and rescue ships built for the Coast Guard Command was delivered in 2014.

    All the vessels have been on mission and have proven their capabilities in the open seas. The final acceptance of three ships, whose warranties expired, was completed in 2014; the fourth is scheduled for April 30, 2015.

    The pioneering, leading private shipyard that provides integrated solutions for project management and systems engineering

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  • KOÇSİSTEM

    Entering 70th year in the Turkish IT sector, KoçSistem has strengthened its market position by posting growth of 17% in 2014.

    According to IDC’s 2014 report, Maximus, the Company’s corporate cloud IT services brand, remained the leader of the Turkish corporate cloud market with a share of 22.9%.

    Entering our 70th year in the IT sector

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  • BİLKOM

    Bilkom has been distributing leading global IT brands for 30 years. It has been prominent in the sector for an added-value service approach and continues to raise the bar as Turkey’s digital life coach.

    Bilkom markets and sells all trendsetting brands - such as Apple, Adobe and Graphisoft - throughout Turkey under an added-value distributorship strategy. In 2014, Bilkom grew over 120%, bringing its sales volume to above TL 760 million. The Company continues to fortify its strong position in the sector with a competitive workforce and operational efficiency.

    Leading global IT brand distributor for 30 years

    More than 120% growth in 2014

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  • RAM DIŞ TİCARET

    From its establishment, Ram Dış Ticaret has conducted its commercial activities in Turkey and in neighboring countries with a direct focus on customer satisfaction and being a reliable business partner.

    In 2014, Ram continued the central procurement process for the flat steel products required by the Group companies, from Erdemir and Borçelik. Approximately 320,000 tons of supplies were acquired with considerable advantages for the Group.

    Reliable business partner in Turkey and neighboring countries

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  • ZER

    For 11 years, by capitalizing on the synergy of collective procurement as well as its expertise and vast supplier network, Zer has created value for customers in marketing, services, supplies and logistics and has enabled Koç Group companies to focus on their core businesses. By creating economies of scale, the Company offers competitive and cost advantages, and also functions as a center of expertise with a specialized procurement staff.

    Zer also assumes the management of suppliers, optimizing the quantity of suppliers and ensuring to standardize the quality of services and products to be procured. Its sustainability approach and contract management skills turn it into a value-adding business partner for clients and suppliers.

    Value-adding business partner for clients and suppliers with its sustainability approach and contract management skills

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