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CEO Message

In 2016, not only our country, but the entire world, felt the adverse impact of unforeseen events. The conflicts in the Middle East, especially in Syria and Iraq, as well as massive migration movements also continued in 2016. This war in the Middle East expanded to western countries as acts of “terrorism”; acts of terrorism took place in our country, as well. Above all, and taking its place as a significant tragedy in our political history, was the attempted coup. Our country experienced great suffering from this coup attempt – thwarted, thankfully, through the united efforts of our nation.

It was inevitable that adverse events in the world and in Turkey would reverberate in the economy.

The global economy faced low trade volume and growth rates. Likewise, Turkey also faced uncertainties due to global events, as well as internal threats at home. However, I believe that our country’s economy proved resistant against these challenges, which not many countries would be capable of withstanding, and we have overcome the most difficult hurdles so far. Particularly with regard to the July 15 coup attempt, the markets were under great pressure. The worst periods were in July and August; but through September, we saw the markets begin to recover. Unfortunately, this was followed by a rise in foreign exchange rates due to external issues, and markets were affected once again.

On a positive note, these uncertainties and crises were not reflected in the business results of Ülker Bisküvi. At the end of the year, the goals we set for growth and profitability fell only slightly short of our objectives. Consolidated sales of our company were realized as TL 3.9 billion whereas profit from consolidated participations was TL 230 million. We achieved new investment of TL 258 million in line with our strategies to improve our business during this period.

We reached a relatively favorable outcome through careful management of our business in 2016, throughout the year’s many challenges. We continued to bring our operating expenses under control, and to keep our production at optimum levels, as we have always done. We followed an effective pricing strategy, with timely price increases and transitions; and, as a result, we were successful in protecting and increasing our profitability. While our sales volume did not show a growth in total, sales of our more profitable branded products continued in both domestic and international operations, and we sustained our gain from the market share. A momentous change for Ülker Bisküvi in 2016 was coming under the roof of the global pladis company, which we founded. Ülker Bisküvi, Ülker, and its sub-brands, played significant roles in Turkey, the Middle East and Central Asia regions. Ülker Bisküvi was the milestone of our strategy towards the pladis TR & MENA & CA Region: 33% of the net sales of pladis are from England and Ireland, and 31% and 9% of its net sales are from Turkey and the Middle East, respectively. These numbers clearly demonstrate the role of Ülker Bisküvi in pladis. By bringing two Yıldız Holding factories, in Egypt and in Saudi Arabia, under Ülker, we have strengthened our position in the region. We will continue this strategy in 2017: we recently announced that discussions have begun on bringing two more companies, in Saudi Arabia and in Kazakhstan, under the umbrella of Ülker Bisküvi. Ülker Bisküvi both contributes to, and benefits from, our ongoing synergy under pladis. We have started producing some of our most popular products abroad, such as McVitie’s Digestives and Krispi, in Turkey, and presented them to our Turkish consumers. And we have brought products cherished by consumers in Turkey into new markets. We will continue to work towards making our factories in Turkey a production base that provides products to global markets.

We are ready for changes that we foresee for 2017. We are prepared for any projected risks, and we have strong reflexes for those that may appear unexpectedly.

With our business partners, consumers, customers and employees, we are confident that we will see happy results for Ülker Bisküvi in the new activity period.

Regards,
Mehmet TÜTÜNCÜ
CEO