Group 1 - Odine collaborates with Mavenir to enhance Turkcell's telecom infrastructure through advanced cloud-based automation, utilizing the Odine Orion platform [1][2] - The project aims to transform telco voice infrastructure by providing an integrated, automated provisioning and routing application that integrates with CRM systems [2][3] - Legacy interconnect systems have been fully virtualized, replaced by the Orion platform, introducing new functionalities such as routing, billing, and fraud detection [3] Group 2 - Turkcell emphasizes its commitment to innovative technologies and local partnerships to enhance network capabilities and service experiences [4] - Odine's CEO highlights the importance of automation and cloud-based solutions for operational efficiency and business growth [4] - Odine is dedicated to developing next-generation technologies, including software-defined networks and AI-powered orchestration, to support sustainable network transformation [6][7]

Financial Data and Key Metrics Changes - For the full year 2024, the company's top line reached TRY 166 billion, reflecting a year-on-year increase of 7.8% [5][30] - EBITDA for 2024 was TRY 70 billion, a 10.2% increase from the previous year, with an EBITDA margin of approximately 42% [5][33] - Net income increased by 30%, exceeding TRY 23.5 billion [7] Business Line Data and Key Metrics Changes - The mobile segment saw a record-breaking 1.9 million net postpaid additions, the highest in 15 years, while the prepaid segment experienced a net loss of 0.9 million subscribers [6][8] - Fixed broadband market maintained rational pricing, with 32,000 net additions in Q4, bringing the total for the year to 168,000 [11] - Digital business services generated TRY 4.4 billion in revenue in Q4, with recurring service revenues rising 19% year-on-year [13] Market Data and Key Metrics Changes - The share of packages of 100 megabits per second and above in the residential fiber portfolio rose by 12 percentage points year-on-year [12] - The churn rate in the mobile segment increased to 2.8%, attributed to aggressive competitor campaigns and the disconnection of inactive subscribers [9][122] Company Strategy and Development Direction - The company is committed to advancing its infrastructure and technology, focusing on 5G and expanding its fiber network [24][28] - Plans to build two new data center modules in 2025, increasing capacity by 8.4 megawatts [16] - The Techfin segment, including Paycell and Financell, is expected to contribute significantly to top-line growth, with Paycell achieving 33% growth in Q4 [18][31] Management's Comments on Operating Environment and Future Outlook - Management expects top-line revenue growth of 7% to 9% for 2025, with a focus on maintaining profitability despite inflationary pressures [29][75] - The company is prepared for potential challenges from increased competition and inflation, emphasizing a diversified revenue model [105][107] - Management highlighted the importance of maintaining a strong cash position and effective balance sheet management [38][97] Other Important Information - The company issued a $1 billion euro bond, with half designated as a sustainable bond, reflecting its commitment to ESG initiatives [20][40] - The cash position at the end of 2024 was TRY 70 billion, with a net debt position of TRY 10 billion [38] Q&A Session Summary Question: What is the timeline for 5G deployment and potential license fees? - Management indicated that there is no official timeline yet, but a tender is expected in 2025, with a live network in 2026 [52][54] Question: What are the growth prospects for the company? - Management expects continued growth, with a focus on mobile and fixed services, and anticipates a similar growth rate in 2025 compared to 2024 [71][75] Question: How will the company manage EBITDA margins amidst inflation? - The company plans to maintain margins through effective cost management and a diversified revenue model [102][105] Question: What is the expected inflation rate for 2025? - The company estimates an average inflation rate of around 33% for 2025 [96][125] Question: What are the plans for dividend distribution? - The company maintains a policy of distributing 50% of net income, with the AGM expected to decide on the exact amount [126] Question: How will the company handle salary hikes in 2025? - Management indicated that salary increases are typically annual, with adjustments made based on inflation and competitive pressures [130][141]

Q4 & FY 2024 | February 27, 2025 BUSINESS OVERVIEW Ali Taha Koç, PhD | Turkcell CEO Turkcell Group: 2024 Highlights We Delivered What We Promised VCC REVENUE EBITDA Margin NET INCOME 166.7 69.8 41.9% 23.5 TRY bn 2024 ▲29.8% YoY ▲7.8% ▲10.2% ▲0.9pp ₺ MOBIL ARPU** TRY 276.8 ▲10.4% 578 K TOTAL NET ADD* 1.9 Mn Highest yearly postpaid net add in the last 15 years *Including mobile, fixed broadband, IPTV and wholesale (MVNO&FVNO) subscribers **Mobile ARPU (Excluding M2M), ARPU is IAS 29 Adjusted All financial fig ...

Company Performance - Turkcell has effectively managed through a challenging macroeconomic environment with cumulative three-year inflation exceeding 340% [1] - The company has leveraged its strong mobile service quality to maintain performance [1] Industry Context - The macroeconomic situation in Turkey has been exceptionally challenging, with significant inflationary pressures [1] Analyst Perspective - The analyst holds a beneficial long position in Turkcell shares through stock ownership, options, or other derivatives [1] - The article reflects the analyst's personal opinions and is not influenced by compensation or business relationships [1]

Financial Data and Key Metrics Changes - The company's top line increased by 7%, reaching TRY 40.2 billion, driven by strong ARPU growth and solid subscriber additions [5][21] - EBITDA rose by 10% to TRY 17.8 billion, resulting in a robust EBITDA margin of 44.2% [5][22] - Net income reported was TRY 14.3 billion, which includes TRY 3 billion profit from operations and proceeds from the sale of Ukraine assets [5][21] Business Line Data and Key Metrics Changes - Mobile segment faced aggressive pricing, leading to a 25% price adjustment in July, resulting in 515,000 new postpaid subscribers added in Q3 [6][7] - The prepaid customer base declined by 266,000 due to alternative data solutions impacting tourist demand [8] - Fixed broadband market saw 47,000 net additions in fiber subscribers, with residential fiber ARPU growing by 15% year-on-year [9][10] Market Data and Key Metrics Changes - The mobile number portability (MNP) activity increased by 47% quarter-over-quarter due to competitive campaigns [6] - The share of high-speed packages (100 megabits and above) in the residential fiber portfolio increased by 10 percentage points year-on-year [11] Company Strategy and Development Direction - The company is focused on digital services and solutions, with standalone paid users reaching five million and revenue from these services growing by 4% year-on-year [12][13] - Techfin segment revenues grew by 20%, driven by increased commissions and transaction volumes [15][17] - The company aims to cover 65% of its total electricity consumption from its own green energy production by 2026 [32] Management Comments on Operating Environment and Future Outlook - Management acknowledged the hyperinflationary environment and indicated that price adjustments have been made to adapt to market conditions [57] - The company expects real revenue growth in 2025, focusing on R&D and maintaining a strong postpaid and fiber customer base [48][49] Other Important Information - Following the divestment of Ukraine assets, the company's cash position increased to TRY 82 billion, with a net debt position of TRY 9 billion [25] - The company plans to issue a new Eurobond up to TRY 1 billion, with a portion expected to be sustainable [25][37] Q&A Session Summary Question: Details on divestment proceeds and 2025 CapEx outlook - Management stated that the final sales value from the Ukraine asset sale will be determined based on closing adjustments and may lead to significant investments [29][30] Question: Timing and structure of potential bond issuance - The company plans to issue around TRY 1 billion in Eurobonds, likely split between conventional and sustainable bonds, expected in Q1 2025 [36][37] Question: Growth prospects for data centers and cloud services - Management emphasized the increasing demand for data centers and cloud services, with plans for significant organic growth in capacity [41][59] Question: Impact of US elections on global strategy - Management indicated that they are monitoring the situation but do not foresee immediate impacts on their business [44] Question: Future M&A strategy - Currently, the company does not have any M&A plans but remains open to opportunities that could enhance growth [62]

Loan Agreement - Turkcell signed a long-term loan agreement with China Development Bank for the first tranche of a total RMB2.46 billion credit package, amounting to RMB1.23 billion (approximately EUR157 million) [3] - The repayment schedule includes 15 installments, with the first installment due 36 months after initial credit utilization at a repayment ratio of 1.25% [4] - The repayment ratios increase progressively, with the final installment due 120 months after initial credit utilization at a repayment ratio of 12.5% [4]

Financial Data and Key Metrics Changes - In Q2 2024, the company's top line reached TRY35 billion, with an EBITDA of TRY15 billion and a solid EBITDA margin of 42.6% [4][12] - The net income for the quarter was TRY2.9 billion, demonstrating financial resilience despite macroeconomic pressures [4] - The EBITDA grew by 0.3% year-over-year, reaching TRY14.9 million, while the EBITDA margin remained stable [13] Business Line Data and Key Metrics Changes - The Turkcell Turkiye segment's revenues rose by 1.5% year-on-year, driven by an expanding subscriber base and higher postpaid share [12] - The mobile segment saw a net addition of 477,000 postpaid subscribers, with the postpaid customer share reaching 73% [5] - In the fixed broadband market, 42,000 new fiber subscribers were added, with a churn rate of 1.2%, the lowest in 18 years [6] Market Data and Key Metrics Changes - Turkcell's international revenues, accounting for 3% of group revenues, rose by 2.7% to TRY890 million [10] - The company faced aggressive pricing actions from competitors, impacting its mobile segment [5] Company Strategy and Development Direction - The company is focused on digital services and solutions, aiming to connect with customers and meet their evolving needs [7] - Turkcell is committed to maintaining its leadership in the data center market, with revenue from these services growing by 57% to TRY540 million [8] - The company plans to accelerate tower fiberization and is preparing for 5G rollout, with expectations for a tender in 2025 [14][30] Management Comments on Operating Environment and Future Outlook - Management acknowledged the impact of inflation on financial performance and indicated that they are closely monitoring economic conditions [11][48] - The company expects the third and fourth quarters to show improved results, driven by strategic pricing adjustments and operational efficiencies [48] Other Important Information - The company has a cash position of TRY51 billion and gross debt of TRY99 billion, resulting in a net debt position of TRY32 billion [15] - The management is exploring funding options for potential reissuance of Eurobonds and is actively managing foreign currency risk [16][30] Q&A Session Summary Question: What will drive a reacceleration of the top line growth in the second part of the year? - Management noted that the absence of large budget projects in Q2 2024 impacted revenue growth, but they expect improvements in the latter half of the year [18] Question: Update on proceeds from the Ukrainian asset sale? - The final sales value will be determined based on closing adjustments, and proceeds may be used for significant investments, including 5G initiatives [18] Question: Revenue growth prospects for the rest of the year? - Management indicated that inflation trends and the absence of one-off projects from the previous year would affect revenue growth, but they remain optimistic about ARPU growth [21] Question: Subscriber base growth in July and August? - The company reported net additions in both months, with decreasing churn rates despite competitive pressures [22] Question: Clarification on revenue growth despite price increases? - Management explained that while ARPU grew, the decline in equipment sales and absence of one-off projects affected overall revenue growth [24] Question: Plans for Eurobond refinancing? - The company is considering options for refinancing the Eurobond due in 2025 and is monitoring market conditions [40] Question: 5G rollout strategy? - The company plans a hybrid rollout for both corporate and retail clients, depending on auction outcomes [45]

Core Viewpoint - Turkcell's stock has appreciated by 20% since the last analysis, outperforming the S&P 500, primarily due to improved inflation news, but concerns about overvaluation have led to a downgrade from hold to sell [3][5][18] Company Performance - Turkcell is expected to report Q2 2024 revenue of $1.13 billion, reflecting an 18% sequential increase and double-digit year-over-year growth, aligning with company guidance despite a Q1 miss [6] - The company has a mixed history of meeting EPS consensus but a more favorable record in revenue delivery, complicating earnings expectations [6][7] Market Conditions - Inflation in Turkey, while easing, remains historically high near 60%, continuing to pressure the company's cost base and margins [4][13] - The Turkish telecom market is mature, with a projected CAGR of 3.52% through 2029, limiting growth potential for Turkcell despite being the largest player with a 41% market share [12][11] Valuation Analysis - A DCF analysis yields a price target of $7.00, indicating a 10% downside from current prices, based on assumptions of revenue growth and inflation trends [8][18] - Revenue projections for Turkcell show growth from $3.626 billion in 2023 to $3.880 billion in 2024, with net income expected to rise from $425 million to $469 million in the same period [9] Future Outlook - Upside potential for Turkcell hinges on rapid inflation decline, continued pricing power, and acceleration in digital business growth, with current trends suggesting limited upside [15][17][18] - The company is well-managed, but macroeconomic factors and recent stock price increases pose significant risks to future growth prospects [18]

Financial Data and Key Metrics Changes - The company reported a 12% increase in top line revenue, reaching TRY31 billion, with a 23% increase in EBITDA, expanding the EBITDA margin by 3.8 percentage points to 41.4% [30][38] - The consolidated revenue increased by 11.8% year-on-year to TRY30.8 billion, with the Turkcell Turkey segment contributing a 13% rise [37] - Net profit reached TRY2.6 billion, supported by strong operational performance despite a net FX loss of TRY1.8 billion [40][51] Business Line Data and Key Metrics Changes - Digital business services generated TRY2.8 billion in revenue, with a 32% year-on-year growth, driven by a 29% increase in digital OTT services [34][26] - Paycell, the payment service platform, saw a 33% year-on-year growth, with EBITDA rising 47% due to post-expense growth lagging behind revenue increase [27] - The corporate revenues experienced a 3% decline, primarily due to fewer one-off large budget projects and a drop in public sector client revenues from 41% to 24% [5][6] Market Data and Key Metrics Changes - The mobile segment saw a net increase of 472,000 postpaid subscribers, with a total postpaid customer base exceeding 27.6 million, reflecting a 72% share [24] - Fixed broadband market added 48,000 fiber customers and 41,000 IPTV subscribers, reaching a total of 1.5 million IPTV customers [25] - International revenues rose 2.2% to TRY815 million, with Best revenues increasing by 24% in local currency terms [112] Company Strategy and Development Direction - The company aims to prioritize fiber subscriber net additions and maintain its leading position in the data center market, with a focus on digital services and solutions [34][26] - The company plans to build more data centers and collaborate with major companies to establish Turkey as a data hub for the region [62] - The 2024 revenue growth guidance has been revised to low-double-digit growth, while maintaining EBITDA margin and CapEx intensity guidance [35] Management Comments on Operating Environment and Future Outlook - Management noted that competition in the mobile market was less aggressive, allowing for a focus on the postpaid segment [24] - The company expressed optimism about the growth of digital services and solutions, expecting continued momentum into the next year [107] - Management highlighted the challenges of projecting inflation due to macroeconomic dynamics but remains committed to maintaining strong operational performance [49] Other Important Information - The company is exploring funding alternatives for euro bond reissues and has a manageable FX debt service of around $340 million [44] - The cash position at the end of Q1 2024 was TRY49 billion, impacted by various payments including a wireless usage tax [43] - The company plans to reduce its derivative portfolio to manage foreign currency risk more effectively [45] Q&A Session Summary Question: What surprised you the most in the past couple of months to increase guidance? - Management indicated that the first couple of months of the quarter exceeded expectations, prompting the guidance revision [60][51] Question: Can you elaborate on the cash position decrease due to Eurobond investments? - The company explained that investing in Eurobonds was a strategy to benefit from high yields compared to deposit rates [68][69] Question: What will be done with the proceeds from the asset sale in Ukraine? - Management stated that while no board decision has been made, significant investments are planned in data centers, solar energy, and 5.5G auctions [71][72] Question: Were there any working capital issues in the first quarter? - Management confirmed a cash outflow related to working capital, primarily due to tax payments and bonuses, but expects recovery in the coming periods [86][87] Question: Can you clarify the calculation of net debt? - Management clarified that the net debt position calculation remains unchanged, including cash and financial assets [75][78]

Q1 2024 | May 27, 2024 Ali Taha Koç, PhD | Turkcell CEO BUSINESS OVERVIEW VCC ₺ OPERATIONAL PERFORMANCE 30.8 Bn TL ▲11.8%YoY NET INCOME +333 K Total* FIBER RESIDENTIAL ARPU GROWTH** 2.6 Bn TL ₺ Solid revenue & profitability growth Double digit real ARPU growths Guidance revised upwards Operational Highlights Mobile Operational Highlights Fixed Broadband TURKCELL GROUP Turkcell Group: Q1 2024 Highlights Double-Digit Real Growth FINANCIAL PERFORMANCE 12.8 Bn TL ▲23.2%YoY NET ADD+41 K IPTV +48 K Fiber +472 K P ...