The document summarizes Turkcell Group's Capital Markets Day presentation from March 14, 2018 in Istanbul. The agenda included strategy overviews, financial highlights, marketing, sales, network, customer experience and IT presentations. Key points from Kaan Terzioglu's strategy overview included Turkcell's digital transformation journey, growth strategy focused on monetizing 4.5G, digital services and international business, and 3-year outlook targeting increased 4.5G subscribers and revenues. Strong financial and shareholder returns were highlighted from 2016-2017 compared to targets and peers.
The document summarizes Turkcell Group's Capital Markets Day presentation from March 14, 2018 in Istanbul. The agenda included strategy overviews, financial highlights, marketing, sales, network, customer experience and IT presentations. Key points from Kaan Terzioglu's strategy overview included Turkcell's digital transformation journey, growth strategy focused on monetizing 4.5G, digital services and international business, and 3-year outlook targeting increased 4.5G subscribers and revenues. Strong financial and shareholder returns were highlighted from 2016-2017 compared to targets and peers.
The document summarizes Turkcell Group's Capital Markets Day presentation from March 14, 2018 in Istanbul. The agenda included strategy overviews, financial highlights, marketing, sales, network, customer experience and IT presentations. Key points from Kaan Terzioglu's strategy overview included Turkcell's digital transformation journey, growth strategy focused on monetizing 4.5G, digital services and international business, and 3-year outlook targeting increased 4.5G subscribers and revenues. Strong financial and shareholder returns were highlighted from 2016-2017 compared to targets and peers.
The document summarizes Turkcell Group's Capital Markets Day presentation from March 14, 2018 in Istanbul. The agenda included strategy overviews, financial highlights, marketing, sales, network, customer experience and IT presentations. Key points from Kaan Terzioglu's strategy overview included Turkcell's digital transformation journey, growth strategy focused on monetizing 4.5G, digital services and international business, and 3-year outlook targeting increased 4.5G subscribers and revenues. Strong financial and shareholder returns were highlighted from 2016-2017 compared to targets and peers.
| CAPITAL MARKETS | DAY 2018 2 Strategy Overview Kaan TERZİOĞLU
| CAPITAL MARKETS DAY 2018 3
DIGITAL 1 TRANSFORMATION
2 GROWTH STRATEGY
3 3-YEAR OUTLOOK
| CAPITAL MARKETS DAY 2018 4
RECLAIMING AN EXPONENTIALLY GROWING MARKET MARKET CAPITALIZATION TREND (US$ Bn)
Telecom Companies OTT Companies 2,385
468 363 291
2012 2017 Note: Telecom companies include British Telecom, Telefonica, Deutsche Telekom, Megafon, MTS, Telecom Italia, Telekom Austria, Telia Company, Softbank and Orange. OTT companies include Facebook, Netflix, Amazon, Google and Tencent. Market capitalisation of last trading days of relevant years were considered.
| CAPITAL MARKETS DAY 2018 Strategy Overview 5
TRANSFORMING INTO THE DIGITAL OPERATOR Network Operator Experience Provider
| CAPITAL MARKETS DAY 2018 Strategy Overview 6
OUR TRANSFORMATION JOURNEY
ORGANIZATIONAL STATE-OF-THE-ART SALES CHANNEL SHAPING TECHFIN CONVERGENCE OF
TRANSFORMATION 4.5G DEPLOYMENT TRANSFORMATION IN TURKEY OTT SERVICES
Source: Bloomberg Note: Top 100 telecom operators in terms of market capitalization is taken into consideration. Turkcell 2017 revenue growth rate is compared to those which announced their financial results as of Feb 15, 2018.
| CAPITAL MARKETS DAY 2018 Strategy Overview 10
DIGITAL 1 TRANSFORMATION
2 GROWTH STRATEGY
3 3-YEAR OUTLOOK
| CAPITAL MARKETS DAY 2018 11
ENHANCING THE «DIGITAL» WITH TELCO CAPABILITIES
| CAPITAL MARKETS DAY 2018 Strategy Overview 12
GROWTH DRIVERS
MONETIZATION MONETIZATION OF CORPORATE INTERNATIONAL
OF 4.5G DIGITAL SERVICES BUSINESS BUSINESS
| CAPITAL MARKETS DAY 2018 Strategy Overview 13
MONETIZATION OF 4.5G 4.5G SUBSCRIPTION
30 23 1.5x 15 Mn higher ARPU potential 15 by a 4.5G user new 4.5G users 11 8 4 4.5G Subscribers 4.5G Compatible SP
UKRAINE BELARUS TR NORTHERN CYPRUS LIFECELL EUROPE
KEY FOCUS: 4G AND DIGITAL SERVICES
| CAPITAL MARKETS DAY 2018 Strategy Overview 19
NEW BUSINESSES
ENERGY & AUTOMOTIVE EDUCATION HEALTHCARE
Smart home, city, transportation Education services End-to-end «Hospital
& energy solutions, connected car to a wide range of customer groups Information Management Systems»
• Turkcell Energy • Turkcell Academy • Leader in terms of # of beds
• Technology provider role in • Hello Hope & Sign Language • Strong pipeline «Turkey’s Automobile Project»
| CAPITAL MARKETS DAY 2018 Strategy Overview 20
NEW BUSINESSES: TURKCELL ENERGY PIONEER IN ENERGY WITH INNOVATIVE SOLUTIONS ELECTRICITY RETAIL MARKET IN TURKEY (SUBSCRIBERS – 2017)
29 Mn 41 Mn • Uninterrupted energy with battery
• Solar business through consumer-prosumer
• Remote monitoring and smart tariff services
12 Mn • Financing options via Financell Liberal Regulated Total Market Market Market Turkcell Energy Target Market Potential Market Customers (2020E) 1 Mn
Source: EMRA Report 2017. Breakdown is company estimate.
| CAPITAL MARKETS DAY 2018 Strategy Overview 21
DIGITAL 1 TRANSFORMATION
2 GROWTH STRATEGY
3 3-YEAR OUTLOOK
| CAPITAL MARKETS DAY 2018 22
RAISING OUR 3-YEAR GUIDANCE
2015 - 2018 2018 2018 - 2020
TURKCELL GROUP (2015 CMD) REVISED NEW
REVENUE GROWTH 10% - 14% 14% - 16% 14% - 16%
EBITDA MARGIN 32% - 35% 37% - 40% 37% - 40%
OP. CAPEX / SALES* 17% - 16% 19% - 18% 18% - 16%
Guidance figures reflect the expected impacts of IFRS 9, IFRS 15 and IFRS 16. A positive 4-5pp impact is reflected in EBITDA margin guidance. Please see financial highlights section for details. *Excluding license
