Sensitivity: Public

2018

Financial Results

January 30, 2019

Sensitivity: Public

• International organic growth, YoY depreciation of TRY and price adjustments led to

30% top-line growth YoY

• Flat gross profit margin QoQ as increasing domestic profitability offsetted the negative

impact of TRY appreciation on international margins

• Relief in raw material prices started to help margins in 4Q18

• Strict opex management with 160 bps QoQ improvement in Opex-to-Sales ratio

• Slight market share losses in Europe compared to 9M18

• TRY appreciationand strong collection performance helped WC/Sales ratio

• Leverage declined thanks to strong EBITDAgeneration and TRY valuation

2018 Q4 Summary

Net Sales

TRY 7.4 bln.

EBITDA

Margin

12.2%

Leverage

2.4X

WC / Sales

28.0%

2

Sensitivity: Public

Key Factors Impacting Revenues

2018 Q4 Sales Performance

International

GrowthOrganic growth (~6%) continued in 4Q18 thanks to strong

performance in Europe, ASEAN and MENA

Currency ImpactTRY’s YoY depreciation against hard currencies (€, $, £) and

some emerging market currencies (PLN, ZAR, RUB)

Domestic DemandDespite the new SCT Incentive and a favorable base,

domestic sell-in demand remained weak

Pakistan MarketMainly due to macro developments, Pakistani market had a

slower quarter

3

Sensitivity: Public

Key Factors Impacting Margins

2018 Q4 Margin Performance

Price AdjustmentsEarlier price adjustment in Turkey, Pakistan and MENA region

led to expansion in profit margins

OPEX ManagementThanks to strict OPEX management during the quarter,

Opex-to-Sales ratio improved by 160bps QoQ

Raw MaterialBoth plastic and metal prices continued to decline

during the quarter

TRY AppreciationTRY appreciationhad a negative impact on international

profitability through sales of pre-purchased inventory but wassupportive for domestic margins

4

Sensitivity: Public

2018 Q4 Performance - Turkey

Market*

• Despite the SCT incentive and low base of 2017, sell-in market contracted by 22% in 4Q. However, retail demand was positive in the last 2 months due to SCT break.

• A/C demand declined by 15% during the quarter.

• Retail demand for TV decreased sharply by 24% (YoY) in the quarter (9M: +0,9%)

Turkish Market by Product Type

(MDA 6)Turkish MDA6 Total Market

YoY Change

* MDA and A/C figures are based on BESD data.

TV figures are based on retail panel of a market research company for Jan-Dec ‘18 period

5

-16% -17%-23%

-20%

9%

-8%

3%

-22%

-38%

-29%

-21%-15%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

Jan

Fe

b

Ma

r

Apr

Ma

y

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2016 2017 2018

('000 Units) 4Q18 4Q17 YoY 4Q16 vs. 4Q16

Refrigerator 312 388 -20% 487 -36%

Freezer 6 46 -87% 58 -89%

Washing M. 401 518 -23% 555 -28%

Dryer 47 45 3% 38 23%

Dishwasher 298 357 -16% 423 -30%

Oven 178 240 -26% 278 -36%

Total 1,242 1,594 -22% 1,839 -32%

Sensitivity: Public

2018 Q4 Performance - Turkey

Arçelik A.Ş.

• Topline decline realized at 3% YoY mainly due to fragile demand environment

- In MDA, unit sales was better than the market in 4Q18. (Market: -22%, Arcelik -18%)

- A/C unit sales also outperformed the market as volumes remained flat YoY.

- In TV segment, the company improved its position and performance in the market in Q4

and it continued to enjoy the second position in FY with ~25% market share.

15%

TV

Sales

Washing

Machine Sales

Underperformers Outperformers

-68%

Cash Register

Sales

6

4Q18 DomesticRevenue Growth

(YoY): -3.0%

17

%

Cooler

Sales

-26%

2%

Air

ConditionerSales

Sensitivity: Public

1.0%

1.9% 2.0%

2.4%

1.7%

0.9%

1.6%1.5%

2.0%

Wa

shin

g M

.

Dry

er

Dis

hw

asher

Coo

ler

Fre

eze

r

Ove

n

TO

TA

L

Fre

e S

tandin

g

Built

-in

2018 Q4 Performance - International

Market*

Market Unit Growth in Major Markets (%)

(MDA 6)

European Market Unit Growth by Product Type

(12M18) (%)

7

• West Europe improved slightly in 4Q18 but closed year with ~1% decline.

- UK, Spain and Italy were the source of improvement (QoQ) while Germany and France were weak.

• East Europe enjoyed another strong quarter as yearly growth reached 8%.

- After a weak 9M, Romania also contributed to region’s performance

• S. African retail demand grew significantly as demand shifted from Q3 to Q4.• s

• Mainly due to macro conditions, Pakistan slowed down in 4Q18.

• Figures are based on retail panel of a market research company.

-10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0%

RussiaPoland

RomaniaUkraine

United KingdomGermany

FranceItaly

Spain

South Africa

9M 12M

Sensitivity: Public

2018 Q4 Performance - International

Arçelik A.Ş.

46%

SDA

Sales

73

%

Grundig MDA

Sales

58%

Built-in

Sales

52%

Free Standing

Sales

Underperformers Outperformers

8

4Q18 International Revenue Growth (YoY):

+46.4%

33

%

TV

Sales

• TRY depreciationand organic growth led to ~46% increase in international sales.

- Share of built-in improved ~100bps YoY to ~20%.

- Grundig sales increased more than 70%.

- SDA had another strong quarter with 52% revenue growth.

Sensitivity: Public

2.5

0.40.7 0.6

-0.2

0.4

-0.7

0.7

-0.3

0.7 0.7 0.6

UK Spain Italy France Germany Romania Poland Russia Ukraine EU23Total

EU23 F/S

EU23 B/I

2018 Q4 Performance - International : Europe

Arçelik A.Ş.

Arçelik Group

Unit Market Share Gains (YoY) (points) - MDA 6*

9

• Slight market share losses in Q4 after an exceptionally strong 9M18.

- Throughout 2018, Beko has reached highest ever market shares (monthly) in WE total, UK,

France, Spain, Romania and Russia.

• TRY is still supportive albeit to a lesser extent compared to 3Q18.

• In some Western European markets, promotional activity was reduced to focus more

on profitability.

* Figures are based on retail panel of a market research company for Jan-Dec 18 except EU23 region, which is based on Jan-Oct

Market Share (%)

20.4 7.7 8.4 7.6 5.5 40.1 15.2 5.5 4.9 10.1 11.2 7.0

Sensitivity: Public

2018 Q4 Performance – International : Asia & Africa

Arçelik A.Ş.

10

ASEAN

• Sales in ASEAN region was ~USD23mn in 4Q18. (USD135mn YTD*)

• Refrigerator production in Thailand was ~345 K units, up by 30%.

• Market share gains go on in the region.

• Sell-in sales were weak as retail demand is expected to be sluggish in 1H19 in S. Africa.

S. Africa & Sub-Sahara

Pakistan

• In line with sluggish market conditions, Dawlance recorded low single digit revenue

growth in local currency.

• Price adjustments continued in all product categories in Q4.

India

• Plant construction is going on as the JV is building up distribution, including listing on

Tata CliQ.

• With the initial product launch, sales to the JV reached TRY 120 million.

* In previous quarters, direct sales to India were included in ASEAN sales. As VoltBek started trading operations, FY figure excludes sales to India.

1,1 1,00,7

1,51,7 1,8

Malaysia Thailand Vietnam

Unit Market Share in Cooling

2017 2018

Sensitivity: Public

60

70

80

90

100

110

120

130

140

Jan-1

6

Apr-

16

Jul-1

6

Oct

-16

Jan-1

7

Apr-

17

Jul-1

7

Oct

-17

Jan-1

8

Apr-

18

Jul-1

8

Oct

-18

4Q Average Plastics Price Index (Market)

40

50

60

70

80

90

100

110

Jan-1

6

Apr-

16

Jul-1

6

Oct

-16

Jan-1

7

Apr-

17

Jul-1

7

Oct

-17

Jan-1

8

Apr-

18

Jul-1

8

Oct

-18

4Q Average Metals Price Index (Market)

Trends in Raw Material Prices

Metal Prices Index - Market

11

Metal Prices Index Quarterly Average - Market

Source: Steel BB, Steel Orbis

Index includes: CRC, HRC, Galvanized Steel, Stainless Steel, Copper, Aluminium

Plastic Prices Index - Market

Source: ICIS - Chemical Industry News & Chemical Market Intell igence

Index includes: ABS, Polystyrene, Polyurethane, Polypropylene

Plastic Prices Index Quarterly Average - Market

-6%

-9%

3Q17 4Q17 1Q18 2Q18 3Q18 4Q18

85 90 94 93 90 85

3Q17 4Q17 1Q18 2Q18 3Q18 4Q18

119 123 128 125 121 111

Sensitivity: Public

2018 Q4 Other Developments

12

A new R&D Center, Arch R&D Co. Ltd., was launched in High-Tech Development Zone,in Wuxi, Jiangsu, China.

Beko Spain received recognition for its career in Spain by the Secretary of State for Energyas Beko has been the fastest growing brand in Spain on the MDA6 sector in the last decade.

The launch of the new Grundig concept store took place in November in S. Africa. The B2Bsolution for architects, designers and interior decorators is a first of its kind in the country.

Beko “Eat Like A Pro” campaign with FC Barcelona won the “Best Brand Activation involvinga Club” category along with a silver award in “Partnership of the Year” at Football BusinessAwards in London.

Thanks to its accomplishments in sustainability, Arçelik won the first prize in the"Management" category of the European Business Awards for the Environment. It is the first-ever Turkish company to receive the award in its industry.

Sardis, the new generation mobile payment terminal developed by Token, the financialtechnologies spin-off company, won the Innovation Award by Consumer TechnologyAssociation at CES.

Sensitivity: Public

Sales Performance

13

Sensitivity: Public

8,125 8,425

12,716

18,479

20,841

26,904

2017 2018

Turkey International

1,903 1,845

3,802

5,570

5,706

7,414

2017 Q4 2018 Q4

39.0%

29.7%

13.2%

6.8%

2.7%

4.4%

4.2%

31.3%

33.6%

15.7%

7.2%

2.2%4.3%

5.6%

Turkey Western Europe

CIS&Eastern Europe Africa

Middle East Pakistan

Other

33.4%

33.6%

15.7%

7.8%

2.4%

3.5%

3.6%

24.9%

39.7%

17.3%

7.9%

2.1%3.2%

4.9%

Turkey Western Europe CIS&Eastern Europe

Africa Middle East Pakistan

Other

2017

2018

+30%

-3%

+46%

Sales by Region

2017 Q4

2018 Q4

14

+29%

+4%

+45%

Sensitivity: Public

Sales Bridge

15

2018 Q4 Organic Currency Effect TOTAL

Domestic Growth -3.1% 0.0% -3.1%

International Growth 5.7% 40.8% 46.5%

Total Growth 2.7% 27.2% 29.9%

1,903 1,844

3,802

5,570

-59216

1552

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2017 Q4 TR - Organic INT - Organic INT - FX Impact 2018 Q4

Turkey International Impact on Rev

TL mn

Sensitivity: Public

Financial Performance

16

Sensitivity: Public

* EBIT w as calculated by deducting the impact of foreign exchange gains and losses arising from trade receivables and payables, credit

f inance income and charges and cash discount expense and adding income and expenses from sale of property plant and equipment.

** Net income before minority

Income Statement

17

TL mn 2018 Q4 2017 Q4 2018 Q3

Δ%

YoY

Δ%

QoQ 2018 2017

Δ%

YoY

Revenue 7,414 5,706 7,696 30 -4 26,904 20,841 29

Gross Profit 2,410 1,749 2,511 38 -4 8,546 6,506 31

margin 32.5 30.7 32.6 31.8 31.2

EBIT * 713 282 603 153 18 2,107 1,406 50

margin 9.6 4.9 7.8 7.8 6.7

Profit Before Tax 270 112 332 141 -19 949 821 16

margin 3.6 2.0 4.3 3.5 3.9

Net Income** 281 90 253 212 11 856 845 1

margin 3.8 1.6 3.3 3.2 4.1

EBITDA* 908 426 787 113 15 2,797 1,954 43

margin 12.2 7.5 10.2 10.4 9.4

Sensitivity: Public

654

873

699

33.7

35.3

39.2

20.0

25.0

30.0

35.0

40.0

45.0

400

450

500

550

600

650

700

750

800

850

900

2017 Q4 2018 Q3 2018 Q4

Revenue Gross Margin (%)

885

663

808

23.724.8

19.5

10.0

12.0

14.0

16.0

18.0

20.0

22.0

24.0

26.0

100

200

300

400

500

600

700

800

900

2017 Q4 2018 Q3 2018 Q4

Revenue Gross Margin (%)

4,167

6,1615,907

31.7

33.1 33.5

25.0

27.0

29.0

31.0

33.0

35.0

37.0

39.0

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2017 Q4 2018 Q3 2018 Q4

Revenue Gross Margin (%)

5,706

7,6967,414

30.7

32.6 32.5

25.0

26.0

27.0

28.0

29.0

30.0

31.0

32.0

33.0

34.0

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

2017 Q4 2018 Q3 2018 Q4

Revenue Gross Margin (%)

Revenue and Gross Profit by Segment

18

Consolidated

White Goods Consumer Electronics Other

Change

in Sales

(YoY)

(QoQ)

(30%)

(-9%)

(42%)

(-4%)

(-9%)

(22%)

(7%)

(-20%)

Sensitivity: Public

Balance Sheet

19

TL mn 31.12.2018 31.12.2017 31.12.2018 31.12.2017

Current Assets 19,196 13,501 Current Liabilities 12,497 8,403

Cash and Cash Equivalents 5,342 2,582 ST Bank Borrowings 5,517 3,262

Trade Receivables 7,756 6,518 Trade Payables 4,734 3,576

Inventories 5,088 3,780 Provisions 582 431

Other 1,011 622 Other 1,663 1,135

Non-current Assets 9,172 6,935 Non-current Liabilities 7,652 5,118

Property, Plant and Equipment 4,534 3,265 LT Bank Borrowings 6,432 4,114

Intangible Assets 3,109 2,578 Other 1,221 1,004

Financial Investments 348 285

Other 1,181 807 Equity 8,219 6,915

Total Assets 28,368 20,436 Total Liabilities 28,368 20,436

31.12.2018 31.12.2017 31.12.2016 31.12.2015

Net Financial Debt/Equity 0.80 0.69 0.69 0.70

Total Liabilities/Total Assets 0.71 0.66 0.66 0.66

Sensitivity: Public

32.5% 30.9% 30.3% 30.8% 29.3% 32.2% 33.8%

33.5%30.3% 31.6% 32.7% 35.1%

28.0%

Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18

9,4147,756

6,201

5,088

6,0454,734

938

751

8,847

7,541

2016 - Assets 2016 - Liabilities 2017 1Q - Assets 20171Q - Liabilities

Trade Rec. Inventory Other Rec. Trade Payables Other Pay. Working Capital

Working Capital / Sales

Working Capital

20

2018 Q3 2018 Q4

Change

19%

30%

31%

18%

Sensitivity: Public

2,886 2,038 1,983 2,582 2,612 2,956 4,225 5,342

-2,770 -2,922 -3,216 -3,262 -3,900 -4,413 -4,687 -5,517

-3,980 -3,874 -3,767 -4,114-4,351

-5,029-6,836 -6,432

2.11

2.52 2.56 2.45

2.833.13 3.15

2.36

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

-10,000

-5,000

0

5,000

10,000

17 Q1 17 Q2 17 Q3 17 Q4 18 Q1 18 Q2 18 Q3 18 Q4Cash and cash equivalent Short term debt Long term debt Net Debt/EBITDA

TL mn

Debt Maturity Profile

21

Cash Breakdown by Currency

Cash & Debt Profile

Debt profile (as of Dec 31 2018)

Effective mn Original TL mn

Interest Rate p.a. (%) Currency Equivalent

TRY 20.6% 4,640 4,640

EUR 1.1% 262 1,580

ZAR 9.4% 750 275

GBP 1.5% 7 50

RON 4.9% 4 6

PKR 9.3% 16,333 611

Total 7,161

USD 5.1% 505 2,657

EUR 4.0% 353 2,130

Total Eurobond 4,787

Total 11,948

201946%

202011%

202118%

202323%

2023+2%

4%

14%

10%

59%

4%9%

TRY USD GBP EUR RUB Other

Sensitivity: Public22

FX Hedging Policy

FX POSITION - CONSOLIDATED

• FX hedging is a strictly pursued policy in Arçeliksince around 30 currencies are activelymanaged in global operations.

• It is a KPI for the company management not tohave an FX exposure exceeding low single-digit% of equity.

• The primary strategy is on balance sheet hedgingmainly through cash, receivables, payables andfinancial liabilities, and the remaining part is hedgedthrough financial derivatives.

* Mainly stemming from Pakistan and Vietnam where hedging is limited

-4.1%

-1.1%

-5.7%

-2.5%-2.1% -2.0%

-3.7%

0.4%

-1.2%

-5.1%

-3.6%

-1.2%

-7.0%

-6.0%

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

-400

-350

-300

-250

-200

-150

-100

-50

0

50

16 Q1 16 Q2 16 Q3 16 Q4 17 Q1 17 Q2 17 Q3 17 Q4 18 Q1 18 Q2 18 Q3 18 Q4

Net FX Position Net FX/Equity

(TRYmn)

Before

Hedge

Hedged

Position

Net

Position

EUR 662 -880 -218

USD -2,092 2,222 130

GBP 697 -683 15

Other 984 -1,009 -25

TOTAL 251 -349 -98

-1.2%Net FX Position/Equity

Sensitivity: Public

Cash Flow

2017

2018

23

TLmn

TLmn

Sensitivity: Public

2019 Expectations

24

Sensitivity: Public

Revenue Growth

EBITDA Margin(2019)**

Around 25% in TRY

Around 10,5%

*6 main products, in compliance with WGMA data.

**EBITDA margin calculations are inline with the methodology used in calculation of historical values , and does not include any impact from TFRS 16 implementation

2019 Expectations

25

AR

ÇE

LİK

A.Ş

.

EBITDA (2019)** TRY 3,3-3,7 bln.

MA

RK

ET

White goods market volume

growthGlobal: ~ +2% sales volume

Long-TermEBITDA margin**

Around 11%

The Group is in the process of

assessing the impact of TFRS 16,

which is expected to be accretive to

EBITDA margin in 2019.

Sensitivity: Public26

investorrelations@arcelik.com

www.arcelikas.com

Investor Relations App

Polat Şen

CFO

Tel: (+90 212) 314 34 34

Hande Sarıdal

Finance Director

Tel: (+90 212) 314 31 85

Orkun İnanbil

Investor Relations Manager

Tel: (+90 212) 314 31 14

Contacts for Investor Relations

Sensitivity: Public

This presentation contains information and analysis on financial statements as well as forward-looking

statements that reflect the Company management’s current views with respect to certain future events.

Although it is believed that the information and analysis are correct and expectations reflected in these

statements are reasonable, they may be affected by a variety of variables and changes in underlying

assumptions that could cause actual results to differ materially.

Neither Arçelik nor any of its managers or employees nor any other person shall have any liability

whatsoever for any loss arising from the use of this presentation.

Disclaimer

27