tav airports holdingir.tav.aero/.../tavhl_investor_presentation_1h07.pdfsera yapi endustrisi –...
TRANSCRIPT
0
September 2007
TAV Airports HoldingManagement Presentation
TAV Airports – Business Overview
TAV Airports – Financial Overview
TAV Airports – Operations
Conclusion
1
Istanbul Atatürk Airport
2
TAV Airports Overview
O&M, IT and SecurityTAV O&M (100%):
Commercial area allocationsCIP / VIP
TAV IT (96%):
Airport IT services
TAV Security (67%):
Security service provider in Istanbul, Ankara and Izmir
Airports Duty Free Food and Beverage
Ground Handling Other
TurkeyIstanbul AtatürkAirport (100%)
Ankara EsenboğaAirport (100%)
Izmir AdnanMenderes Airport (Intl. Terminal) (100%)
Georgia
Tbilisi International Airport and Batumi Airport (60%)
Tunisia (1)
Monastir and Enfidha Airports (100%)
ATÜ (50%)Largest duty free operator in Turkey
Partner with Unifree– leading German travel retailer (Travel Value)
BTA (67%)44 outlets with a total seating capacity of 4,500 in IstanbulOperates Istanbul Airport Hotel
Bakery & pastry factory serving Starbucks in Turkey
€142m
Rev
enue
s1H
07(3
)
€64m €23m€23m
Notes: (1) Not reflected in 1H07 financials. We had signed Tunisia Enfidha and Monastir airports concession agreements on May 18, 2007(2) Based on number of flights for 2006(3) Revenues represent the proportional interest of these companies in TAV Airports (e.g. 50% of ATÜ revenues, 60% of Havaş and 60% of TAV Georgia) (before eliminations)
Havaş (60%)Traffic, ramp and cargo handling
Majorgroundhandler in Turkey with a c.51%(2) share
Operates in 11airports in Turkey including Istanbul, Ankara, Izmir and Antalya
€27m
3
Ownership Structure
Founding shareholders
1. Tepe – Turkish integrated conglomerate focused on infrastructure and construction
2. Akfen – holding company operating in the construction, tourism, foreign trade, insurance and natural gas sector
3. Sera Yapi Endustrisi – family of Dr. Sani Sener, CEO of TAV Airports
4. Goldman Sachs (Dec 2006)
5. Babcock & Brown – infrastructure fund (Dec 2006)
6. Global Investment House – a Kuwait based fund (Aug 2006)
7. IDB Infrastructure fund – Bahrain based private investment vehicle affiliated with the Islamic Development Bank (Apr 2006)
8. Kuwait Investment Authority
9. Free Float
Current Shareholder Structure
18,40%
3.20%
4.92%
5.00% 15.71%
18.86%
5.16%3.15%
25.60%
1
2
3
4*
5
7
9
6 New shareholders
* 34,875,000 of the shares owned by Goldman Sachs that correspond to 14.4% of our issued and outstanding share capital have been provided by Tepe, Akfen Holding and Sera to Goldman Sachs as collateral and the title of those shares have been transferred to Goldman Sachs for this purpose. A pledge granted by Goldman Sachs in favour of Tepe, Akfen Holding and Sera exists on those shares. As a result, the voting rights, right of receiving dividends, pre-emption rights for participating in cash share capital increase in connection with those (except for acquiring gratis shares under any share capital increase) belong to Tepe, Akfen Holding and Sera as if such shares had not been owned by Goldman Sachs.
8
4
Investment Highlights
Agreed regulatory framework providing hard currency fees
Long-term concessions (Istanbul: 2021, Ankara: 2023, Tbilisi: 2027, Tunisia: 2047)
Fixed cost base and minimal ongoing maintenance capex(4)
Buoyant Turkish economy (2001-2006 CAGR(1) = 7.3%)
Strong passenger growth (2001-2006 CAGR(2) = 11.0%)
Diversified portfolio with leading market position (46% market share(3))
Large catchment areas
Deregulation of domestic market
Strategic shareholder base and internationally recognised JV partners
Well positioned to win domestic and international concessions
Development of the service business (e.g. ATÜ, BTA, Havaş)
#1 Airport
TerminalOperator in
Turkey
Clear Regulatory
Framework and Earnings Visibility
Well Positioned
for Growth
Notes: (1) TURKSTAT(2) Istanbul Ataturk Airport (excluding transit passengers)(3) Based on 2006 number of passengers(4) Minimal capex on existing concessions as all terminals are brand new. Also, the lease agreement for Istanbul mentions no additional mandatory capex for TAV
5
Turkey is a Fast Growing Market
Attractive Market Conditions GDP and tourism growth (1995-2006)(Index, 1995=100)
GDP growth 7.3%(1) over the last five years
In 2006 foreign visitors amounted 19.8m(2) (tourism approx 5% of GDP)
2nd largest country in Europe (population: 74m)
Current passport holders represent only 11% of the Turkish population, while 50 million are under the age of 30 (3)
Deregulation of domestic market
Limited alternative transport infrastructure 0
50
100
150
200
250
300
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
GDP Tourist Arrivals Total Passengers
Economic Crisis
9/11 and bankruptcy of
airlines
DevaluationEarthquake
Bird flu
Source: DHMI, Passenger figures for 2006Notes: (1) TURKSTAT; (2) Ministry of Culture and Tourism; (3) TURKCELL Survey
6
Turkish Aviation Market has Grown Rapidly
Demand is Expected to be Strong 2005 - 2009 annual passenger growth forecast
Source: DHMİ
(Index, 1996=100)
0
50
100
150
200
250
300
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
Domestic passengersInternational passengers
Source: IATA, Top 10 highest growth countries with over 2m annual passengers (05-09); Ranked by average annual growth rate for the 2005-09 forecast period
11,20%
9,60%
9,50%
9,20%
8,90%
8,50%
8,40%
8,40%
7,60%
7,40%
Poland
China
Czech Republic
Qatar
Turkey
Romania
Malaysia
India
UAE
Pakistan
5,60%
5,30%
5,10%
Total International
North Atlantic
Within EU
From 1991 to 2006, the annual Turkish passenger growth rate was 11.8% pa, despite events such as the wars in Iraq, earthquakes, terrorist attacks, economic crisis (1)
Turkey is the 5th fastest growing market among countries with over 2m annual passengers for the period from 2005 to 2009 (2)
Notes: (1) DHMI(2) IATA – October 2005
7
Earnings Visibility
Notes: Passenger service charges apply to departing passengers only
Non-AviationAviation
IstanbulAgreed passenger service charge
$15 per intl. pax€3 per dom. pax
Ankara
Revenue guarantees€15 per intl. pax€3 per dom. paxFixed PSC €13m + 5% volume growth p.a.
IzmirRevenue guarantees
€15 per intl. paxFixed PSC €15m +3% volume growth p.a.
TbilisiAgreed passenger service charge
$22 per intl. pax – growing at 2% p.a.Fixed $6 per dom. pax
Duty Free and
Catering
Duty Free available to all international inbound and outbound passengers
Increased number of shops, improved selection of products and check-in / security procedures enhanced
Potential to enter local in-flight catering market by 2009
OtherHigh margin and operational leverage
Minimal maintenance capex requirement
Monastir&
Enfidha
Agreed passenger service charge€8.25 per intl. pax in 2008 €9 per intl. pax in 2009
BatumiAgreed passenger service charge
$12 per intl. pax$7 per dom. pax
8
We are the #1 Airport Operator in Turkey
#1 Airport operator in Turkey
(Passenger number, million)
Large catchment areas
Istanbul Atatürk Airport
Ankara
Mugla
Manisa
IzmirAydin
TekirdagSakaryaYalova
Kirklareli
Duzce
Edirn
e
Kirikkale
Cankiri
Kirsehir
Bolu
Karabuk
Yozgat
Aksaray
EskisehirBalikesir
Denizli
U?ak
KocaeliIstanbul
Georgia
Ankara
Mugla
Manisa
IzmirAydin
TekirdagSakaryaYalova
Kirklareli
Duzce
Edirn
e
Kirikkale
Cankiri
Kirsehir
Bolu
Karabuk
Yozgat
Aksaray
EskisehirBalikesir
Denizli
U?ak
KocaeliIstanbul
Ankara
Mugla
Manisa
IzmirAydin
TekirdagSakaryaYalova
Kirklareli
Duzce
Edirn
e
Kinkkale
Cankiri
Kirsehir
Bolu
Karabuk
Yozgat
Aksaray
EskisehirBalikesir
Denizli
Usak
KocaeliIstanbul
GeorgiaAnkara Esenboga Airport
Izmir Adnan MenderesAirport
TbilisiInternational Airport
4.5
14.6
21.3
4.4 (2)
0
5
10
15
20
25
Istanbul Antalya Ankara Izmir
TAV operates 3 of the 4 largest airports in Turkey
TAV is the leading airport operator in Turkey with a 46% market share
The airport terminals which we operate in Turkey handled 27.3 million passengers in 2006 and 8.5 million in 1Q07(1)
46% MARKET SHARE
Source: DHMI, Passenger figures for 2006Notes: (1) Excluding transit passengers
(2) TAV only operates the international terminal, which had 1.4m passengers in 2006
BatumiAirport
9
Recently signed concession agreement in Tunisia
Airports in Tunisia March 16, 2007 - We had submitted the best bid for the operation of Tunisia Enfidha and Monastir airports tenders
April 9, 2007 - We had decided to form the company TAV Tunisie SA, fully owned by TAV Airports Holding
May 18, 2007 - We had signed Tunisia Enfidha and Monastir airports concession agreement
The concession periods of both airports will last until May 2047
The operation of the Monastir and Enfidha Airports will cover all airport activities excluding the air traffic control
The concession rent fee:
For the Monastir Airport, 33.7% and 11.7% of the annual revenues for 2008 and 2009 respectively, or minimum €14.8 mn p.a.
It will increase in a linear rate between 11% to 26% of the annual revenues of the Monastir and Enfidha Airports
Monastir and Enfidha (50-60 km from Monastir) airports are located in a tourism region of Tunisia and almost all passengers are international
10
Monastir and Enfidha concession agreement
Existing airport concession in Monastir:
The operation is planned to be undertaken as of January 1, 2008
Declared capacity of 3.5m passengers per year
In 2006, it has served 4.2 million passengers -mainly tourists using charters
The passenger service charge: €8.25 in 2008 and €9 in 2009, for the outgoing international passengers.
The authorities have not guaranteed any number of passengers.
For the Monastir Airport, there are service companies with ongoing current contracts.
BOT airport concession in Enfidha:
Building this airport, as Monastir airport capacity cannot be extended
The operation shall be undertaken following the completion of the investment (latest October 2009)
Formal capacity will gradually increase from 7m to 22m passengers over time
The group companies within the TAV Airports Holding Inc. (ATÜ, BTA, TAV O&M, etc.) will serve at the Enfidha Airport.
Initial investment of approximately €400m, 30% of which will be financed by equity and 70% by loans
11
Developments and Strategy
Developments in the period:May 18, 2007 - A concession agreement for Tunusia Enfidha and Monastir airports is signed.
May 26, 2007 - TAV is granted the operation of the Batumi Int. Airport for 20 yrs. and the airport opened.
Developments after the period:July 6, 2007 - The capital increase in TAV Esenboga and acquirement of the remaining 25% share of TAV Esenboga
July 30, 2007 - Acquirement of the remaining 5% share of TAV Izmir from Havas
August 31, 2007 - TAV is awarded the tender of Antalya-Gazipasa Airport- Lease period of 25 yrs- Fixed rent payment of US$50,000 and 65% of net profit every year- 500,000 passenger capacity- The strategy of focusing on boutique airports
Upcoming tenders in the region
Key upcoming tenders:
Saudi Arabia (Riyadh, Dammam, Jeddah)
Bodrum (Turkey)
India
12
Traffic Performance
13%12.414.17.96.2TAV Total 16%6.67.74.43.3Int’l
19%2.02.41.31.1Ankara Esenboga17%0.50.60.30.2Int’l19%1.51.81.00.9Dom.14%0.50.60.40.2Izmir Adnan Menderes1%0.30.30.10.1Georgia Tbilisi
8%4.34.62.52.1Dom.16%5.46.23.52.7Int’l12%9.710.96.04.8Istanbul Ataturk
11%5.86.43.52.9Dom.
∆1H061H072Q071Q07Airports
Strong passenger growth:
14.1 million passenger in 1H07, 13.3% growth
19% growth in Ankara and 14% growth in Izmir
Total int’l passenger traffic grew 16%
11% growth in domestic passenger traffic
Air Traffic Movement:
148 thousand ATM in 1H07, 11% growth
Int’l ATM grew 11%
10% growth in domestic ATM
Source: Turkish State Airports Authority (DHMI)
TAV Passenger Figures (million pax)
11%134.4148.580.767.8TAV Total 11%73.381.344.436.8Int’l
14%21.624.513.111.4Ankara Esenboga24%5.06.23.52.7Int’l10%16.518.39.68.6Dom.21%4.35.23.61.7Izmir Adnan Menderes5%2.52.71.51.2Georgia Tbilisi
10%44.348.626.522.2Dom.9%61.667.436.031.4Int’l
10%105.9116.162.553.6Istanbul Ataturk
10%61.167.236.330.9Dom.
∆1H061H072Q071Q07Airports
Source: Turkish State Airports Authority (DHMI)
TAV Air Traffic Movements (‘000)
13
Operational Performance
Continuing revenue growth:Consolidated revenue increased by 26% to €225 million in 1H07The growth was 23% in 1Q07 and 27% in 2Q07 compared to previous year
Improving operational performance:EBITDAR increased by 25% to €94.8 million, implying 42% margin€17.4 million net loss in 1H07, compared to €50.1 million net loss in 1H07
EBITDAR (€m)
Consolidated Revenue (€m)
2005 2006 1Q06 1Q07 1H06 1H07
80.2 99.1
179.1225.0
y-o-y +26%
400305
2005 2006 1Q06 1Q07 1H06 1H07
27.1 37.8
75.794.8
y-o-y +25%
168149
Net Income (Loss) (€m)
-21.6 -21.4
-50.1
-17.3
-59,3
40,5
2005 2006 1Q06 1Q07 1H06 1H07
14
TAV Airports – Business Overview
TAV Airports – Financial Overview
TAV Airports – Operations
Conclusion
Ankara Esenboğa
15
Revenue Profile
TAV Airports Revenues
Total revenues increased by 26% to €225 million in the first half of 2007.
There is no historical financial information for Ankara, Izmir and Tbilisi (only passenger data) – in 1H07 the volumes at these airports were approximately 30% of Istanbul’s volumes
Services commenced operations at the new airports in the last months of 2006 2007 will be the first full year of operations for the new Group (airports in Turkey)
875%3271511Others7%1081156253Istanbul
29%1101427765Airports
52%15231310BTA23%52643628ATU (50%)29%1061377859Services
26%17922512699Consolidated-37-54-30-24Eliminations
29%216279156123Total72%13231310Others
6%26271710Havas (60%)
Change1H061H072Q071Q07(€ million)
16
EBITDAR Profile
TAV Airports EBITDAR (*)
EBITDAR rose 25% to €95 million in 1H07, implying 42.2% margin.
Istanbul has a good like-for-like EBITDAR track record
675%0221Others26%67854837Istanbul29%68874938Airports
3%2220BTA40%3421ATU (50%)
-20%9770Services
25%76955738Consolidated-1100Eliminations
23%77945738Totaln.m.-2-3-2-1Others
-25%655-1Havas (60%)
Change1H061H072Q071Q07(€ million)
Note: (*) EBITDAR figure for Istanbul includes concession rent expense
17
1H07 Financial Summary
TAV Airports – 1H07
Note: (*) EBITDAR figure is used for Istanbul
2826%13Georgia (60%)
1-54Eliminations65534%94279Total
12-12%-323Others
12026%414Ankara9424%29Izmir
-14--40Tunisia
40473%85115Istanbul63261%87142Airports
-17%223BTA136%464ATU (50%)235%7137Services
65542%95225Consolidated
-217%527Havas (60%)
Net DebtEBITDA MarginEBITDA (*)Revenues(€ million)
1H07 results are not directly comparable with the previous year
Contribution of new terminals in 1H07
18
Consolidated Income Statement
(16.2)0.92.1(0.9)Transaction gain/(loss) (net)
(1.25)(0.07)0.02(0.09)Earnings / (loss) per share – basic and diluted:
40,000,000238,958,333238,958,333238,958,333Weighted average number of shares outstanding
(50.1)(17.5)4.9(22.4)
(48.0)(17.3)4.1(21.4)Equity holders of the parent(2.1)(0.2)0.8(1.0)Minority interest
1.0(0.0)(0.1)0.1Other gains and losses(31.6)(27.3)(9.7)(18.0)Finance costs (net)
(36.7)(20.2)5.7(25.9)Profit/(loss) before tax
(13.4)2.7(0.8)3.6Income tax benefit /(expense)(50.1)(17.5)4.9(22.4)Profit/(loss) for the period from continuing operations
Attributable to:
2.3
11.1(21.3)(12.2)(33.9)(26.0)(21.4)
4.7121.3
2Q07
2.7
(9.8)(21.4)(11.7)(35.9)(22.7)(17.2)
4.095.1
1Q07
8.25.0Investment income
8.78.7Other operating income(36.3)(38.6)Cost of inventory sold, service rendered(29.9)(48.7)Employee benefit expense
170.4216.4Operating incomeContinuing operations
(37.1)(42.7)Other operating expenses(3.5)(23.9)Depreciation and amortization expense
(70.3)(69.8)Concession rent expenses
1.91.3Operating profit
1H061H07(€ million)
19
Consolidated Balance Sheet
364.0354.7327.4Total Equity1,309.31,304.71,350.0TOTAL LIABILITIES AND EQUITY
341.4332.7304.3Equity attributable to equity holders of the parent22.622.023.1Minority interest
747.2789.979.9Total Non-Current LiabilitiesEquity
720.7761.749.7Bank loans26.528.230.2Other non current liabilities
860.6929.9796.1Total Non-Current Assets1,309.31,304.71,350.0TOTAL ASSETS
Current Liabilities128.268.3820.7Bank loans, current portion69.991.7122.0Other current liabilities
198.1160.0942.7Total Current LiabilitiesNon Current Liabilities
225.1272.7187.6Prepaid concession expenses208.6
448.6
374.866.2
134.3165.4
8.9
31.03.2007
167.3
441.2
553.883.2
140.8323.5
6.3
31.12.2006
184.7Other non-current assets
159.2Restricted bank balances140.8Prepaid concession expenses, current portion113.6Other current assets
35.1Cash and cash equivalentsCurrent Assets
Non Current Assets448.7Total Current Assets
450.8Built-operate-transfer (BOT) Investment (net)
30.06.2007(€ million)
20
Consolidated Cash Flow Statement
80.4(37.0)(23.5)Cash generated from operations(3.0)(1.5)(0.4)Income taxes paid
(31.4)(23.4)(8.3)Interest paid(0.2)(0.3)(0.2)Retirement benefits paid45.8(62.2)(32.4)Net cash provided from / (used in) operating activities
72.694.035.5Operating cash flows before movements in working capital(59.0)
0.214.5(0.2)(1.4)
8.935.9
(22.4)
1Q07
7.8(131.0)Change in working capital
Adjustments to reconcile net profit to net cash provided by operating activities:
70.369.8Amortization of concession asset-18.3Depreciation of BOT Investments
(50.1)(17.5)Profit / (Loss) for the periodOperating activities
33.027.9Accrued interest expense(6.3)(0.6)Accrued interest income(1.5)(3.6)Unrealized foreign exchange differences on loans
27.2-0.3Other
1H061H07(€ million)
21
Consolidated Cash Flow Statement
35.294.2-Decrease in restricted bank balances
107.2125.1(1.2)Net cash provided from financing activities
(6.2)28.8(2.8)NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
10.96.311.7CASH AND CASH EQUIVALENTS AT THE BEGINNING OF PERIOD
4.735.18.9CASH AND CASH EQUIVALENTS AT THE END OF PERIOD
5.25.45.5Other
-48.338.6Premium in excess of par-(0.3)(0.4)Dividends paid
(24.2)(229.5)(65.3)Repayment of borrowings91.0207.020.4New borrowings raised
Cash Flows from Financing Activities
(7.4)(6.3)47.3Other investments(159.2)(34.0)30.8Net cash used in investing activities
(151.8)(27.7)(16.5)Additions to BOT InvestmentsInvesting activities
1Q07 1H061H07(€ million)
TAV Airports – Business Overview
TAV Airports – Financial Overview
TAV Airports – Operations
Conclusion
22
Izmir Adnan Menderes International Terminal
23
Istanbul Atatürk Airport (100% owned)
12% YoY passenger volume growth in 1H07
Revenue of €115 million in 1H07, up 7%
€84.7 million EBITDAR in 1H07, implies 26% growth and 73% margin
16% revenue growth in $ terms (TAV Istanbul collect US$ 15 per int’l pax)
€16.6 duty-free spend per pax
Passenger traffic 2001-2007 (m)Strong growth in Passenger volume and Revenues
Revenue (€m)
THY (49%) Atlas Jet (24%)
Onur Air (24%) Others (3%)
Domestic International
THY (%47) Atlas Jet (4%)Lufthansa (4%) Onur Air (3%)
KTHY (2%) Others (40%)Source: DHMİ
Passengers per airline (2006)
Source: DHMI, Terminal passenger figures exclude transit passengers
10.99.7
21.319.315.6
12.111.412.6
2001 2002 2003 2004 2005 2006 1H06 1H07
International Domestic
11.0% CAGR 2001-06
0
50
100
150
200
250
2003 2004 2005 2006 1H06 1H07
Source: TAV Airports
15.6% CAGR 2003-06
y-o-y +7%
y-o-y +12%
24
Managing our Diversified Portfolio
Ankara Esenboga Airport (100% owned)
Izmir Adnan Menderes Airport (100% owned)
Tbilisi International Airport (60% owned)
Operations commenced in October 16, 2006.
With the new terminal and relieved capacity constraints, Ankara is expected to grow in the coming years
Operations commenced in September 13, 2006.
Diversified customer base
Talks with Euro flag carriers to fly direct
Operations in new terminal commenced in February 7, 2007.
Capturing 98% of all air traffic in Georgia
ATÜ and BTA started to operate in the new terminal
Georgian Airways (29%)
THY (13%)
Aeroflot (8%)
Azal (7%)
Lufthansa (6%)
Siberia (5%)
Others (32%)
THY (70%)
Pegasus (11%)
Lufthansa (3%)
Onur Air (3%)KTHY (3%)
Atlas Jet (2%)
Others (8%)
Sun Express (20%)Onur Air (13%)Atlas Jet (10%)Pegasus (10%)Lufthansa (7%)KTHY (7%)THY (3%)Others (30%)
Passengers per airline (2006) Passengers per airline (2006) Passengers per airline (2006)
Total passengers (million) Total passengers (million) (*) Total passengers (000’s)
+7.6%CAGR
+17.6%CAGR
2.42.0
4.53.8
3.32.82.83.2
2001
2002
2003
2004
2005
2006
1H06
1H07
International DomesticSource: DHMI Source: Georgian authorities
1.51.7
1.51.41.51.5
0.600.53
2001
2002
2003
2004
2005
2006
1H06
1H07
252 274 318402
547 567
251 253
2001
2002
2003
2004
2005
2006
1H06
1H07
International Domestic
y-o-y +19% y-o-y
+14%
y-o-y +1%
Source: DHMI, (*) International passengers only
25
ATU Duty Free (50% owned)
ATU is the sole duty free operator at Istanbul Ataturk, Ankara, Izmir and TbilisiAll international pasenger traffic at Ataturk Airport increased by 17% in 1H07.Competitive concession fee (~43%) paid to TAV for ATÜ-operated shops in Ataturk AirportSpend per pax decreased from €17.9 in 1H06 to €15.6 in 1H07, mainly becouse of inclusion of Izmir & Ankara. ATÜ also pursues tenders outside TAV operations
Spend per pax (€)
Source: TAV, Figures imply 100% of ATU
Revenue (€m)
Financial Data
40%5.27.34.72.5EBITDA23%104.2128.571.756.8Total Revenues
-13%17.915.615.216.3Spend per pax (€) -5.0%5.7%6.6%4.5%EBITDA Margin
∆1H061H072Q071Q07(€ m)
17.914.814.8 16.0 15.6*
14.3
2003 2004 2005 2006 1H06 1H072003 2004 2005 2006 1H06 1H07
188.0217.3
104.2128.5
y-o-y +23%165.5
141.9
* 1H07 Duty-free spend per pax includes Istanbul (€16.6), Ankara & Izmir; while previous periods indicate Istanbul only
26
BTA Catering Services (67% owned)
BTA is the food and beverage operator at Istanbul Ataturk (Intl), Ankara, Izmir and TbilisiTotal revenue increased by 52% in 1H07, reflecting the inclusion of operations at new airports and revenue from Cakes&Bakes operations.Concession fees: BTA pays c40% of its revenues to TAVSpend per pax decreased from €2.1 in 1H06 to €1.8 in 1H07, however €2.1 per pax spend is maintained in Istanbul.BTA is in negotiations to provide in-flight catering operations within the local market by 2009
Spend per pax (€)
3%1.51.51.50.1EBITDA52%15.022.712.510.2Total Revenues
-13%2.11.81.52.1Spend per pax (€)
-10.0%6.7%11.8%0.6%EBITDA Margin
∆1H061H072Q071Q07(€ m)
2003 2004 2005 2006 1H06 1H072003 2004 2005 2006 1H06 1H07
29.435.1
15.0
22.7
y-o-y +52%
1.8*2.1
2.41.9
Source: TAV, Figures imply 100% of BTA
* 1H07 Food & beverage spend per pax includes Istanbul (€2.1), Ankara & Izmir; while previous periods indicate Istanbul only
21.114.9 1.3
1.6
Revenue (€m)
Financial Data
27
Havaş Ground Handling (60% owned)
62.651.858.551.8
2004 2005 2006 1H06 1H07
Total revenue of Havas increased by 6% in 1H07.
Better figures in 2Q07 than 1Q07 due to seasonality
Favourable market characteristics with only two operators
Currently operating at 11 airports in Turkey
Formed strategic partnership with Cyprus Turkish Airlines (KTHY) to undertake ground handling operations in Nothern Cyprus (Ercan Airport)
122.0
Revenue (€m) # Aircrafts handled (‘000)
Financial Data
25.2
-5.3%-0.916.7
1Q07
37.3
30.6%8.8
28.72Q07
-25%10.57.9EBITDA6%42.745.4Total Revenues
21%51.862.6# Aircrafts handled (‘000)
-24.5%17.4%EBITDA Margin
∆1H061H07(€ m)
2005 2006 1H06 1H07
84.1103.8
y-o-y 6%
Source: TAV, Figures imply 100% of Havas
42.7 45.4
y-o-y +21%
28
Other Services
Other services income mainly contains incomes from maintenance, CIP lounge services, security services and software sales
TAV O&M (100%), incorporated in 2004
Commercial area allocations and maintenance
CIP / VIP
TAV IT (96%), become a separate entity in 2005
Airport IT services, software and hardware sales
TAV Security (67%), became a separate entity in 2006
Security service provider in Istanbul, Ankara and Izmir
Financial Data
Revenue Breakdown (1H07)
Source: TAV
* All periods include “TAV Holding”
n.m.-1.010.1
1Q07
n.m.-1.912.7
2Q07
n.m.-1.5-2.8EBITDA72%13.322.8Total Revenues
-n.m.n.m.EBITDA Margin
∆1H061H07(€ m)
2005 2006 1H06 1H07
10.3
35.3y-o-y +72%
13.3
22.8TAV
Security15%
TAV IT14%
TAV O&M57%
TAV Holding
14%
Revenue (€m)
29
Istanbul Atatürk International Arrivals
TAV Airports – Business Overview
TAV Airports – Financial Overview
TAV Airports – Operations
Conclusion
30
Outlook
Traffic passenger growth
Commercial Commercial revenuesrevenues
New concessionsNew concessions
IATA forecasts 8.9% growth p.a. in TurkeyTHY joining Star Alliance expected to boost pax by 2 million
ATÜ and BTA expected to increase revenues at new airportsAll international passengers eligible for duty free (departing and arriving)BTA – potential from in-flight catering operations within local market (2009)
2007 will be the first full year of operations at Ankara, Izmir and Tbilisi
Recently won two concessions in Tunisia
Started operations in Batumi Airport
CapexCapex Minimal maintenance capex on existing concessions as all terminals are brand new
DividendsDividends Dividends are expected to commence in 2 to 3 years
31
2007 Outlook
Passenger Traffic *
16% YoY passenger growth in full year of 2005
10% YoY passenger growth in full year of 2006
12% YoY passenger growth in the first seven months of 2007
Pax (million)
* Combined figures for terminals operated by TAV in Turkey
1,3
1,5
1,7
1,9
2,1
2,3
2,5
2,7
2,9
3,1
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2004 2005 2006 2007
32
Conclusion
Turkish GDP, Population & Tourist Growth $ / € Based Charges Diversified Portfolio
Strong Fundamentals
Attractive Business Model
Minimal Ongoing Maintenance Capex
High Future Margins & Operational Leverage = Best-in-
class FCF Conversion
New strategic investors, enhanced corporate
governance & strengthened capital base
Enhanced Platform
33
Appendix
Istanbul Atatürk International Terminal
34
Concession Overview
Source: Company data, Notes: (1) As of 30 June 2007
Type / expire Scope Concession fee Net Debt(1)2006
Pax (mppa)Fee/paxIntern’l
Fee/paxdomesticAirport
Concession(2021) Intl + dom $165m/yr €404m21.2 US$15 €3Istanbul
Ataturk
BOT(2023) Intl + dom - €120m4.55 €15 €3Ankara
Esenboga
BOT(2015) Intl - €94m1.45 €15 -Izmir A
Menderes
BOT(2027) Intl + dom - €28m0.6 US$22
(+ 2% p.a.) US$6Tbilisi
Volume guarantee
No
0.6m Dom.0.75 Int’l for 2007 + 5%
p.a.
1.0m Int’l for 2006 + 3%
p.a.
No
TAV stake
100%
100%
100%
60%
BOT + concession
(2047)Intl + dom
11-26% of revenues from 2010 to 2047
€28mnet cash4.2 €8.25 in 2008
€9 in 2009€8.25 in 2008€9 in 2009
Monastir&
EnfidhaNo100%
BOT(2027) Intl + dom - -- US$12 US$7Batumi No60%
35
Market Performance
Share Performance
6
11
16
21
26
31
36
41
14.0
9.07
31.0
8.07
16.0
8.07
02.0
8.07
19.0
7.07
05.0
7.07
21.0
6.07
07.0
6.07
24.0
5.07
10.0
5.07
26.0
4.07
11.0
4.07
28.0
3.07
14.0
3.07
28.0
2.07
Volume ($m)
6,0
7,0
8,0
9,0
10,0
11,0 Price ($)
-19%-3%-9%3M
-7%18%7%Since IPO
-7%-2%-4%Weekly
Share Price Performance
-7%-3%-6%1M
Relative to ISE-100USDYTL
Avg. Daily Volume US$ 3.5 mn (last 3 months)
Free Float 18.4%
Foreign ownership 93.7% of free float
Closing Price TRY 10.7 (US$ 8.5) per share
Market Cap US$ 2,052 mn
Notes: Share figures in this page was prepared as of 14 September, 2007.
6,0
7,0
8,0
9,0
10,0
11,0
14-0
9-07
31-0
8-07
16-0
8-07
02-0
8-07
19-0
7-07
05-0
7-07
21-0
6-07
07-0
6-07
24-0
5-07
10-0
5-07
26-0
4-07
11-0
4-07
28-0
3-07
14-0
3-07
28-0
2-07
Relative
0,8
0,9
1,0
1,1
1,2
1,3 Price ($)
TAVHL ($) Relative to ISE
36
Historic Overview
1997 1998 2000 2003 200620022001
January 2000ATÜ began operationsInternational terminal building completed c.8 months ahead of schedule
June 2000Concession agreement extended through to 2nd July 2005 in return for a 30% enlargement of the international terminal
1999 20052004
Established under the name of Tepe Akfen Vie Yatirim Yapim veIsletme A.S.Tepe and Akfen, together with Flughafen Wien A.G. (“Vie”) successfully tendered for BOT project for Istanbul Atatürk AirportConcession deadline 7th May 2004
May 2004BTA started operating the Istanbul International Airport Hotel
August 2004Executed the BOT agreement for Ankara Esenboğa International Airport (right to operate through mid-2023)
September 2004TAV O&M incorporated
June 2005TAV won the tender for Ataturk Airport to operate for 15.5 years (through 2nd January 2021)
July 2005TAV acquired 60% of Havaş sharesTAV obtained control of the BOT for Izmir AdnanMenderes Airport (right to operate through January 2015) through the acquisition of Havaş
September 2005TAV Urban Georgia LLC won the BOT tender for the Tbilisi Airport (10.5 years operating contract) with a 9.5-year extension granted in return for the re-development of the Batumi Airport
August 2005TAV IT became a separate entity
March 2006TAV Security became a separate entity
August 2006Name changed to TAV Havalimanlari Holding A.S.
September 2006Completed the construction of Izmir AdnanMenderes Airport’s international terminal
October 2006Ankara Esenboğa’s new domestic and international terminals completedBTA Catering Services
was founded
2007
February 2007IPO: TAV Havalimanlari Holding offered 44.56 million of its shares to public
March 2007TAV won the tender to operate Monastir and Enfidha Airports in Tunisia for 40 years
May 2007TAV started to operate Batumi Airport
July 2007TAV acquired remaining 25% of TAV Esenboga and 5% of TAV Izmir
August 2007TAV is awarded the tender of Antalya-Gazipasa Airport
37
Board of Directors
Ali Haydar KurtdarcanVice Chairman
Dr. Sani ŞenerMember and CEO
Ibrahim Suha GucsavMember
Mustafa KalenderMember
Hamdi AkinChairman
Dr. Cem KozluIndependent member
Mumtaz KhanMember
Chairman of Tepe Construction Ind. Inc
Chief Executive Officer of TAV Airports
Vice Chairman of Akfen Holding
Member of the Boards of Tepe Group companies
Chairman and CEO of Emerging Markets Partnership (Bahrain)
Chairman of Akfen HoldingMember of Ankara Chamber of Commerce (ATO) and Turkey Industrialists’ and Businessmen’s Association
Positions within TAV Airports and other companies
Independent Board Member
Ilhan IIMember Chairman and member of the Board of several Tepe Group companies
Shailesh Kumar DashMember Global Investment House (Kuwait)
Seref ErenMember Adviser, TAV Airports
Mehmet ErdoganMember External Affairs Coordinator, TAV Airports
Executives
Tepe / Akfen Holding related non executives
Strategic shareholder representatives
Independent
Pierre de ChampfleuryIndependent member Independent Board Member
James Bernard FarleyMember Babcock & Brown
Irfan ErciyasMember Board member of Akfen Holding
Suleyman SonMember General Manager and Board member of Tepe Construction
38
Disclaimer
This presentation does not constitute an offer to sell or the solicitation of an offer to buy or acquire any shares of TAV HavalimanlariHolding A.Ş. (the "Company") in any jurisdiction or an inducement to enter into investment activity. No information set out in this document or referred to in such other written or oral information will form the basis of any contract.The information used in preparing these materials was obtained from or through the Company or the Company’s representatives or from public sources. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its accuracy, completeness or fairness. The information in this presentation is subject to verification, completion and change. While the information herein has been prepared in good faith, no representation or warranty, express or implied, is or will be made and noresponsibility or liability is or will be accepted by the Company or any of its group undertakings, employees or agents as to or in relation to the accuracy, completeness or fairness of the information contained in this presentation or any other written or oral information made available to any interested party or its advisers and any such liability is expressly disclaimed. This disclaimer will not exclude any liability for, or remedy in respect of fraudulent misrepresentation by the Company.
This presentation contains forward-looking statements. These statements, which may contain the words “anticipate”, “believe”, “intend”, “estimate”, “expect” and words of similar meaning, reflect the Company’s beliefs, opinions and expectations and, particularly where such statements relate to possible or assumed future financial or other performance of the Company, are subject to risks and uncertainties that may cause actual results to differ materially. These risks and uncertainties include, among other factors, changing business or other market conditions and the prospects for growth anticipated by the management of the Company. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. These forward-looking statements speak only as at the date of this presentation. The Company expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Past performance cannot be relied upon as a guide to future performance. As a result, you are cautioned not to place reliance on such forward-looking statements.
Information in this presentation was prepared as of 14th September, 2007.