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Park Elektrik Üretim Madencilik Sanayi ve Ticaret A.Ş. February 2012.

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Presentation on theme: "Park Elektrik Üretim Madencilik Sanayi ve Ticaret A.Ş. February 2012."— Presentation transcript:

1 Park Elektrik Üretim Madencilik Sanayi ve Ticaret A.Ş. February 2012

2 2 Contents I. Ciner Group in Brief3 II.Park Elektrik Overview6 III.Operations 10 IV.Micromine Reserve Report13 V.Planned Investments19 VI.Financial Structure22 VII.Evaluation of The Latest Financial Tables32 VIII.Corporate Governance Rating39 IX.Market Data40 Park ElektrikFebruary 2011

3 Park Elektrik3 I.Ciner Group in Brief Park ElektrikFebruary 2011

4 Park Elektrik4 Ciner Group, Introduction  Park Holding, the main shareholder of Park Elektrik, is controlled by Ciner Group, which is solely owned by Mr. Turgay Ciner. Ciner Group’s history goes back to 1978 when it was founded.  Ranking among the largest Groups of Turkey, Ciner Group diversified its operations from the energy and mining sectors to tourism, media and broadcasting sectors.  Ciner Group is a pioneering actor in energy and mining sector given its new and initial steps since early 1990s. In line with accelerated privatization efforts in 1990s, the Group successfully involved in mining and energy sectors which are the underlying sectors of the Group’s fast growth in recent years. February 2011

5 Park Elektrik5 Ciner Group, Main Line of Businesses Energy & Mining Group Ciner Group Media Group Commerce, Industry & Services Group Major Companies Park Elektrik Park Termik Park Teknik Eti Soda Silopi Elektrik Park Enerji Ekipmanları Major Companies & Brands Ciner Yayın Holding Haberturk Newspaper Haberturk TV, Radio, Haberturk Web Site Bloomberg HT, FHM, Marie Claire, Newsweek Major Companies Park Marine Park Aviation Lares Park Hotels Park Insurance Park Foreign Trade Denmar Logistics February 2011

6 Park Elektrik6 II.Park Elektrik Overview February 2011

7 Park Elektrik7 The Company  Established in 1994.  Initially offered to public in 1997. Park Elektrik is the sole listed company within Ciner Group.  Changed its commercial title in 2000.  Commenced copper mining operations in late 2006.  Merged with ISE-listed Group company, Ceytas, in May 2009.  Added asphaltite mining into its operation line following Ceytas merger.  Currently operating a copper and an asphaltite mine and plans to establish an HPP (Hydroelectricity Power Plant) in the medium term, and a NGPP (Natural Gas Power Plant) in the long term. February 2011

8 Park Elektrik8 Ownership Structure February 2011

9 Park Elektrik9 Participations, Park Termik  Park Elektrik has 10% stake in Park Termik Elektrik San. ve Tic. A.S., a Ciner Group company which is involved in thermal power generation in Çayırhan, Ankara.  Park Termik operates Cayirhan Thermal Power Plant which has a total production capacity of 620 MW, in four units.  The plant is an integrated power generator which procures coal through its own lignite mines. February 2011

10 Park Elektrik10 III.Operations February 2011

11 Park Elektrik11 Park Elektrik’s Existing & Planned Facilities Asphaltite Mine Sırnak Natural Gas Power Plant Adana Copper Mine Siirt HPP Diyarbakır February 2011

12 Park Elektrik12 I) Madenköy Copper Zone  Park Elektrik acquired operation license of Madenkoy copper mine from Eti Holding, a state-owned entity engaged in mining businesses, in 2004 for TL9.4 mn.  Mine operations started in late 2006 in the copper zone. So far, around 3 mn tons of ore was extracted in the copper zone.  According to initial reports, proven reserves in the zone was determined at 13 mn tons of ore. However, based on a recent report conducted by Micromine Consulting Services, total reserves in the zone was determined at 39.8 mn tons of ore, 31.2 mn tons of which was measured.  The company has a concentration facility and it produces and sells concentrated copper that includes a varying rate of copper. Currently, copper content in the concentrate varies between 19-20% levels.  Although the Company does not posses a smelting facility, it recently initiated a trial production through a domestic subcontractor to produce A grade cathode copper that includes 99.9% copper content.  Park Elektrik exports all of its concentrated copper and cathode copper production. February 2011

13 Park Elektrik13 Micromine Reserve Report Based On JORC  According to a JORC compliant recent reserve estimation made by Micromine Consulting Services, based on the drilling and sampling works by Eti Holding (1981), Preussag AG Metall (1988) and Park Elektrik, the total reserves of Madenköy project was determined 39,821,000 tons of ore, 31,182,000 tons of which was set to be measured.  Based on the same report, average tenor rate in Madenkoy copper mine is determined as 2.4% for the whole zone. Current tenor in the zone is lower at 1.9- 2.0% levels. Source: JORC Resource Estimate Report by Micromine February 2011

14 Park Elektrik14 Capacity Expansion  In parallel with growing reserves in the Madenkoy copper zone, the company increased its concentration facility’s capacity from 750k to 1.2 mn tons as of October 2011. Total capex for this investment was Euro 3.5mn.  Furthermore, Park Elektrik plans to increase its concentration capacity to 1.8 mn tons in the short-mid term. The company plans to complete this second phase capacity expansion in 2013 with a planned investment amount of Euro 3.5-4mn.  In line with increasing capacity, Park Elektrik revised its production targets for the coming two years. The company expects 95k and 150k wmt of production for 2012 and 2013, respectively. February 2011

15 Park Elektrik15 2012 Production Targets February 2011

16 Park Elektrik16 Zone Plan February 2011

17 Park Elektrik17 II) Silopi Asphaltite Zone  Asphaltite is a petroleum-origin hydrocarbon with a thermal value of 5,500-5,800 kcal/kg.  Park Elektrik has the operational rights of Silopi asphaltite mine until 2033. Estimated asphaltite reserve in Silopi is around 35 mn tons based on Turkish Coal Enterprise (TKI) reports.  Operations in the asphaltite zone started in June 2009. The company provides asphaltite to Silopi Elektrik Üretim A.Ş., a group company which is involved in electricity production in Silopi with fluidized bed technology and has a starting capacity of 135 MW.  Annual production amount in Silopi is around 450,000 currently and is subject to increase from 2014 onwards in line with capacity expansion of Silopi EUAS. With the expansion, annual asphaltite production will be tripled.  Park Elektrik has a profit margin of 15% on its asphaltite sales based on recently renewed contract by two companies. The contract will be valid as long as Silopi Elektrik runs the operations.  The mine will be open-pit for the first years of operation. Later on, underground mining will be done by the method of “Cut and Fill Block Caving”. February 2011

18 Park Elektrik18 Open-Pit Mining in Silopi February 2011

19 Park Elektrik19 IV.Planned Investments February 2011

20 Park Elektrik20 Diyarbakır HPP  Installed capacity will be 50.5 MW.  Production license is valid for 49 years.  Estimated investment amount is US$ 60 mn according to initial feasibility studies. February 2011

21 Park Elektrik21 Ceyhan Natural Gas Power Plant  Park Elektrik applied to Energy Market Regulatory Authority for a license to establish a NGPP in Ceyhan, Adana.  Installed capacity will be 423 MW.  Production license will be valid for 49 years.  Estimated investment amount is Euro 250 mn. February 2011

22 Park Elektrik22 V.Financial Structure February 2011

23 Park Elektrik23 Concentrate (dmt) & Cathode Sales (ton) February 2011

24 Park Elektrik24 Annual Concentrate (dmt) & Cathode (ton) Sales February 2011 * In 2010, there was a production halt of four months. ** Cathode copper sales realized for the first time in 3Q11.

25 Park Elektrik25 Annual Asphaltite Sales (ton) February 2011 * Asphaltite operations started in mid 2009.

26 Park Elektrik26 Total Sales Revenues* (TL) * Ignores other sales & discounts. February 2011

27 Park Elektrik27 Breakdown of COGS, as of 9M11 February 2011

28 Park Elektrik28 Unit Cash Costs For Con. Copper (TL/wmt) February 2011

29 Park Elektrik29 Net Earnings (TL mn) February 2011

30 Park Elektrik30 Annual Margin Comparison February 2011

31 Park Elektrik31 Sources of Financing (TL mn) February 2011 * Park Elektrik has no financial debt.

32 Park Elektrik32 VI.Evaluation of 9M11 Financial Results February 2011

33 Park Elektrik33 Evaluation of 9M11 Financial Results  In 1H11, Park Elektrik’s product composition changed by including cathode copper into its product range for the first time. Although still in trial period, the copper cathode production reached 1846 Mt by the end of 3Q11. By 3Q11, the company’s concentrated copper production in wmt increased by 184% as compared to the strike shaken previous year. Concentrated copper sales were realized with 153% increase in dmt, y-o-y, as some amount of concentrated copper was utilized for cathode copper production of 1846 mt by the third quarter. 1210 mt of the cathode copper has been sold by the end of 3Q11.  Revenues from total sales more than tripled under the effect of the previous year’s mine strike and soared copper prices, while revenues from the asphaltite sales were kept almost same as the previous year.  The company also had TL15mn of other operational income due to its realized contract in London Metal Exchange. February 2011

34 Park Elektrik34 Production & Sales Amount February 2011

35 Park Elektrik35 Sales Breakdown (TL) & Gross Margin by Products February 2011 9M109M11% Copper Sales31,871,808122,768,872285 Gross Margin of Copper55%64%- Asphaltite Sales14,086,79214,087,5420 Gross Margin of Asphaltite32%20%- Other Sales87,0871,283,988nm Total Sales Revenues46,045,687138,140,402200 Overall Gross Margin48%59%-

36 Park Elektrik36 Income Statement (TL) February 2011

37 Park Elektrik37 Margins (%)9M109M11 Gross Profit Margin4859 Operational Profit Margin1856 EBITDA Margin4064 Net Profit Margin4061 February 2011

38 Park Elektrik38 Summary Balance Sheets (TL) YE109M11 Current Assets278,577,962302,771,805 Fixed Assets96,996,526168,684,694 TOTAL ASSETS375,574,488471,456,499 Short Term Liabilities28,757,83138,721,063 Long Term Liabilities4,255,8166,477,122 Shareholders Equity342,560,841426,258,314 TOTAL LIABILITIES375,574,488471,456,499 February 2011

39 Park Elektrik39 Corporate Governance Rating  Park Elektrik was rated with 8.67 as a result of the Corporate Governance study done by SAHA Kurumsal Rating Agency. According to report done by SAHA, the rating means that the company performs “very good” in terms of Capital Markets Board’s corporate governance principles. It has, to varying degrees, identified and actively managed all significant corporate governance risks through comprehensive internal controls and management systems. The company’s performance is considered to represent best practice, and it had no deficiencies in any of the areas rated. February 2011

40 Park Elektrik40 T H A N K Y O U. CONTACTS Yesim BilginturanSelim ErdoganIR Manager Phone: +90 216 531 25 33+90 216 531 25 35 February 2011

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