Anadolu Efes BEER OPERATIONSBEER OPERATIONS

1Q2010 Results Conference Call Presentation

Alejandro Jimenez Can Çaka

12.05.2010

Alejandro Jimenez Can Çaka EFES BEER GROUP PRESIDENT CFO

ForwardForward--Looking StatementsLooking Statements

This presentation may contain certain forward-looking statements concerning

our future performance and should be considered as good faith estimates

made by the Company. These forward-looking statements reflect management

expectations and are based upon currently available data. Actual results are

subject to future events and uncertainties, which could materially impact the

Company’s actual performance.

2

General Overview & Operating Performance General Overview & Operating Performance

by by Alejandro JimenezAlejandro Jimenez

Beer Sales Volume DevelopmentBeer Sales Volume Development--1Q20101Q2010

Total Beer Volume Development

4.4 4 54.4 4.5

2 5 2 72.5 2.7mhl

1.9 1.8

1Q2009 1Q2010

Turkey Beer Operations

International Beer Operations

Total beer sales volume increased by 2.4% in 1Q2010;

Total Beer Sales

International Beer Operations

4

Sales volume in Turkey beer operations declined by 7.9%Sales volume in Efes Breweries International (EBI) increased by 10.5%

TURKEYTURKEYChallenging Quarter in the Turkish MarketChallenging Quarter in the Turkish MarketChallenging Quarter in the Turkish MarketChallenging Quarter in the Turkish Market

Volume Development Sales Revenue Development

1.9 1.8

mhl

TRL

m

295.0 272.5

m T

1Q2009 1Q20101Q2009 1Q2010

Market Share by Volume

Others10.6%

Sales volume in Turkey beer operations declined by 7.9%, due to;14% increase in average sales prices by the beginning of 2010 to

reflect 35% hike in excise taxeslower than beer price increases for other alcoholic beverages

Market Share by Volume

The Nielsen C

Anadolu Efes89.4%

high base of last yearsmoking banchallenging economic environment

d it

Com

pany, YTD

M

despite;double digit growth in export volumes

5

March 2010

EFES BREWERIES INTERNATIONALEFES BREWERIES INTERNATIONALSolidified position in Operating MarketsSolidified position in Operating MarketsSolidified position in Operating MarketsSolidified position in Operating Markets

Volume Development Sales Revenue Development

149.4 166.1l SD2.5 2.7

mh

m U

1Q2009 1Q2010

•Consolidated sales volume increased significantly by 10.5% in 1Q2010 compared to 1Q2009, contributed by;

•initiatives to increase availability of our products

1Q2009 1Q2010

initiatives to increase availability of our products

•innovation to maximize the growth of strategic brands

•the low base of last year

d itdespite;

• higher beer prices to reflect higher taxes

•unfavorable economic conditions

•Consolidated net sales revenue increased by 11.2% in 1Q2010, as a result of higher volumes and price increases andsupported by the appreciation of local currencies versus USD and revenue management initiatives, despite the negativeeffect of excise tax increases.

6

Continued to Outperform the RUSSIAN MARKETContinued to Outperform the RUSSIAN MARKET

Sabmiller Other16 6%

Volume Development Market Share by Volume – 1Q2010

The Niel

YTD

Ma

BBH38.5%

Heineken

EBI10.1%

6.8% 16.6%

mhl

2.0 2.2

lsen Com

pany, Torch 2010

InBev15.5%

Heineken12.5%

1Q2009 1Q2010

otal National U

rba

Market Share by Volume – 1Q2009

TY

• Beer market is estimated to have contracted by ca.12% in 1Q20101

• EBI’s sales volume increased significantly by 9.5% in 1Q2010

k t h i d f th d h d 10 1% i 1Q2010

an,

Numbers may not add up to 100 due to rounding.

BBH39 7%EBI

Sabmiller6.7%

Other13.0%

The Nielsen C

omY

TD M

arch 2009

•market share improved further and reached 10.1% in 1Q2010

from 9.4% in 1Q2009

• Net sales revenue in USD terms increased by 9.4%, contributed by;39.7%

InBev15.8%

Heineken15.4%

EBI9.4%

mpany, Total N

atio

• price increases

• appreciation of Ruble against USD in 1Q2010 vs. 1Q2009

despite;

7

onal Urban,

Numbers may not add up to 100 due to rounding.

despite;

• significant excise tax increase, which is not fully reflected to

consumers yet[1] The Nielsen Company, National Urban Retail Audit Report, March YTD 2010

Regulatory Developments in RussiaRegulatory Developments in Russia

•As part of the Russian Government’s measures against abuse of alcohol usage per•As part of the Russian Government s measures against abuse of alcohol usage, per capita alcohol consumption is aimed to be lowered

In this context, major actions taken up to date are;In this context, major actions taken up to date are;

•Excise tax on beer increased from RUB 3/lt to RUB 9/lt as of January 1, 2010•Market impact will depend on various factors such as p p

•How much of the excise increase will be reflected on prices during the year -PARTIALLY REFLECTED BY INDUSTRY PLAYERS UNTIL NOW•Macroeconomic environment

•Brewering industry will suffer from lower sales volumes and profitabilities•We already passed most of the effect of excise tax hike

•Minimum price for vodka set at RUB 89 per half a lt as of January 1, 2010•Many proposals in Duma, some of which may effect beer producers

•Manageable but painful restrictions on sales hours of beer, outdoor NO OFFICIA

8

consumption, ban of beer sales in kiosks etc.- NO OFFICIAL ANNOUNCEMENT YET

Enriched Enriched Brand PBrand Portfoliosortfolios withwithDDifferentifferent TTastesastes and and PPackagesackagesgg

In 1Q2010 EBI continued to focus on innovation toIn 1Q2010, EBI continued to focus on innovation to maximize growth of its strategic brands as well as to benefit from niche opportunities in the operating markets. ...markets. ...

Line extentions mainly for mainstream brands and new bottles for lower mainstream brands Gold Mine and Green in Russiafor lower mainstream brands, Gold Mine and Green, in Russia

Line extentions in other operations

EBI realizes the importance of innovations in the sales volume performance, therefore will maintain its focus on an innovated SKU portfolio as one of its primary strategies behind its main strategic brands

9

strategies behind its main strategic brands.

Financial Overview Financial Overview

by by Can ÇakaCan Çaka

TURKEYTURKEY

Operational SnapshotOperational Snapshot--1Q2010 Performance1Q2010 Performancep pp p

1Q2009 1Q2010 Growth (%)

Total Sales Volume (mhl) 1,9 1,8 (7,9%)

Net Sales (million TRL) 295,0 272,5 (7,6%)

Gross Profit (million TRL) 198,4 187,1 (5,7%)

Gross Profit margin (%) 67,2% 68,7% 142 bps

EBITDA (million TRL) 134 2 104 0 (22 5%)

Net Sales declined by 7.6% mainly due to the lower volumes, despite an average price increase of 14%

EBITDA (million TRL) 134,2 104,0 (22,5%)

EBITDA margin (%) 45,5% 38,2% (731 bps)

to reflect excise tax increase

Gross Profit Margin improved by 142 bps due to;

• lower commodity prices

• Stronger TRL despite;

• higher fixed costs per liter due to lower volumes

• higher wages and energy prices

EBITDA Margin declined by 731 bps, attributable to higher operating expenses mainly due to low base of 1Q2009(Marketing, Selling and Distribution Expenses was 9.1% lower in 1Q2009 vs. 1Q2008, while it was up 9.0% in FY2009over FY2008) as well as shift of certain sales and marketing expenses to 1Q. However, we believe that this will phase outthrough prospective quarters and we maintain our full year guidance with slight EBITDA margin decline. 11

TURKEY BEER OPERATIONSTURKEY BEER OPERATIONS

Strong Free Cash Flow GenerationStrong Free Cash Flow GenerationStrong Free Cash Flow GenerationStrong Free Cash Flow Generation

(million TRL)1Q2009 1Q2010

Operating Profit 115,6 82,4 Depreciation & Amortization 16,7 18,2

( )

Other non-cash items 1,9 3,4 EBITDA 134,2 104,0

Change in Inventory 4,6 2,5 Change in Trade Receivables (56,7) (70,9)

Change in Trade Payables 2,6 0,1 Change in Other Assets/ Liabilities 3,8 33,2

Change in Working Capital (45,8) (35,0) Income Taxes & Employee Benefits Paid (10,1) (15,3) CAPEX, net (20,8) (21,9) Minority Buy-Out and Other Investing Activities - (296,2) Net Financial Income (Including interest) 10,8 6,3 FCF 68,3 (258,2)FCF 68,3 (258,2)

FCF excluding minority buy-out and other investing activities 68,3 38,1

12

EFES BREWERIES INTERNATIONALEFES BREWERIES INTERNATIONAL

Operational SnapshotOperational Snapshot--1Q2010 Performance1Q2010 PerformanceOperational SnapshotOperational Snapshot 1Q2010 Performance1Q2010 Performance

1Q2009 1Q2010 Growth (%)1Q2009 1Q2010 Growth (%)

Total Sales Volume (mhl) 2,5 2,7 10,5%

Net Sales (million USD) 149,4 166,1 11,2%

Gross Profit (million USD) 65,2 72,7 11,5%

Gross Profit margin (%) 43,7% 43,8% 13 bps

EBITDA ( illi USD) 24 1 25 6 6 3%

Net Sales increase above the volume growth as a result of higher volumes and price increases

EBITDA (million USD) 24,1 25,6 6,3%

EBITDA margin (%) 16,1% 15,4% (71 bps)

g g pand supported by the appreciation of local currencies versus USD and revenue managementinitiatives, despite the negative effect of excise tax increases.

Gross margin increased slightly by 13 bps, mainly due to lower commodity prices andcontinued cost saving initiatives despite the negative effect of tax hike in Russia

EBITDA Margin declined by 71 bps, due to higher operating expenses mainly attributable to theincreased transportation costs in line with higher sales volume, further contributed by inflation andlocal currency appreciation in 1Q2010 13

EFES BREWERIES INTERNATIONALEFES BREWERIES INTERNATIONAL

Positive Free Cash Flow GenerationPositive Free Cash Flow GenerationPositive Free Cash Flow GenerationPositive Free Cash Flow Generation

(million USD)1Q2009 1Q2010

Operating Profit 4,2 (0,8) Depreciation & Amortization 19 8 24 7

( )

Depreciation & Amortization 19,8 24,7 Other non-cash items 0,1 1,6

EBITDA 24,1 25,6 Change in Inventory 28,0 (6,0)

Change in Trade Receivables 18 7 (1 9)Change in Trade Receivables 18,7 (1,9) Change in Trade Payables 11,2 36,6

Change in Other Assets/ Liabilities 10,3 (5,4) Change in Working Capital 68,2 23,3 Income Taxes Paid (0 9) (0 3)Income Taxes Paid (0,9) (0,3) CAPEX (28,0) (20,5) Capital Increase in Subsidiaries by Minority Shareholders - 17,5 Net Financial Expense (Including interest) (37,6) (1,5) FCF 25 7 44 2FCF 25,7 44,2

FCF excluding capital increase in subsidiaries by minority shareholders 25,7 26,6

14

Net Net Financial Financial DebtDebt & Financing& FinancingT k B O tiTurkey Beer Operations

• Cash & cash equivalents at 320.4 million TRL - Net cash position of 26.3 million TRL

Efes Breweries International

• Consolidated gross debt at US$ 615.0 millionC h & h i l US$ 181 1 illi N d b i i US$ 433 9 illi• Cash & cash equivalents at US$ 181.1 million - Net debt position at US$ 433.9 million

EBI-Net Financial Debt* EBI-Maturity BreakdownEBI Net Financial Debt EBI-Maturity Breakdown

2.8x EBITDA 2 5x EBITDA

20134.4%

20142.6%

2.5x EBITDA

D

201026.5%

482.5 433.9m U

SD

201115.5%

201251.0%

FY2009 1Q2010

15*excluding put options

CLOSING REMARKSCLOSING REMARKS

by by Alejandro JimenezAlejandro Jimenez

Turkey beer operations

• In 1Q2010, domestic sales volumes in Turkey declined, in line with our expectations

• EBITDA margin declined from exceptionally high 1Q2009, contributed by shift in sales and marketing

initiatives to 1Q

However, these negative effects will phase out through prospective quarters and we maintain our full

id ith l i l di it d li i l i T k b ti d li ht EBITDAyear guidance with low single digit decline in volumes in Turkey beer operations and slight EBITDA

margin decline.

International beer operations

• Sales volume increased significantly in 1Q ourperforming market estimates• Sales volume increased significantly in 1Q, ourperforming market estimates

Although current trajectory of EBI’s 1Q2010 performance was significantly better than the one on

which our full year guidance is based on, we believe it would be more appropriate to revise the

17

outlook after seeing the 1H performance, although we believe our strategic initiatives will continue to

provide us momentum going forward.

? QUESTIONS PLEASE ?? QUESTIONS PLEASE ?? QUESTIONS PLEASE ?? QUESTIONS PLEASE ?

APPENDIXAPPENDIX

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