park elektrik Üretim madencilik sanayi ve ticaret a.Ş. august 2015
TRANSCRIPT
Park Elektrik Üretim Madencilik Sanayi ve Ticaret A.Ş.
August 2015
2
Contents
I. Company & Operations 3II. Ownership Structure & Participation
18III. Ciner Group 21IV. Financial Structure 24V. Evaluation of The Latest Financial Tables
32VI. Corporate Governance Rating
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Park Elektrik August 2015Park Elektrik Madencilik
Park Elektrik 3
I. Company & Operations
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Park Elektrik 4
Introduction
Park Elektrik is the sole copper mining company on the ISE. The company operates Madenköy copper mine in Siirt, in the southeast of Turkey, since late 2006.
Total resources of Madenköy copper mine was determined as 41.5 mn tons of ore with an average grade of 2,02% according to a JORC based report conducted by Micromine Consulting Services in February 2014. So far, Park Elektrik extracted approximately 9 mn tons of ore out of total resources of 41.5 mn tons in the zone.
The company has a concentration facility and it produces and sells concentrated copper, which is the final product of the company. Park Elektrik sells all of its concentrated copper, that includes copper content of around 20%, to an international commodity broker, namely Traxys.
As of YE2014, total number of employees is 479. 387 employees of total work force are blue collar employees working in the copper mine.
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Location of Copper Mine
Copper Mine
Siirt
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Madenköy Copper Zone
Park Elektrik acquired operation license of Madenkoy copper mine in 2004 from Eti Holding, a state-owned entity engaged in mining businesses, for TL9.4 mn.
Copper mine operations started in late 2006 in Madenköy copper zone. So far, approximately 9 mn tons of ore have been extracted in the copper zone, while the remaining resources is 32.5 mn tons of ore.
According to initial reports, proven reserves in the zone was determined as 13 mn tons of ore when Park Elektrik commenced its operations in 2006. However, according to latest reserve report issued by Micromine Consulting Services in February 2014, total resources in the zone was determined as 41.5 mn tons of ore, 36.3 mn tons of which was measured.
Park Elektrik exports all of its concentrated copper production to an international commodity broker namely Traxys, while the end customer is China.
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According to a JORC (Joint Ore Resources Code) compliant reserve report issued by Micromine Consulting Services in February 2014, total resources of the project was determined as 41.5 million tonnes of ore.
According to the same report, average grade in Madenköy copper mine is 2.02% for the whole zone and average grade of the measured resources is 1.95%.
Micromine Reserve Report Based On JORC
Micromine October 2011 Resource Report
Micromine February 2014 Resource Report
Tonnes Grade (%) Tonnes Grade (%)
Measured 31.182.000 2,26 36.264.000 1,95
Indicated 6.439.000 2,79 5.002.000 2,45
Inferred 2.206.000 3,38 225.000 3,52
Total Resources 39.821.000 2,40 41.500.000 2,02
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Production Volumes & Targets
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2011 2012* 2013** 2014 2015E
Stripping (m3) - 3,500,292 10,151,224 14,291,281 9,000,000
Ore Production (tons, wet) 1,024,871 1,138,232 1,540,031 1,723,653 1,652,000
Ore Used In Con. Center (tons, dry) 949,731 1,081,320 1,463,029 1,637,470 1,569,400
Grade of Ore (%) 1,73 1,77 1,47 1,18 1,35
Recovery Rate 87% 86% 82% 87% 87%
Con. Copper Production (wmt) 77,510 89,253 96,038 91,185 98,225
Con. Copper (dmt) (~92% of wmt) 71,309 82,113 88,354 83,890 90,367
Copper (mt) (~20% of dmt con. copper) 14,262 16,423 17,670 16,778 18,073
* Pre-stripping started in 2012. ** Production through open-pit started in mid of 2013.
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Long Term Planning in Open Pit
Having being operated by underground mining since the beginning of operations in the Madenköy copper zone, Park Elektrik shifted its copper mining operations from underground to open-pit mining by the mid of 2013. Pre-stripping in the zone started in 2012 and it continued until mid of 2013.
Based on projections, the company plans to continue open pit mining between 2013-2031. Throughout open pit mining for 18 years, the company plans to produce 26.4 mn tons of ore with 246 mn m3 stripping with an average strip ratio of 9.3 by the end of 2031.
2014 was the first full year of open pit mining therefore Park Elektrik had to work with very low grade with a high volume of stripping.
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Period Estimated Total Stripping(m3)
Estimated Total Ore Production(ton)
Estimated Strip Ratio
Estimated Total Con. CopperProduction (wmt)
2013-2031 246,000,000 26,400,000 9,31 2,107,702
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Open Pit Site View
Current View From Mine
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August 2015
Views From The Pit
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Main Ore Body
Topography
Open Pit Topographic View – I
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Open Pit Topographic View - II
Main Ore Body
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Open Pit Site Cross Section
Power Plant Projects
Withdrew natural gas power plant applications for Edirne and Ceyhan regions due to the complexities of the investment stages and uncertainities.
Obtained environmental impact assessment report for Hydroelectricity power plant (HPP) of 50MW in Diyarbakır/Tarihler. Transmission aggreement with TEIAS was achieved. Tender offer for construction of the facility will be made soon.
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II. Ownership Structure & Participation
Park Elektrik August 2015Park Elektrik Madencilik
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Ownership Structure
Others32%
Turgay Ciner7%
Park Holding61%
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Participation, 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 has operating rights of Çayırhan 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.
In 2014, Park Elektrik gained TL7 mn dividend income from Park Termik.
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III. Ciner Group
Park Elektrik August 2015Park Elektrik Madencilik
Park Elektrik 21
Ciner Group, Main Line of Businesses
Energy & Mining Group
Ciner Group
MediaGroup
Commerce, Industry &
Services Group
Major Companies & Brands
Haberturk NewspaperHaberturk TV, Radio,Haberturk Web Site
Bloomberg HT, Aks TV (Show TV)
Major CompaniesCiner Marine,Ciner Aviation,
Lares Park Hotels,Park Insurance,
Denmar Logistics,
Park Holding Ciner Yayın Holding
Major CompaniesPark Elektrik, Park
Termik, Silopi Elektrik, Park Teknik, Park
Toptan, Eti Soda, Rio Tur Soda, Park Cam
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Ciner Group
Park Holding, the main shareholder of Park Elektrik with 61% share, is solely owned by Mr. Turgay Ciner.
Ranking among the largest Groups of Turkey, Ciner Group’s history goes back to 1978 when it was founded. The Group has a diversified business portfolio. However, the Group’s main line of businesses are mining and energy in which it has a wide expertise.
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.
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IV. Financial Structure
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Annual Concentrated Copper Production (wmt)
* Annual production declined due to production halt of four-month in 2010.
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2006 2007 2008 2009 2010 * 2011 2012 2013 2014
13,771
52,55464,371 63,138
37,426
77,510
89,253
96,038
91,185
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Annual Con. Copper (dmt) & Cathode (ton) Sales
* In 2010, there was a production halt of four months.
** 6,613 dmt of concentrated copper were used to produce 1,210 mt copper cathode. This pushes 2011 total sales up to 61,667 dmt.
*** 14,296 dmt of concentrated copper were used to produce 2,521 mt copper cathode, that is increasing 2012 total sales volume up to 87,663 dmt.
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2006 2007 2008 2009 2010 2011 2012 2013 2014
9,271
47,417
60,931 59,163
32,239
55,054
73,367
93,049
85,038
1,210 2,521
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Total Sales Revenues (TL)
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2007 2008 2009 2010 2011 2012 2013 2014
80
,04
0,6
45
11
0,7
13
,83
3
69
,85
7,0
81
64
,19
1,6
60
15
1,1
35
,66
4
22
9,2
64
,82
1
22
6,5
24
,68
6
20
9,9
27
,68
9
8,211,605
19,314,397
19,709,514
30,816,836 33,704,018
11,587,475
copper asphaltite
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Net Earnings (TL mn)
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2007 2008 2009 2010 2011 2012 2013 2014
19.8
74.8
19.4
37.2
100.9107.3
69.3
20.5
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Breakdown of Cost of Production, as of YE14, (copper only)
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Deprecia-tion65%
Labour12%
Energy4%
Fuel4%
Materials2% Others
12%
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Annual Margin Comparison
(TL mn) 2008 2009 2010 2011 2012 2013 2014
Sales 111 79 84 173 265 261 223
Gross Profit 73 32 44 107 134 72 24
Gross Margin 66% 41% 52% 62% 51% 28% 11%
EBITDA 62 24 42 112 165 147 121
EBITDA Margin 56% 30% 50% 65% 62% 57% 54%
Net Earnings 75 19 37 101 107 70 20
Net Margin 68% 25% 44% 58% 40% 27% 9%
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Sources of Financing (TL mn)
* Park Elektrik has no financial debt.
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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
88 100 130 143223
302 343443 450
520 499
814
66 53
60
3033
41 53
6455
Shareholders' Equity Total Debt
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V. Evaluation of 1H15 Financial Results
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Evaluation of 1H15 Financial Results
In 1H15, copper concentrate production was realized as 48,079 wmt indicating %5 increase as compared to 1H14. Copper concentrate sales during the same period decreased %3,5 and realized as 41,105 dmt while it was 42,634 dmt last year.
The relatively sharp decline in the sales revenues by %21 was due to the lack of asphaltite sales and decreased copper prices. The company had withdrawn from asphaltite business by selling its facility to Silopi Elektrik A.Ş. in 2014.
Financial ratios have all recovered due to the increasing grade levels as well as decreased depreciation costs in the production costs.
August 2015Park Elektrik Madencilik
Production 1H14 1H15 %Concentrated Copper (wmt) 45,618 48,079 5%
Sales 1H14 1H15 %Concentrated Copper (dmt) 42,634 41,105 -3,5%
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Income Statement (TL)
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1H14 1H15 %Sales 122,005,526 96,275,552 -21%COGS -102,795,670 -71,213,524 -31%Gross Profit 19,209,856 25,062,028 30%
Gross Margin 16% 26%Marketing, Distribution Exp -7,765,899 -6,984,244 -10%General Adm. Expenses -13,053,518 -8,882,246 -32%Other Operating Income 12,341,263 15,674,572 27%Other Operating Expenses -21,261,762 -2,913,113 -86%Operating Income -10,530,060 21,956,997 n.m.
Operating Margin -9% 23%Income From Investments 15,763,570 2,006,343 -87%Expense From Investments -304,079 -16,032 -95%Income Before Financial Exp. 4,929,431 23,947,308 386%Financial Income 202,958 10,080 -95%Financial Expenses -398,363 -255,961 -36%Profit Before Tax 4,734,026 23,701,427 401%Tax Income / Expense 8,687,598 -3,385,890 -139%Net Profit 13,421,624 20,315,537 51%
Net Margin 11% 21%
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Summary Balance Sheets (TL)
YE14 1H15
Current Assets 297,365,121 310,561,626
Fixed Assets 255,897,086 264,603,289
TOTAL ASSETS 553,262,207 575,164,915
Short Term Liabilities 38,151,674 132,107,493
Long Term Liabilities 16,434,153 15,530,192
Shareholders Equity 498,676,380 427,527,230
TOTAL LIABILITIES 553,262,207 575,164,915
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VI. Corporate Governance Rating
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Corporate Governance Rating
Park Elektrik’s corporate governance rating increased to 8.98 according to a recent report conducted by SAHA Corporate Rating Agency in June 2013. Based on the report, 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.
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Board of Directors
Stakeholders
Public Disclosure & Transparency
Shareholders
82 84 86 88 90 92 94 96 98
87.06
87.93
96.65
87.86
MAIN SECTORS AVERAGE: 89.80
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T H A N K Y O U.
CONTACTS
Yesim Bilginturan Selim Erdogan
IR Manager IR Manager
Phone: +90 216 531 25 33 +90 216 531 25 35
[email protected]@cinergroup.com.tr
www.parkelektrik.com.tr www.cinergroup.com.tr
August 2015Park Elektrik Madencilik