Ford Otomotiv Sanayi (FROTO) Q1 2026 earnings summary

Executive summary

• Maintained leadership in Turkey's commercial vehicle market with a 24.4% share, despite an 18% decline in domestic sales and revenue, and resilient export volumes supported by new product launches and strong demand for Puma Gen-E.

• Profitability was pressured by a widening gap between EUR/TRY appreciation (25%) and inflation (31%), unfavorable FX/inflation dynamics, and higher EV penetration in exports, with gross margin declining to 6.9%.

• Announced acquisition of Koçfinans for $137 million to enhance vertical integration and financial services capabilities, pending regulatory approval and with no impact on Q1 2026 financials.

• Maintained strong positioning in commercial vehicles, supporting Ford's European operations and focusing on long-term value creation and operational excellence.

• Focus remains on ecosystem-based growth and disciplined execution in Türkiye and Romania despite near-term volatility.

Financial highlights

• Q1 2026 revenue was TRY 192.4 billion, down 9% year-over-year; domestic revenue fell 22%, export revenue declined 5%, and exports accounted for 84% of revenue.

• Gross profit dropped 27% to TRY 13.3 billion; operating profit fell 51% to TRY 4.9 billion; adjusted EBITDA was TRY 11.7 billion, down 28% year-over-year, with margin at 6.1%.

• Net income declined 35% to TRY 5.5 billion; IFRS tax expense was TRY 2.5 billion, about TRY 1 billion lower year-over-year.

• Free cash flow fell 52% to TRY 16.1 billion; CapEx/sales ratio at 1.0%.

• Net financial expenses decreased 27% due to lower FX losses.

Outlook and guidance

• Revenue growth guidance for 2026 revised to flat from previous high single-digit growth, reflecting macroeconomic and FX/inflation pressures.

• Adjusted EBITDA margin guidance at 7%-8%; total production volume expected between 690k–740k units; CapEx guidance: €300–400 million.

• Retail sales, export wholesales, export production, and investment levels remain unchanged in guidance.