Haci Ömer Sabanci Holding (SAHOL) Q2 2024 earnings summary

Executive summary

• Delivered resilient performance in H1 2024 amid macroeconomic volatility and inflation, with continued execution of strategic initiatives, including major acquisitions in cloud technology and building materials, and expansion in renewables.

• Maintained high liquidity and financial flexibility, with holding-only cash at TL 12 billion and net debt/EBITDA at 1.3x, supporting ongoing investments.

• Recognized for ESG achievements, including a 20% reduction in emissions, 24% reduction in water consumption since 2021, and multiple sustainability awards.

• Interim consolidated financials for H1 2024 reviewed with no material misstatements by independent auditor.

• The group operates in diverse sectors: banking, financial services, energy, material technologies, mobility solutions, digital, and others.

Financial highlights

• Combined H1 2024 revenue rose 8% year-over-year to TL 509.6 billion; EBITDA fell 41% to TL 61.8 billion; consolidated net income turned negative at TL -7.6 billion.

• Total assets decreased to TRY 2,646,444,094 thousand as of 30 June 2024; equity attributable to parent fell to TRY 432,893,634 thousand.

• NAV up 23% in USD terms to $10.8 billion since year-end, with a more balanced portfolio and a 41% discount to market cap.

• Non-bank margin contracted by 160 basis points; non-bank CapEx to sales ratio at 11.3%.

• Earnings per share for the period was negative TRY 3.69, compared to positive TRY 5.34 in the prior year.

Outlook and guidance

• Expect stronger performance in H2 2024, especially in energy generation due to higher price caps and increased demand; 2024 EBITDA guidance for energy segment confirmed at $500 million.

• Management focused on disciplined cost management, maintaining liquidity, and advancing new economy investments.

• Evaluating impact of new tax regulations published in August 2024 on financial statements.

• CapEx in energy distribution to accelerate in H2; continued focus on organic and inorganic growth opportunities.

• Monitoring inflation, FX, interest rate trends, and regulatory changes.