Türkiye Sise Ve Cam Fabrikalari (SISE) Q4 2024 earnings summary

Executive summary

• 2024 revenue reached TRY 185.6 billion, down 15% YoY, with net income at TRY 5.0 billion, an 80% decrease, and EBITDA at TRY 13.9 billion, reflecting margin compression and lower sales.

• Inflation accounting (IAS/TAS/TMS 29) significantly impacted reported results, with a 15% decline in consolidated revenue and a net monetary position gain of TRY 15.9 billion.

• Chemicals became the largest contributor to consolidated revenue and EBITDA, supported by full consolidation of US soda ash operations.

• Operating profit turned negative at -1.2 billion TL, and EPS dropped to TRY 1.75.

• The Group completed the acquisition of the remaining 40% of Pacific Soda LLC, increasing its stake to 100% and recognizing a bargain purchase gain.

Financial highlights

• Gross profit margin declined to 22.7% (down from 27.5% in 2023), but 29% excluding IAS 29.

• Net debt at TRY 72.1 billion ($2 billion), with net debt/EBITDA at 5.2x (2.3x adjusted, excluding inflation accounting).

• Free cash flow was negative TRY 31 billion, down from positive TRY 58 billion in 2023.

• Total assets and equity at TRY 399.0 billion and TRY 208.1 billion, both down from 2023.

• EPS dropped 79% to TRY 1.75.

Outlook and guidance

• CapEx for 2025 will be strictly limited to EBITDA generation, with prioritization of ongoing greenfield projects.

• Management expects positive EBIT impact of EUR 8-10 million from operational adjustments in Europe in 2025.

• Working capital targeted to return to historical levels (~30% of revenue) from current elevated levels (~34%).

• Net leverage is aimed to be kept around 3.5x, with management tracking a non-IAS 29 net leverage of 2.8x.

• No significant impact expected from new global minimum tax regulations.