Morning Note /
Global

Turkey: Earnings season continues till 19 Aug

  • BIST 100 paused on breaking historical high levels and closed the day in red after a volatile trading prior US inflation

  • EREGL MGROS and CCOLA 2Q financial were announced yesterday and AEFES and THYAO financials will be out today

  • Today a sluggish opening is likely 2,770-2,750 are the daily support levels

ATA Invest
10 August 2022
Published byATA Invest

BIST 100 paused on breaking historical high levels and closed the day in the red after volatile trading prior to US inflation data which will be out today. Earnings season continues till 19 Aug; EREGL MGROS and CCOLA 2Q financials were announced yesterday and AEFES and THYAO financials will be out today.

Today a sluggish opening is likely, 2,770-2,750 are the daily support levels. We remain very positive on TUPRS and the recovery attempts yesterday were eye-catching.

Company news:

*EREGL TI> Broadly in line with our estimates. Erdemir realized a net income of TL6,639mn, 1.5% lower than both our estimate and consensus of TL6,743mn mainly due to slightly lower than expected EBITDA. The company realised an EBITDA/ton of US$356 in 2Q22, slightly short of our estimate of US$365 by 2.5%. Negative impact of higher than expected cash costs (+2.7%) surpassed the positive impact of higher than expected average prices (+1.0%) and sales volume(0.4%) and the company recorded EBITDA of TL11,022mn in 2Q22, 2.3% lower than our estimates and 3.0% above than consensus. We currently have a 12-mnth TP of TL42/shr, implying 65% upside potential, including 15% cash dividend. Following solid 2Q22 results, do not need any revisions for now.

*CCOLA TI> 2Q22 Review: In-line with expectations...CCOLA posted TL1,233mn net income in 2Q22, in-line with our estimate of TL1,229mn and consensus estimate of TL1,211mn net income. TL44mn higher than expected PBT was offset by TL41mn higher than expected tax expenses.The company recorded TL2,830mn EBITDA which was 2% lower than our expectation of TL2,876mn and 2% lower than consensus estimate of TL2,896mn. In 2Q22, CCOLA recorded 19.3% EBITDA margin 117bps lower than our estimate of 20.4%. Based on our estimates, CCOLA is currently trading at 2022E 5.3x EV/EBITDA and 10.2x P/E. 5yr avg EV/EBITDA and P/E multiples are 5.8x and 11.4x, respectively

*MGROS TI> 2Q22 Results: Migros realized impressive 2Q22 results. Migros increased its net income to TL441mn in 2Q22 from TL2mn in 2Q21, beating our estimate of TL213mn by 107% and consensus estimate of TL190 by %132%. Stronger than expected net income was mainly due to better than expected EBITDA supported by slightly higher than expected topline growth and improvement in EBITDA margin. In addition to stronger than expected gross margin, some accounting changes regarding provisions led to higher than expected EBITDA margin of 9.8% vs our estimae of 8.2% and consensus of 7.5%. We believe that reaction to 2Q22 results will be positive.

*SAHOL TI> bought back 500K shares at an average price of TL22.82 on 9 August 2022. Since 09 Nov 2021, the total number of shares bought back reached 60.6mn at an average price of TL16.99.

*MPARK TI> bought back 24K shares at an average price of TL41.09 on 09 August 2022. Since 25 May 2022, the total number of shares bought back reached 2.1mn at an average price of TL35.64.

Weekly Agenda:

Aug 10: June Unemployment rate

Aug 10: AEFES 2Q cons NI: TL 924 mn

Aug 10: THYAO 2Q cons NI: TL 6.859 mn ATA TL 7,019 mn

Aug 11: June CAD

Aug 11: MPARK 2Q cons NI: TL 843 mn

Aug 11: AKSA 2Q cons NI: TL 509 mn

Aug 11: TKFEN 2Q cons NI: TL 700 mn ATA TL 669mn

Aug 11: ASELS 2Q cons TL 1,745 ATA 1,463 mn

Aug 12: June Industrial Production Index