Q2 2026 Anadolu Efes Biracilik ve Malt Sanayii A.S. Earnings Call

August 12, 2026

Speaker #1: TIF-29. Just to remind you, this conference call is being recorded. And the link will be available online. Before we start, I would kindly request you to refer to our notes in our presentation regarding forward sequencing statements.

Speaker #1: Now, I'm leaving the ground to Mr. Onur Alturk, Anadolu Efes Q3. Sir,—

Speaker #2: Also, thank you. Good morning and good afternoon, everyone, and welcome to our first half-2026 results conference call. as we anticipated, at the beginning of the year the operating environment remained highly volatile throughout the second quarter, particularly in the domestic markets.

Speaker #2: Political developments in the Middle East, higher oil prices, and persistent inflationary pressures continued to pressurize consumer sentiments across many of our markets. Despite the challenges, we once again showed the strength of our diversified business model, our wide geographic footprint together with the solid contribution from both our beer and soft drinks businesses, enabled us to deliver another resilient and consolidated performance in Q2.

Speaker #2: On a consolidated basis, volumes increased by more than 7%, mainly supported by the healthy momentum across our soft drink business. Revenue growth of 2.8%, reflected not only in volume growth but also in our continued pricing discipline.

Speaker #2: Yet revenue productivity was challenged by affordability issues. We also continued to benefit from improving gross profitability in soft drink business, while maintaining a disciplined approach to operating expenses despite persistent inflationary pressures, and higher distribution expenses driven by elevated fuel prices.

Speaker #2: As a result, we delivered another quarter of EBITDA margin expansion on a consolidated basis. Another encouraging development during the quarter was our cash generation.

Speaker #2: Both businesses delivered positive free cash flow, allowing us to further strengthen our balance sheets with consolidated net debt-to-EBITDA improving 1.2 times. Having said that, the first half also confirmed that the recovery in Türkiye beer has been slower than we originally anticipated, while demand trends improved during June and we have seen encouraging signs entering the summer season.

Speaker #2: The overall consumer environment remains more challenging than we expected, at the beginning of the year. Reflecting this more cautious outlook, we have updated our full-year 2026 beer group guidance.

Speaker #2: We will get into details in the following slides. Now, let me walk you through the performance of our beer group in much more detail.

Speaker #2: As we discussed earlier, domestic beer continued to operate in a difficult consumer environment, while our international operations once again demonstrated their resilience and continued to contribute to beer group volumes positively.

Speaker #2: During the second quarter, our beer group volumes reached 3.8 million hectoliters, while this represents an 8% decline year-on-year. It is important to highlight that we overall performance was largely driven by the softness in Türkiye.

Speaker #2: Looking at our international operations, volume declined by 4.1% on a reported basis, but however excluding the impact of the export business restructuring in Georgia, our international beer business actually returned to growth, increasing by 1.2% in the second quarter of 2026.

Speaker #2: With our CIS markets continuing to deliver resilience operational performance. Apart from the operational performance, we also made meaningful progress in executing our long-term international expansion strategy.

Speaker #2: As a follow-up to our year-to-date achievements, we officially started license production in Azerbaijan and also signed a 12-year agreement in both Uzbekistan and China.

Speaker #2: These partnerships represent important milestones in our asset-life expansion strategy, enabling us to enter attractive markets with limited capital investment while increasing the availability of our brands to local consumers.

Speaker #2: Also in the UK, our cooperation with Sunrise continues successfully, further expanding the reach of our international portfolio. While these initiatives will not materially change our financial performance in the very near future, they represent important building blocks for the future and further diversify our international volume base.

Speaker #2: Let me now turn to our Türkiye beer operations, where the operating environment remained highly challenging throughout most of Q2. As we discussed at the beginning of the year, affordability has been under pressure, for some time due to sticky inflation in the country.

Speaker #2: Unfortunately, these pressures had impacted volumes much higher than we had initially anticipated in the beginning of the year, resulting in a slower recovery in demand during the first half.

Speaker #2: The weaker consumer environment was further amplified by unfavorable weather conditions, particularly during April and May, which continued to weigh on HoReCa channel consumption and the overall market volumes, of course.

Speaker #2: As a result, our beer volumes in Türkiye declined by 12.5% during Q2. Having said that, I would like to highlight an important one important thing: we started to see some improvement in demand during June and July, while these two months' performance do not mean a trend change.

Speaker #2: It gives us some confidence that consumer activity is gradually normalizing as we move into the key summer months. During Q2, we also successfully completed the acquisition of the majority stake in Barış Üzüm, the transaction is another important milestone in our strategy of building a broader and more diversified alcoholic beverages portfolio in Türkiye.

Speaker #2: We also successfully completed the relaunch of FS Family. This is far more than a packaging change; it's a comprehensive renovation of our core brands with the improved tastes and modern look.

Speaker #2: And an enhanced execution standards across all consumer touchpoints. The relaunch is the result of extensive consumer research and nearly two years of preparation. While it's still early days, the initial consumer and customer feedbacks has been encouraging for us.

Speaker #2: Rather than relying on a single growth engine, we also continue to build a balanced portfolio that allows us to participate across different consumer occasions and price points where we address each of the segments with a variety of brands.

Speaker #2: Let me now provide some additional color on the performance of our international beer operations, which once again showed resilience. Starting with Kazakhstan, we delivered another quarter of healthy growth.

Speaker #2: Our performing the markets and marking our fourth consecutive quarter of volume expansion. This performance reflects the strength of our commercial execution, continued premiumization efforts, and our ability to adopt quickly to changing consumer preferences.

Speaker #2: Recent product launches, together with our focus on premium brands, and the CAC channel, continue to support both volume and value growth in Kazakhstan. In Georgia, reported volumes remained affected by the export business restructuring that we discussed in previous quarters, however excluding this temporary impact, the underlying business continued to perform very well, supported by healthy domestic demand and disciplined execution.

Onur Altürk: Further expanding the reach of our international portfolio. While these initiatives will not materially change our financial performance in the very near future, they represent important building blocks for the future and further diversify our international volume base. Let me now turn to our two key beer operations where the operating environment remains highly challenging throughout most of Q2. As we discussed at the beginning of the year, affordability has been under pressure for some time due to sticky inflation in the country. Unfortunately, these pressures have impacted volumes much higher than we had initially anticipated in the beginning of the year, resulting in a slower recovery in demand during H1. The weaker consumer environment was further amplified by unfavorable weather conditions, particularly during April and May, which continued to weigh on HoReCa channel consumption and the overall market volumes, of course.

Onur Altürk: Further expanding the reach of our international portfolio. While these initiatives will not materially change our financial performance in the very near future, they represent important building blocks for the future and further diversify our international volume base. Let me now turn to our two key beer operations where the operating environment remains highly challenging throughout most of Q2. As we discussed at the beginning of the year, affordability has been under pressure for some time due to sticky inflation in the country. Unfortunately, these pressures have impacted volumes much higher than we had initially anticipated in the beginning of the year, resulting in a slower recovery in demand during H1. The weaker consumer environment was further amplified by unfavorable weather conditions, particularly during April and May, which continued to weigh on HORECA channel consumption and the overall market volumes, of course.

Speaker #1: Further expanding the reach of our international portfolio. While these initiatives will not materially change our financial performance in the very near future, they represent important building blocks for the future and will further diversify our international volume base.

Speaker #1: Let me now turn to our Türkiye beer operations, where the operating environment remained highly challenging throughout most of the second quarter. As we discussed at the beginning of the year, affordability has been under pressure for some time due to sticky inflation in the country.

Speaker #2: Moldova also delivered another solid quarter, despite a relatively strong comparison base. Our well-balanced portfolio and successful innovations introduced over the past years continue to support steady growth across different consumer segments.

Speaker #1: Unfortunately, these pressures had impacted volumes much higher than we had initially anticipated in the beginning of the year, resulting in a slower recovery in demand during the first half.

Speaker #2: Let me finally touch upon the performance of our soft drink business, which continued to show solid momentum in this quarter as well. During the first half, CCI once again delivered healthy volume growth, supported by the continued strength of its international footprint.

Speaker #1: The weaker consumer environment was further amplified by unfavorable weather conditions, particularly during April and May, which continued to weigh on Horeca channel consumption and the overall market volumes, of course.

Speaker #2: During Q2, consolidated volumes increased by 9.3%, reaching 519 million unit cases. This strong performance was primarily driven by Pakistan and Central Asia, once again highlighting the strength of CCI's international footprint.

Speaker #1: As a result, our beer volumes in Türkiye declined by 12.5% during the quarter. Having said that, I would like to highlight an important one important thing: we started to see some improvement in demand during June and July.

Onur Altürk: As a result, our beer volumes in Turkey declined by 12.5% during the quarter. Having said that, I would like to highlight one important thing. We started to see some improvement in demands during June and July. While these two months' performance do not mean a trend change, it gives us some confidence that consumer activity is gradually normalizing as we move into the key summer months. During the quarter, we also successfully completed the acquisition of the majority stake in Tariş Üzüm. The transaction is another important milestone in our strategy of building a broader and more diversified alcoholic beverages portfolio in Turkey. We also successfully completed the relaunch of Efes Family. This is far more than a packaging change. It is a comprehensive renovation of our core brands with improved tastes, a modern look, and enhanced execution standards across all consumer touch points.

Speaker #2: In Türkiye, volumes declined by 1.1% to 159 million unit cases, while the spiking beverage category remained under pressure. We were pleased to see the stills category continue to sustain its positive momentum.

Speaker #1: While these two months' performance do not mean a trend change, it gives us some confidence that consumer activity is gradually normalizing as we move into the key summer months.

Speaker #1: During the quarter, we also successfully completed the acquisition of the majority stake in Tariş Üzüm, the transaction is another important milestone in our strategy of building a broader and more diversified alcoholic beverages portfolio in Türkiye.

Speaker #2: Our international operations continued to perform strongly, with volumes increasing by 15.4%, building on an already strong comparison base from last year. Pakistan once again delivered an outstanding performance with 17% volume growth, while Uzbekistan remained one of our fastest-growing markets, expanding by 21.1% during Q2.

Speaker #1: We also successfully completed the relaunch of Efes Family. This is far more than a packaging change; it's a comprehensive renovation of our core brands with the improved tastes and modern look.

Speaker #2: Kazakhstan also maintained its strong momentum, delivering 12.7% volume growth, supported by continued consumer demand and disciplined commercial execution. In Iraq, despite the ongoing geopolitical uncertainties in the region, we still managed to deliver 1.1% volume growth.

Speaker #1: And enhanced execution standards across all consumer touchpoints. The relaunch is the result of extensive consumer research and nearly two years of preparation. While it's still early days, the initial consumer and customer feedback has been encouraging for us.

Onur Altürk: The relaunch is the result of extensive consumer research and nearly two years of preparation. While it is still early days, the initial consumer and customer feedback has been encouraging for us. Rather than relying on a single growth engine, we also continue to build a balanced portfolio that allows us to participate across different consumer occasions and price points, where we address each of the segments with a variety of brands. Let me now provide some additional color on the performance of our international beer operations, which once again showed resilience. Starting with Kazakhstan, we delivered another quarter of healthy growth, outperforming the markets and marking our fourth consecutive quarter of volume expansion. This performance reflects the strength of our commercial execution, continued premiumization efforts, and our ability to adopt quickly to changing consumer preferences.

Speaker #1: Rather than relying on a single growth engine, we also continue to build a balanced portfolio that allows us to participate across different consumer occasions and price points, where we address each of the segments with a variety of brands.

Speaker #2: Overall, we are very pleased with the performance of our soft drink business. With that, let me now hand over to Yasemen, who will take you through our financial performance in more detail.

Speaker #1: Thank you, Onur. Good morning, and good afternoon, everyone. As Onur covered on those financials, I will briefly give you more insight to the beer growth performance for Q2 and Q1.

Speaker #1: Let me now provide some additional color on the performance of our international beer operations. Which, once again, showed resilience. Starting with Kazakhstan, we delivered another quarter of healthy growth.

Speaker #1: Our performing the markets and marking our fourth consecutive quarter of volume expansion. This performance reflects the strength of our commercial execution, continued premiumization efforts, and our ability to adopt quickly to changing consumer preferences.

Speaker #1: In Q2, the beer group saved their earnings declined by 6% to almost 20 billion. TL, revenue performance was primarily impacted by the weaker volume trend in our Türkiye beer operations, although this was partially offset by the resilience of our international operations.

Speaker #1: Recent product launches, together with our focus on premium brands and the CAC channel, continue to support both volume and value growth in Kazakhstan. In Georgia, reported volumes remained affected by the export business restructuring that we discussed in previous quarters.

Onur Altürk: Recent product launches, together with our focus on premium brands and the CAC channel, continue to support both volume and value growth in Kazakhstan. In Georgia, reported volumes remained affected by the export business restructuring that we discussed in previous quarters. However, excluding this temporary impact, the underlying business continued to perform very well, supported by healthy domestic demand and disciplined execution. Moldova also delivered another solid quarter, despite a relatively strong comparison base. Our well-balanced portfolio and successful innovations introduced over the past years continue to support steady growth across different consumer segments. Let me finally touch upon the performance of our soft drink business, which continued to show solid momentum in this quarter as well. During H1, CCI once again delivered healthy volume growth, supported by the continued strength of its international footprint.

Onur Altürk: Recent product launches, together with our focus on premium brands and the tech channel, continue to support both volume and value growth in Kazakhstan. In Georgia, reported volumes remained affected by the export business restructuring that we discussed in previous quarters. However, excluding this temporary impact, the underlying business continued to perform very well, supported by healthy domestic demand and disciplined execution. Moldova also delivered another solid quarter, despite a relatively strong comparison base. Our well-balanced portfolio and successful innovations introduced over the past years continue to support steady growth across different consumer segments. Let me finally touch upon the performance of our soft drink business, which continued to show solid momentum in this quarter as well. During H1, CCI once again delivered healthy volume growth, supported by the continued strength of its international footprint.

Speaker #1: So, Türkiye beer operations recorded 11 billion TL revenue in Q2, which represents 11% decrease, mainly due to 12.5% volume decline in the period. While we observe a modest improvement in the discount levels in the domestic market, this benefit was offset by an unfavorable prolactics as affordability pressure continued to shift consumer demand toward lower price value segment offerings.

Speaker #1: However, excluding this temporary impact, the underlying business continued to perform very well. Supported by healthy domestic demand and disciplined execution, Moldova also delivered another solid quarter.

Speaker #1: Despite the relatively strong comparison base, our well-balanced portfolio and successful innovations introduced over the past years continue to support steady growth across different consumer segments.

Speaker #1: Turning to international operations, saved revenue increased by almost 2% year-on-year to 8.3 billion TL, within the international portfolio Kazakhstan was the strongest contributor, supported by timely pricing actions and continued premiumization.

Speaker #1: Let me finally touch upon the performance of our soft drink business, which continued to show solid momentum in this quarter as well. During the first half, CCI once again delivered healthy volume growth, supported by the continued strength of its international footprint.

Speaker #1: As a result, revenue per liter in Kazakhstan expanded by a robust 14% year-on-year. Consequently, beer group revenue for the Q1, which almost 30 billion TL, representing almost 7% year-on-year decline.

Speaker #1: During the second quarter, consolidated volumes increased by 9.3%, reaching 519 million unit cases. This strong performance was primarily driven by Pakistan and Central Asia, once again highlighting the strength of CCI's international footprint.

Onur Altürk: During the Q2, consolidated volumes increased by 9.3%, reaching 519 million unit case. This strong performance was primarily driven by Pakistan and Central Asia, once again highlighting the strength of CCI's international footprint. In Türkiye, volumes declined by 1.1% to 159 million unit case. While the sparkling beverage category remained under pressure, we were pleased to see the stills category continue to sustain its positive momentum. Our international operations continued to perform strongly, with volumes increasing by 15.4%, building on an already strong comparison base from last year. Pakistan once again delivered an outstanding performance with 17% volume growth, while Uzbekistan remained one of our fastest-growing markets, expanding by 21.1% during the quarter. Kazakhstan also maintained its strong momentum, delivering 12.7% volume growth, supported by continued consumer demands and disciplined commercial execution.

Speaker #1: Beer group gross profit declined by almost 10% to 9 billion TL in Q2, with a margin contraction of 200 basis points. While Türkiye operations were mainly impacted by softer volumes, which resulted in a higher fixed cost burden per liter, we also saw some pressure due to higher labor and the packaging cost.

Speaker #1: In Türkiye, volumes declined by 1.1 million unit cases, while the sparkling beverage category remained under pressure. We were pleased to see the stills category continue to sustain its positive momentum.

Speaker #1: Moreover, Kazakhstan gross profit was also under pressure, mainly due to the very favorable cost base in the last year. Coming to EBITDA, beer group recorded 3.1 billion TL EBITDA, where we had an almost 15% EBITDA margin in Q2, which indicated we were under 75 basis points contraction.

Speaker #1: Our international operations continued to perform strongly, with volumes increasing by 15.4%, building on an already strong comparison base from last year. Pakistan once again delivered an outstanding performance, with 17% volume growth, while Uzbekistan remained one of our fastest-growing markets, expanding by 21.1% during the quarter.

Speaker #1: Approximately half of this declined was attributable to gross margin erosion, as discussed earlier. As shown in the bridge analysis, the primary pressure points remain net revenue generation, largely driven by weaker volume in domestically.

Speaker #1: Kazakhstan also maintained its strong momentum, delivering 12.7% volume growth, supported by continued consumer demand and disciplined commercial execution. In Iraq, despite the ongoing geopolitical uncertainties in the region, we still managed to deliver 1.1% volume growth.

Speaker #1: In Türkiye, the softer top-line performance, negatively impacted gross profitability, at the same time we saw the anticipated increase in selling and marketing expenses related to the FS relaunch.

Onur Altürk: In Iraq, despite the ongoing geopolitical uncertainties in the region, we still managed to deliver 1.1% volume growth. Overall, we are very pleased with the performance of our soft drink business. With that, let me now hand over to Yasemin, who will take you through our financial performance in more detail.

Speaker #1: Overall, we are very pleased with the performance of our soft drink business. With that, let me now hand over to Yasemin, who will take you through our financial performance in more detail.

Speaker #1: These investments were delivered and aimed at strengthening visibility and supporting communication behind the relaunch. On the other hand, our international operations continued to benefit from disciplined cost management, selling and marketing expenses, as well as general administrative expenses, declined as a proximity of net sales, primarily in Kazakhstan and Moldova.

Speaker #2: Thank you, Onur. Good morning, and good afternoon, everyone. As Onur covered on those best financials, I will I will briefly give you more insight to the beer group performance for the second quarter and the first half.

Yasemen Guven Cayirezmez: Thank you, Onur. Good morning and good afternoon, everyone. As Onur covered under the financials, I will briefly give you more insight to the beer group performance for the Q2 and the H1. In the Q2, the beer group sales earnings declined by 6% to almost 20 billion TRY. Revenue performance was primarily impacted by the weaker volume trends in our Türkiye beer operations, although this was partially offset by the resilience of our international operations. Türkiye beer operations recorded 11 billion TRY revenue in the Q2, which represents 11% decrease, mainly due to 12.5% volume decline in the period. While we observe a modest improvement in the discount levels in the domestic market, this benefit was offset by an unfavorable product mix as affordability pressure continued to shift consumer demand towards lower priced value segment offerings.

Yasemen Güven Çayırezmez: Thank you, Onur. Good morning and good afternoon, everyone. As Onur covered under the financials, I will briefly give you more insight to the beer group performance for the Q2 and the H1. In the Q2, the beer group sales earnings declined by 6% to almost 20 billion TRY. Revenue performance was primarily impacted by the weaker volume trends in our Türkiye beer operations, although this was partially offset by the resilience of our international operations. Türkiye beer operations recorded 11 billion TRY revenue in the Q2, which represents 11% decrease, mainly due to 12.5% volume decline in the period. While we observe a modest improvement in the discount levels in the domestic market, this benefit was offset by an unfavorable product mix as affordability pressure continued to shift consumer demand towards lower priced value segment offerings.

Speaker #1: As a result, our sales operations once again delivered strong profitability in Q2, with EBITDA margins remaining above 30% across each of these markets. This solid performance has partially offset the margin pressure experienced in Türkiye.

Speaker #2: In the second quarter, the beer group sales revenue declined by 6% to almost 20 billion. TL revenue performance was primarily impacted by the weaker volume trends in our Türkiye beer operations, although this was partially offset by the resilience of our international operations.

Speaker #1: Consequently, beer group EBITDA in Q1 was 2.3 billion TL, with an EBITDA margin of 7.7%. Coming to free cash flow, in Q2 of 2026, beer group generated free cash flow of 3.8 billion TL, the year-on-year decline in the free cash flow was primarily driven by lower operational profitability, and reduced contribution from work capital.

Speaker #2: So Türkiye beer operations recorded 11 billion TL revenue in the second quarter, which represents 11% decrease, mainly due to 12.5% volume decline in the period.

Speaker #2: While we observe a modest improvement in the discount levels in the domestic market, this benefit was offset by an unfavorable product mix as affordable temperature continued to shift consumer demand toward lower price value segment offerings.

Speaker #1: This impact was partially offset by prudent capital expenditure management, as well as lower tax and interest payments during Q2. Despite the current challenging operating environment, our commitment to cash flow generation remained unchanged.

Speaker #2: Turning to international operations, sales revenue increased by almost 2% year on year to 8.3 billion TL. Within the international portfolio, Kazakhstan was the strongest contributor, supported by timely pricing actions and continued premiumization.

Yasemen Guven Cayirezmez: Turning to international operations, sales revenue increased by almost 2% year-on-year to 8.3 billion TRY. Within the international portfolio, Kazakhstan was the strongest contributor, supported by timely pricing actions and continued premiumization. As a result, revenue per hectoliter in Kazakhstan expanded by a robust 14% year-on-year. Consequently, beer group revenue for the H1 reached almost 30 billion TRY, representing almost 7% year-on-year decline. Beer group gross profit declined by almost 10% to 9 billion TRY in the Q2, with a margin contraction of 200 basis points. While Türkiye operations were mainly impacted by softer volumes, which resulted in a higher fixed cost burden per hectoliter, we also saw some pressure due to higher labor and the packaging cost. Moreover, Kazakhstan gross profit was also under pressure, mainly due to the very favorable cost base in the last year. Coming to EBITDA.

Yasemen Güven Çayırezmez: Turning to international operations, sales revenue increased by almost 2% year-on-year to 8.3 billion TRY. Within the international portfolio, Kazakhstan was the strongest contributor, supported by timely pricing actions and continued premiumization. As a result, revenue per hectoliter in Kazakhstan expanded by a robust 14% year-on-year. Consequently, beer group revenue for the H1 reached almost 30 billion TRY, representing almost 7% year-on-year decline. Beer group gross profit declined by almost 10% to 9 billion TRY in the Q2, with a margin contraction of 200 basis points. While Türkiye operations were mainly impacted by softer volumes, which resulted in a higher fixed cost burden per hectoliter, we also saw some pressure due to higher labor and the packaging cost. Moreover, Kazakhstan gross profit was also under pressure, mainly due to the very favorable cost base in the last year. Coming to EBITDA.

Speaker #1: All of these result in a net debt to EBITDA ratio at 4.7 as of June 30, which would be at 3.3 in next Q2 figures.

Speaker #2: As a result, revenue per hectoliter in Kazakhstan expanded by a robust 14% year-on-year. Consequently, beer group revenue for the first half reached almost TRY 30 billion, representing an almost 7% year-on-year decline.

Speaker #1: Let me briefly touch on our financial performance excluding the effect of Q2. The beer group generated 30 billion TL in revenue in Q1, representing a gross of 24% year-on-year, as I highlighted earlier, this growth was primarily driven by our international operations, in addition the appreciation of Kazakh Tenge against Turkish Lira in Q2 of 2026, compared to the same period of last year, provided further support, making revenue growth more visible in non-Q2 figures.

Speaker #2: Beer group gross profit declined by almost 10% to 9 billion TL in the second quarter, with a margin contraction of 200 basis points. While Türkiye operations were mainly impacted by softer volumes, which resulted in a higher fixed cost burden per hectoliter, we also saw some pressure due to higher labor and packaging costs.

Speaker #2: Moreover, Kazakhstan gross profit was also under pressure, mainly due to the very favorable cost base in the last year. Coming to EBITDA, beer group recorded 3.1 billion TL EBITDA, where we had an almost 15% EBITDA margin in the second quarter, which indicated 475 basis points contraction.

Speaker #1: On the same basis, EBITDA increased by 2% year-on-year to 4.5 billion TL, corresponding to an EBITDA margin of 15%. Turning to cash and debt management, as of June 30, gross debt at beer group level stood at approximately 1 billion TL, 1 billion US dollars, with more than 60% of total debt terminated in hard currency, at the consolidated Andolu Efes level, gross debt amounted at approximately 2.3 billion US dollars, almost 60% was in the hard currency.

Yasemen Guven Cayirezmez: Beer group recorded 3.1 billion TRY EBITDA, where we had almost 15% EBITDA margin in Q2, which indicated 475 basis point contraction. Approximately half of this decline was attributable to gross margin erosion, as discussed earlier. As shown in the bridge analysis, the primary pressure point remained net revenue generation, largely driven by weaker volume domestically. in Türkiye, the softer top-line performance negatively impacted gross profitability. At the same time, we saw that stated increase in selling and marketing expenses related to the Efes relaunch. These investments were deliberate and aimed at strengthening visibility and supporting the communication behind the relaunch. On the other hand, our international operations continued to benefit from disciplined cost management, selling and marketing expenses, as well as general and administrative expenses declined as a percentage of net sales, primarily in Kazakhstan and Moldova.

Yasemen Güven Çayırezmez: Beer group recorded 3.1 billion TRY EBITDA, where we had almost 15% EBITDA margin in Q2, which indicated 475 basis point contraction. Approximately half of this decline was attributable to gross margin erosion, as discussed earlier. As shown in the bridge analysis, the primary pressure point remained net revenue generation, largely driven by weaker volume domestically. in Türkiye, the softer top-line performance negatively impacted gross profitability. At the same time, we saw that stated increase in selling and marketing expenses related to the Efes relaunch. These investments were deliberate and aimed at strengthening visibility and supporting the communication behind the relaunch. On the other hand, our international operations continued to benefit from disciplined cost management, selling and marketing expenses, as well as general and administrative expenses declined as a percentage of net sales, primarily in Kazakhstan and Moldova.

Speaker #2: Approximately half of this decline was attributable to gross margin erosion, as discussed earlier. As shown in the bridge analysis, the primary pressure points remained net revenue generation, largely driven by weaker volume domestically.

Speaker #1: On the liquidity side, 36% of beer group cash balance and 32% of consolidated Andolu Efes cash balance were held in hard currency, as a result, our net debt to EBITDA ratio stood at 4.7 for the beer group and 1.3 for Andolu Efes on consolidated basis.

Speaker #2: In Türkiye, the softer top-line performance negatively impacted gross profitability. At the same time, we saw the anticipated increase in selling and marketing expenses related to the FS relaunch.

Speaker #2: These investments were delivered and aimed at strengthening visibility and supporting the communication behind the relaunch. On the other hand, our international operations continued to benefit from disciplined cost management, selling and marketing expenses, as well as general administrative expenses, declined as a first minute of net sales primarily in Kazakhstan and Moldova.

Speaker #1: Turning to risk management, we further strengthened our commodity hedge position for Türkiye and CS operations, our aluminum hedge coverage increased to 88% for 2026, at an average price of 3,100 US dollars per ton, for 2027 we have already secured 27% coverage at an average price of 3,070 US dollars per ton.

Speaker #2: As a result, our sales operations once again delivered strong profitability in the quarter, with EBITDA margins remaining at about 30% across each of these markets.

Yasemen Guven Cayirezmez: As a result, our CIS operations once again delivered strong profitability in the quarter, with EBITDA margins remaining above 30% across each of these markets. This solid performance has partially offset the margin pressure experienced in Türkiye. Consequently, beer group EBITDA in H1 was 2.3 billion TRY, with an EBITDA margin of 7.7%. Coming to free cash flow in Q2 2023, beer group generated free cash flow of 3.8 billion TRY. The year-on-year decline in the free cash flow was primarily driven by lower operational profitability and reduced contribution from working capital. This impact was partially offset by prudent capital expenditure management, as well as lower tax and interest payments during the quarter. Despite the current challenging operating environment, our commitment to cash flow generation remained unchanged.

Yasemen Güven Çayırezmez: As a result, our CIS operations once again delivered strong profitability in the quarter, with EBITDA margins remaining above 30% across each of these markets. This solid performance has partially offset the margin pressure experienced in Türkiye. Consequently, beer group EBITDA in H1 was 2.3 billion TRY, with an EBITDA margin of 7.7%. Coming to free cash flow in Q2 2023, beer group generated free cash flow of 3.8 billion TRY. The year-on-year decline in the free cash flow was primarily driven by lower operational profitability and reduced contribution from working capital. This impact was partially offset by prudent capital expenditure management, as well as lower tax and interest payments during the quarter. Despite the current challenging operating environment, our commitment to cash flow generation remained unchanged.

Speaker #1: On the effects side, we closed our effects exposure at an average rate of almost 49. With that, let me hand over to Onur to walk you through our updated guidance.

Speaker #2: This solid performance has partially offset the margin pressure experienced in Türkiye. Consequently, beer group EBITDA in the first half was TL 2.3 billion, with an EBITDA margin of 7.7%.

Speaker #2: Yasemen, thank you. Before we move on to Q&A, let me briefly talk about our revised outlook I mentioned in the first part. As we mentioned earlier, the first half has been shaped by a more challenging operating environment than we had anticipated at the beginning of the year.

Speaker #2: Coming to free cash flow, in the second quarter of 2026, beer group generated free cash flow of 3.8 billion TL, the year on year decline in the free cash flow was primarily driven by lower operational profitability, and reduced contribution from working capital.

Speaker #2: While our international operations continue to perform strongly, consumer demand in Türkiye beer remains softer for longer, leading to a slower recovery than we had originally expected.

Speaker #2: This impact was partially offset by prudent capital expenditure management, as well as lower tax and interest payments during the quarter. Despite the current challenging operating environment, our commitment to cash flow generation remains unchanged.

Speaker #2: As a result, we are updating our full-year beer group guidance to reflect these dynamics, we now expect beer group volume to decline by low single digits compared to our previous expectation of low single digit growth.

Speaker #2: All of these resulted in a net debt to EBITDA ratio at 4.7 as of June 30, which would be at 3.3 in the next closing TS29 figures.

Yasemen Guven Cayirezmez: All of this result in a net debt-to-EBITDA ratio at 4.7 as of 30 June, which would be at 3.3 in excluding TAS 29 figures. Let me briefly touch on our financial performance, excluding the effect of TAS 29. The beer group generated 30 billion TRY in revenue in H1, representing a growth of 24% year-on-year. As I highlighted earlier, this growth was primarily driven by our international operations. In addition, the appreciation of Kazakh Tenge against Turkish lira in Q2 2023 compared to the same period of last year, provides further support, making revenue growth more visible in non-TAS 29 figures. On the same basis, EBITDA increased by 2% year-on-year to 4.5 billion TRY, corresponding to an EBITDA margin of 15%. Turning to cash and debt management.

Yasemen Güven Çayırezmez: All of this result in a net debt-to-EBITDA ratio at 4.7 as of 30 June, which would be at 3.3 in excluding TAS 29 figures. Let me briefly touch on our financial performance, excluding the effect of TAS 29. The beer group generated 30 billion TRY in revenue in H1, representing a growth of 24% year-on-year. As I highlighted earlier, this growth was primarily driven by our international operations. In addition, the appreciation of Kazakh Tenge against Turkish lira in Q2 2023 compared to the same period of last year, provides further support, making revenue growth more visible in non-TAS 29 figures. On the same basis, EBITDA increased by 2% year-on-year to 4.5 billion TRY, corresponding to an EBITDA margin of 15%. Turning to cash and debt management.

Speaker #2: The revision is entirely driven by our revised outlook for Türkiye beer, while our expectations for our international beer operations remain unchanged. Reflecting the lower volume outlook, we also now expect beer group EBITDA margin to decline by around 150 basis points under Q2, or around 100 basis points on a without Q2 impact.

Speaker #2: Let me briefly touch on our financial performance, excluding the impact of TS29. The beer group generated TRY 30 billion in revenue in the first half, representing a growth of 74% year-on-year, as I highlighted earlier.

Speaker #2: This growth was primarily driven by our international operations. In addition, the appreciation of the Kazakh Tenge against the Turkish Lira in the second quarter of 2026, compared to the same period last year, provided further support, making revenue growth more visible in non-TS29 figures.

Speaker #2: Importantly, this revision is driven by a lower operating leverage, resulting from softer volumes, rather than any deterioration in our pricing discipline or revenue management capabilities or our product mix.

Speaker #2: Most importantly, despite the headwinds in our Türkiye beer business, we continue to expect beer group free cash flow to be at break even for the full year.

Speaker #2: On the same basis, EBITDA increased by 2% year on year to 4.5 billion TL, corresponding to an EBITDA margin of 15%. Turning to cash and debt management, as of June 30, gross debt at beer group level stood at approximately 1 billion TL, 1 billion US dollars, with more than 60% of total debt terminated in hard currency, at the consolidated Andolu Efes level, gross debt amounted at approximately 2.3 billion US dollars, almost 60% was in the hard currency.

Speaker #2: At the consolidated Andolu Efes level, we continue to expect mid-single digit volume growth, and low single digit revenue collectivity growth under Q2, while we now expect EBITDA margin to decline slightly.

Yasemen Guven Cayirezmez: As of 30 June, gross debt at beer group level stood at approximately 1 billion TRY, $1 billion, with more than 60% of total debt denominated in hard currency. At the consolidated Anadolu Efes level, gross debt amounted at approximately $2.3 billion, almost 60% was in the hard currency. On the liquidity side, 36% of beer group cash balance and 32% of consolidated Anadolu Efes cash balance were held in hard currency. As a result, our net debt-to-EBITDA ratio stood at 4.7 for the beer group and 1.3 for Anadolu Efes on consolidated basis. Turning to risk management. We further strengthened our commodity hedge positions. For Türkiye and CIS operations, our aluminum hedge coverage increased to 88% for 2023. At an average price of $3,100 per ton. For 2027, we have already secured 27% coverage at an average price of $3,070 per ton.

Yasemen Güven Çayırezmez: As of 30 June, gross debt at beer group level stood at approximately 1 billion TRY, $1 billion, with more than 60% of total debt denominated in hard currency. At the consolidated Anadolu Efes level, gross debt amounted at approximately $2.3 billion, almost 60% was in the hard currency. On the liquidity side, 36% of beer group cash balance and 32% of consolidated Anadolu Efes cash balance were held in hard currency.

Speaker #2: The resilience of our soft drink business and international beer operations continues to support our consolidated performance. Looking ahead, while we remain mindful of our macroeconomic and geopolitical uncertainties, we continue to focus on the factors within our control, investing behind our brands, maintaining pricing discipline, and preserving a strong balance sheet through financial discipline.

Speaker #2: On the liquidity side, 36% of beer group cash balance and 32% of consolidated Andolu Efes cash balance were held in hard currency. As a result, our net debt to EBITDA ratio stood at 4.7 for the beer group and 1.3 for Andolu Efes on consolidated basis.

Speaker #2: Now, we are ready to take your questions, Aslı.

Yasemen Güven Çayırezmez: As a result, our net debt-to-EBITDA ratio stood at 4.7 for the beer group and 1.3 for Anadolu Efes on consolidated basis. Turning to risk management. We further strengthened our commodity hedge positions. For Türkiye and CIS operations, our aluminum hedge coverage increased to 88% for 2023. At an average price of $3,100 per ton. For 2027, we have already secured 27% coverage at an average price of $3,070 per ton. On the FX side, we close our FX exposure at an average rate of almost 49. With that, let me hand over to Onur to walk you through our updated guidance.

Speaker #1: Thank you. There is one question on the floor. Let me read it. How are you working to return to positive free cash flow generation, and refinancing the 28 bonds?

Speaker #2: Turning to risk management, we further strengthened our commodity hedge position for Türkiye and FS operations. Our aluminum hedge coverage increased to 88% for 2026, at an average price of 3,100 US dollars per ton for 2027.

Speaker #1: What are the rating agencies' views on these results? Are you at risk of a rating downgrade? Regarding the cash flow, actually, since we couldn't get the full performance of the top-line performance of our P&L, we focused on the balance sheet management.

Speaker #2: We have already secured 27% coverage at an average price of 3,070 US dollars per ton. On the FX side, we closed our FX exposure at an average rate of almost 49.

Yasemen Guven Cayirezmez: On the FX side, we close our FX exposure at an average rate of almost 49. With that, let me hand over to Onur to walk you through our updated guidance.

Speaker #1: And accordingly, our focus on the working capital management, zero-based budgeting in terms of the OPEX, and also the full scope of our balance sheet.

Speaker #2: With that, let me hand over to Onur to walk you through our updated guidance.

Speaker #1: And including the CAPEX management. So in terms of the Euro bond, we've been working on the reissuance of the Euro bond, refinancing of the Euro bond, so regarding the rating agencies, we have been meeting with the rating agencies in frequent way.

Speaker #1: Yasemin, thank you. Before we move on to Q&A, let me briefly talk about our revised outlook. As I mentioned in the first part, and as we mentioned earlier, the first half has been shaped by a more challenging operating environment.

Onur Altürk: Yasemin, thank you. Before we move on to Q&A, let me briefly talk about our revised outlook I mentioned in the first part. As we mentioned earlier, the H1 has been shaped by a more challenging operating environment than we had anticipated at the beginning of the year. While our international operations continued to perform strongly, consumer demand in Turkey beer remained softer for longer, leading to a slower recovery than we had originally expected. As a result, we are updating our full year beer group guidance to reflect these dynamics. We now expect beer group volume to decline by low single digits compared to our previous expectation of low single-digit growth. The revision is entirely driven by our revised outlook for Turkey beer, while our expectations for our international beer operations remain unchanged.

Speaker #1: Then we had anticipated at the beginning of the year while our international operations continued to perform strongly, consumer demand in Türkiye beer remained softer for longer, leading to a slower recovery than we had originally expected.

Speaker #1: But of course, in terms of their reactions and their comments, we don't think so it's the right approach to make a comment on behalf of them.

Speaker #1: As a result, we are updating our full year beer group guidance to reflect these dynamics. We now expect beer group volume to decline by low single digits compared to our previous expectation of low single digit growth.

Speaker #1: Thank you, Yasemen. There are a couple of questions from Evgenia. Let me start with the demand part for domestic market demand part for Onur Bey, and then I'll go through the finance part for Yasemen.

Speaker #1: The revision is entirely driven by our revised outlook for Türkiye beer, while our expectations for our international beer operations remain unchanged. Reflecting the lower volume outlook, we also now expect beer group EBITDA margin to decline by around 150 basis points under TS29, or around 100 basis points on a without TS29 impact.

Speaker #1: What would be a catalyst for domestic market demand to improve?

Onur Altürk: Reflecting the lower volume outlook, we also now expect beer group EBITDA margin to decline by around 150 basis points under TAS 29 or around 100 basis points on a without TAS 29 impact. Importantly, this revision is driven by a lower operating leverage resulting from softer volumes rather than any deterioration in our pricing discipline or revenue management capabilities or our product mix. Most importantly, despite the headwinds in our Turkey beer business, we continue to expect beer group free cash flow to be at breakeven for the full year. At the consolidated Anadolu Efes level, we continue to expect mid-single digit volume growth and low single digits revenue per hectoliter growth under TAS 29. While we now expect EBITDA margin to decline slightly, the resilience of our soft drink business and international beer operations continues to support our consolidated performance.

Speaker #2: 15% volume decline we saw in the first half in Türkiye, but not something actually as we expected or anticipated at the beginning of the year, as I mentioned.

Speaker #1: Importantly, this revision is driven by a lower operating leverage, resulting from softer volumes, rather than any deterioration in our pricing discipline or revenue management capabilities or our product mix.

Speaker #2: During the presentation, as we discussed, consumer purchasing power deteriorated much more sharply than we had anticipated, and that is really the key factor behind the performance we are seeing today.

Speaker #1: Most importantly, despite the headwinds in our Türkiye beer business, we continue to expect beer group free cash flow to be at break even for the full year.

Speaker #2: Based on what we see today, we have revised our guidance to a low single digit volume decline for the full year, but having said that, given the uncertainties around the purchasing power tourism season and broader geopolitical environments, I would also highlight that there is still some downside risk on this one.

Speaker #1: At the consolidated Anadolu Efes level, we continue to expect mid-single-digit volume growth and low-single-digit revenue growth under TS29, while we now expect the EBITDA margin to decline slightly.

Speaker #2: Looking at recent numbers, June and July combined delivered almost 4% year-on-year growth, and August has started positively, actually. And I wouldn't call it a particularly strong start, but the momentum is encouraging.

Onur Altürk: While we now expect EBITDA margin to decline slightly, the resilience of our soft drink business and international beer operations continues to support our consolidated performance. Looking ahead, while we remain mindful of our macroeconomic and geopolitical uncertainties, we continue to focus on the factors within our control, investing behind our brands, maintaining pricing discipline, and preserving a strong balance sheet through financial discipline. Now, we are ready to take your questions, Aslı.

Speaker #1: The resilience of our soft drink business and international beer operations continues to support our consolidated performance. Looking ahead, while we remain mindful of our macroeconomic and geopolitical uncertainties, we continue to focus on the factors within our control, investing behind our brands, maintaining pricing discipline, and preserving a strong balance sheet through financial discipline.

Onur Altürk: Looking ahead, while we remain mindful of our macroeconomic and geopolitical uncertainties, we continue to focus on the factors within our control, investing behind our brands, maintaining pricing discipline, and preserving a strong balance sheet through financial discipline. Now, we are ready to take your questions, Aslı.

Speaker #2: Overall, I have to be honest, this is a challenging year. I mean, we have a new Efes family active launch, that might be a catalyst for the rest of the year.

Speaker #2: The consumer environment remains tough, and our visibility is limited on this one, and we continue to monitor developments very closely. At the same time, we are staying focused on what we can control, and on executing our plans as effectively as possible.

Speaker #1: Now, we are ready to take your questions, Aslı.

Speaker #2: Thank you. There is one question on the floor. Let me read it. How are you working to return to positive free cash flow generation and refinancing the 28 bonds?

Aslı Kılıç Demirel: Thank you. There is one question on the floor. Let me read it. How are you working to return to positive free cash flow generation and refinancing the '28 bonds? What are the rating agencies' views on these results? Are you at risk of a rating downgrade? Okay, regarding the cash flow, actually, since we couldn't get the full performance of the top line performance of our P&L, we focused on the balance sheet management and accordingly are focused on the working capital management, zero-based budgeting in terms of the OpEx, and also the full scope of our balance sheet, including the CapEx management. In terms of the Eurobonds, we've been working on the reissues of the Eurobond, refinancing of the Eurobond. Regarding the rating agencies, we have been meeting with the rating agencies in frequent ways.

Speaker #2: As we all know, our execution muscle is the strongest one in the field, and also let me underline that we also saw some temporary pressures on our own volumes as we intentionally reduced our inventory levels in the trade.

Speaker #2: What are the rating agencies' views on these results? Are you at risk of a rating downgrade? Okay. Regarding the cash flow, actually, since we couldn't get the full performance of the top-line performance of our P&L, we focused on balance sheet management.

Speaker #2: Ahead of this Efes family uplift launch, this was deliberate decision to ensure a smoother and a healthier transition to the renewed Efes family portfolio.

Speaker #2: So to make it available in March and more point of sales, the deliberately diminished our old stocks, let's say. So that is an effect of this as well.

Speaker #2: And accordingly, our focus on the working capital management, zero-based budgeting in terms of the OPEX, and also the full scope of our balance sheet and including the CAPEX management.

Speaker #1: Onur Bey, there are more questions about the Turkish beer market. So let's continue with them, and then I'll go back to finance part for Yasemen to answer.

Speaker #2: So in terms of the Euro bond, we've been working on the reissuance of the Euro bond, refinancing of the Euro bond. So regarding the rating agencies, we have been meeting with the rating agencies in frequent way.

Speaker #1: How did the Turkish beer market perform in the second quarter? So this is a question related to the market rather than our performance. And could you help us understand how much of the weakness was driven by the overall market versus company-specific factors such as portfolio mix channel dynamics or the relapse?

Speaker #2: But, of course, in terms of their reactions and their comments, we don't think it's the right approach to make a comment on behalf of them.

Aslı Kılıç Demirel: But of course, in terms of their reactions and their comments, we don't think so it's the right approach to make a comment on behalf of them. Thank you, Yasemin. There are a couple of questions from Evgenia. Let me start with the demand part, for domestic market demand part for Onur Bey, and then I'll go through the finance part for Yasemin. What would be a catalyst for domestic market demand to improve?

Speaker #3: Thank you, Yasemin. There are a couple of questions from Evgenia. Let me start with the demand part for domestic market demand for Onur Bey, and then I'll go through the finance part for Yasemin.

Speaker #2: Let me actually, this is the first part I almost answered the first part, but Turkish beer market after so many years after so many years, is now in a decline.

Speaker #2: We can say that. So we just tried these numbers from Nissan, and our market online data as well. So beer market is not growing because of the obvious reason I have mentioned already.

Speaker #3: What would be a catalyst for domestic market demand to improve?

Onur Altürk: 15% volume decline we saw in the H1 in Turkey was not something actually as we expected or anticipated at the beginning of the year, as I mentioned during the presentation. As we discussed, consumer purchasing power deteriorated much more sharply than we had anticipated, and that is really the key factor behind the performance we are seeing today. Based on what we see today, we have revised our guidance to a low single-digit volume decline for the full year. But having said that, given the uncertainties around the purchasing power, tourism season, and broader geopolitical environments, I would also highlight that there is still some downside risk on this one. Looking at recent numbers, June and July combined delivered almost 4% year-on-year growth, and August has started positively actually, and I wouldn't call it a particularly strong start, but the momentum is encouraging.

Speaker #1: 15% volume decline we saw in the first half in Türkiye was not something actually as we expected or anticipated at the beginning of the year.

Speaker #2: And in terms of portfolio mix channel dynamics, order launch, I mean, let me handle this on this way. Our portfolio mix is improving as we mentioned before.

Speaker #1: As I mentioned during the presentation, as we discussed, consumer purchasing power deteriorated much more sharply than we had anticipated, and that is really the key factor behind the performance we are seeing today.

Speaker #2: We have the best premium portfolio. In the country, so we are trying to leverage it. And as we all know, we just relaunched Stella, and we are observing good improvements in this one.

Speaker #1: Based on what we see today, we have revised our guidance to a low single digit volume decline for the full year. But having said that, given the uncertainties around the purchasing power tourism season and broader geopolitical environments, I would also highlight that there is still some downside risk on this one.

Speaker #2: So our portfolio mix is improving. In the channel dynamics, that's the problem in the on-trade channel and Horeca channel. We see an obvious slowdown as we all know.

Speaker #2: Traditional trade is also struggling on a channel base, and in the modern channel, we see some dynamics and dynamism, but again, it should be on the promo prices.

Speaker #1: Looking at recent numbers, June and July combined delivered almost 4% year-on-year growth, and August has started positively. Actually, I wouldn’t call it a particularly strong start, but the momentum is encouraging.

Speaker #2: So all channels in an upsell is struggling right now, but it is definitely resulting from the purchasing power, disposable income, and the macros that are obvious.

Speaker #1: Overall, I have to be honest, this is a challenging year. I mean, we have a new Efes Family Active launch—that might be a catalyst for the rest of the year.

Onur Altürk: Overall, I have to be honest, this is a challenging year. We have a new Efes Family Actif launch that might be a catalyst for the rest of the year. The consumer environment remains tough, and our visibility is limited on this one, and we continue to monitor developments very closely. At the same time, we are staying focused on what we can control and on executing our plans as effectively as possible. As we all know, our execution muscle is the strongest one in the field. Let me underline that we also saw some temporary pressures on our own volumes as we intentionally reduced our inventory levels in the trades ahead of this Efes Family uplift launch. This was deliberate decision to ensure a smoother and a healthier transition to the renewed Efes Family portfolio.

Speaker #2: And the points that we already mentioned during the presentation.

Speaker #1: The consumer environment remains tough. And our visibility is limited on this one. And we continue to monitor developments very closely. At the same time, we are staying focused on what we can control.

Speaker #1: Thank you very much. And now going back to the finance questions, what are your plans for the refinancing of 28 bonds? Do you consider coming to the bond market, or do you plan to tap into other sources of funding?

Speaker #1: And on executing our plans as effectively as possible. As we all know, our execution muscle is the strongest one in the field. And also, let me underline that we also saw some temporary pressures on our own volumes as we intentionally reduced our inventory levels in the trade.

Onur Altürk: As we all know, our execution muscle is the strongest one in the field. Let me underline that we also saw some temporary pressures on our own volumes as we intentionally reduced our inventory levels in the trades ahead of this Efes Family uplift launch. This was deliberate decision to ensure a smoother and a healthier transition to the renewed Efes Family portfolio. To make it available in much and more point of sales, we deliberately diminish our old stocks, let's say. There is an effect of this as well.

Speaker #1: Would you expect some shareholder support with regards to bond refinancing, or more conservative approach to dividends? And the second question is, 25 EBITDA margin, was already under pressure at 13%, and now you're expecting a further 150 basis points contraction.

Speaker #1: Ahead of this Efes family uplift launch, this was deliberate decision to ensure a smoother and a healthier transition to the renewed Efes family portfolio.

Speaker #1: So, to make it available in March and in more points of sale, we deliberately diminished our old stocks, let's say. So, that is an effect of this as well.

Onur Altürk: To make it available in much and more point of sales, we deliberately diminish our old stocks, let's say. There is an effect of this as well.

Speaker #1: What would you say if there is any room for margins and what is the margin that you would expect in normal conditions? Regarding the bond, actually,

Aslı Kılıç Demirel: Onur Bey, there are more questions about the Turkish beer market. Let's continue with them, and then I will go back to finance part for Yasemin to answer. How did the Turkish beer market perform in Q2? This is a question related to the market rather than our performance. Could you help us understand how much of the weakness was driven by the overall market versus company specific factors such as portfolio mix, channel dynamics, or the relaunch?

Speaker #3: Onur Bey, there are more questions about the Turkish beer market, so let's continue with them. Then, I'll go back to the finance part for Yasemin and answer her questions.

Speaker #3: we already applied to the capital markets in order to increase our limit. So within that content, we started to our preliminary studies internally. So in terms of the bond issues, yes, we are planning to reapply to the bond market, and within that content, by considering the existing cash flow position, yes, for the dividends, we've been considering what would be our approach.

Speaker #3: How did the Turkish beer market perform in the second quarter? So this is a question related to the market rather than our performance. And could you help us understand how much of the weakness was driven by the overall market versus company specific factors such as portfolio mix channel dynamics or the relaunch?

Speaker #3: Most probably, it will be a conservative approach. And on top of that, our cash flow discipline and free cash flow focus will continue. So in terms of the EBITDA, on top of that, depending on the downside potential in the Turkish beer operations, there could be 100% 100 basis points further contraction in our EBITDA margins.

Onur Altürk: Actually, I almost answered the first part. But Turkish beer market after so many years is now in a decline. We can say that. We justify these numbers from Nielsen, and our market online data as well. Beer market is not growing, because of the obvious reason I have mentioned already. In terms of portfolio mix, channel dynamics, or the relaunch, let me handle this on this way. Our portfolio mix is improving. As we mentioned before, we have the best premium portfolio in the country, so we are trying to leverage it. As we all know, we just relaunched Stella, and we are observing good improvements in this one. So our portfolio mix is improving. In the channel dynamics, that is the problem. In the on-trade channel and HoReCa channels, we see an obvious slowdown, as we all know.

Speaker #1: Let me actually, the first part, I almost answered the first part. But Turkish beer market after so many years after so many years, is now in a decline.

Speaker #1: We can say that. So, we just find these numbers from Nielsen and our market online data as well. So, the beer market is not growing because of the obvious reasons I have mentioned already.

Speaker #1: That would be an important question. There was no so with inflationary accounting, including the inflationary accounting, the guidance is 150 basis points contraction. Without the inflation accounting, numbers, the contraction will be limited 200 basis points.

Speaker #1: And in terms of portfolio mix, channel dynamics, and order relaunch—let me handle this this way. Our portfolio mix is improving, as we mentioned before.

Speaker #1: We have the best premium portfolio in the country, so we are trying to leverage it. And as we all know, we just relaunched Stella.

Speaker #1: And last year's base for non-inflationary numbers for EBITDA margin was 19.6%. So this corresponds to if we consider the 100 basis points contraction, this will correspond to around 18.6 to 19% EBITDA margin.

Speaker #1: And we are observing good improvements in this one. So our portfolio mix is improving. In the channel dynamics, that's the problem in the on-trade channel and Horeca channel.

Onur Altürk: So our portfolio mix is improving. In the channel dynamics, that is the problem. In the on-trade channel and HoReCa channels, we see an obvious slowdown, as we all know. Traditional trade is also struggling on a channel base. In the modern channel, we see some dynamics and dynamism. But again, it should be on the promo prices. All channels in a nutshell is struggling right now, but it is definitely resulting from the purchasing power, disposable income, and the macros that are obvious and the points that we already mentioned during the presentation.

Speaker #1: Because the inflationary accounting impacts the Turkish operations EBITDA margin much more than the international operations, it seems to be far lower than non-inflationary numbers.

Speaker #1: We see an obvious slowdown as we all know. Traditional trade is also struggling on a channel base. And in the modern channel, we see some dynamics and dynamism, but again, it should be on the promo prices.

Onur Altürk: Traditional trade is also struggling on a channel base. In the modern channel, we see some dynamics and dynamism. But again, it should be on the promo prices. All channels in a nutshell is struggling right now, but it is definitely resulting from the purchasing power, disposable income, and the macros that are obvious and the points that we already mentioned during the presentation.

Speaker #1: But the profit margin is already a conservative margin expectation. So we are not expecting much deviation from this for the full year. For the time being, I don't see any more questions.

Speaker #1: So, all channels, in a nutshell, are struggling right now. But it is definitely resulting from the purchasing power, disposable income, and the macros that are obvious.

Speaker #1: And the points that we already mentioned during the presentation.

Speaker #3: Thank you very much. And now going back to the finance questions, what are your plans for the refinancing of 28 bonds? Do you consider coming to the bond market, or do you plan to tap into other sources of funding?

Speaker #1: So let me remind that the floor is yours for writing down the questions. I don't see any more questions on the floor. So thank you for everyone for joining to this call.

Aslı Kılıç Demirel: Thank you very much. Now going back to the finance questions. What are your plans for the refinancing of 2028 bonds? Do you consider coming to the bond market, or do you plan to tap into other sources of funding? Would you expect some shareholder support with regards to bond refinancing or more conservative approach to dividends? The second question is, 2025 EBITDA margin was already under pressure at 13%, and now we are expecting a further 150 basis points contraction. What would you say if there is any room for margins, and what is the margin that you would expect in normal conditions? Regarding the bond, actually, we already applied to the capital market in order to increase our link. Within that content, we started our preliminary studies internally.

Speaker #3: Would you expect some shareholder support with regards to bond refinancing? Or more conservative approach to dividends? And the second question is, 25 EBITDA margin, was already under pressure at 13%, and now you're expecting a further 150 basis points contraction.

Speaker #1: See you in our nine-month 26 results. Thank you.

Speaker #3: What would you say if there is any room for margins? And what is the margin that you would expect in normal conditions?

Speaker #2: Regarding the bond, actually, we already applied to the capital market in order to increase our limit. So within that content, we started to our preliminary studies internally.

Speaker #2: So, in terms of the bond issues, yes, we are planning to reapply to the bond market. And within that context, by considering the existing cash flow position, yes, for the dividends, we've been considering what would be our approach.

Yasemen Guven Cayirezmez: In terms of the bond issues, yes, we are planning to reapply to the bond market, and within that content, by considering the existing cash flow position. Yes, for the dividends, we have been considering what would be our approach. Most probably it will be a conservative approach. On top of that, our cash flow discipline and free cash flow focus will continue. In terms of the EBITDA, on top of that, depending on the downside potential in the Turkish beer operations, that could be 100 basis points further contraction in our EBITDA margins. There would be any further question? There was none. Including the inflationary accounting, the guidance is 150 basis points contraction. Without the inflation accounting numbers, the contraction will be limited to 100 basis points. Last year's base for non-inflationary numbers for EBITDA margin was 19.6%.

Yasemen Güven Çayırezmez: In terms of the bond issues, yes, we are planning to reapply to the bond market, and within that content, by considering the existing cash flow position. Yes, for the dividends, we have been considering what would be our approach. Most probably it will be a conservative approach. On top of that, our cash flow discipline and free cash flow focus will continue. In terms of the EBITDA, on top of that, depending on the downside potential in the Turkish beer operations, that could be 100 basis points further contraction in our EBITDA margins. There would be any further question? There was none. Including the inflationary accounting, the guidance is 150 basis points contraction. Without the inflation accounting numbers, the contraction will be limited to 100 basis points. Last year's base for non-inflationary numbers for EBITDA margin was 19.6%.

Speaker #2: Most probably, it will be a conservative approach. And on top of that, our cash flow discipline and free cash flow focus will continue. So, in terms of the EBITDA, on top of that, depending on the downside potential in the Turkish beer operations, there could be 100 basis points further contraction in our EBITDA margins.

Speaker #3: That would be another question. There was no so. With inflationary accounting, including the inflationary accounting, the guidance is 150 basis points contraction. Without the inflation accounting numbers, the contraction will be limited to 200 basis points.

Speaker #3: And last year's base for non-inflationary numbers for EBITDA margin was 19.6%. So, if we consider the 100 basis points contraction, this will correspond to around 18.6% to 19% EBITDA margin.

Yasemen Guven Cayirezmez: If we consider the 100 basis points contraction, this will correspond to around 18.6% to 19% EBITDA margin. Because the inflationary accounting impacts the Turkish operations' EBITDA margin much more than the international operations, it seems to be far lower than non-inflationary numbers. But the profitability margin is already a conservative margin expectation. So we are not expecting much deviation from this for the full year. For the time being, I do not see any more questions. So let me remind that the floor is yours for writing down the questions. I do not see any more questions on the floor. So thank you for everyone for joining to this call, and see you in our nine-month 2026 results.

Yasemen Güven Çayırezmez: If we consider the 100 basis points contraction, this will correspond to around 18.6% to 19% EBITDA margin. Because the inflationary accounting impacts the Turkish operations' EBITDA margin much more than the international operations, it seems to be far lower than non-inflationary numbers. But the profitability margin is already a conservative margin expectation. So we are not expecting much deviation from this for the full year. For the time being, I do not see any more questions. So let me remind that the floor is yours for writing down the questions. I do not see any more questions on the floor. So thank you for everyone for joining to this call, and see you in our nine-month 2026 results.

Speaker #3: Because the inflationary accounting impacts the Turkish operations' EBITDA margin much more than the international operations, it seems to be far lower than non-inflationary numbers.

Speaker #3: But the profitability margin is already a conservative margin expectation, so we are not expecting much deviation from this for the full year. For the time being, I don't see any more questions.

Speaker #3: So let me remind that the floor is yours for writing down the questions.

Speaker #1: Hello?

Speaker #3: I don't see any more questions on the floor. So thank you, everyone, for joining this call. See you for our nine-month 2026 results.

Onur Altürk: Thank you.

Yasemen Guven Cayirezmez: Thank you.

Yasemen Güven Çayırezmez: Thank you.

Speaker #3: Thank you.

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Q2 2026 Anadolu Efes Biracilik ve Malt Sanayii A.S. Earnings Call

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