Beer Group President And Anadolu Efes Ceo Can Çaka’s Comments

I am delighted to share another exceptional quarter of performance for Anadolu Efes, especially during the most significant period of the year. These robust results are the testament of our agility and resilience in constantly changing business environment, which clearly demonstrate our unwavering dedication to excellence and our commitment to financial discipline. In the third quarter, we have achieved a remarkable net sales revenue growth of 67% coupled with 84% increase in EBITDA (BNRI) on a consolidated basis. This outstanding performance has also resulted in a significant margin expansion of more than 230 basis points, despite the high base from last year. The strong profitability performance along with disciplined CAPEX spending yielded a phenomenal level of cash generation during the quarter, taking up year-to-date Free Cash Flow to record high level of TL 10.8 billion; implying 53% year-on-year increase in TL and 10% increase in USD terms.” commented Mr. Can Çaka, Beer Group President and Anadolu Efes CEO.

Beer group volume growth accelerated in the period outperforming robust momentum in the previous quarter, by registering 8% increase in 3Q driven by the strong growth achieved in Russia and Türkiye. CIS operation’s volumes were relatively softer, while demand being affected from strong pricing in these countries as a result of high inflationary environment. In soft drinks business, Pakistan operations continued to be negatively affected from macroeconomic challenges recording in a double-digit decline. Nevertheless, this was largely offset by the strong performance registered in Türkiye, Uzbekistan and Iraq; implying a consolidated volume growth of 3% for CCI.

Russian beer volumes demonstrated a strong improvement in the quarter by growing low-to-mid-single digits, exceeding our expectations. This achievement can be attributed to the positive impact of introducing innovative products, accelerated focus on commercial strategies and a more balanced pricing strategy, all contributing to a much stronger performance compared to previous periods.

Despite a very high base of last year, Türkiye beer volume performance remained very strong amidst a challenging operating landscape with purchasing power being under pressure in a high inflationary environment. Notably, Turkish operation achieved mid-single digit volume growth thanks to strong portfolio play, favorable pricing and also strong tourism activity in the country.

As third quarter unfolds, marking another success story, we are highly confident in our ability to meet our 2023 expectations. Furthermore, we make another improvement in our outlook as we now expect flattish EBITDA (BNRI) margin despite cycling record high profitability levels in 2022.

I want to take the chance to express my sincere gratitude to my team and our colleagues for their outstanding contributions to make the summer of 2023 another season of remarkable achievements. Their commitment to excellence have been an inspiration to us all. With their continued dedication and determination, I am confident that we will break new record-highs in the years ahead.