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Central Securities Depository & Trade Repository of Türkiye
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oda_ExplanationTextBlock| | Evaluation of the 2025/2026 Financial Year Results and Expectations for the 2026/2027 Financial Year The financial results of our Company for the special accounting period from 1 July 2025 to 30 June 2026, together with its operational and certain financial expectations for the 2026/2027 financial year, are presented below for the information of the public: Strengthening the Financial Structure Of the proceeds generated from the sale of shares carried out by BG Holding A.Ş., the controlling shareholder of our Company, TRY 4,640,000,000 was transferred to the Company's accounts on 2 July 2026 as a capital advance in order to strengthen the Company's equity structure. As the process of converting this amount into share capital through a capital increase by way of private placement is subject to the approval of the Capital Markets Board of Türkiye ("CMB"), Balsu Gıda Sanayi ve Ticaret A.Ş. applied to the CMB on 7 July 2026 in connection with the relevant capital increase by way of private placement. Our equity-to-financial-debt ratio stood at 42.05% in our consolidated financial statements as of 30 June 2026. Assuming that the TRY 4.640 billion capital advance is converted into share capital upon receipt of CMB approval, the ratio, calculated on the basis of the 30 June 2026 balance sheet, would rise to approximately 74.47%. This would further reinforce our position among the companies with the strongest financial structures in our sector. Evaluation of the 2025/2026 Financial Year During the 2025/2026 hazelnut season, Türkiye's hazelnut crop declined significantly compared with the previous year as a result of adverse agricultural conditions, particularly frost. Other agricultural challenges, most notably the brown marmorated stink bug, also negatively affected crop volumes and quality in certain production regions. As previously disclosed by our Company, Türkiye's hazelnut crop was reported at approximately 717 thousand tonnes in 2024 and approximately 441 thousand tonnes in 2025. The contraction in supply led to a rapid increase and heightened volatility in hazelnut prices, causing international customers to postpone purchasing decisions and, consequently, resulting in lower export volumes. Accordingly, Türkiye's shelled hazelnut exports decreased by approximately 38.7% in the period from 1 September 2025 to 30 June 2026 compared with the same period of the previous season, falling from 276,374 tonnes to 169,480 tonnes, a level not seen in the past 30 years. In order to fulfil its existing and anticipated delivery obligations to customers without interruption, our Company continued to carry raw material and finished goods inventories in a high-price environment. Higher raw material costs, longer inventory holding periods and the resulting increase in working capital requirements raised the need for financial borrowing and increased finance expenses. Although demand previously considered to have been deferred was expected to translate into sales more rapidly during the season, the recovery in volumes occurred later and remained more limited than anticipated due to international customers' cautious purchasing policies in the high-price environment. These developments adversely affected our Company's sales volume, working capital cycle and net profit for the period, particularly during the first nine months of the financial year. In the financial year from 1 July 2025 to 30 June 2026:
Operational Outlook for the 2026/2027 Financial Year Based on current field observations and sector assessments, the 2026/2027 hazelnut crop is expected to create a more balanced supply environment compared with the 2025/2026 season. A recovery in sales and export volumes is anticipated, supported by improved access to raw materials, a more balanced pricing environment and customer demand deferred from the previous season. Although the larger crop is expected to result in lower prices, we expect higher volumes to enable our sales revenue to remain at the previous season's level. In addition, faster cash conversion and a reduction in inventory levels are expected to result in an approximately 60% reduction in indebtedness. With a stronger capital structure, lower raw material prices and faster cash conversion, an approximately 70% reduction in finance expenses is targeted. The EBITDA margn is expected to remain at the previous year's level, while a very strong increase in net profit is expected as finance expenses decline. Strategic Investments HENDEX Activated Carbon Following the positive results of test production and sales conducted since last year as part of our Hendex investment, installation of our first main production line is progressing in accordance with the planned schedule. The installation work is targeted for completion by 15 December 2026, after which the facility is expected to be commissioned gradually. The facility has an annual raw material processing capacity of 58,000 tonnes and, based on the planned yield rates, is expected to reach an annual finished product production capacity of approximately 18,000 tonnes. In the 2026/2027 financial year, the Hendex investment is planned to generate approximately USD 25 million in revenue and contribute USD 7 million in EBITDA. BAC – Chile Hazelnut Orchards Balsu Agro Chile continues its agricultural operations on its 168-hectare landholding in Chile's Maule Region. As is known, the principal objective of this investment is to understand an entirely different ecosystem and to meet the raw material requirements of our processing facility through both our own production and procurement from other farmers. Following the planting activities undertaken since 2018, the company currently produces hazelnuts from approximately 70,000 trees. In the 2025/2026 season, USD 1.2 million in profit was generated from the company's own production. Balsu Agro Chile continues its efforts to diversify its commercial activities by leveraging its agricultural know-how and the grower network it has established. BIC – Chile Integrated Hazelnut Processing Facility The first phase of the integrated hazelnut processing facility investment undertaken through our subsidiary in the Republic of Chile has been completed and production has commenced. Under the second phase, trial production is scheduled to begin on 26 October 2026, and the advanced processing facility is planned to commence operations in November 2026. On a single-shift basis, the facility currently has a hazelnut cracking capacity of 100 tonnes and a roasting capacity of 20 tonnes. By taking advantage of different harvest periods, the investment aims to diversify our Company's raw material procurement sources and provide a more balanced year-round supply of products to global customers, while also opening new markets in neighbouring countries where hazelnuts have historically had little or no market presence. As the hazelnut season in Chile will begin in 2027, the current business plan has been prepared on a 2027 calendar-year basis. Within this framework, a total processing and product volume of approximately 19,000 tonnes is targeted, comprising 15,000 tonnes of contract cracking services and 4,000 tonnes of various hazelnut products. Based on the current budget, gross profit of approximately USD 7.4 million is projected for the 2027 calendar year. Respectfully announced to the public. Statement Regarding Forward-Looking Information The forward-looking statements contained in this disclosure have been prepared on the basis of current market conditions, the reasonable assumptions of the Company's management and the budget approved by the Board of Directors. Material changes affecting Türkiye or Balsu in relation to hazelnut crop volumes and prices, climatic conditions, agricultural diseases and pests, international demand, exchange rates, financing costs, supply chain conditions or the commissioning schedules of investments may affect the extent to which the disclosed expectations are realised. If actual results differ materially from the publicly disclosed expectations or if a material change occurs in such expectations, the relevant developments will be disclosed to the public in accordance with capital markets legislation. | ||||||||
We proclaim that our above disclosure is in conformity with the principles set down in “Material Events Communiqué” of Capital Markets Board, and it fully reflects all information coming to our knowledge on the subject matter thereof, and it is in conformity with our books, records and documents, and all reasonable efforts have been shown by our Company in order to obtain all information fully and accurately about the subject matter thereof, and we’re personally liable for the disclosures.
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