PINAR SU SANAY İ VE T İ CARET A. Ş PINAR SU SANAY İ VE T İ CARET A. Ş
History 2002 1997 1985-86 2003 1984 P ı nar Madran water The first Madran water in plastic P ı nar Ş a ş al in Marmara Water Inc. packed in demijohns Potable water (for the bottle. Turkish Standards Institution PVC packages Was established upon first time) in non- was introduced was awarded Golden Package with 2010 acquisition of two 2003 recycled package... the plastic bottle of Madran Memba springs in Adapazar ı Merged with P ı nar Ş a ş al Suyu 1985 and Isparta P ı nar, Ya ş am 1995 2001 Birma ş Tüketim P ı nar ı m and P ı nar 2007-2008 Mallar ı Ticaret P ı nar Ş a ş al was Annual production TSE ISO 14001 Denge waters were A. Ş . exported to reached 100,000 tones. Environmental P ı nar Su receives natural launched in the Germany for the New resources were Management System mineral water licenses for market. first time started to be searched. Certificate all three of its factories. 1984 ’85 ’90 ’95 ’00 ’02 ’04 ’06 ’08 ’09 2010 1984 1999 2005 2003 P ı nar Su plant was ISO 9002 Quality 2010 TS 13001 HACCP TS ISO 9001- established in İ zmir, Management Food Safety System 2000 Certificate Menderes to produce first P ı nar Su Order Hotline System Certificate 1996 Certificate bottled water in Turkey 444 99 00 was established. Second factory of P ı nar Su was 2004 1989 established in Nazilli, Ayd ı n and P ı nar www.pinarmutfagi.com site Madran water, one of the top-notch %90 of total water exports of was established. waters in the world in terms of taste, met Turkey is realised by P ı nar with the customers. Su P ı nar Su Page 1
Market Overview 1.600.000 1.336.568 1.400.000 1.214.668 1.200.000 990.685 � Bottled water sector in Turkey reached 9 billion L and 3,1 billion TL 1.000.000 Tonnes market value in 2009. 707.972 800.000 535.394 600.000 � Within the same year, bottled water consumption per capita is 126 L. 400.000 (37 L PET; 89 L HOD) (2008: 114 L) 200.000 0 � Bottled water consumption per capita is 142 L in France, 176 L in Italy 2005 2006 2007 2008 2009 and 143 L in Spain. Source: Nielsen –Packaged non-recyclable (PET) � 71% of the whole consumption is 19 L HOD segment, the remaining 29% is PET bottled water segment. � In 2009, volume growth is 2% in HOD and 8% in PET segments. � Average capacity usage rate of the industry is 40% Source: SUDER P ı nar Su Page 2
Market Overview Growth Potential GDP vs. Turkish Bottled Water Market Growth Rate � Consumption of the carbonated beverages is declining due to consumers’ increasing consciousness and 20% trend towards a healthy life 15% 14% 13% Tap water recognized as “non-drinkable” in big cities � 10% 9% 8% 7% 7% 7% � Continuously increasing consumption of bottled, branded 5% 5% 5% 3% 3% 1% water 0% -5% -5% � Turkey has an advantage in terms of spring water -10% sources. Portion of natural water sources in use is only GDP Growth Turkish Bottled Water Market Sales Volume Growth 30% The Bottled Water Sector in Turkey 2003 – 2010 * 2003 2004 2005 2006 2007 2008 2009 2010 * Production (billion lt) 5,7 6,2 7 7,8 8,1 8,7 9 9,5 Market Value (billion tl) 0,6 0,8 1 1,2 2,1 2,1 3 3,2 Per Capita Consumption (lt) 81 83 93 105 96 114 122 - * SUDER estimates are given for 2010. P ı nar Su Page 3
Key Players in Turkish Bottled Water Market P ı nar Su & Competitors � Increasing investments of worldwide players like Natural Mineral Water - PET Nestle, Danone, Coca Cola due to high potential in Competitor 1 the market (M&A, spring source investments etc.) 13% Competitor 2 8% � Trend in the industry is to increase spring sources to optimize logistic costs Competitor 3 Other Competitors 8% 57% PINAR � Small sized entrepreneurs are causing fragmented 7% Competitor 4 Competitor 5 market structure 4% 3% Competitor 1 Competitor 2 Competitor 3 PINAR Competitor 4 Competitor 5 Other Competitors Source: Retail Value Market Shares, Nielsen, 2009 (not inc. BIM) P ı nar Su Page 4
Product Range � Under the brand name of P ı nar Ya ş am P ı nar ı m – MADRAN ; production of PET water in 0,33 lt ve 0,5 lt, 0,51 lt, NRB glass bottle, 3 lt,3,25 lt, 5 lt, 8 lt,ve 10 lt PET and policarbon demijohn water in 19 is realized. � Under the brand name of P ı nar Ya ş am P ı nar ı m – ÇAMLICA; 0.33 lt, 0.5 lt, 1.5 lt, 5 lt PET and policarbon demijohn water in 19 lt is realized. � Under the brand name of P ı nar Ya ş am P ı nar ı m – TOROS; 0.5 lt, 1.5 lt, 5 lt PET and policarbon demijohn water in 19 lt is realized. P ı nar Su Page 5
Supply Brings unique gift of nature to consumers in its purest form PET Preform Supply; Spring Sources; � High quality natural spring sources in 3 different regions � Long term cooperation with local multinational producers sustain quality assurance � Diversified sources in Ayd ı n , Isparta , Sakarya provides benefits in distribution and transportation � Sustainable improvement in packaging costs costs (short-neck, light-weight bottle) � Long term agreements with the State P ı nar Su Page 6
Production Quality & Hygiene in each step of production � Turkey’s first bottled natural spring water � Modern production facilities and sources in 3 territories: — Çaml ı ca (2003) / Adapazarı with 400,000 tonnes capacity — Madran (1996) / Aydın with 490,000 tonnes capacity — Toros (2003) / Isparta with 210,000 tonnes capacity � Beverages segment product portfolio is composed of HOD and Adapazar ı (Çaml ı ca) Ayd ı n (Madran) (9 production lines) (5 production lines) PET bottled water. � Starting 2010, Lean Six Sigma projects are initiated Isparta (Toros) (4 production lines) P ı nar Su Page 7
Sales & Distribution Expected advantages of merger – P ı nar Su & Birma ş Seasonality � To create a more effective model in sales and distribution 100% network, 90% 20% 20% 20% 80% 70% 30% 31% 31% 60% To increase competitive strength in the national market, � 50% 40% 28% 28% 27% 30% � Tax optimization, 20% 21% 21% 22% 10% 0% 2007 2008 2009 � Cost savings, Quarter -1 Quarter -2 Quarter -3 Quarter -4 Breakdown of Sales Volume (PET/PC) � Sales and distribution are realized through total 420 dealers consist of 321 PC and 99 HOD. PET 48% PC 52% PET PC P ı nar Su Page 8
Export � P ı nar Su exports to total of 20 countries. � P ı nar Su exports reached to $ 2,5 Mn in 2009. � Germany forms 47% of the total exports. � Share of exports in total net sales is around 4%. � Growth is expected in exports parallel to domestic market 15,69% 1,57% 0,39% 7,84% 47,06% 7,84% 19,61% GERMANY U.K. DENMARK CYPRUS U.A.E. U.S.A. OTHERS P ı nar Su Page 9
Business Highlights High quality, hygienic and EU standard production � P ı nar Su uses Clean Room technology which is regarded as the most advanced technology available in the world’s bottled water industry. • Brand Recognition The first Turkish beverage that has registered its quality by having been � awarded with a proficiency certificate by the American National Sanitation • Corporate Image and Reputation Foundation (NSF) • Consumer Loyalty � All of P ı nar Su’s activities are performed under the ISO 9000 Quality Management System, ISO 22000 Food Safety Management System and ISO 14000 • Widespread and Effective Distribution Environmental Management System Network Strong brand equity • HACCP - Food Security Management � According to the “Brands” survey conducted every year by the independent System research firm of Nielsen, P ı nar ranked fifth among all the brands (both national and international) in all sectors in Turkey that consumers felt the closest to in • Strong Production –Technical 2009. Substructure - know-how Robust growth prospects � In 2010, Turkish bottled water market is expected to grow 6% and reach to 9,5 billion L. P ı nar Su Page 10
Stock Performance As of August 23, 2010 ; Ownership Structure � Price at August 23, 2010 > 5,05 TL � Market Capitalization > 64,1 mio TL Paid-in Capital > 12,789,345 TL � 32% � Total outstanding shares in free float > 32 % 58% 1% PINSU Share Performance Relative to ISE-General 9% 5,05 160 6 140 5 120 P ı nar Süt Ya ş ar Holding Ya ş ar Birle ş ik Pazarlama Free Float 4 100 80 3 83,91 60 2 40 1 20 - 0 9 9 9 9 9 9 0 0 0 0 8 9 9 9 0 0 0 0 0 0 0 1 1 1 1 0 0 0 0 1 - - - - - - - - - - - - - - - y t r y r y h l e r r y h l e i s e i e r c r n l e e r c r n l u u u p b p b a r b b a r u g u a J o J u A m u a A m J m J u r M t r M A c e e b e b O c e v c e F o F e e D N D P ı nar Su Page 11 ISE-General (Right Axis) PINSU (Right Axis)
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