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HIGH PROFIT MARGIN INVESTMENT OPPORTUNITY FOOD INDUSTRY IN TURKEY (JULY 2016)

STRICTLY CONFIDENCIAL

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INTRODUCTION

LOCATION Turkey - Marmara Region

ACTIVITY START 2004

COMPANY A family company. Operates in pastry sector.

PROFILE One branches and 63 franchises across 7 major cities

MARKET Turkey, Saudi Arabia

NUMBER OF

EMPLOYEES 137

STRENGHTS

* Third place in the market

* 40 different varieties of pastries which are totally handmade by housewives

* 4.000 kg/day production

* 7.000 m2 of production unit* Over 10 years of experience in industry

* High level EBITDA margin* Visionary and loyal management team

WEAKNESSES

* Marketing activities

* Coverage in major cities

* Family company

* Need growth capital

OPPORTUNITIES

* Increasing the coverage in major cities

* Franchise opportunities in abroad

* Increasing interest in balkan pastries

THREATS

* Strong economic downturn

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SOME SELECTED PASTRY (BOREK) & DESSERT PRODUCTS

Pastry with cheese Pastry with mince Rose Pastry Rolled Pastry with

cheese

Pastry Tray

Simit (Turkish Bagel) Savory Pastry Turkish Baklava Turkish BaklavaVarious Cakes

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INTRODUCTION

COMPANY ROADMAP

• In 2015 new franchise shop concept was well adopted. Franchises got advantage of new concept and

increased their revenue by 137% in average.

• They received 194 requests for franchise in 2015 and 21 found eligible for franchise.

• Priority to increase coverage in big cities and abroad.

2004 4 years 5 years 2 years 5 years

Starts in a small shop (150 m2)

1st Franchise2 Franchises

1 Branch

Trademark registration25 Franchises

1 Branch

Branding, new concept. New HQ. 58 Franchises

4 Branches

2008 2013 2015

Leadership150 Franchises

1 Branch, 29 Mio € Rev.

2020

ESTABLISHMENT

Brand awareness

Initiate growth

Franchising concept

Growth with franchising model LEADERSHIP

In short, the company captured the brand awareness, the concept of integrity, correct product selection, quality

standards and the franchise model that is needed to growth in the sector.

The company's goal is to become a leader in the industry by 2020.

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INTRODUCTION

• Low labor costs. Majority of workers are housewives who work with minumum wage salary.

• The cost of goods & revenue ratio was 68% in 2015 while 76% in 2014. 8 points improvement YOY. In 2020

this ratio projected as 60%

• Operating leverage is 207,8%

FINANCIAL KEY INDICATORS & FUTURE EXPECTATIONS

PROFIT & LOSS PROJECTION (€ *)

Years 2014 (R) 2015(R) 2016(P) 2017(P) 2018(P) 2019(P) 2020(P)

Revenue 3.223.172 4.664.841 6.823.472 9.709.957 15.165.591 21.358.015 28.988.040

Cost of Goods Sold (-) 2.458.206 3.177.159 4.486.063 6.207.925 9.358.304 12.953.408 17.382.016

Gross Profit 764.966 1.487.682 2.337.409 3.502.032 5.807.287 8.404.606 11.606.024

Operating Expenses (-) 408.269 721.529 924.655 1.340.063 1.913.397 2.475.950 3.154.719

EBIT 356.698 766.153 1.412.754 2.161.970 3.893.889 5.928.656 8.451.305

Amortization 0 82.510 89.364 140.767 209.305 260.708 312.111

EBITDA 356.698 848.663 1.502.118 2.302.737 4.103.194 6.189.364 8.763.416

Projection 2015 2015 2016 2017 2018 2019 2020

Point of Sales # 32 56 66 86 106 126 146

Sales Growth 99,0% 44,7% 46,3% 42,3% 56,2% 40,8% 35,7%

EBITDA Marjin 11,1% 18,2% 22,0% 23,7% 27,1% 29,0% 30,2%R: Recast

P: Projektion

€ for 2015-2020 = 2,9181 TL

0

10.000.000

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2015 2016 2017 2018 2019 2020

REVENUE

EBITDA

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INTRODUCTION

INVESTMENT

Amount of Investment : 4 Mio EUR (for minority share)• To strengten the operating capital• To realize the growth targets• Majority share option negotiable

• In 2020 being number one in the industry by increasing the franchise units,

sales and EBITDA.

• Becoming ready for opening abroad after completing the institutionalization and

branding work.

• Achieve EBITDA margin over 30% by increasing efficiency and marketing

activities.

In 2015, the company was listed among the 100 fastest growing companies in Turkey thatcompetition was organized by TOBB, TEPAV and Allworldnetwork in cooperation.

Company held 36th place in overall ranking, 3rd place in food industry.

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STRICTLY CONFIDENCIAL

THANK YOU!FOR ANY FURTHER INFORMATION, PLEASE CONTACT:

Ercan Aslanturk

NBB Advisors Turkey | Partner

E: ercan.aslanturk@nbbadvisors.comT :+90(212) 319 3890M:+90(532) 234 5010

http://www.nbbadvisors.com/tr/