CFO Message

Dear Investors;

At Brisa, we always feel the strong support of our main shareholders, namely Sabancı Holding and Bridgestone Corporation; and operate with the aim of leading the Turkish tyre and mobility industry with sustainable growth, thus adding value to the country's economy and your journey.

We never compromise on our principles of corporate governance, transparency, occupational safety and efficiency. Our main goal is to sustain the values of our company which touch many areas including investment, innovation and employment.

In today's global economic world, it is vital to be able to foresee risks as well as opportunities and take timely precautions when preparing medium and long-term company strategies with the aim of ensuring economic sustainability. At Brisa, our ultimate goal in risk management is to ensure the sustainability of our products, services, operations, reputation and financial strength, and in this way to create the highest value for our stakeholders.

We direct our company's actions by taking into consideration the exchange rate fluctuations and economic developments that the Turkish economy may encounter from time to time and run a forecasting system that is most compatible with reality. We follow our budget plans meticulously, carry out investment feasibility studies wisely, make our decisions by considering our stakeholders, and last but not least, work for economic sustainability.

As Türkiye's tyre industry leader and one of the leading industrial enterprises, we continue to demonstrate a strong performance in both domestic and international markets. Thanks to our balanced working capital management, successful channel and product portfolio management, effective pricing policies and high brand awareness, our company delivers a robust performance. In 2023, despite the increase in costs, our operating profit increased by 38% compared to the previous year, as a result of our strong sales revenues, the right steps we took regarding our supply chain, the efficiency increase we achieved in production and the hedging policies we implemented against the exchange rate risk.

Moreover, we issued our first corporate bond in 2023. With our effective financing transactions, we both kept our foreign currency position strong and limited our financing costs. As a result of implementing agile and robust financial management, our net profit was 58% higher than the previous year, while we closed the year with 518 million TRY in net cash.

In addition to our strong operational and financial performance, as another indicator of our determination to create sustainable value for our stakeholders, we continued with profit distribution last year and handed out a gross sum of 1.0 billion TRY of our 2023 net distributable profit as cash dividend to our shareholders, equivalent to 339.40%.

We are one of the leading companies in the field of sustainability, which is increasingly important in the investment world, and are moving forward with determination in our strategy and concrete goals in this field. As a reflection of our determination on this issue, we signed a loan agreement with the European Bank for Reconstruction and Development (EBRD) for the equivalent of 100 million US dollars, to be used to finance the new investment expenditure programme for the 2023-2025 period.

We are proud to be a global pioneer in the field of sustainability and were included in the Global A List in the CDP "Climate Change" and "Water Security" categories in 2023, being the only company in the global tyre industry to achieve this success. In line with the scenario that will keep the earth's temperature at 1.5 0 C, we were among the few companies that have had our Scope 1-2-3 emission reduction targets approved by Science Based Targets (SBT) in 2021. We are the first company in the world tyre industry and in the Turkish business world to achieve this. Our Environmental, Social and Governance (ESG) performance in 2023 was listed in the "Excellent" category -like the previous year- as a result of the transparent and objective evaluation made by Refinitiv, a London Stock Exchange (LSEG) company. Thanks to these results, we ranked first in the global tyre industry and third in the automotive industry, while our aim is to reach Net Zero Emission level in all our activities by 2050.

We are aware that we need to be future-fit as from today, in line with the rapid developments in technology and the dynamically changing needs of our customers and, in this context, continue our R&D studies, modernization and smart technology investments in our factories. We apply the best examples of industry 4.0 in our brand new Aksaray Factory equipped with smart technologies. With our approach to adding value to our dealers and customers, we focus on diversifying our mobility solutions by offering services beyond tyres. While doing all this, we also accelerate our digitalization journey, and are proud to have a digitalization score above Türkiye's average, according to the results determined by independent research.

We ensure our permanent leadership by creating value for our customers, business partners and investors with our powerful brands, superior quality products, innovative services developed with our customer-oriented approach, and innovative sales channels. Under challenging conditions in the global and local markets, we aim to maximize our profitability with our strategies to establish the export/domestic market balance by focusing on our strategic priorities.
We will continue to add value to our country and the industry with the vision of going beyond tyres and becoming a trend setter in mobility.

Kind regards,

Neslihan Döngel ÖZLEM
CFO