Dear Members, Employees and Valued Business Partners,
The 100th anniversary of Our Republic
As a generation that witnessed the 100th anniversary of our Republic, we experience the excitement and pride of reaching this blessed anniversary, and we commemorate Gazi Mustafa Kemal ATATÜRK and all the heroes of our National Struggle with mercy, gratitude and respect.
On the 100th anniversary of our republic, our nation was deeply shaken by the tragedy of the 6 February earthquakes. Our pain was all the more deeper with the loss of our colleagues from İsdemir, OYAK Pazarlama, OYAK Security and Omsan Logistics, along with thousands of our citizens. In addition to our İskenderun Iron and Steel factory, which was forced to suspend production during this process, our Adana and Mardin Cement factories was also affected. While the earthquakes directly affected 11 provinces in our country, they left a mark on all of our 85 million people. The spirit of unity and solidarity we demonstrated once again highlighted the importance of solidarity. I once again wish God's mercy on all of our citizens and colleagues who lost their lives in the disaster and would like to take this opportunity to offer my condolences to their relatives.
As we step into the second century of our glorious Republic, which we inherited and have carried to this day with significant achievements, Gazi Mustafa Kemal ATATÜRK said, “We do not need anything. All we need is work.” This motto will always serve as our guide on the path to the future.
Founded in 1961, OYAK has distinguished itself as Türkiye's most successful complementary occupational pension fund and has always worked, produced and shared for 62 years.
OYAK has successfully managed the challenges of domestic and international markets during this period, accurately predicting the risks and skilfully taking advantage of the opportunities to reinforce added value production, with the agility, flexibility, scale and power offered by the durable structure it has built.
OYAK has served its mission with its breakthroughs and maintained the welfare of its members by constantly building their assets.
OYAK continued to generate added value for our country in 2023 with its activities in six different continents.
I am delighted to note that we have achieved all our strategic, operational and commercial goals that we planned and budgeted for 2023.
The most important risks affecting all of our areas of activity have been the wave of global inflation and the geopolitical negativities experienced in our surrounding region. Our institution has benefited from the astute and proactive portfolio management strategy which it has implemented, maintaining its strong and sustainable growth while achieving its goals in all of the business lines it operates in.
Based on our 2023 financial results, our total assets increased by 77% compared to the previous year to reach TL 847 billion, while our consolidated net assets increased by 71% compared to the previous year to TL 332.8 billion and our consolidated revenue increased by 38% to TL 457.8 billion.
Our rate of return in 2023 was 77.1%, indicating that we protected our members' savings in real terms and achieved the goal of providing high returns. This result was achieved with the valuable contributions of our management teams, who played a role in the realization of our strategic breakthroughs, as well as our workforce of over 38,000 employees who performed their duties with a high level of belonging, passion and dedication in OYAK and OYAK Companies. I would like to thank our Chairman of the Board of Directors and the members of the Board of Directors and Auditors for their support throughout this process. I hope that this rate, achieved under the exceptional market conditions of 2023, will bring benefit to all of our members and be repeated in a sustainable manner.
Our export income and tax contribution, indicating our contribution to the Turkish economy, are other indicators of our success. In 2023, our total exports on a Group level increased to USD 4.6 billion, comprising 1.81% of Türkiye's total exports.
The TL 85.6 billion in tax which we paid in 2023, 1.90% of all taxes collected in Türkiye and 0.99% of corporate taxes were covered by OYAK and OYAK Companies.
We steadfastly aimed to do more by continuing our work to improve the services we offer our members and strengthen the benefits provided in 2023. In summary, we worked with self-confidence and determination as a global Group operating in six different continents with equity capital exceeding USD 10 billion. As always, the sense of responsibility we feel towards our 470,000 members is at the heart of our work.
Shaping the future in the automotive logistics industry
The Renault partnership and investment, realized in 1969, marked the turning point of OYAK's investments in the automotive sector. Four new models are planned to be manufactured at the Bursa plant until 2027 under this partnership, which now stands as one of the groundbreaking and leading participants of our country's automotive industry. We see this breakthrough, which marks a new chapter in our cooperation with our French partner, as an important indicator of the greater cooperation and success we will achieve in the future.
Despite the recent rise in geopolitical conflict, the negativities associated with the resulting migration movements and the devastating consequences of the global climate crisis, the realization of such a large investment indicates the long-term confidence of our partner, a representative of foreign capital, in both OYAK and our country.
We carry out our ambitious work in the logistics sector by taking concrete steps in the field of sustainability for a greener world. While global logistics has become more important all over the world in recent years, we are working to move our presence forward with our leading role in balanced, integrated, environmentally friendly freight transportation.
Focusing on customer satisfaction, Omsan Logistics succeeded in being one of the first logistics companies to receive the "Green Logistics Certificate" issued by the Ministry of Transport and Infrastructure under the General Directorate of Transport Services Regulation.
Shaping global markets
With more than half a century of experience in the Turkish chemical industry, OYAK Chemical Agricultural Companies continue to grow by investing in world on a global scale.
Our subsidiary, Akdeniz Chemson, is the world's largest producer in the PVC industry, with a production capacity of 412,000 tonnes of PVC polymer chemical additive materials in its facilities located throughout five continents. Akdeniz Chemson, which is a major influencer of the PVC stabilizer market, has set out a pioneering vision, standing far ahead of its competitors in the field of sustainability with the ECO-TAB® and Low Carbon Tabular Alumina products which it launched in 2023.
Shaping its global presence with an understanding of "right investment in the right market" by analyzing the demands and needs of the sectors in which it operates in detail, OYAK completed another important milestone by bringing Akdeniz Chemson's facility with an annual production capacity of 30,000 tonnes into operation in China. Under its current structure, Akdeniz Chemson is able to carry out uninterrupted production 24 hours a day, on different continents and in all time zones, stretching from China to the USA.
Another important achievement in 2023 was the award of a gold medal to our Almatis company, which achieved scores above the industry average in the EcoVadis evaluation, which focuses on the environment, employee and human rights, ethics and sustainable supply.
Serving as a pioneer of smart agriculture with its national projects in the fields of R&D, new product development and agricultural technologies, HEKTAŞ has been carrying out its activities with a focus on sustainable growth strategy in recent years.
Our company hosted the 2nd International Molecular Plant Protection Congress (IMPPC) in 2023 at the Agricultural Innovation, Training and Experience Center (F.A.R.M.) in Bursa's Orhangazi district. This important global congress was opened by the American biology professor, Craig Mello, who won the Nobel Prize in Medicine in 2006 in recognition of his studies on RNA interaction. The congress created a major impact, turning into a platform where 81 scientists from different countries discussed the future of world agriculture, sustainability and new agricultural practices.
HEKTAŞ's investment in the Niğde factory marked an important step, demonstrating the strategic importance the Group attaches to agriculture. HEKTAŞ, which has undertaken the "Agriculture 4.0" transformation, has started to direct "Agriculture 5.0" at the point it has reached today. HEKTAŞ, the flagship of Turkish agriculture, and Ferbis, the innovative face of efficient agriculture, will support producers in their investments, not only increasing their market clout in the field of plant protection, but also continuing to create employment in the region.
A stakeholder in the global energy transformation in
With the transformation in the energy sector, we have become a key player in the renewable energy sector by focusing on protecting resources, reducing environmental pollution and the healthy functioning of the ecosystem, in line with our mission of making our world greener and more liveable.
OYAK is strengthening its position in the energy sector as a stakeholder of the global transformation within the scope of its strategic approach based on a multidisciplinary perspective.
TotalEnergies stations, which are undergoing a transformation in Türkiye, are working to leave the legacy of a sustainable environmental to future generations by investing in sustainable sources of energy, electricity and services that make a difference.
The change in GüzelEnerji’s logo in 2023 highlighted its energetic, sustainable and global structure. In cooperation with the TSK Mehmetçik Foundation, new stations were added to the service network, expanding the area reach of the positive impact created. M Oil, GüzelEnerji's lubricants brand, signed an international cooperation agreement with Valvoline, the world's first branded engine oil manufacturer, in licensed production and market management in its sector.
OTOJET, which provides services for electric vehicle (EV) charging in line with GüzelEnerji's new generation energy vision and zero carbon footprint targets and operates as the first fuel company in Türkiye to hold an electric charging operator license determined by EMRA, continues to expand its number of charging units.
Milangaz attained a market share of 6% in the Auto-LPG segment and an 18.1% market share in the LPG canister segment. With its state-of-the-art machinery and equipment, Milangaz’s cylinder manufacturing factory offers a level of annual production capacity sufficient to respond to the need for LPG canisters in the domestic market as well as in foreign markets.
Expanding and strengthening our deeply rooted structure in the financial sector with our digital breakthroughs.
ANKER Bank, operating in Germany, reached an asset size of EUR 1,261 million, spurred on by important developments in the investment sector in 2023. With our investments in digital banking, Innovance Information Technologies has expanded and developed its operations in partnership with OYAK ANKER Bank, United Payment Services and Electronic Money with United Payment.
With our Venture Capital Investment Funds, we aim to contribute to economic growth and employment by investing in startups that are open to innovation and digitalization in our country. In this vein, we offer our members and customers a range of innovative business models by supporting sustainable business models that can provide potential high returns in the future and influence the market.
The volume of brokerage transactions carried out by OYAK YATIRIM, one of Türkiye's most established and respected brokerage firms also grew in 2023 with the support of its collaborations. JCR Eurasia Rating confirmed OYAK YATIRIM's long-term credit rating at the highest level of AAA.
Significant gains in the cement business line
Another important step taken in the cement industry was the cooperation entered into with the Taiwan Cement Corporation (TCC), the world's largest cement producer. Following the signing of the term sheet in November 2023 and completion of approvals from the Competition Board, OYAK transferred 40% of its global cement and concrete activities to TCC with the share transfer agreement in January 2024. With this contract, around USD 740 million will enter our country for investment purposes. The partnership established with TCC is the largest partnership agreement in the history of the Turkish cement industry, both in terms of the size of the transaction and the valuation criteria.
Contributing to Türkiye's 2053 net zero target in the field of sustainability, OYAK Cement's "Net-Zero" commitment was registered by the Science Based Targets initiative (SBTi) in 2023. OYAK Cement was also the first Turkish cement company to sign up to the Global Net-Zero commitment.
Our mining metallurgy companies working to prepare a better future for humanity
The secret of OYAK's success lies in its ability to lead change. With OYAK's power and strategic actions, it has become a global player by moving forward with sustainable growth, responsible production and people-centric approach in all sectors. Erdemir and İsdemir, pioneers of the iron and steel industry, have guided the sector in our country in the green transformation process and successfully created their road map by declaring "our goal for a better future is the green transformation".
In this context, our short-term goal is to reduce carbon emissions per unit of crude steel production by at least 25%. In this regard, we aim to realize the USD 3.2 billion transformation investment in Erdemir and İsdemir by the end of 2030. This plan also includes the installation of a solar power plant with an annual generation capacity of 1.7 million MWh.
In 2021, Erdemir broke its 50-year EBITDA record in dollar terms, returning a net period profit of TL 15.5 billion. In 2022, Erdemir generated a net profit of TL 18.0 billion, and despite the earthquake in 2023 and the economic contraction in the sector against the backdrop of the global conjuncture, Erdemir managed to round off year with a net profit of TL 4.0 billion.
In parallel with our growth targets that create sustainable value for all of our stakeholders, Ermaden will provide a great contribution to our sustainability targets by increasing raw material supply security and the level of self-sufficiency in steel production, thanks to the USD 550 million pelletizing facility to be established in the iron mining area in Bingöl-Avnik.
Another goal we are prioritizing is to reduce the foreign dependence of Türkiye's growing defence industry, to be unaffected by supply restrictions and to ultimately meet 100% of our country's needs for armoured steel from domestic and national sources. Our work in this area continues apace, with the Group producing the raw materials and final products of heat-treated high-strength steels, as well as carrying out the R&D to develop them.
Another goal we prioritize is Our aim is to reduce the foreign dependency of Türkiye's growing defense industry, to be unaffected by supply restrictions, and to ultimately supply our country's armor steel needs from 100% domestic and national sources. While our work in this field continues rapidly, the raw materials and final products of heat-treated high-strength steels, including R&D, are produced within the Group.
One of OYAK's greatest sources of pride was the start of submarine steel production. While Germany and France are the leading countries in the production of submarine steel for the global market, the USA and China are currently the countries producing for their own needs. OYAK, which has elevated Türkiye to the global league with its production of submarine steel, is preparing to offer solutions to national projects with the support of the submarine construction steel it produces with domestic resources.
An expanding presence in the food industry with new products
Our food companies, an area of strategic importance for us within the framework of our sustainable growth vision, expanded their range of products in 2023 with the rapid growth in our distribution network supporting the increase in our penetration in national and local retail chains providing services in Türkiye.
SAGRA, which has a deeply rooted history dating back 87 years, entered the retail industry with four store openings. Our Sarelle brand has appeared on the shelves with its renewed design. Tamek, with a wide product portfolio of over 300 different types and packaging types in nine categories, continued its exports to 32 countries in addition to its domestic activities, and added 17 new products to its product portfolio during the year.
Onwards with Housing projects
Aiming to provide the greatest return for its stakeholders, OYAK İnşaat is one of the most successful companies in the field of construction thanks to its techniques, quality and service. Developing new housing projects for its members in line with the principles of the environment, sustainability, quality and security, OYAK İnşaat continued its work unabatedly in 2023. Homes completed within the scope of the 1st Stage of the Seyirce project were handed to our eligible members. While 1,003 homes were offered for sale in the OYAKKENT Silüet Project, 312 homes in the 2nd Stage of the Seyirce project and 216 homes in the in the 1st Stage of the Çiğli project were presented to our members.
We moved from our Head Office building, where our members had been served for more than 60 years, to our new environmentally friendly Head Office built by OYAK İnşaat. We brought our Companies, which had been located in various locations in Istanbul together to the OYAK Dragos Plaza with the aim of increasing synergies.
Striving to increase our competitiveness on an international scale and expand our global sphere of influence
As one of our country’s important economic powerhouses, we will continue to take steady steps in the fields of employment, production and exports. Another axis of our road map is to advance the strength and knowledge we have gained in the course of the last 62 years to a higher level in the global arena with our constantly improving competitiveness, to move forward without deviating from our goal and to create value. The greatest source of our success is our strong reputation among the valuable members of the Turkish Armed Forces, the precious family members of our beloved martyrs, and our heroic veterans.
As we leave behind the first century of our Republic, at OYAK will maintain our strong belief in our country and steadfastly follow our disciplined management approach, produce by remaining resistant to uncertainties and work with all our might to achieve our medium and long-term goals.
We will continue our sustainable growth with the valuable contributions, opinions and suggestions of our valued members, dear employees and valued business partners.
Respectfully,
Süleyman Savaş ERDEM
CEO
Board Member