Ladies and gentlemen, welcome to Anadolu Efes First Q uarter 2021 Financial Results Conference Call and Webcast. My name is Aslı Demirel, and I'm the Head of Investor Relations of Anadolu Efes. Our presenters today, Mr. Can Çaka, the CEO, and Mr. Orhun Köstem, the CFO. All participants will be in a listen-only mode. Following the first part of the call, there will be a Q&A session, and you will be able to write down your questions on the question box on your web screen. Just to remind you, this conference call is being recorded, and the link will be available online. Before we start, I would kindly request you to refer to our notes in our presentation regarding forward-looking statements. Now I'm leaving the grounds to Mr. Can Çaka, Anadolu Efes CEO. Sir. Thank you, Aslı. Hi, everybody. Good afternoon and good morning, wherever you are. Thank you all for joining our first quarter earnings release call. Apparently, things have not become any easier since our year-end conference call. 2021 has started and continues to be tough, especially in Türkiye. However, I can happily say that we have made a pretty strong start to the year, driven by the dedication and hard work of the entire Anadolu Efes team under such challenging circumstances. I just wanted to take the opportunity to thank the whole team for this strong set of results. We delivered 13% volume growth in the first quarter with the contribution of both business lines. Beer volumes were expanded by almost 5%, with Russia, Kazakhstan, and Moldova taking the lead in terms of growth percentages. CCI also had a remarkable performance both domestically and internationally. In addition, we had a strong revenue growth in the quarter as a result of price increases, favorable product mix, and as well as the favorable conversion impact. We also had a good profit performance in the quarter. In addition to the support of the top line, there has been some shifts between quarters in terms of OpEx, of which we expect partially to be normalized in rest of the year. We were able to deliver a better-than-expected revenue and margin performance in the quarter. As noted in our full-year results call, we accelerated our focus and investments related to our Plus One relaunch in Türkiye in order to be ready for the peak season. The OpEx in our Turkish operation was higher compared to a year ago. We had relaunched Efes Family last year with full look-and-feel revitalization, and now we are reviewing our look and feel in the field, in the market, as we planned at the beginning of the year, as we communicated in our prior calls as well. We were also able to beat expectations in terms of free cash flow with a significant improvement year-on-year basis. This is supported by a very disciplined working capital management. Thanks to Orhun and his team, obviously, here, despite the fact that we increased our market investments incrementally in this quarter to drive consumption and to be ready for the season. We are continuing to invest on our infrastructure to improve our digital capabilities in order to be more effective and efficient in the post-pandemic era, whenever it comes. Our digital transformation projects, which were awarded by industry experts in the first place, will continue to be at the core of our focus for while achieving our long-term targets. As a recent note, we made an announcement on Monday regarding our intention to evaluate the opportunities to refinance our USD Eurobonds that are maturing in 2022. In this regard, we made our application to the Capital Markets Board for approval and started the process. This would be another busy period for our finance team. In the first quarter, our consolidated volumes reached 23.2 mhl, and 31% of our consolidated sales volume came from Beer Group. Our revenue growth significantly outperformed the volume increase exceeding TRY 6 billion, and contribution of Beer Group in terms of the revenues was higher compared to the volume proportion, almost reaching to 40% of revenues in the first quarter. EBITDA performance was very strong as well. This is especially attributable to the performance of soft drinks. International beer margin was also higher in this period, therefore, consolidated EBITDA margin improved by almost 500 basis points, reaching to 11.6 percentage points in the quarter. Due to the seasonality of our business, free cash flow was negative in the quarter. First quarter is the time where we spend disproportionate CapEx. As I noted, to be ready for the peak season, whereas from the revenue and profitability contribution point of view, the first quarter is the lowest among all other quarters. However, there has been a significant improvement on a year-on-year basis from TRY -1 billion last year to TRY -250 million this year. Basically, we are talking about a TRY 750+ million improvements on the free cash flow generation versus last year. Our beer operation sales volume was up more than 4%, reaching to 7.3 mhl. International operations was the main contributor to the growth. It was another strong quarter for Russia, where the beer industry grew around 6% year-on-year, according to Rosstat. Our volumes were even stronger than that, but more importantly, we gained value share compared to the year-end. We are focusing on the value share. We gained value share in the country. We saw positive dynamics in different price segments, and specifically our brand Bud showed highest volume growth, increasing more than 25%. Spaten, Essa, Stella Artois, other licensed brands registered double-digit growth rates as well. Also our non-alc offerings had also remarkable performance benefiting from especially sales through e-commerce channels. However, there has been some deterioration. Maybe follow that, there has been some deterioration in consumer purchasing power in the period due to the economic [competitions] following the COVID period. We are cautious for the rest of the year. In Ukraine, the beer market was down by low single digits, and our performance was slightly below the market due to the implemented price increase ahead of the competition in Ukraine. We are expecting our performance to normalize starting from the second quarter onwards, when prices are more settled. We continued our launches in the quarter, offering consumers different tastes and varieties as well. Our efforts are continuing despite all. In Ukraine, the number of cases are increasing. Unfortunately, there is the impact on the market and our performance, specifically in Ukraine. Kazakhstan and Moldova both had superior performance with close to 20% volume growth each. Georgia was also up by low single digits. We are observing in every country some premiumization, which is supporting our profitability. Obviously our focus on and where we are the most stronghold segment is the mainstream segment. We registered growth in the segment through the period as well. Türkiye, we discussed this several times, is obviously the most impacted from COVID among all the other operations due to the high share of on-trade. Our volumes were impacted the most as a result, especially in the first two months of the year, due to the cycling of the pre-COVID period last year. We benefited from a temporary reopening in March, where the shortfall for the first two months was partially mitigated. Those are our positive signs. Whenever we are out of this pandemic, I would say we expect things to be normalized and be better. During the first quarter, as noted, we accelerated our marketing spend related to our Plus One relaunch, and we are seeing early positive signs of stabilization in our market share. That is comforting us. Obviously, Plus One relaunch around the Efes brand family is positively perceived by our consumers. A couple of notes on our subsidiary. CCI's consolidated sales volume continued its growth momentum and increased by almost 18% in the first quarter, with positive contribution from all countries. International operations had a superior performance, with Pakistan and Jordan taking the lead. There were obviously lockdowns and restrictions that curbed the number of COVID cases in Türkiye. Despite these headwinds in Türkiye, we were able to deliver more than 10%- 12% volume growth. Sparkling beverages growth was even higher rate, registered around 20% increase. Still category grew more than 15%, with improvements in juice and energy segments, all positive, while only water category declined by almost 15%. International operations grew more than 20%, 23%. Pakistan had a superior performance and posted more than 40% volume growth, with consumer and shopper initiatives and regional acceleration plans, as well as optimal resource allocation in the country. In the CIS, the volume growth was more than 8%. Excluding Kazakhstan, all countries recorded double-digit volume growth rates. Middle East posted 9%. The performance was driven there by Jordan, where the volumes were up more than 40%, 42%. Remarkable performance. We have already discussed the operational part in the previous slides, but I would like to go over the strong bottom line that we have delivered. Our net income was almost around TRY 300 million in the first quarter. It benefited from higher operational profitability, obviously, and also there were some one-off items like FX gains recorded as a result of repatriated cash from Efes Breweries International to Anadolu Efes, that is in order to finance our working capital needs there. Also we sold our land in Lüleburgaz during the period, therefore, gains from this sale supported the bottom line as well as the free cash flow. I'll hand over to Orhun for his remarks on financials. Unfortunately, this will be last call on our side. Actually, Orhun is leading the call. Basically, I would like to thank him for his great contribution to this organization for long years, and especially for the last two years. Working with him was quite a pleasure for me. Obviously, Orhun's departure is good for Orhun and is a loss for Anadolu Efes. I'm happy for Orhun, and that's business, that's life. I'm pretty happy that we are strong bench at Anadolu Efes, and we were able to take the news from Orhun happily. While being happy for his career, we were able to also name his successor. Gökçe will be joining the team here in Istanbul, spending long years in international operations in finance and leading the team. You would remember Orhun paved a way for CFOs having operational experience. I believe Gökçe's operational experience would also add to our team. I'm very confident with this replacement. I would like to thank Orhun once again. I don't want to have him crying before he makes his final remarks. That's why I'm going to cut short and leave the ground to him. Thank you, Orhun. Thank you, Can, and many thanks for your kind words. Obviously, well, it was thrilling for me to be part of the journey for Efes, starting from a rather booming business in Türkiye, and now today, obviously a very sizable regional beverage business. Many thanks for your leadership and support, especially over the past two years, where we have been making serious changes to the business, which obviously will impact the future years to come. As Can was underlining, I'm quite confident as I pass the flag on to my successor, Gökçe, which I'm sure is going to continue raising the bar to better levels. Ladies and gentlemen, welcome again to our first quarter results webcast for Anadolu Efes, and we're quite happy to report another quarter of strong results. First of all, it's important to note that the first quarter of 2020 was our latest memories of our normal lives. Basically, growing over that quarter in the first quarter of 2021, we feel was quite important, even though the rate of rebound is different. As I'm sure you know, in alcoholic drinks and beer, obviously, some of the shopping patterns like e-commerce or home delivery are restricted. In essence, there are different paths and velocity of rebound for our two business units. Coca-Cola İçecek, which I'm sure you must have followed, has announced a very strong set of results and obviously contributed quite significantly to Anadolu Efes results in this first quarter. Beer Group. Also in Beer Group, we have enjoyed very strong growth, volume terms, obviously 4% ahead of last year. Between the volume growth and the price increases in all of the operations, together with a favorable product mix, we have been able to grow revenues ahead of volumes. Even on a constant currency basis, our growth was close to 19% revenue. Then EBITDA, we ended up with a slight negative EBITDA, as Can was pointing out. Although we have seen very strong performance across our businesses in Kazakhstan, Moldova, and Georgia, and very favorable results in Russia and Ukraine compared to last year. Nevertheless, we have been disproportionately spending in Türkiye in this first quarter as we prepare ourselves for a very busy season, hopefully in rest of the year. Those preparations resulted in a slight negative EBITDA, even though a very serious rebound from last year's first quarter. At 310 basis points margin expansion. More importantly, as I'm going to walk you through in the next page, a very significant positive swing in the free cash flow of the Beer Group, just under TRY 700 million compared to the first quarter of 2020. If you look at Anadolu Efes. On a consolidated basis, Anadolu Efes has delivered very strong set of results. 13% volume growth, 36.5% revenue growth, which is about 27% on a constant currency basis, and EBITDA margin expansion of about 500 basis points. Again, just under TRY 800 million from a positive free cash flow swing between first quarter of 2020 and first quarter of 2021. If I can walk you through the breakdown of how our EBITDA and free cash flow has grown in the Beer Group. As you see on the EBITDA side, as I was saying, we've seen price increases across all markets. We've seen positive mix in terms of super premium to premium segments of our portfolio growing incrementally faster, which added up, obviously, a very strong revenue generation. Our cost of sales were up. This year, obviously, we're happy with what we have done in the first quarter of the year in general. As a reminder, as you will all remember, we have been actively hedging our positions in the cost of sales. Just to give you an indication, in Türkiye, we've hedged about 78% of our FX exposure. For other than [aluminum] PET, we've hedged about 68% and 43% of our exposure for 2021. For Türkiye, we've covered all our barley requirements. Nevertheless, we believe the cost evaluation for us in Türkiye would be close to 20%. If you look at the commodities, there's obviously a very serious price increase across the commodity space. These are the things we will need to manage in rest of the year going forward. The SG&A expenses, obviously, if you look across the businesses, except for Türkiye, all businesses delivered operating expense margins much lower than last year. As we said, in Türkiye, we are consciously spending behind our brands, which we feel is the most opportune time for us to enjoy a very good season, hopefully rest of the year. The rest of it is mainly the currency conversion, which was favorable, which in turn almost halved the EBITDA loss compared to the first quarter of 2020. A good performance that flew into the free cash flow, if you look at the chart below. Obviously, the biggest contributor to free cash flow in the smallest period of the year was the working capital in all of our operations. That was still very disciplined. We are, in certain of our operations, building inventory and stocks before the season to ensure that we can support hopefully some demand growth in the summer season and rest of the year. We have realized the sale of Lüleburgaz brewery land, which flows into our cash flow. Even though we spent incrementally higher in capital expenditure in the first quarter of this year compared to last year, we've ended up with a positive free cash flow swing of just under TRY 700 million. The majority of this financial income expense and FX gain loss element that you see here is TRY 151 million, is the dividends we have received from Coca-Cola İçecek in the first quarter, which is obviously quite unusual at this time of the year. Having said that, given the limitations and changes to the regulations in Türkiye, obviously the timing of that has changed year-on-year. On the next page, again, certain reminders. Obviously, we don't carry any FX denominated debt in Türkiye or elsewhere in our portfolio, except for the Eurobonds, which matures at the end of October 2022. As Can was pointing out, you must have seen our application as part of our review of refinancing debt in rest of the year. Just for clarification, because I'm sure it must be noted, we will be staying within our application limit of $1 billion. The refinance our existing Eurobond is only for $500 million. As we said in consecutive calls earlier, we would very much like to make sure that we are prepared to capitalize on the most opportunistic time in the markets for that exercise. If you look at our indebtedness, again, it's within our stated policy limits for Anadolu Efes. It's down to 1x net debt to EBITDA from 1.5x a year ago. On Beer Group side, it's flat at 2x. That's pretty comfortable within our, as I said, policy limits, which we disclosed to be between 1x- 2 x. In terms of the risk management, I already talked about our commodity hedges, FX management, and with the net investment hedge, our bottom line is pretty much protected to a great extent against potential currency volatility in the rest of the year. With that, I'll turn back to Can to continue with the call. Thank you. Thank you, Orhun. For the rest of the year, so far, obviously, 2021 is no different than 2020 in terms of challenges and ambiguities. I think the most concerning one is uncertainty around what's going to be next, how long these limitations, especially in Türkiye, will continue. We have little clarity about what exactly lies ahead. I would say in our region, when we look into different countries, Türkiye and then Ukraine, our number of cases are very high. Russia is more under control. Let's say the second peak is behind. Number of cases are going down. Some sort of relaxation continues in the country. Kazakhstan, similar, vaccination is going reasonably well, similar to Russia. Moldova and Georgia also, we see kind of normalization both in terms of number of cases and the restrictions. Again, there are clear uncertainties around how long this could continue, the new variants and so on, so forth. Despite the fact that we were quite happy here to note about the strong start we had to the year, on one side, this is the smallest quarter of the year, and on the other hand, all these uncertainties. That is the reason we just keep our outlook similar. We reiterate our 2021 guidance. We don't make any change as of today. I hope to report back much stronger results in the second and third quarter, and then we would obviously be discussing the guidance. As of today, we reiterate and keep our guidance as of the beginning of the year. Thank you for your patience. We'll be happy to have questions. There is one, actually already responded from Anjali Doshi about whether we will utilize the $1 billion or just consider the refinancing of $500 million existing Eurobond. Yes, we applied for a higher ceiling, let's say that's for the approval purposes. Our intention is to refinance the existing $500 million as of today. If you have any further questions, please note in the Q&A site. Are there any questions? It seems no, Can Bey, Orhun Bey. Seems we were quite clear enough. Thank you for your attention. Look forward to talk to you in the next calls, and thank you again. Thank you very much. Stay healthy. Thank you.