Ladies and gentlemen, thank you for standing by. I'm Costantino, your Chorus Call operator. Welcome, and thank you for joining the Tüpraş conference call and live webcast to present and discuss the third quarter 2022 financial results. At this time, I would like to turn the conference over to Mr. Doğan Korkmaz, CFO, Mr. Levent Bayar, Head of Investor Relations. Mr. Bayar, you may now proceed. Hi, everyone. Good morning to all from Tüpraş headquarters in Istanbul, and welcome to our teleconference. I am Levent Bayar, Head of Investor Relations. I am here with Doğan Korkmaz, CFO, and team members from Tüpraş Investor Relations and Reporting Department. Over the next hour, we will first go over our operational and financial results for the third quarter of 2022. We will continue with the Q&A sessions. I'll draw your attention to our cautionary statement. During today's presentation, we will make forward-looking statements that refer to our estimates, plans, and expectations. Actual results and outcomes could differ materially. Please refer to our financial reports and material disclosures for more details. These documents are available on our website. In the next two slides, we will provide you with a brief summary of the key highlights regarding the third quarter of 2022. We will go into detail for each subject on the following slides. Now let's take a look at Tüpraş highlights in detail for the third quarter of 2022. The first chart shows comparative performance of simple average product cracks and our natural gas costs per processed barrel. Mid-distillate cracks remained high in the third quarter, continued to be driven by supply-demand imbalance. In the meantime, natural gas prices in Turkey continued to increase with sharp hikes. Cost of natural gas in our refinery processes increased to $6.8 per barrel in the first nine months. On the second chart, wide products remained a strong source of domestic sales performance while our marketing position has strengthened. Jet fuel sales have been improving, having reached 1 million tons of sales, nearing pre-COVID levels. Bitumen sales increased by 8% year-over-year in the third quarter after its contraction in the first half. The bottom chart shows operational financial performance of our new business line, electricity. Takeover process of Entek has been finalized in September, and Entek financials are now fully consolidated retrospectively. With strong production and rising electricity prices, Entek showed a strong improvement in its EBITDA, increasing it by 3x. As you know, we cover this section in two main components, as developments in global oil markets and developments in the Turkish market. Let's start with the top left box. Brent price declined in the third quarter of 2022 quarter-over-quarter, amid recession fears, new sources for alternative oil supplies, and SPR releases. As declining demand weighed during this time, total crude stocks were at mid levels of their five-year range due to pent-up production. Fears regarding Russian oil and recession continue to weigh on sentiment for Brent prices. On the top right, we have a chart of gas prices against refined product demand. As natural gas supply problems and price increases continue in Europe, gas-to-oil switching accelerated, resulting in additional support to mid-distillate cracks in the third quarter. Now taking a look at the bottom row, Turkish market. Raw fuel demand was firm in this period while gasoline consumption showed a strong growth, increasing by 30% in the first eight months compared to 2019. Jet fuel demand in Turkey, which was up by 45% year-over-year in the first eight months of the year, remains only 12% below 2019. Right bottom area shows Turkish macro indicators of which continued to be volatile during the third quarter. September PMI was below 50 level, while dollar versus lira increased to TRY 18.5. Natural gas prices in Turkey in the third quarter increased by 25% quarter-over-quarter with 50% hike that was announced in September. BOTAŞ has revised its methodology and changed the calculation of industrial tariffs in October. Now let's take a look at cracks for the third quarter of 2022 in comparison to last year as well as pre-COVID three-year average on this page. Tight global supply conditions with Russia-Ukraine war and rising refining costs continued to keep mid-distillate cracks at record levels. Due to recessionary fears, gasoline cracks decreased to second quarter levels but still above the pre-COVID three-year average. High-S ulfur Fuel Oil Cracks remained weak in the third quarter with elevated supply. Taking a look at the details. Diesel cracks were up by $35 per barrel year-over-year and averaged at $42.1 per barrel in the third quarter of 2022. Diesel cracks were again at historic high levels throughout the quarter with significantly tight inventories due to reduced Russian-originated products and robust demand levels globally, excluding China. In addition to the impact of ongoing war, soaring refining costs also continued to push up product cracks. In October, diesel cracks were even stronger at $57 per barrel as global product imbalance persists and additional gas oil demand emerges. Jet fuel cracks averaged at $36.7 per barrel in the third quarter of 2022, again at a very high level compared to last year. Similar to diesel, undersupplied mid-distillate market has led to extremely high levels in jet fuel cracks in the third quarter compared to the past five-year range. The sizable spread between diesel and jet fuel is largely a result of weaker Asian demand for jet fuel following China lockdowns. According to Eurocontrol data, European air traffic was at 88% in the third quarter versus 2019 level. The agency now forecasts to see 92% level by the end of this year under its base demand scenario. Average jet cracks were at $39.9 per barrel in October 2022, in parallel to upward trend seen in diesel cracks. Gasoline cracks averaged at $16.7 per barrel in the third quarter. While near the fourth quarter, gasoline still remains above compared to both last year's same quarter, as well as past pre-COVID three-year average. Third quarter levels of gasoline cracks are largely a result of faltering demand in the United States, leading to lower exports from Europe to the region. Average gasoline cracks were realized at $15.8 per barrel in October 2022. High- Sulfur Fuel Oil cracks averaged around $-39 per barrel and were almost $27 per barrel weaker compared to the third quarter of last year. This was mainly due to very high refinery utilization, leading to excess supply. In addition to that, high natural gas costs limit conversion unit utilization, leading to additions to the HSFO pool. High-S ulfur Fuel Oil cracks were realized at -$35.9 per barrel in October 2022. Moving over to the crude price differentials. Heavy crude differentials widened in the third quarter compared to the previous quarter. Discounts offered by Basra Light and Turkey grades were especially higher during this period, mainly due to additional supply in the market as well as recession fears. In the meanwhile, discount of some crude types, such as CPC, has narrowed. OPEC decided to apply production cuts again in the October meeting. Overall production will be decreased by 2 MMbpd from the August 2022 levels, starting from November 2022. This announcement had very limited impact on heavier grade as of now. We continue to believe the output for heavy differentials will remain very hard to predict looking forward. The course of the Russia-Ukraine war, how different countries will be sharing crude oil, potential developments on the other sanctioned producers, and the implementation of OPEC's decision will continue to be decisive in this regard. Now let's take a look at Tüpraş operations, starting with production volume. On the left-hand side, you can see our production volumes. Our total production in the third quarter of this year was 7 million tons. Suspension of production in our hydrocracker and coker unit in RUP facility has resulted in 257,000 production loss in the third quarter. This malfunction did not have a material impact on capacity utilization rate. Our total crude distillation capacity utilization was 91%, and other feedstock capacity utilization was at 97%, reaching 98% for the whole system in the third quarter of 2022. Moving over to the sales. Let's start with the chart on the left-hand side. In the third quarter, our domestic sales and international sales reached 6.6 and 2 million tons respectively, summing up to 8.5 million tons in total. Our total jet fuel sales continued to improve, were 40% higher compared to last year in the third quarter as improving trend in aviation continues. Both diesel and gasoline sales were strong in the third quarter. Diesel sales in the domestic market were firm, with industrial and logistics activity remaining steady. The arrival of the summer season in Turkey had a positive impact on gasoline demand. Our domestic bitumen sales have also recovered in this quarter and were 8% higher year-over-year. Our total bitumen sales were 26% higher year-over-year in the third quarter of 2022. Now let's move to the electricity operations. This slide summarizes electricity production and sales activities of Entek in the first nine months of 2022. Entek produced a total of 1.2 TWh of electricity in the first nine months of 2022. Given the dominance of hydro assets in the portfolio, 66% of the electricity is generated from hydropower. 14% of the production comes from wind power and the rest is CCGT generated. Summing up, Entek generated 969 GWh of zero-carbon electricity in the first nine months of 2022. Out of that 969 GWh of zero-carbon electricity, near 35% is sold to the feed-in tariff, which is $73 per MWh. The rest is sold to spot market, which operates at a price cap above of feed-in tariff. Now let's move to the financials. Before we talk on details, we would like to highlight one important point here. With Entek takeover, we have started to fully consolidate it as of the nine months of 2022. To make an apple-to-apple comparison, Entek numbers are included in the consolidated performance of 2021 as well. Both pre-takeover and post-takeover financials of 2021 are available in our nine months 2022 footnotes. Let's take a look at the P&L items in detail for the third quarter now. Revenues more than tripled year-over-year and recorded at TRY 151 billion, equivalent of near $8.5 billion in the third quarter of 2022 and near $23 billion in the first nine months of 2022. Total product sales were up by 7% in the third quarter versus last year, with sales increasing in all major products. Average Brent price in the third quarter increased by 37% year-over-year, accompanied by depreciation in lira, supporting our revenue growth. Cost of Goods Sold also more than tripled year-over-year with higher Brent prices and increase in energy expenses. Especially energy expenses were near 5.5 x of last year's third quarter figures, driven by sequential natural gas tariff hikes. Gross profit significantly increased to TRY 19.5 billion, with improvement in cracks, wider differentials, and inventory gains. Material increase in operational expenses was mainly due to logistics expense that was led by Turkish lira depreciation and higher sales. Increase in general expenses was mainly due to personnel expenses in parallel to inflationary adjustments. Loss from other operations was at TRY 3.8 billion. That largely includes FX losses on trade payables due to lira depreciation. Income from equity investments, i.e., OPET, was recorded at TRY 310 million. As a conclusion of this, we have recorded TRY 13.2 billion of profit before tax in the third quarter of 2022. Below PBT, we have recorded TRY 1.6 billion tax expenses, including TRY 400 million positive impact originated from deferred tax amount. We have recorded TRY 11.6 billion of net income in the third quarter of 2022. Now for EBITDA, our EBITDA CCS is materialized at TRY 17.4 billion. Year-over-year increase was mainly driven by materially better crack margins and wider differentials, despite elevated energy expenses. We have also recorded near TRY 500 million EBITDA from our electricity production company, Entek. We have recorded near TRY 400 million positive inventory effect. This increase was mainly due to Turkish lira depreciation. With our hedging methodology, we continue to mitigate the pricing risk of 2/3 of crude oil inventory, which enables us to protect against the high volatility in Brent prices as was seen in August and September. Consequently, our reported EBITDA materialized at TRY 17.8 billion, which is materially stronger compared to the last year's same period. Now let's take a look at the profit before tax bridge. As you can see from the waterfall chart, increase in crack margins was the most supportive factor of profit before tax in the third quarter of 2022. TRY 16.6 billion contribution was recognized as a result of materially higher year-over-year product cracks. Wider heavy crude differentials and strong sales volumes supported PBT with TRY 3.3 billion and TRY 2.4 billion respectively. Our new business lines, electricity contribution to the PBT, was TRY 328 million, with strong growth in Entek's EBITDA. Natural gas costs were the most important factor limiting profitability in this quarter. The increase in natural gas prices had a negative impact of TRY 4.9 billion in the PBT year-over-year compared to the third quarter of last year. Due to Turkish lira's depreciation and higher interest rates in the third quarter, TRY -3 billion impact was recognized in the third quarter of 2022 compared to the same period of the last year. Due to the malfunctioning group, we calculate around TRY -2 billion impact, which is parallel with the figure of $110 million that we shared in our public disclosure back in August. There were also other smaller effects amounting to TRY +454 million impact on the bridge. All in all, third quarter 2022 profit before taxes materialized at TRY 13.3 billion, which indicates an overall near TRY 12 billion improvement compared to the last year's same period. Now let's take a look at the financial highlights. In the third quarter, we have recorded TRY 17.8 billion of EBITDA, more than 6x of last year's same period. This is largely achieved with strong operational performance. Accordingly, we recorded TRY 11.6 billion of net profit in the third quarter of 2022. With strong EBITDA generation and disciplined funding management, we ended the third quarter with net cash position, and our net debt- to- EBITDA materialized at - 0.1x as of the end of the third quarter. With strong cash generation, our current ratio climbed to 1.3x. On the bottom right panel, we have the return on equity. As you can see, our return on equity boosted as a result of significant generation of returns. We have recorded 83% return on average equity as of the end of the third quarter 2022. Let's continue with the details on our balance sheet. Cash and cash equivalents and financial liabilities at the end of the third quarter was at TRY 42.3 billion and TRY 36.5 billion respectively. We ended this quarter with TRY 5.8 billion of net cash with strong operational cash generation. On the working capital side, we have maintained our working capital buffer also in the third quarter. Our inventory turnover was better quarter-over-quarter, while our payment terms were slightly shorter compared to the previous one. While near-term debt looks elevated, we have around $2 billion of cash, which is sizably over short-term portion of near $700 million if there's any immediate needs. Regarding our FX exposure management, we ended the third quarter with $12 million short position. Following the ongoing volatility in Brent prices, our inventory amount registered at $2 billion in the third quarter of 2022. We have $1.5 billion of hard currency cash position at the end of the period. We also continue to manage a sizable position of FX assets with forwards, of which decreased a bit in this quarter to $726 million. Trade and other receivables decreased from $5 billion - $3.4 billion quarter-over-quarter. This was largely due to decrease in Brent prices, especially toward the period end. On the liability side. Both our short-term and long-term debt maintained compared to last quarter, totaling $1.3 billion. We continue to employ strict FX exposure management policies which targets the FX position at the period end. Now looking at the maintenance calendar for 2022. We operated with near peak utilization in the third quarter, only slightly slowed down during four-week maintenance program. We have started crude oil and vacuum units periodic maintenance in İzmit, which should take six weeks to complete. Following the completion of that, we will start ramps in İzmit, which will take about seven weeks to complete. There is no maintenance activity planned for Kırıkkale Refinery in 2022. On this slide, we have our expectations for 2022. Looking into details, we haven't changed our Tüpraş net refining margin expectation and kept it at $13-$14 per barrel. Regarding production and sales figures, there is no change in our expectations as well. We still expect 26 million-27 million tons of production and 28 million-29 million tons of sales, while we expect capacity utilization to be between a range of 90%-95%. Our consolidated CapEx target for 2022 is $200 million, as previously announced, and we will spend around 45% of that in sustainability-focused energy efficiency and environmental projects. On this slide, we would like to sum up some key figures for the first nine months of the year and compare them with our year-end guidance. We had a net refining margin of $14.9 per barrel in the first nine months. Our guidance stays at $13-$14 per barrel for the whole year. Capacity utilization was at 94.2% in the nine months. Our guidance is, which is in line with our guidance range of 90%-95%. In the first nine months, we have produced 21.2 million tons and sold 22.2 million tons, and maintain our full year guidance of 26 million-27 million tons of production and 28 million-29 million tons of sales. We have spent $101 million in the first nine months in CapEx. We maintain our CapEx guidance at $200 million. I would like to remind that this project also includes Entek as well. We have spent about 52% of our CapEx in sustainability-focused investment in the first nine months, slightly above our target which is 45% for the whole year. Before opening the session for the Q&A on the next slide, I'd like to give recent updates of our strategic transition plan, which was announced last year, November. The third quarter was a period in which we both generate strong profits and made progress in our new investment areas. In line with Tüpraş's long-term strategic transition plan, we continue to accelerate our steps towards our new investment areas in the third quarter. As you all know, we announced Entek's takeover in April 2022. Entek's takeover was fully completed in the third quarter with the approval of shareholders in the extraordinary general meeting, which was held on August 25. Our solid steps for zero-carbon electricity generation are also going on. In the second quarter, we signed an agreement for the construction and installation of a solar power plant in Kırıkkale Refinery, which was 12.6-MW capacity. In addition, following the change in the relevant regulations, we applied for an additional 54.4-MW capacity installation in Kırıkkale. Our efforts to produce zero-carbon electricity in İzmir and Batman refineries continue as well. On the biofuel side, as we disclosed in the previous quarter, we signed a license agreement with one of the world's leading technology companies, Honeywell. We will be using their UOP Ecofining technology. With this technology, Tüpraş will produce Sustainable Aviation Fuel, renewable diesel, and other products with 400,000 tons of capacity per year. This concludes our conference call for the third quarter. Now we can take the questions. The first question comes from the line of Kishmariya Anna with UBS. Please go ahead. Good day, everyone. Congratulations with very strong results. I have a few questions, if I may. First will be about the fourth quarter to date. What do you see what are the developments? Do you see some potential for the outlook revision upwards given the very high diesel margins at this time? The second question would be about the windfall taxation and whether you hear any discussion in Turkey of potential taxation or increase in taxation given the energy crisis like we have in Europe or another country. Thank you. Let me take the first one related to how far the fourth quarter has been faring so far. As you have suggested, the diesel margins remain quite strong in the fourth quarter. Our operations are also continuing similarly. We have completed the repairs related to the malfunction group, and this is also running at the full capacity as we speak. Yes, we are not currently considering revising our guidance for the event as our initial assessments continue to remain relevant for the fourth quarter. In regards to your second question, windfall taxation, we're not expecting a windfall tax in Turkey as it was in some of the countries of Europe. The pricing mechanism is unchanged for many years now. The refinery outlet prices are pretty much according to that calculated daily. You know, Turkey is a significantly short market. Any price cap would definitely have an impact on the imports. In the case of imports towards Turkey, obviously financial expenses is a substantial part of that, and the freight cost historically. Around 40% of the diesel used in Turkey is catered with these imports. If you look at the Turkish fuel prices, they continue to be the cheapest in Europe in comparison to the rest of the countries within the EU area. In case the government applies a windfall tax, or a cap in refinery price, this would definitely deteriorate our cash flow generation. We're definitely explaining to the authorities in our generic discussions with other purposes. Mind you, Tüpraş was acquired by Koç around 15 years ago, and we've spent over $7 billion to make our refineries very complex. Hence we're making this much profit nowadays by having this opportunity to process heavier grades and being able to run our refineries at nearly full capacity. Any taxation, additional taxation on refining will definitely have an impact on future investments, either from us or from other parties, not only in refining sector but in energy sector in general. That's what we are explaining to everyone that we are discussing with. Last but not least, Tüpraş made, I mean, with obviously historical FX rates, over $700 million of loss in the last three years, therefore and didn't have any incentives or subsidies from Turkish government during those days, as it was the case in other countries. I remember, for example, Australia or a couple of other countries where refineries were being supported. Even we didn't have any subsidies, incentives or support due to pandemic conditions, we managed to keep a very strong balance sheet, and we kept on producing for the needs of the country. We like to believe that we will keep the same track and comply with the duties of Tüpraş as being a very strategic company in the country. Although we're not having a windfall tax, you would definitely know that the natural gas prices in Turkey has increased quite more than what we have seen outside Turkey because of a base effect. At the moment, the increase in industrial sector, especially in particular, in refining, is way beyond what the households are experiencing in terms of price hikes. Therefore, we're definitely supporting the natural gas consumption and then the cost of natural gas within the country. We might consider it as a contribution as well. Thank you. Mis s Kish mariya, have you finished with your questions? Yes. Thank you. The next question is from the line of Kaylı Erdem with BNP Paribas. Please go ahead. Thank you. Hi, everyone. Congratulations for the strong result. I have three questions. First, can you give us more color on your net refining margin calculation? Can you give a rough calculation on your contribution related to Entek and also imported products, as I see around 900,000 imports, diesel imports during the quarter, so-called trading activities. Also, do you consider that as a net refining for the per barrel? Can you give us any contribution, like $1 or $2, from trading activities on top of Entek? Second one is, as we see, you have surpassed your margin guidance, net refining margin guidance by the end of nine months. Do we see any downside risks for the year end because your guidance is still around $13-$14 per barrel? Third one is the energy costs. When the hydrocracker facility back on stream do you expect any significant increase in the energy costs? Can you give us your running costs for the rest of the year? Thank you for your answers. Let me take this one. Regarding the net refining margin calculation, Entek's financials or operational performance is not included in the net refining margin calculation, given the fact that it is a refinery performance checking metric. In terms of the imported products question related to the diesel, that was because of the group's malfunction. During that time we had to import diesel in order to continue to cater to our customers. Regarding the contribution Sorry for interruption, but in terms of CCS, EBITDA, clean EBITDA, do we exclude Entek P&L and contribution from it also clean EBITDA also? No, it is included in the clean EBITDA, but it is not included in the net refining margin calculation. Good. Continuing to your second question regarding to trading activities contribution. Yes, they have been contributing positively to the activities of Tüpraş, but it is not at a very strong level. In terms of the net refining margin calculation, or guidance for the whole year, which is $13-$14 per barrel, we already expect a somewhat of a normalization in the fourth quarter, but historically strong crack performance continues. We would like to remind that we have a number of maintenances scheduled for the fourth quarter, which is going to have a small impact compared to the third quarter performance. All in all, we continue to expect a very strong year in 2022 as a total. For the energy costs that you have asked, we believe we're kind of at the peak of the energy prices, especially in TTF. We expect a level of correction as we move on from the winter period. As we get closer to April, May time, we expect lower prices in dollar terms. Having said that, obviously it's pretty much depending on BOTAŞ's pricing mechanism going forward. They have announced their monthly prices quite recently. There hasn't been a major hike again this month, although we had a major one from last month. We think that we are at the peak of prices from BOTAŞ, at least in dollar terms, save for any corrections in the near future, due to FX movements in the country. Thank you. Thank you. The next question is from the line of İşlek İlayda with İş Yatırım. Please go ahead. Hello, this is Emre from İş Yatırım. Thank you very much for the presentation, detailed presentation. I have a question on the working capital requirement. In the third quarter alone, we calculate a big cash outflow due to the change in working capital. It's about, I think, TRY 16 billion-TRY 17 billion in third quarter alone. You were earlier mentioning some normalization in the working capital requirement, and part of the increase is due to, you know, typical items like receivables, inventories and trade payables. There is also another part of cash outflow which seems to be related to, you know, derivative instrument payments. My question is, how should we expect this item to for the upcoming quarters? I mean, are we going to see like more normalization or should we look at this big swing as a one-off for the quarter? How is it going to develop, I mean, for the remainder of the year? That's my question. Another question is about your strategic plan guidance. I mean, are you planning to make revisions in it? Actually, it's good that it's. We appreciate very much that you give, you know, such a detailed and long-term guidance. My question is whether you would revise it or not, I mean, based on realizations. Thank you very much. Thank you. Let me start with the working capital requirement. To start with, obviously, we always mention that having a kind of zero working capital requirement is the ultimate ongoing target we have internally. From time to time, we find ourselves in a better favorable position. I don't see that TRY 16 billion of movement. At the end of the last quarter, our working capital requirement was around TRY -9 billion, whereas it is around TRY -4 billion at the moment. The movement in between is around TRY 5 billion. The reasons why there are this much movement from one quarter to another is somewhat driven by the price changes in crude oil, because obviously we're working with average costing in our Cost of Goods Sold. The terms we get from our suppliers is way longer than the terms we give to our customers in the country or outside the country. If you're selling it around two weeks of terms when you sell, but when you buy, if it's more than 60 days of terms, then the bulk of your payments are with the crude oil prices from two months ago, whereas your sales is with quite recent crude oil prices. Remember the movements in crude oil from two-three months ago. That's really bringing the main impact. Same goes for the currency effects movements. Obviously these are booked in Turkish liras, and it works with two-three months of lag in Turkish lira payable terms. Those are the reasons behind that. Otherwise, our terms agreements with our suppliers or customers did not change. From time to time, there might be changes due to the mix of customers and suppliers. In this case, we didn't even have that. That was purely down to the crude oil prices and the FX movements, and the term differences in between our supply and sales. For the strategic transition, yes, we have provided a very detailed P&L towards 2030, and then to 2050. Having a favorable year at the beginning of the period is well appreciated by us, but would not necessarily change our position for the strategic transition going forward. Having said that, having another good year for 2023 would be something that we will need to consider. For that we need to have a proper budget for the coming year, which we don't at the moment. We're still working on the year. Hence we're not providing you with any expectations, year-end expectations for the coming year. As soon as we have it, if it would have any impact on our P&L for the long period towards 2030, we would definitely revise our numbers. Remember, we talked about a very good refining atmosphere in between years 2025-2030. This year, and if it is a good one next year, will be something that we did not expect to this extent when we were planning for this ten-year period. These are on the numbers. In terms of the steps to be taken or which are taken until now, I think we are quite on track. We finalized our basic engineering on SAF, and we already selected the refinery and even the unit, the land that we're going to build our SAF plant, and we already announced the capacity. That was something that was planned accordingly in the beginning. The only upside there would be the additional licenses that we will be able to get with the new piece of regulation introduced in Turkey for solar and wind. They are obviously quite positive. They will have even a financial effect in the coming year because of the current electricity prices. I don't necessarily think that it would have a material impact on our transition plan in general. We'll see. As soon as we have the budget, if needed, we would definitely revise that plan as well, because that's another forward-looking statement of the company anyways. Yeah. Thank you, Doğan. Thank you. The next question is from the line of Pletser Tamás with Erste Group Research. Please go ahead. Yes, thank you very much for your presentation. Good morning. Two questions on my side. First on your short-term outlook, what kind of impact do you expect from the EU embargo on Russian crude oil and crude oil derivatives from December and February next year? How would it impact your operations or your import opportunities? What is your guidance here? That would be my first question. Second question, I know that you already mentioned that you would come up with a detailed strategy later on, but what can be the major directions for Tüpraş? You have now a lot of cash on your balance sheet, or at least you are in a cash position. Do you expect this cash to be distributed among the shareholders or spend more on certain areas like on Entek and then power generation? Can you give us a little color on that, please? Sure. Let me start with the sanctions, the EU sanctions, and then move on to your next question. You know the sanctions, the EU sanctions will take place by fifth of December and for refined petroleum product, it will be February of next year. There could be a price cap on Russian crude refined product purchases. But details on the guidelines are not finalized at this point in time for us and for other players in the market. We're definitely following the issue with several counterparties and authorities. The most important thing is Tüpraş will definitely always be in compliance with international regulations which are applicable to Tüpraş obviously. We are not obviously in EU area, and obviously the sanctions are somewhat synchronized, not fully, but mostly in between G7 and EU being part of it. Discounts on Russian crudes obviously are known to everyone, but not to the extent that everyone expects. There are additional costs such as insurance, logistics, and financing. Therefore, although the cover price of Urals at the moment are, I don't know, maybe $30-$40, it goes down to single- digits of benefits for the ones who purchase it. We all know, even many European countries are still purchasing it. The way you might follow the advantage that we are getting from our waterfall, the differentials, the advantage on differentials, that Tüpraş gets is not at the top of the list when you look at the current performance of the company. We might lose a bit of that if we choose to buy less of Russian crude or semi products. Alternatives might get a bit more expensive. Financially it's still a moving beast. We need to find that out, but I wouldn't expect it to be a major differentiator for Tüpraş' current profitability, because the lack of supply, the lack of products is supporting the cracks mostly. The biggest impact really comes from there rather than the purchasing of crude oil. Going forward, it really will find its way every month with the different, obviously, actions taken by EU, G7, and we didn't really get a clear view on what the final procedures will be. In your second question, you asked about the short-term talks about what the current cash will be used for. First of all, obviously the strategic transition plan is there. It is very detailed, and we already said that we're going to spend around $350 million on average, definitely not every year in this period. Obviously it will start climbing to that amount from where we are because we already started with electricity capacity build up, but the spending on SAF will start slightly after. Then the last bit of investment will be in electrolyzers for hydrogen which will come mostly towards 2030. It doesn't mean that we will immediately go up to $350 million of CapEx. In terms of dividend distribution, we promised for over 80% of distribution for any annual income. We are pretty much in line with what we have achieved in the past. It is still valid. Obviously the decision for dividend distribution is given in an AGM, but we come up as the management of the company with an offer. The offer will be pretty much in line with the current policy of ours. We will offer to distribute over 80% of our income for this year, after deducting the buildup accumulated losses from the previous years, which we already covered in the end of second quarter, and save for the reserves that we need to take aside. Okay. That's fair enough. Thank you very much. Just one more follow-up. When do you expect the proposal of the management board for the dividend? I mean, it's going to be next March, April. When can we expect that? It is pretty much in line with the calendar of the AGM. I mean, we didn't yet decide on the date of the AGM, which I believe would be somewhere in the middle of March next year. A month or so before that, we would come up with our suggestion on the dividend distribution. Okay, great. Thank you very much. Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you. Thank you all for joining this call this morning for the third quarter of Tüpraş. Let me make a few closing remarks before we conclude. Today, once again, our third quarter results clearly demonstrated our operational performance has far exceeded pre-COVID levels. We achieved quite successful results amidst high volatility in refining macro globally and significant refining costs increases. Global supply shortage due to Russia-Ukraine war increased refining costs and, you know, seasonally high demand in the third quarter reflected obviously positively on the crack margins of petroleum products. Although increased natural gas prices pressured our profitability, it was quite outbalanced by record high crack margins boosting overall profitability. Demand in Turkey was also strong in this quarter in all products, especially on the jet fuel side. We increased our total sales 7% year-on-year this quarter. Our domestic sales in the third quarter reached above 2019 levels. Customer preference in Tüpraş products was even stronger, as our capacity, operational reliability, and strong balance sheet provide better visibility for our customers in Turkey. We also managed our balance sheet in general and our cash in particular quite vigorously. We closed the quarter with a net cash position close to TRY 6 billion, and our net debt- to- EBITDA ratio remained negative. We will continue keeping a very strong war chest against any downturn in the industry or in the economies that we operate in. Our steps for our strategic transition plan continued rapidly also in this quarter. On the zero-carbon electricity side, takeover process of Entek was completed with the approval of our shareholders in August. We now fully consolidate Entek into our financials. Moreover, we applied for an additional 54.4 MW of solar license, and we'll finalize installations in our Kırıkkale Refinery with that. Our efforts to produce zero-carbon electricity in İzmit and Batman refineries continue as well. On biofuels, basic engineering studies were completed, and we decided on the technology that we will be using for producing Sustainable Aviation Fuel in İzmit. We continue to work on feedstock side, and we'll inform you as we complete these steps. Last but not least, thank you very much for your votes in this year's Institutional Investor survey, which ranked us at number one position in energy sector in the emerging EMEA region in investor relations, CEO, and CFO categories. Thank you all for listening us today. I hope we managed to give you the right understanding of Tüpraş's business to you. Please feel free to come back with any questions and comments after this call and in due course. I wish you all a very happy day and goodbye.