INVESTOR PRESENTATION June 2019 1 STRATEGIC APPROACH FOCUS ON - - PowerPoint PPT Presentation

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TURKCELL INVESTOR PRESENTATION

June 2019

STRATEGIC APPROACH

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FOCUS ON CUSTOMER

DIGITAL SERVICES DIGITAL BUSINESS SOLUTIONS TECHFIN PLATFORM

OUR CUSTOMERS WELL-INVESTED INFRASTRUCTURE

MORE TO FOLLOW

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32 Min

Calling

12 Min

Interacting

37 Min

For VOIP users

22 Min

Reading

79 Min

Watching

49 Min

Listening

2.8 M

Searches per day

63

Documents uploaded per person per day

12 Min

Playing (Playcell)

33 Min

Playing (Tavla Go)

30 Min

Contest time

DELIVERING VALUE WITH DIGITAL SERVICES

178 million core app downloads

Note: Times given are in a day unless otherwise indicated.

68.6% multiplay customers 93.7 million digital subscribers

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DIGITAL SERVICES – GLOBAL EXPANSION

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PROVIDING END-TO-END ICT SERVICES

PUBLIC & HYBRID CLOUD SERVICES

CYBER DEFENSE & SECURITY OPERATION SERVICES DIGITAL TRANSFORMATION SOLUTION & SERVICES INTEGRATED INDUSTRY DIGITAL SOLUTIONS

DIGITAL BUSINESS SOLUTIONS

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INFORMATION AND COMMUNICATION TECHNOLOGIES MARKET

47.1 55.6 64.7 75.6 86.9 22.1 25.9 29.6 38.2 44.7

2014 2015 2016 2017 2018

ICT Market Size in Turkey (bn TRY)

131.7 19% 17% Information Technologies Communication Technologies

2014 - 18 CAGR (%)

69.2 113.8 94.3 81.5

Source: Deloitte, April 2019

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67K m2 33K m2

DC space with 10K m2 white space DC space with 20K m2 white space

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TURKCELL DATA CENTERS

Locations

Turkcell Data Centers Gebze Data Center TURKEY’S LARGEST DATA CENTER Key clients: Oracle, IBM, Pegasus Airlines, HP, PwC

Note: Turkeys largest in terms of white space. Gebze Data Center

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3.3Mn

Paycell app downloads

1.5Mn

Paycell Cards

TECHFIN PLATFORM

5.0Mn

Total Paycell users

1.7Bn TL

Total Transaction

• n Paycell in Q119

Money transfer Utility payments QR code payment Mobile wallet Paycell Top-ups Carrier Billing Device Loan Insurance Device Leasing

3.6Bn TL

Loan Portfolio

28Mn

Credit scored customers

2.9Mn

Registered credit cards POS

10 25 50 117

PAYCELL: VALUE PROPOSITION

2016 2015 2017 2019E 2018 2020E 2021E 2022E 2023E 187 300 20 38 93 135 213 EBITDA Mn TL

50%

CAGR 2019-2023

TODAY + TOMORROW

POS & MPOS Hybrid cards (Gaming, Gift) Loyalty program Paycell Card Sales Points Micro Credit Carrier Billing Utility payments Money Transfer Mobile wallet Paycell Top-ups QR Code Payment

Paycell Revenue (mn TL)

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WELL-INVESTED INFRASTRUCTURE: FOCUS ON SHARING

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Number of cities In partnership with Türksat & Vodafone Turkcell (stand-alone)

Turkcell infrastructure Overlapping Türksat infrastructure

First in Europe

10 Gbps

Fiber to the home

The map displays the cities in Turkey where Turkcell offers fiber and cable internet services through its partnership with Türksat and Vodafone. HFC stands for hybrid fiber-coaxial.

3.4 mn 3.4 mn fiber + 3.0 mn cable (HFC)

Homepass

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THREE PILLARS OF OUR BUSINESS MODEL HEDGING

INFLATIONARY PRICING FX & INTEREST RATE HEDGING LIQUIDITY

• Key for sustaining growth & margins
• Secure ROI of projects & investments
• Reflecting costs to the prices
• Proven track record
• Keeping all cash in hard currency
• FX hedged for whole maturity, both
• n principal & interest of loans
• Converted variable to fixed interest
• Strong cash flow for capex needs
• Additional committed lines
• 2.0Bn USD cash* covers principal &

interest payments until 2022

56% 44%

Details of Financial Debt

(After Hedging)

Local Currency FX

Principal & Interest Payments**

(Million USD)

100 106 115 111 110 115 125 131 129 130 139 136 142 147 164158 161 100 103 103 106 109 110 112 114 120 123 123 128 132 138 147 157 158 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 TCELL ARPU (exl. M2M) CPI Column1

Turkcell ARPU vs. CPI Trend (Q115=100)

Fixed interest Variable interest

*Includes Fintur sale proceeds. **Data of Turkcell Group companies, excluding TCF

80% 20% 552 591 246 241 1,904 297 7 7 6 22 2019 2020 2021 2022 2023+ FX Local Currency 849 598 252 247 1,927

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MAJOR FUNDING & HEDGING DETAILS

TYPE & DATE AMOUNT MATURITY INTEREST PURPOSE OF FUNDING

Club Loan (September 2015) US$500Mn EUR445Mn 2-year grace period, 5-year maturity 3-month LIBOR/ EURIBOR + 2.00% CAPEX and inorganic growth opportunities Bond (October 2015) US$500Mn 15/10/2025 5.75% (fixed rate) China Development Bank (October 2015) EUR500Mn EUR750Mn 3-year grace period, 10-year maturity EURIBOR + 2.20% Debt restructuring CAPEX CAPEX and inorganic growth opportunities Bond (April 2018) US$500Mn 11/04/2028 5.80% (fixed rate) Repayment of existing indebtedness 80% hedged with PCCS 7% hedged with PCCS

HEDGING DETAILS

• 100% hedged with PCCS

~48% hedged with PCCS &CCS

UTILIZATION

Fully utilized in Jun 16

• Fully utilized

in Oct 15 ~EUR550 Mn utilized as of March 19

• EKN-Covered

(March 2019) US$150Mn 10-year maturity

1st Tranche: LIBOR+2.10% 2nd-3rd Tranche: 5.35%

CAPEX US$50mn utilized as of March 31

• EUR : EURIBOR + 2.20%

USD : LIBOR + 2.22% CNY : 5.51%

Q1 2019 RESULTS

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5.7 Bn TL

19.2% yoy

Q1 2019: STRONG START TO THE YEAR

178 Mn

downloads

2.3 Bn TL

40.2% margin

772 Mn TL

Fintur sale P&L contribution

0.2x impact 1.3x

Leverage ratio

STRONG TOPLINE RESILIENT EBITDA THE DIGITAL OPERATOR ASSET-LIGHT STRATEGY

Performance exceeding targets

10 K

Participants

265 K

Digital participants

TURKEY’S TECH SUMMIT

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Consolidated TRY Million1

Q1 2018 Q4 2018 Q1 2019 QoQ% YoY %

Revenue

4,762 5,626 5,675 0.9% 19.2%

EBITDA

2,022 2,239 2,281 1.9% 12.8%

EBITDA Margin

42.5% 39.8% 40.2% 0.4pp (2.3pp)

Net Income

501 864 1,224 41.7% 144.5%

Op.Capex/Sales2

11.1% 25.7% 15.6% (10.1pp) 4.5pp

1 TRY figures are based on IFRS. 2 Excluding license fees

TURKCELL GROUP FINANCIAL HIGHLIGHTS

• +0.4 pp QoQ improvement in EBITDA margin (+2.2 pp in Turkcell Turkey)
• Capex in line with targets

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10.3% 12.8% 19.4% 22.4% 19.9% 18.5% 13.8% 15.0% Q118 Q218 Q318 Q418 Q119 Q219E Q319E Q419E 32.7 38.1 38.1 6.30 (0.11) (0.80)

Q118 ARPU

• excl. one-off

impacts and M2M Organic growth Dunning fee Other reg. & tax impacts Q119 ARPU

• excl. M2M

54.0 55.9 62.8 30.5 33.6 38.1

Q117 Q118 Q119 Q219

REPORTED AND COMPARABLE ARPU TREND

ARPU (TL)

like-for-like* growth

Residential fiber Mobile blended (excl.M2M)

19.6% 11.7%

* The ARPU of customers who have stayed with Turkcell for at least 14 months.

Mobile ARPU Growth (TL) CPI Turkey (YoY) 12.3%

YoY

13.4% 19.3%

As inflation declines, we expect

• ur ARPU growth to exceed it

Source: Bloomberg

 Upsell performance has doubled in Q119 on a yearly

basis in terms of number of subs and revenues

 12pp y-o-y decrease in downsell (to lower packages)

ratio in Q119

18 37.7 35.5 35.1 41.6 41.6 42.1

10.3% 17.3% 20.0%

Jan-19 Feb-19 Mar-19 2018 2019 YoY

NET ADD AND NEW SUBSCRIBER TRENDS

NEW POSTPAID CUSTOMERS’ ARPU (TL) MOBILE NET ADDITIONS (thousand)

 Positive net additions since March  Customer loss in low ARPU segment in Jan-Feb  <25 TL ARPU decreased by 4% QoQ  >50 TL ARPU increased by 7% QoQ

• 103
• 45

66

Jan-19 Feb-19 Mar-19 Apr-19

 Increasing prices of new postpaid customers’ packages

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LEADING CAMPAIGNS IN Q119

LEADERSHIP IN QUALITY AND EXPERIENCE

4.5 mn participants/gifts

«#DO» campaign

+9 +11 +20 +23

Q118 Q119 Points over next best Points over third best

Source: Future Bright

CUSTOMER EXPERIENCE

Turkcell Score 23

2.2 mn first-timer to our

digital services

Consumer Net Promoter Score (Points)

13.4 mn participants 140 mn gifts

Turkcell’s Shake & Win – specials for the 25th year

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SOLID BALANCE SHEET

NET DEBT/EBITDA

1 Corresponds to proceeds from the Fintur transaction closed on April 2, 2019. 2 Q119 balance includes Fintur sale proceeds. 3 Excludes Turkcell Consumer Finance Company’s loan portfolio

TCF loan porfolio Net Debt2,3

TRY Mn Q4 2018 Q1 2019 Total Cash 7,419 8,888 Due From Related Parties1

• 2,230

Total Assets 42,765 46,079 Total Debt 20,156 22,867

Lease Obligations 1,414 1,410

Total Equity 16,054 17,102 Net Debt2 12,736 11,749 Net Debt3 8,565 8,108

SUMMARY

9,516 8,565 8,108 4,790 4,171 3,641

1.7x 1.4x 1.3x 1.2x 1.0x 0.9x

Q318 Q418 Q119 Net Debt/EBITDA Net Debt/EBITDA

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7,419 7,305 8,888 8,888 2,281 (827) (1,569) 1,666 (83)

Cash Q418 EBITDA Change in operating assets/liabilities Cash flow from investing activities Cash flow from financing activities Other Cash Q119

LIQUIDITY MANAGEMENT

TRY MILLION1

Q418 vs. Q119

Fintur cash

2,230

1 Figures are based on IFRS.

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(204) (301) (255) (224) 216 Q118 Q218 Q318 Q418 Q119

FX EXPOSURE

8.9Bn TL

Nominal

34% 10% 49% 7% 50% 33% 9% 8%

CASH1 DEBT

Before Hedging

2 Including advance payments, hedging and excluding FX swap transactions for TL borrowing. Derivatives (VIOP) and forward transactions are included.

After Hedging

NET FX POSITION2

22.9Bn TL

USD MILLION

Share

1 Excluding FX swap transactions for TL borrowing.

USD EUR TRY Other

79% 21%

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GUIDANCE REVISED UPWARDS

PREVIOUS

• OP. CAPEX / SALES*

TURKCELL GROUP

2019 GUIDANCE

REVENUE GROWTH EBITDA MARGIN

NEW

16% - 18% 17% - 19% 37% - 40% 38% - 40% 16% - 18% 16% - 18%

*Excluding licence fees

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NOTICE

This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E

• f the Securities Exchange Act of 1934 and the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. This

includes, in particular, our targets for revenue, EBITDA and capex in 2019 or for the medium term 2018 to 2020. More generally, all statements other than statements of historical facts included in this presentation, including, without limitation, certain statements regarding the launch of new businesses, our operations, financial position and business strategy may constitute forward-looking

• statements. In addition, forward-looking statements generally can be identified by the written or oral use of forward-looking

terminology such as, among others, "will," "expect," "intend," "estimate," "believe", "continue" and “guidance”. Although Turkcell believes that the expectations reflected in such forward-looking statements are reasonable at this time, it can give no assurance that such expectations will prove to be correct. All subsequent written and oral forward-looking statements attributable to us are expressly qualified in their entirety by reference to these cautionary statements. For a discussion of certain factors that may affect the outcome of such forward looking statements, see our Annual Report on Form 20-F for 2018 filed with the U.S. Securities and Exchange Commission, and in particular the risk factor section therein. We undertake no duty to update or revise any forward looking statements, whether as a result of new information, future events or otherwise. The Company makes no representation as to the accuracy or completeness of the information contained in this presentation, which remains subject to verification, completion and change. No responsibility or liability is or will be accepted by the Company or any of its subsidiaries, board members, officers, employees or agents as to or in relation to the accuracy or completeness of the information contained in this presentation or any other written or oral information made available to any interested party or its advisers. Please note that all financial data are consolidated whereas non-financial data are unconsolidated unless otherwise specified. In the charts or tables used in this presentation totals may not foot due to rounding differences. The figures used in this presentation are rounded while percentage changes are calculated based on the figures disclosed in the press release.

TURKCELL GİZLİ

For further information please e-mail

investor.relations@turkcell.com.tr

• r call Turkcell Investor Relations at

(+90 212 313 1888) Turkcell IR app

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THANK YOU