Ford Otomotiv Sanayi A.S.

Ford Otosan reported first-half 2026 revenue of TRY 427 billion, down 12% versus the inflation-adjusted prior-year base. Gross profit was TRY 29.3 billion, down 28% year over year; operating profit was TRY 11.6 billion, down 56%; adjusted EBITDA was TRY 25.6 billion, down 37%; profit before tax was TRY 10.2 billion, down 52%; and net income was TRY 10.3 billion, down 40%. Gross margin was 6.9% and adjusted EBITDA margin was 6.0%, down about 1.6 and 2.4 percentage points, respectively; adjusted EBITDA per vehicle fell to about EUR 1,438 from EUR 1,839. For the full year, management now expects Turkish industry volume of 1.2 million to 1.3 million units, domestic retail volume of 75,000 to 85,000, export volume unchanged, revenue to decline in the mid- to high-single digits, and adjusted EBITDA margin of 6% to 7%.

Gul Ertug framed the quarter as mainly a macro-driven profit squeeze, pointing to inflation running above currency depreciation, auto loan rates near 46%, softer demand and tougher competition. She said Ford Otosan remained resilient in exports and kept leadership in Turkish commercial vehicles, while acknowledging that the entrepreneurial businesses, especially Ford Trucks, were more exposed to the unfavorable FX-inflation gap because of high local content. Her tone was defensive but constructive: she repeatedly emphasized that management is responding with mix changes, cost actions, and deliberate volume discipline to protect profitability.

Unal Arslan gave the financial picture in detail: revenue of TRY 427 billion, gross profit of TRY 29.3 billion, adjusted EBITDA of TRY 25.6 billion, operating profit of TRY 11.6 billion, net debt of TRY 112 billion, and net debt to trailing 12-month adjusted EBITDA of 1.76x. He said the main pressure came from the 18 percentage point gap between euro appreciation and CPI in Turkey, which hurt translation and profitability, plus higher input costs and weaker operating income from euro-linked leased assets. Cash generation remained solid: operating cash flow was TRY 19.2 billion, free cash flow was positive at TRY 10.9 billion, capex was TRY 8.3 billion, and cash and cash equivalents ended at TRY 56 billion. He also noted the working capital cycle stayed stable at 17 days, and that the Koç Finansman acquisition would not be included in industrial leverage for covenant purposes; the cash out for the acquisition was around USD 130 million, with about 10 basis points impact on leverage excluding Koç Finans.

Analysts pressed on why export share/mix was weakening despite better European demand, and management said the shift in market share was largely normalization after Ford and Volkswagen derivatives both fully ramped, not a structural problem or a sign that Ford Otosan is losing the program. They also challenged the sharp gross margin swing, and management said the long-term Ford contracts are still being honored as written; the margin pressure came from inflation accounting, FX timing and the domestic/truck mix rather than any contract waiver. Another question focused on the Truck segment and Koç Finansman: management said trucks are under heavy regulatory and cost pressure because of high local content and VECTO-related investment needs, while Koç Finansman’s debt would be excluded from industrial leverage and its contribution will only show from Q3 onward. In response to concerns about Romania shutdown reports and a possible Eurobond, management denied the shutdown rumor, said the Craiova stoppage was a planned maintenance shutdown, and said a Eurobond remains a funding option but there is no current definitive plan.