Koc Holding A.S. Unsponsored ADR Class B

For the first half of 2026, Koç Holding reported combined revenue of more than TRY 2.7 trillion, up 7.2% year on year, consolidated profit before taxes of around TRY 84 billion, up 154%, and consolidated net income of TRY 20.3 billion, up 147% versus the prior year period. First-half CapEx was roughly $1.7 billion. At June end, the holding had about $1 billion of net cash, gross cash of $1.6 billion after a $600 million club loan draw, a current ratio of 1.25x, and net financial debt-to-EBITDA of 1.1x including finance. By segment, energy contributed TRY 20.7 billion, automotive TRY 3.4 billion, finance TRY 2.2 billion, consumer durables TRY 421 million, and other segment was dilutive at TRY 6.5 billion. On guidance, Tüpraş raised its full-year net refining margin expectation to $13 to $15 per barrel from a first-half realized margin of $15.6 per barrel; no broader group revenue or earnings guidance was given.

Dogan Korkmaz framed the quarter as a solid result delivered against a more volatile macro and geopolitical backdrop, with high rates, weak domestic demand, and pressure on exports. His message was that Koç’s diversified portfolio, balance sheet strength, and disciplined execution helped offset those headwinds. He also stressed active portfolio management, saying the group is using strategic actions, acquisitions, divestments, and organizational changes to improve focus, scale, and operating efficiency.

Korkmaz highlighted the group’s financial resilience: revenue above TRY 2.7 trillion, net income of TRY 20.3 billion, profit before taxes around TRY 84 billion, and strong liquidity with about $1 billion net cash at holding level and $1.6 billion gross cash. He noted conservative leverage at 1.1x net financial debt-to-EBITDA including finance and a 1.25x current ratio, and said around 76% of gross cash is in hard currency. He also pointed to value creation actions such as the $600 million club loan, the sale of a 2% stake in Tüpras, and the Yapı Kredi asset management transaction, which is expected to add about 70 basis points to CET1 upon closing.

Analysts focused on high leverage at Arçelik and Otokar, asking what concrete steps would reduce debt and whether Koç would inject more capital. Management said Otokar’s delivery volatility is tied to contract timing, the Romania project is progressing on track, and only a modest interim capital need of around $30 million to $35 million was referenced while the business executes its pipeline. On Arçelik, management said it is pursuing cost optimization, working capital improvements, deleveraging, and land monetization plans, but Koç said it would likely not step in to buy the land and is prepared to support the company if needed. Citi also asked about capital allocation and NAV monetization; Koç said reinvestment in existing businesses is the top priority, cash is a strategic buffer, and buybacks would be a board decision rather than the first use of cash.