Ülker Bisküvi Sanayi A.S.

Q2 consolidated volume increased 1.3% year over year to approximately 163,000 tons. Q2 revenue declined 11.4% to TRY 27 billion. Gross profit was TRY 6.6 billion, with gross margin at 24.6% versus 27.2% last year. EBITDA was TRY 2.8 billion, implying a 10.4% margin versus 14.6% a year ago. Net income rose 45.5% year over year to TRY 1.4 billion, and net income margin improved to 5.1% from 3.1%. For the first half, volume rose 0.7%, revenue fell 7.2% to TRY 63.3 billion, gross profit was TRY 16.7 billion, and first-half net income was TRY 3.1 billion versus TRY 4.3 billion last year. Balance sheet leverage remained at 1.17x covenant net debt/EBITDA, and 64% of the open FX position was hedged. Management revised 2026 net sales guidance from flat to a low single-digit decline, while maintaining EBITDA margin guidance at 13.5% plus or minus 1.5 percentage points.

The CEO framed the quarter as one of resilient volumes but heavy pressure from promotions, cocoa costs, inflation accounting and softer consumer demand, especially in Turkey. He emphasized that Ulker is prioritizing market share, affordability and brand health over short-term price realization, and said the company remains confident in volume growth and in meeting the EBITDA guidance. He also highlighted innovation, international diversification and AI/digital transformation as long-term strategic pillars.

The CFO described Q2 as a quarter of resilient volume but challenging top-line and margin dynamics. She cited Q2 revenue of TRY 27 billion, gross profit of TRY 6.6 billion, gross margin of 24.6%, EBITDA of TRY 2.8 billion at a 10.4% margin, and net income of TRY 1.4 billion, while first-half revenue reached TRY 63.3 billion and gross margin was 26.5%. She also pointed to a strong balance sheet with covenant net debt/EBITDA at 1.17x, 70% of liabilities long term, 64% of open FX exposure hedged, and said inventory days rose to 123, which she characterized as timing-related rather than a structural change.

Analysts pressed management on whether margin weakness was self-inflicted from defending market share versus driven by cocoa and pricing pressure, and asked when margins might recover. Management said the weak quarter reflected an unusually promotional Turkey market, a high prior-year base, cocoa cost effects and international pressure, and reiterated confidence in the full-year EBITDA guidance. Questions also focused on international margins, which management said were hit by stronger competition in Central Asia and war-related demand and logistics pressure in the Middle East, as well as FX losses and interest expense; CFO said FX losses were lower mainly because of a more favorable FX environment and 64% hedging coverage, while lower interest expense reflected derivative impacts and new financing done at a lower rate.