Ladies and gentlemen, thank you for standing by. I'm Poppy, your Chorus Call operator. Welcome, and thank you for joining the Erdemir Conference Call and Live Webcast to Present and Discuss the Full Year 2023 Financial Results. All participants will be in a listen-only mode and the conference is being recorded. The presentation will be followed by a question-and-answer session. [Operator Instructions]. Please note Eregli Demir ve Çelik Fabrikalari, T.A.S. Erdemir, may, when necessary, make written, or verbal announcements about forward-looking information, expectation, estimates, targets, assessments and opinions. Erdemir has made the necessary arrangements, about the amounts and results of such information, through its disclosure policy - that has shared such policy with the public through the Erdemir website, in accordance with the Capital Markets Board regulations. As stated in related policy, information contained in forward-looking statements, whether verbal or written, should not include unrealistic assumptions, or forecasts. It should be noted that actual results, could materially differ from estimates, taking into account the fact that, they are not based on historical facts, but are driven from expectations, beliefs, plans, targets and other factors, which are beyond the control of our company. As a result, forward-looking statements, should not be fully trusted, or taken as granted. Forward-looking statements, should be considered valid only considering the conditions prevailing, at the time of the announcement. In cases, where it is understood that forward-looking statements, are no longer achievable, such matter will be announced, to the public and the statements will be revised. However, the decision to make a revision is a result of a subjective evaluation. Therefore, it should be noted that when a party is coming, to a judgment based on estimates and forward-looking statements, our company may not have made a revision, at that particular time. Our company makes no commitment to make regular revisions, which would fully cover changes in every parameter. New factors may arise in the future, which may not be possible to foresee at this moment in time. At this time, I would like to turn the conference over to Ms. Idil Onay Ergin, Investor Relations Director. Ms. Ergin, you may now proceed.

Thank you very much, Poppy. Good afternoon, everyone. Welcome to our conference call and webcast of Erdemir for the last quarter of 2023. Today, our CFO, Mr. Serdar Basoglu; and Financial Control and Reporting Director, Mr. Ulas Yirmibes, are also joining the webcast. First of all, I will go through our Investor Presentation, which you can find on our website, and you can also follow it through the webcast. Then at the end of this presentation, there is going to be a Q&A session as usual. Before starting the presentation I will handover to our CFO, Mr. Serdar Basoglu. The line is yours.

Thank you, Idil. Good afternoon everyone. Welcome to our 2023 results conference call, and thank you for joining us today. As usual, our IR Director, will take you through the details of fourth quarter performance of our company, by the presentation. But before starting our presentation, I would like to highlight some of the important developments in 2023, and the market expectations for 2024. Actually, 2023 was a year in, which both sad and happy events occurred together. The earthquake disaster caused a lot of damage in our country and our company. Despite the magnitude of the earthquake, we recovered very quickly after the production was suspended for approximately three months at our Istanbul facility, which located in the earthquake zone. With the extraordinary efforts of our colleagues in the region and returned to pre-earthquake levels as of third quarter. So, as you all know, we reached an agreement on an estimate issuance claim advance payment of $100 million. This amount, was reflected as the income in our third quarter financial statement, and paid in the last quarter. The total payment amount has not been clarified yet, but necessary efforts, are being made to collect the total claim payment in the first half of this year. We were proud, to announce the commissioning of the new second blast furnace in [Eregli]. Our company aims to increase efficiency, by reducing costs and contribute to sustainable production, with the new second blast furnace. When we look at the Turkish steel market, the extraordinary increases in imports continue from South Korea, Japan, Indonesia, and especially from China, which focused on our exports, due to economic stagnation in its domestic market. Turkish flat steel sector, has also struggled with sharply competitive pricing by Asian suppliers, which has caused a decrease in the export share of Turkish producers. Consequently, the steel exports import coverage ratio of the Turkish steel industry fell to 57 from 90, as import volumes increased by 16 despite the sharp decline in export volumes in 2023. Despite all the difficult conditions in the market, we achieved to generate US$643 million EBITDA and US$170 million net profit in 2023. In 2024, we aim to continue our production at full capacity. After commissioning of the new second blast furnace in Erdemir, the new first blast furnace in Isdemir, will also be launched in the second half of this year. We focus on cost-cutting, self-sufficient investments aimed at increasing our internal efficiency. We expect the steel industry, to have a more stable year, depending on the developments in China. We aim to achieve, over 8.2 million tonnes sales in 2024. So, I will be with you at the end presentation. So, now I would like to hand over the mic to our Investor Relations Director, Idil. Idil, the line is yours.

Thank you, Mr. Basoglu. Our presentation consists of two sections, as you already know. The first one is the market overview and then the financial results. So, let's start with the commodity prices. In Page 3, you will see the prices of steel-related commodities and HRC. Let's take a look at coking coal, iron ore, scrap and HRC prices. Price level of coking coal was around $295 per tonne at the beginning of the year. It reached its lowest level in May, and then it has gradually increased, and reached $314 per tonne in spot market as of today. Our mining accidents in Australia and China, were one of the most important issues that, caused prices to remain high in 2023. While activities in the mines were suspended after the accidents, increased controls and precautions in the mines where production continued. So, iron ore price was around $117 per tonne at the beginning of the year and it has reached $122 per tonne today with a relatively stable trend. In 2023, the Chinese government focused on incentive efforts, in order to support weak demand and accelerate economic recovery, after the collapse in the real estate sector. These efforts have supported positive expectations, for the recovery of domestic demands, throughout the year. On the other hand, expectations that, Chinese steel producers, will not see an acceleration in production levels, after the holiday caused decrease in iron ore prices last week. After reaching its highest level with $665 per tonne in March 2022, the current scrap price is in the range of $350 to $450 per tonne. The decrease in global scrap consumption in 2023 is due to the declining steel production in Turkey and South Asian markets and the decline in global scrap trade. At the beginning of 2024, Turkey's imported scrap price increased to $420 due to the seasonal weak scrap flow, and high scrap collection costs. On the bottom right, we show HRC prices in Black Sea, China, and South Europe. HRC prices, which peaked in March 2022, due to the Russia-Ukraine war, are already normalized. Global HRC prices weakened, due to the fact that the expected recovery in China did not fully materialize and the slowdown in the manufacturing industry sectors. In the second half of 2023, HRC prices were stable under the pressure of high interest rates, and weak global demand. On Page 4, you will see the production, consumption, exports, and imports figures of Turkish steel markets for the 12 months of 2023. While steel production remains at the same level, steel consumption reached a record level of 38.1 million tonnes, with an increase of 17%. Despite the world crude steel production, remained stable at 1.8 billion tonnes, Turkish crude steel production decreased by 4% and negatively differentiated from the world steel industry. While exports decreased by 31% in 2023, the increase in imports by 16%, caused the export-import coverage ratio, which was 90% in 2022, to fall to 57% in 2023. So let's take a look at the financial results, and the operational metrics. On Page 6, you will see the brief summary of our 12-month results. Despite the earthquake disaster, we achieved $6.2 billion revenue and we generated $643 million EBITDA. On Page 7, you will see the operational indicators of our company. As you all know, due to the earthquake that occurred on February 6, we lost approximately three months of production and 600,000 tonnes of sales. All the decreases you see on this page are related with the situation. We have gradually recovered in the last two quarters. The crude steel capacity utilization ratio in the second and third quarters, was approximately 80%, and our fourth quarter capacity utilization ratio, was about 90%, as it was before the earthquake. Our production and sales returned to normal levels, as of the third quarter. Both our production and sales tonnage, reached over 2 million tonnes in the fourth quarter. So let's take a look at the segmental breakdown, of domestic sales and export volumes on Page 8. As you can see from the pie charts, there has been a change between sectors, due to the effect of markets and demand conditions, when we compare to last year's breakdown. There has been a transition from the pipeline profile and rolling, and auto industry to distribution chains. We see similar situation in the loan products. There has been a transition to industries that, use value-added products, and have higher profitability margins. As I mentioned in the previous slide, the unusual decline in export is mainly caused by the earthquake. On Page 9, breakdown of revenue for domestic and export sales, 87% of the revenue comes from domestic sales, in line with the domestic volume. The decline in annual sales revenue is mainly caused by the earthquake. The decline in EBITDA per tonne, due to the earthquake, recovered very quickly. I would also like to point out, that in order to be able, to compare with other quarters, the effects of inflation accounting, are not included in the EBITDA per tonne calculation. In 2024, we expect to see above $100 per tonne. Despite all the difficult conditions in the market, we achieved to generate $643 million EBITDA and $170 million net profit in 2023. Net profit of $345 million was achieved in the last quarter, due to the increase in sales tonnage in EBITDA and deferred tax revenues, as a result of inflation adjustment in legal financials. On Page 10, you can see how we reached to net profit from EBITDA. The largest item was depreciation, which was $222 million in 12 months. The other major item in this chart, was financial expenses, which are high, due to the operational foreign exchange laws. And tax expense was $190 million. After other expenses, net profit was $170 million. In the graph below, you can see EBITDA to change in cash-bridge. There is a release of [$100 million] in working capital. Also, we spend around $1.1 billion to capital expenditures in 12 months. This amount also includes, advances paid for the capital expenditures as well. And that you will see the difference, between the CapEx page in Page 13, and this one. $475 million credit was mainly used, for networking capital, and investments. On Page 11, you will see historical trend of financial borrowings and net debts. When we look at the 12 months of 2023, our networking capital remained almost stable, compared to the end of last year. There was a decrease in inventories, and trade receivables, due to the declining prices. Our net debt position was $1.5 billion at the end of the year. Due to the non-operational costs incurred, because of the earthquake, low EBITDA was realized and with the ongoing capital expenditures, the net debt EBITDA ratio was 2.3 multiplier. We expect that the EBITDA will increase, and net debts will remain stable for the rest of the year in 2024. And net debt EBITDA ratio, will decrease below two multiplier again. Slide 12, represents our cost of sales breakdown, due to the increase in production after the earthquake. Our raw material usage increased and due to the price decrease, the biggest change was in coal. The use of imported semi-finished products, which is imported slab, increased due to the halt of production at Istanbul, for three months due to the earthquake. Page 13 represents the historical CapEx spending. Total CapEx spending was $977 million in 12 months. When we [add the] advance, $247 million to the figure, we have reached the investment expenditures of $1.1 billion. After commissioning of the second blast furnace of Erdemir in October 2023, the new first blast furnace in Istanbul, will also be commissioned in the second half of this year. We expect that CapEx will reach up to $1 billion again in 2024, with maintenance and other ongoing investments. On Page 14, we are proud to announce our Net Zero roadmap last month. We aim to reduce carbon emissions per tonne, by 25% by 2030, 40% by 2040, and achieve Net Zero emissions, by 2050, compared to the base year of 2022. We plan to spend $3.2 billion for transformational investment of Erdemir and Isdemir, by the end of 2030. 70%, 80% of the $3.2 billion investment will be sourced externally, utilizing easily accessible financial resources for the green transformation. Erdemir and Isdemir's crude steel capacity will reach 13 million tonnes by 2030. Now we may continue with the Q&A session. We will be delighted to answer your questions with Mr. Serdar Basoglu. Thank you for listening.

Hello everyone again. Thank you for joining us today. We hope to see you next quarter's call. Have a nice day. Thank you very much.

Thank you.

Ladies and gentlemen, the conference is now concluded and you may disconnect your telephone. Thank you for calling and have a good afternoon.