Dogus Otomotiv Servis ve Ticaret (DOAS) Q3 2024 earnings summary

Executive summary

• Revenue for 9M2024 declined 20% year-over-year to 120.6 billion TRY, with net profit dropping 73% to 6.0 billion TRY, reflecting margin compression, higher costs, and inflation accounting.

• Turkish automotive market is expected to reach 1.2 million units by year-end, matching last year's record level.

• Electrification remains a key focus, with all brands set to offer EVs in the Turkish market by Q1 2025.

• Market share maintained in key segments despite a 3% decline in total market sales; commercial vehicle sales up over 30% year-over-year.

• Significant increase in operational expenses and a sharp decline in income from associates contributed to lower profitability.

Financial highlights

• EBITDA for 9M2024 was 14.2 billion TRY, down 54% year-over-year; net profit at 6.0 billion TRY.

• Gross profit margin fell to 16.6% from over 22% last year, mainly due to lower new vehicle sales margins.

• CapEx rose 81% year-over-year to 2.4 billion TRY, with investment focused on digitalization and electrification.

• Financial liabilities decreased 19% to 11.9 billion TRY; cash and cash equivalents fell 86% to 1.4 billion TRY.

• Working capital decreased 20% to 33.9 billion TRY; net debt position increased 146% to 10.5 billion TRY since December 2023.

Outlook and guidance

• Full-year sales expected at 125,000 units (excluding Skoda), with total group sales around 170,000 units.

• Investment spending planned at 4.7 billion TRY, focusing on digitalization, mobility, electrification, and sustainability.

• EV sales projected to reach 3,500 units in 2024 and 15,000 units in 2025.

• Priorities include operational efficiency, cautious expenditure management, and optimum profitability.