The Half Mavi Indir ##HOT##

Through effective cost management, supported by the strong sales performance, we delivered 150 basis points improvement in OpEx to sales ratio in the second quarter of 2023 despite the minimum wage hike impact included in July figures. We continue to generate cash from operations, and our net cash position increased to TRY 1.913 billion.International sales recorded only 3% constant currency growth in Q2 2023, mainly due to slower trading in our developed markets. International margins were also pressured this quarter with macroeconomic challenges.Online sales growth was mostly driven by mavi.com performance in Turkey and direct-to-consumer channels in international markets.Before going into details, I have a few notes on brand investments and developments about the spring/summer 2023 season. Driven by our All Blue, all better for all approach, we are working passionately to fulfill our commitment to making the most sustainable jeans. This season, we added the natural dye and Mavi archive off-cycle collections to our eco-friendly offering, which combines great design with the latest technology, unique ideas and innovation. We continue at full steam to enrich our omnichannel applications to create the happiest Mavi customers and offer the best shopping experience, both in the stores and online. The strong trust we elicited from our customers is our biggest driver. According to Future Brand Trust survey conducted in the first half of the year, Mavi was named Turkey's most trusted brand among nearly 150 brands from all 16 industries. Reputation, quality, financial soundness, responsibility and affinity were highlighted as Mavi's strengths in terms of trust with customers.We have long been a favorite love brand in Turkey, and now we are thrilled to crown our profitable position in the market by ranking among the most trusted brands.After this [ broad ] note, let's look at the key highlights for the first half of 2023. Moving on to Slide 5. Our consolidated sales reached [ TRY 8,415 million ] in the first half 2023, growing 104% year-on-year. Turkey retail sales grew 114%, and Turkey online sales grew 95%. Our EBITDA realized TRY 1.887 billion, resulting in an EBITDA margin of 22.4%. Our net income grew 62% and reached TRY 1.139 billion.In Turkey, ahead of our targets, we acquired 718,000 new customers in the first half of the year. Number of active [ loyalty ] card members in Turkey is now at 6.4 million.Moving on to review our channel performance. As of first half of 2023, total revenue consists of 67% retail, 23% wholesale and 10% e-commerce sales. With the continued robust performance, 87% of total consolidated revenue was generated in Turkey. The inflationary environment in Turkey continued to drive demand and as Mavi we make sure, we have the newness and variety at the right price to respond to this demand and remain consumers brand of choice. Because of the [ Eid ] holiday moved from the second quarter last year to first quarter this year, implying a strong [ mix ]. Nevertheless, our sales in Turkey grew 115% in the second quarter, with retail growing 110% and online growing [ 109% ], catching up year.The strong wholesale growth is mostly related to low base and the relatively irregular nature of shipments. In the first 6 months, covering our spring/summer 2023 season, sales in Turkey grew 119%. We continue to with the softness in demand internationally, especially in developed markets. Total international revenue in constant currency grew 3% in the second quarter and 8% in the first half of the year. Retail and direct-to-consumer online channels were the better performance.Let's look into our Turkey retail business in more detail. In Turkey, growing in retail continues to be at the heart of our business strategy, despite the slowdown of store openings in the recent years. We will continue to expand current stores and square meters, grow our product offering while constantly taking new actions to make sure that consumers have a great shopping experience. Having said that, in the first half of 2023, we opened 4 and closed 4 stores, and we are now operating 329 own operated stores across 169,000 square meters of selling space in Turkey with an average store size of 513 square meters. Most of the new square meter planned for 2023 will take place in the second half of the year.On Slide 10, let's elaborate on the like-for-like store performance. Traffic growth of 16% in first half 2023, despite continued strong consumer demand. Like-for-like sales grew 116% in the first half of the year, driven by 81% basket size growth and 19% transaction growth. Basket size growth was enabled not only by the dynamic pricing strategy, but also the newness driven by right product mix. As Mavi management, we always review the success of our growth figures especially in these days of high inflation with actual volumes in number of pieces sold. We are happy to report that 18.5% volume growth was achieved in the first half of 2023, in line with management's sustainable growth targets.Moving on to Slide 11 to review category-based developments in Turkey retail. We continue to trace strong growth across our product categories. All product categories also delivered growth in number of pieces as stated earlier. Both Denim and non-Denim business grew above 110% in Turkey, with Denim constituting 42% of total Turkey retail sales as of first half 2023. We are constantly following changing consumer preferences and enriching our product range, especially in casual lifestyle categories.Knits business constituting of T-shirt, sweatshirt and jersey offerings grew 107% year-on-year and make up 28% of our retail sales in Turkey. Capitalizing on the same trend, our new category non-Denim bottoms grew 135%, now constituting 8% of sales in the spring/summer season. Jackets being one of our focused categories in the recent quarters continued its strong momentum and grew 166% in the first half of 2023. Accessories grew 97% and shirts grew 108% this season.Going forward to review our online sales performance on to Page 13. Our direct-to-consumer online sales are made up of mavi.com and marketplace sales that are reported under e-commerce channel. In these charts, we review the total online sales of Mavi, including the sales of the third-party digital platforms to reach the wholesale. In the first half of 2023, our direct-to-consumer e-commerce sales share in total consolidated revenue is 10%, whereas including the wholesale e-com, total online sale is 10.7% of total consolidated revenue.Online sales in Turkey consists of only direct-to-consumer channels and grew 95%, driven by the strong 131% growth of our own website, mavi.com. Marketplace performance varies among platforms. There are some platforms growing aggressively and some that are cutting down on marketing spend hence [ performing softer ]. Online sales now constitute 8% of total sales in Turkey. International online business grew 35% in the first half, negatively impacted by the macro driven demand weakness in some markets, direct-to-consumer channels platform relatively better, growing 49%. Online makes up 29% of total international sales. With retail being a significant channel for the consumer, especially in Turkey context, omnichannel capabilities are becoming more important for our future growth and in improving the shopping experience for consumers. Our omnichannel projects are launched successfully, and we witnessed the initiatives driving incremental sales.Mavi will continue to invest in digitalization and CRM projects that support omnichannel growth and make sure online business continues to be a positive contributor to margins.Let's move on to review our consolidated financial results. We review our gross margin performance on Slide 15. Recall that in 2022, the high product cost started kicking in, in the second half of the year. Hence, in the first half of 2023, there was significant product cost inflation due to a low base. On the other hand, with the current FX levels, we are witnessing deterioration in international gross margins in the last few quarters. In Turkey, strong demand was captured with variety, newness and right product price positioning, which resulted in high sell-through rates with low markdown spending. All in all, we view to 52.1% gross margin in the second quarter as a success and the 390 basis points decline as a normalization from the extraordinary low base.Moving on to Slide 16 to review our EBITDA and bottom line performance. It should be noted that Turkey OpEx figures include the impact of the latest minimum wage hike that was effective as of July. Nevertheless, the significant OpEx inflation in the first half of the year was once again leveraged by the strong top line growth and effective cost management. We continue to deliver improvements in our rent ratios in Turkey retail business. On the other hand, there is a notable deterioration of OpEx ratio in the international markets due to soft sales growth.

Despite the challenging macro environment, our total OpEx-to-sales ratio improved 160 basis points year-on-year in the first half. As a result, our EBITDA, excluding the IFRS 16 adjustments grew 73% year-on-year, resulting with an EBITDA margin of 18.9%. EBITDA margin, including IFRS 16 realized 22.4% in the first half of 2023. Thanks to our net cash position, the increase in net financial expenses is limited and the operational performance is mostly mainly reflected to our bottom line. Our net income in the second quarter realized TRY 624 million, bringing the net income for 6 months to TRY 1.139 billion with a net income margin of 30.5%.On Slide 17, we look into our operational cash flow and working capital performance. Operational cash conversion is 49% due to increasing working capital requirements, which is the result of the increasing cost of inventory and the initiatives taken to mitigate product cost pressures such as cash payments, early looking, advance payments for raw materials and so forth. The 135% year-over-year increase in inventory level at the end of July 2023, is largely driven by 88% product cost inflation year-on-year. Inventory in number of pieces in Turkey is only 24% higher compared to the same year last year and is in line with the sales growth and demand expectations. Inventory comprises of all fresh seasonal products.Now let's move on to Slide 18. We spent TRY 186 million in capital expenditures in the first half of the year resulting in a CapEx to sales ratio of 2.2%. On the retail side, we have a few store openings and new store concept transformations taking place. Apart from retail, we have been investing predominantly on IT projects, digital investments and R&D. Although, we have been using our cash in working capital in order to mitigate product cost increases and optimize gross margins, we continued cash generation from operations. Our net cash position continued to increase and reached on TRY 1.913 billion as of the end of quarter 2.