CELEBI GROUND HANDLING ANNUAL REPORT 2018

3 Çelebi Ground Handling 2018 Annual Report Higher inflation than the previous year The upward movement in oil prices, the 37% increase in the value of the foreign currency basket against the TL and the high course of food prices led to a significant increase in inflation. Although the Consumer Price Index decreased by 0.40% compared to the previous month in December 2018, it increased by 20.30% compared to the same month of the previous year, and by 16.33% when compared to the twelve-month average. Among the main expenditure groups, the steepest increases were seen in goods and services (28.80%), food and non-alcoholic beverages (25.11%), housing (23.73%), and entertainment and cultural activities (20.86%). On the other hand, the Domestic Producer Price Index decreased by 2.22% in December 2018 compared to the previous month but increased by 33.64% when compared to December 2017, while 27.01% higher when compared to twelve month rolling average. Export coverage reaches 83.8% According to foreign trade data announced by the Turkish Statistical Institute, both the foreign trade deficit and the current account deficit narrowed significantly in 2018. As of the end of the year, exports had increased by 7% to reach USD 168 billion while the slowdown in domestic demand and fall in the value of the Turkish Lira precipitated a decline in imports. Total imports decreased by 4.6% to USD 223 billion. The export coverage ratio increased to 83.8% in December 2018, which was 60% in December 2017. The highest volume of exports in 2018 was made to Germany, followed by the United Kingdom, Italy and Iraq. Russia ranked first in imports, followed by Germany, China and the USA. CBRT opts to maintain a tight monetary policy stance in 2019 The CBRT decided to maintain a tight monetary policy stance until there was a significant improvement in the inflation outlook, given the ongoing risks to price stability despite the partial recovery in recent months. The main factor that could play a role in monetary policy decisions would be the emergence of a downward trend in inflation that could be considered as permanent. Under the guidance of the New Economic Program announced in September 2018 and in accordance with the soft landing scenario, there is a strong agreement between the market actors that higher quality growth will be achieved in 2019. It is thought that the balancing in the economy will continue in the first half of the year with a recovery to emerge thanks to the base effect and with the contribution of the tourism sector for the rest of the year. Çelebi Ground Handling continued to work to achieve efficient and sustainable growth in 2018, a year dominated by economic and political tension around the world. Rounding off its 60 th year of operation in 2018, our Company once again successfully reflected its long-standing experience gained in its corporate history to its performance, with a strong set of operational and financial results. At the end 2018, our Company’s total assets amounted to TL 1,522 million and our shareholders’ equity amounted to TL 353 million. In the same period, when our consolidated net turnover increased to TL 1,334 million, our consolidated gross profit amounted to TL 457 million with an increase of 70.24%, with a real operating profit of TL 276 million. The results of our operational activities, which we adapt according to prevailing requirements, were in line with our targets. In the January-December 2018 period, we offered services to a total of 126,777 flights in Turkey. In the same period, we offered services for 98,797 tons of cargo tonnage under our cargo operations in Turkey. Successful results from our foreign subsidiaries, too Çelebi Airport Services India Private Limited, our subsidiary operating at the Indira Gandhi Airport in Delhi, India, started services at the Kochin station on 8 January 2018 and at the Bangalore station on 18 September 2018. With the addition of these stations to the portfolio, the number of flights served increased by 90% compared to 2017, to reach 28,524. Celebi Delhi Cargo Terminal Management India Pvt. Ltd., our subsidiary providing cargo warehousing and handling services at Delhi International Indira Gandhi Airport, handled 523,009 tons of cargo in 2018.