CELEBI GROUND HANDLING ANNUAL REPORT 2018

ÇELEBİ HAVA SERVİSİ A.Ş. 89 Çelebi Ground Handling 2018 Annual Report Convenience Translation into English of Consolidated Financial Statements Originally Issued in Turkish NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 DECEMBER 2018 (Amounts expressed in Turkish Lira (“TL”) unless otherwise indicated.) Other long-term payables December 31, 2018 December 31, 2017 Deposits and guarantees received 16.098.610 12.532.767 16.098.610 12.532.767 NOTE 10 - INVENTORIES December 31, 2018 December 31, 2017 Merchandises 3.053.738 3.068.338 Other inventories (*) 11.059.888 9.393.658 14.113.626 12.461.996 (*) Other inventories include fuel oil, baggage sticker, boarding passes, miscellaneous periodicals, clothes and spare parts. NOTE 11 - PROPERTY, PLANT AND EQUIPMENT Movements in property, plant and equipment for the period ended December 31, 2018 are as follows: Opening Currency Translation Closing January 1, 2018 Additions Disposals Transfers Differences December 31, 2018 Cost Plant, machinery and equipment 270.953.620 33.289.019 (11.933.987) 553.585 20.363.330 313.225.567 Motor vehicles 64.371.389 10.855.317 (371.063) 167.462 17.203.638 92.226.743 Furniture and fixtures 26.259.867 2.497.059 (501.352) 61.308 1.672.696 29.989.578 Leasehold improvements (*) 120.745.249 1.958.063 (45.563) 74.898 2.244.773 124.977.420 Construction in progress 1.672.075 155.986.828 - (1.057.852) 377.976 156.979.027 484.002.200 204.586.286 (12.851.965) (200.599) 41.862.413 717.398.335 Accumulated depreciation Plant, machinery and equipment (187.451.076) (15.138.464) 6.512.199 39.489 (13.037.174) (209.075.026) Motor vehicles (44.943.828) (3.400.991) 371.061 - (11.810.596) (59.784.354) Furniture and fixtures (21.925.042) (1.884.677) 501.665 - (1.187.753) (24.495.807) Leasehold improvements (*) (74.062.517) (27.152.811) - - (1.022.642) (102.237.970) (328.382.463) (47.576.943) 7.384.925 39.489 27.058.165 (395.593.157) Net book value 155.619.737 321.805.178 (*) In May 2013, a tender was made for the construction of the third airport in Istanbul. The Joint Venture Group, which won the tender, started to invest in Istanbul Airport. The General Directorate of State Airports Authority announced that Istanbul Airport will start its operations in March 2019 and the commercial flights made from Istanbul Ataturk Airport will be terminated. In accordance with the assumption that the ground handling services to be provided by the Group to commercial passenger aircraft at the Atatürk Airport will end within the first quarter of 2019, the Group has reviewed the useful lives of the tangible fixed assets classified as special cost in the related station and decided to redeem the remaining net book value. The effect of the economic life estimate change on the net profit for the year is TL 21.130.026 as expense. (**) TL 154.531.497 of the investments in progress is composed of investments made for Istanbul Airport. Depreciation expense for the period ended December 31, 2018 in the amount of TL 41.630.011 and TL 5.946.932 are respectively included in cost of sales and operating expenses. The net book value of plant, machinery and equipment amounting TL 189.065 are purchased by financial leasing as of December 31, 2018.