ÇELEBİ AR19-270720 (1)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 DECEMBER 2019 ÇELEBİ HAVA SERVİSİ ANONİM ŞİRKETİ (Amounts expressed in Turkish Lira (“TL”) unless otherwise indicated.) Convenience Translation into English of Consolidated Financial Statements Originally Issued in Turkish 94 Çelebi Ground Handling Inc. 2019 Annual Report Movements in property, plant and equipment for the period ended December 31, 2018 are as follows: Opening January 1, 2018 Additions Disposals Transfers Currency Translation Differences Closing 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 construction 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. NOTE 12 - RIGHT OF USE ASSETS Movements in right of use assets for the period ended December 31, 2019 are as follows: Opening Adjustment January 1, 2019 Additions Transfers Foreign currency translation differences Closing December 31, 2019 Cost Building and land 415.515.178 - 13.860.864 5.933.224 435.309.266 Plant, machinery and equipment 45.464.306 - - 296.266 45.760.572 Vehicles 7.743.084 - - 162.439 7.905.523 468.722.568 - 13.860.864 6.391.929 488.975.361 Accumulated depreciation Building and land - (35.147.877) - (834.634) (35.982.511) Plant, machinery and equipment - (21.441.849) - (49.143) (21.490.992) Vehicles - (3.421.909) - (23.936) (3.445.845) (60.011.635) - (907.713) (60.919.348) Net book value 468.722.568 428.056.013 Depreciation expense for the period ended December 31, 2019 in the amount of TL 60.011.635 is included in cost of sales.