ÇHS AR21-ENG-030622

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2021 ÇELEBİ HAVA SERVİSİ ANONİM ŞİRKETİ AND ITS SUBSIDIARIES (Amounts expressed in Turkish Lira (“TL”) unless otherwise indicated.) 119 Çelebi Ground Handling Inc. 2021 Annual Report The net debt/(equity+net debt) ratio as of 31 December 2021 and 2020 is as follows: 31 December 2021 31 December 2020 Total financial liabilities (*) 2.740.676.806 1.805.663.280 Less: Cash and cash equivalents (1.093.574.832) (571.830.186) Less: Time deposits (14.078.067) (9.019.305) Less: Restricted bank balances (102.609.932) (18.443.286) Net debt 1.530.025.975 1.206.370.503 Net debt (Except for the impact of TFRS 16) 267.817.972 491.670.729 Shareholder’s equity 1.669.845.086 446.297.475 Capital invested 3.199.871.061 1.652.667.978 Net debt/capital invested 0,48 0,73 (*) As of 31 December 2021, TL 1.262.208.003 of the net debt consists of the lease amounts discounted in accordance with TFRS 16 effective as of 1 January 2019 (31 December 2020: TL 714.699.774). NOTE 33 - FINANCIAL INSTRUMENTS Fair value disclosures of financial instruments Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Estimated fair values of financial instruments have been determined by the Group by using available market information and appropriate valuation methodologies. However, judgement is necessarily required to interpret market data. Accordingly, estimates presented herein are not necessarily indicative of the amounts the Group could realise in a current market exchange. The following methods and assumptions are used to estimate the fair values of financial instruments: Monetary assets Financial assets that are carried at cost value including cash and cash equivalents are assumed to reflect their fair values due to their short-term nature. The carrying value of trade receivables, with related impairments is assumed to reflect their fair values. Monetary liabilities Short-term bank loans and other monetary liabilities are foreseen to approximate their carrying values due to their short-term nature and the significant portion of long-term bank loans and other monetary liabilities having variable interest rates. The Group classifies the fair value measurements of financial instruments at fair value on the financial statements into the following categories, using three levels of hierarchy, according to the sources of each class of financial instruments. - Level 1: Valuation techniques using market prices (unadjusted) in the active market for the identified financial instruments. - Level 2: Other valuation techniques, including indirect or direct observable input. The fair value of financial assets that are not traded in an active market is calculated using the observations on the market at the highest level that can be used and the assumptions at the lowest level for the company. - Level 3: Valuation techniques that do not include observable market inputs.