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Verda Tasar: Hello, everyone, welcome to Ulker Biskuvi's Third Quarter 2025 Earnings Call. Thank you for joining us today and for your continued interest in our company. We appreciate your time as we review another solid quarter of performance, highlighting our continued focus on sustainable growth, operational efficiency and delivering value to our consumers and shareholders. With that, I will now hand it over to our CFO, Fulya Banu Surucu, who will walk you through the operational and financial results in detail. Fulya Banu, please.
Fulya Surucu: Beste, thank you. Good morning, good afternoon, everyone. Thank you for joining us today for Ulker Biskuvi's third quarter 2025. Due to a last-minute change of plans, our CEO had to travel and could not attend this meeting. He apologizes for that and said hi to everyone. So today, I will walk you through our operational performance highlights and provide a deeper dive into our financials and segment performance, discuss our balance sheet, strategic initiatives and conclude with our outlook. After the presentation, I will be happy to take your questions. To begin, Ulker continues to deliver strong results, driven by our diverse product portfolio, correct strategies and commitment to innovation. So let's begin with a snapshot of the macroeconomic landscape in Turkiye as we entered the last quarter of 2025. Despite ongoing global uncertainties, the country's GDP growth rate is projected to stabilize at 2.7% for this year. And it is expected to land at 3.7% for 2026 per IMF, higher than the world's GDP growth of 2.8%. Turkiye CDS spreads have shown improvements, reflecting increased investor confidence and a more stable outlook compared to previous years. Inflation remains as a challenging topic, even though there is a significant variation when you break this down by main items. As of September 2025, total inflation stands at 33.3% year-over-year. Consumer confidence index has shown gradual improvement over the past year, causing a positive shift in consumer outlook. In summary, we operate in a dynamic volatile macroeconomic environment. GDP growth remains resilient. We see an improvement in consumer confidence, but we are mindful of inflationary pressures and probable shifts in consumer confidence and behavior. So today's key messages is mainly -- there are 6 key messages I'd like to share with you. Agility is staying responsive amid economic volatility; champion link value and accessibility, ensuring our products remain affordable and widely available; driving consistent growth momentum through innovation and execution; leveraging AI-driven performance and operational excellence; delivering impactful new product development and consumer-centric campaigns; maintaining operational excellence and rigorous cost management to safeguard our margins. So in summary, this is how we will continue to deliver value to our investors, our customers and all our stakeholders towards the end of the year and continuing in 2026 as well. On the next page, we will talk about new product launches and their contributions. So let's start with third quarter first. During the first 3 quarters of the year, we successfully introduced a series of new products, each closely aligned with evolving consumer needs. These launches delivered a meaningful contribution, accounting for 4% of our snacking revenue in the third quarter. Our innovation pipeline remains robust with strong consumer engagement. Let me take a look at how the picture changes or how the picture looks as of 9 months revenue contribution. For the first 9 months, new product launches accounted for 13% of domestic and 6% of international snacking revenue, totaling 11%. This demonstrates our ability to drive growth through innovation. We continue to innovate both domestically and internationally, ensuring our portfolio meets evolving consumer preferences. Our sustainability strategy remains at the core of our strategy and our vision. We advanced our Beyond Hazelnuts and regenerative agriculture programs, we published our 10th sustainability report, and we won the Sustainable Business Award for Carbon Management and Net Zero. Our social responsibility initiatives like the Mobile Health Service continue to make a positive impact. When we take a look at the highlights in terms of corporate communications, we have continued to strengthen our corporate reputation through community engagement, sustainability and brand storytelling. We are proud to be the main sponsor of the European Para Youth Games in Istanbul, supporting young athletes and inclusivity. With inspiring stories, we reached millions via digital and press channels Competing With Heart video series. Our communication efforts have amplified our achievements. We have been awarded various platforms -- in various platforms for excellence in business, HR, digital transformation, safety, sustainability and quality. So our people are our greatest asset. We are proud to be recognized as Turkiye's Happiest Workplace for the fourth year in a row. We have invested in AI training, R&D development and well-being initiatives, earning 21 awards, including 11 gold at the International Business Awards, which is one of the most prestigious award programs in the business world. All these achievements reflected our ongoing investment in people, innovation and operational excellence, positioning us for sustainable growth and continued success. So let me continue with our operational performance. Ulker's geographic footprint continues to be a key driver for our resilience and long-term growth. Let me start with our home market, Turkiye. Despite a challenging macroeconomic environment, which I have shared at the beginning of the presentation with all of you, we delivered 4.9% revenue growth and a solid 7.9% EBITDA growth, which is adjusted for inflation accounting number. This performance reflects our disciplined solid pricing, strong brand equity and operational agility. Export operations delivered 19% revenue growth, supported by strong demand in key markets and improved market execution. EBITDA decline of 8%, primarily due to ongoing inflationary pressures and the depreciation of Turkish lira that impacted cost base and profitability. We remain confident that our export strategy is on the right track and we continue to prioritize sustainable growth and brand strengthen in our international markets. In Middle East, you see a 5.9% revenue growth. And in North Africa, we delivered 29.5% revenue growth, supported by strong momentum and pricing. EBITDA was slightly down by 0.7%, but we view this as a short-term margin normalization. Finally, in Central Asia, we achieved 11.5% revenue growth. Even though there was a decline in EBITDA, this was impacted by currency devaluation, input cost inflation and our overall, our geographic diversity continues to be a strategic advantage, helping us balance risk and capture growth across multiple markets. Turning to our revenue mix. Ulker's scale and [indiscernible] which are clearly reflected in our top line performance. As of the first 9 months of 2025, we generated TRY 80.9 billion in net revenue, with 71% coming from our domestic operations and 29% from international markets. And you also see on the same page deck, I mean, the breakdown of the export -- international markets by export, Central Asia, North Africa and Middle East as well. Let me take a look at our global -- our market share. Ulker continues to hold the leading market shares in key categories across our core regions. In Turkiye, we remain the undisputed leader in biscuits, chocolate and cakes with 34% market share. In Middle East, our strong presence in biscuit category continues with 27% market share. In North Africa, we are gaining ground, especially in biscuits, where our market share has reached 14%. In Central Asia, we are also an important player in chocolate with 14% market share. So Ulker, in summary, maintained leading market shares in biscuit, chocolate and cake in all the regions we operate. So let me continue with the financial performance, how we delivered financially in Q3. In Q3 '25, we accelerated growth with balanced top line and margin improvement. Revenue, gross profit, EBITDA and net income all increased year-on-year, reflecting our effective strategies and operational discipline. Now let's take a look on a deeper perspective on each bucket for Q3. Volume increased by 0.7% from 172 tons in Q3 '24 to 174 tons in Q3 2025. Total revenue up 4.8%, reaching TRY 25.4 million compared to TRY 24.2 million last year. The gain came again from our disciplined pricing promotions and improved mix. Gross profit rose 13% to TRY 7.4 million from TRY 6.6 million in Q3 '24. Gross margin expanded from 27.1% to 29.2%, a 2.1 percentage point improvement driven by lower cost pressure and better product portfolio mix. EBITDA grew 16.5%, delivering TRY 4.5 million, up from TRY 3.9 million a year ago. So net income reached to TRY 1.1 million, demonstrating the strong pass-through from margin improvement to bottom line earnings. In this quarter, we are not just defending our margins in a challenging environment, but we are also growing them with revenue and profit both advancing versus prior year. So on a 9-month perspective, for the first 9 months, we balanced growth and headwinds. While some metrics faced pressure, our net debt to EBITDA remains at a healthy level and we continue to focus on sustainable profitability. So for the first 9 months, total volume declined by 1.5%. Revenue increased by 4.6%, reaching TRY 80.9 million. Gross profit increased -- slightly increased to 30.2%, reaching TRY 24.4 million. And EBITDA remained at 17.8%, again, with inflation accounting adjusted, which is quite a healthy number and we delivered 5.7% net income of TRY 4.6 million. And net debt to EBITDA, this is just a calculation from the face of the balance sheet, 1.76. And over the coming slides, I will be sharing with you the net debt to EBITDA from covenant calculation perspective, which is quite a low number and which is a very healthy number. So when we look at the breakdown domestic versus international. So our financial performance is strong across both domestic and international markets with notable improvements in EBITDA and gross profit. We continue to optimize our regional mix for profitability. Our domestic operations total revenue decreased by 3%, reaching to TRY 17.1 million in Q3 2025. Gross profit increased by 10.2%, reaching 28.5% gross profit margin, delivering TRY 4.9 million gross profit and EBITDA margin on the domestic side is approximately 19.7%, close to 20%, reaching to TRY 3.37 million. Total snacks market in Turkiye contracted approximately by 2.1% year-over-year compared to Q2 2025. And in line with this market contraction, our domestic volume also in Turkiye declined accordingly, reflecting the broader industry trend. However, this was offset by a strong 9.6% volume growth in export and international operations, which contributed positively to our overall volume. In terms of international business, total revenue is up 26.1% reaching to TRY 8.2 million in total revenue and we were able to deliver approximately 31% gross profit margin in international business and delivering an EBITDA margin of 13.7%. So the breakdown domestic versus -- domestic and international shows 2 distinct dynamics: domestically improving margins despite lower revenue, demonstrating strong pricing power and cost discipline. Internationally robust top line growth but some margin compression due to FX and cost factors, both regions contributing positively [indiscernible] EBITDA growth. So let me continue on the consolidated volume and revenue contribution by category. Overall, total snacking revenue grew by 5.1%, supported by innovation and effective marketing. On this slide, we move from regional to category level performance. Snacking sales volume grew 1.3%, reaching to 153 tons in Q3 2025. Snacking sales value increased by 5.1% from TRY 23 million to TRY 24.2 million. This value growth shows the positive mix and impact, more premium SKUs successful innovation launches and price discipline across all our core categories. And category mix, biscuits rose from 57% in Q3 to 59% in Q3 '25. Chocolate declined slightly from 33% to 31%, reflecting competitive pricing and portfolio adjustments. And cake steady at 10% continue to provide category diversification. Overall, snacking portfolio revenue increase was supported by targeted product launches, optimized volume mix and integrated marketing campaigns, both digital and in-store aimed at strengthening brand equity and consumer flow. This strategic focus allowed us to build value even on modest volume gains. So on balance sheet finance, again, we closed the quarter on a very -- with a very strong balance sheet. Our balance sheet remains robust. We have closed with 63% of our net position hedged, secured a new syndication with our commercial banks and EBRD and our covenant-based net debt EBITDA is at 1.11 as of September 2025. I'm sure you have seen from the news that our syndication loan is finalized with the commercial banks reaching to $250 million, 5-year bullet syndication loan, the first in the Turkish private sector since 2020 with very prestigious led by JPMorgan and its very highly prestigious international banks with 11 banks, we were able to complete the first 5-year bullet syndication since 2020 in Turkish private sector. And very recently, we have also closed EUR 75 million with EBRD with the same conditions, again, a 5-year bullet with the same conditions that is on syndication. So with all these new updates, our long-term loan is around 31%, short-term is 69% and this will -- over the coming months, this will change to long-term when we finalize -- I mean, it's already finalized in October. But as of Q4, most of the loans will go to the long-term bucket on this table. So in terms of net debt EBITDA, it's 1.11. So you see our high focus on net debt EBITDA. And in terms of working capital, yes, there is a slight increase versus prior year, but it's mainly driven by seasonality and we may go into detail if you have additional questions in terms of working capital. So for outlook, we shared with you that a net sales growth of 3% and EBITDA margin of 17.5%. But with this volatile environment and uncertainties, we shared with you a range for net sales with plus and minus 1%, EBITDA margin with plus and minus 0.4%. As of Q3 end, we also keep the same outlook for 2025 and we believe that we will be able to meet the targets that we have shared with you. So this 5H growth model, our CEO shared this with you. Again, most of our strategy is based on these 5H growth models that we have stated beginning of the year, which we are also very keen and very proud about. So that's all I'd like to -- I wanted to share with you in terms of our Q3 performance. So we believe that our Q3 performance is quite strong. And I'm happy to take any questions you have for me.
Operator: [Operator Instructions] Our first question is from Eren Ercis from Yapi Kredi.
Eren Ercis: Congratulations for the good results. My question is regarding to your 2025 guidance. Your guidance implies a 2% revenue decline and around 1 point year-over-year EBITDA margin contraction in fourth quarter of 2025. Could you please elaborate on the main reasons behind maintaining this guidance despite the strong this quarter performance and higher trading growth? And how do you see fourth quarter 2025 and October trends and also 2026?
Fulya Surucu: Thank you for your question. So there is a base impact in Q4 2024. So our fourth quarter in 2024 was very, very strong, extremely strong, especially with some new innovations. If you might remember, Dubai Chocolate, we were first in the market from a commercial perspective, first company in the market with a branded Ulker's brand in the market, which really has huge sales, much better sales and much more sales than we had anticipated, which contributed significantly to our Q4 numbers. So also Q4 2024 was very, very strong. So there is a base impact. So if I tell you that there might be a slight decrease versus 2024, these are the reasons. So again, we believe that Q4 will be a strong Q4 as well. October went overall well. And we do not expect, hopefully, any huge surprises unless something very unexpected comes out globally or regionally. So we believe that we will be able to meet our guidance. And I think not changing the guidance and meeting this guidance in such a volatile environment is also another success, I believe.
Eren Ercis: Okay. And I have one more follow-up question according to your EBITDA margin, if it's okay for you?
Fulya Surucu: Of course. Sure, please go ahead.
Eren Ercis: When we look at your third quarter domestic EBITDA margin improvement seems partly linked to product mix. It could be attributable to higher chocolate unit prices during 2 periods. Could you confirm whether this was the main driver or if there was also a positive contribution from raw material costs or pricing efficiencies?
Fulya Surucu: Overall, I can tell you without going into too much detail yet, you have the right idea, yes.
Operator: Our next question is from Alasdair Alexander from Sanarus Investment Management. You mentioned seasonality on the inventory levels. Where do you expect inventory to be by end of the year and going into next year?
Fulya Surucu: Well, the increase in -- so there is also seasonality impact in 2024, by the end of 2024, we ended up with very low inventory levels. And when we started this year in 2025, there was an increase in inventories related to the higher cocoa shipments in half 1, which impacted our inventory numbers. So the increase in inventory is a direct result of a planned rebalancing and a significant shift in the timing of our procurement compared to last year. So when we had this, the relevant impact will also neutralize we believe that by year-end. And we had very low inventory levels in 2024. And we believe that a deliberate planned front-loading of our cocoa procurement in the first half of 2025, which also is still impacting us will be normalized by year-end.
Operator: Our next question is from Ali Kerim from Gedik Investments.
Ali Akkoyunlu: My question is more on 2026. You bought some raw materials during the first half of the year. And since then, cocoa dropped by 30%. The first question is, how you avoid inventory losses on this? And the second question is, if the trend continues like this, how do you think that will impact your financial performance in 2026?
Fulya Surucu: Thank you for your question. Yes, cocoa dropped very unexpectedly in the last couple of months or maybe in the last couple of weeks. But again, it increased and it kind of went down again. And as of today, we do not know how it's going to be towards the end of the year. It keeps changing. It went up to 4,800. So we definitely monitor it very closely. Now it's around 4,400 in GDP. So we keep definitely monitoring it. But what we are -- the first part of our procurement in the first half of the year, which impacted us, I mean, positively, especially in the first half of the year and then the last year as well. We have a hedge policy that we shared before. But again, we do not disclose any numbers how much we are closed or not. It is not a number that is disclosed. I believe that, I mean, first, we do not know how things will change. And second, based on that, I think we will be able to navigate through this challenge. And a significant portion of our cocoa needs for the remainder of 2025 is secured as also into -- 2026 has also been secured at prices determined by our half 1 numbers. But again, as of today, we do not disclose any exact number. And I believe that with the volatilities and uncertainties, we should be able to navigate it. But as of today, it is early to say anything. And I believe also that the benefit of the recent drop in spot prices will have a lag effect. We'll see.
Operator: Our next question is from Mehmet Yigit from Unlu & Co. Congrats for the results. How do you see the Turkiye total snacking market so far in the fourth quarter 2025? What is the reason for higher inventory and working capital in 2025 compared to 2024?
Fulya Surucu: In terms of the total snacking market, the market contracted by 2.1%, including all snacking markets. So -- and for the first 9 months, it decreases by 1.8%. And on a Q3, quarter-to-quarter basis, it decreased by 2.1%. So there is a shrinkage in the market that impacts all the companies and consumers. So that's how we see it. I mean, in Q4, there might be a slight sequential improvement over Q3, driven by a typical year-end seasonality and holiday demand. So I expect Q4 to be slightly better than Q3. But Q3 and on the first 9 months of this year, there was a shrinkage and contraction in the market, which impacted all of us. So fourth quarter is expected to be better. Regarding your second question of inventory, I think I kind of answered it in the prior question. But overall, let me summarize that in the first half of the year, we had an increase in inventories of the higher cocoa shipments that we had in half 1. With this higher inventory shipments in half 1, it kind of continued in Q2 and Q3 that impact Q3 as well that impacted our inventory levels. And we expect it to normalize towards the end of the year. And I think overall, that's the main reason.
Operator: Our next question is from Cemal Demirtas from Ata Yatirim.
Cemal Demirtas: Congratulations for the results. My first question is about the cocoa side. You mentioned about it that you secured. But could you tell us a little bit about the hedging mechanism there? And related to the margin recovery, we see the second quarter margin was very much negative surprise and we see a positive surprise in the third quarter. Considering the cocoa price or other raw material prices, should we expect the margins to stabilize around 17% to 18% in the following quarters, maybe also in 2026? Is it a fair assumption? And related to working capital, should we see also some normalization in the following year? Because as my colleagues mentioned, your working capital needs increased compared to last year, but what should be the picture for 2026? And related to demand side, you said better quarter in fourth quarter so far. Is it in the domestic or both in domestic and international side?
Fulya Surucu: Okay. Let me start with your last question. The demand side is both international and domestic. So that's the expectation. In terms of working capital, yes, we expect 2026 to normalize. And in fact, I expect that you will be able to see it through Q4 as well. Regarding -- what was the first -- the first question is relating to cocoa hedge and margin. So related to margin, Cemal, we think that we will be able to meet our guidance. So from that guidance, you should -- you can also, I mean, calculate the expected Q4 margin. We believe that we should be able to meet that target to meet that margin number and we will be able to meet our full year guidance as promised before. And regarding cocoa hedge, yes, definitely, there is a hedge policy in the company that goes throughout the year. But as of today, we do not disclose how much is hedged or unhedged. And as you know, the number -- the cocoa number is very volatile. It decreased to 4,000 and it increased to 4,800. It is 4,400 and we still do not know what is going to happen in November, by the end of November, December and January, we'll see. But I mean, we are confident. We are acting per our policy as stated our policy. And depending on the changes on the benefit -- the benefit of the recent drop in spot prices will have a lag effect. And we do not expect to see a material positive impact on our cost of goods sold until further into 2026. Hope this helps.
Cemal Demirtas: And Fulya, as a follow-up, related to your open position and your hedging, do you have any specific target for that, just like the cost of your debt? When I look at your FX and the interest expense, in TL terms, I calculate around 27% in TL terms. if I'm not wrong, in the following quarters because when we look at your open position when the TL depreciation narrows, you should have lower financial expenses. But as you are protecting your position through hedging, you have a stable FX or like the interest expense and plus FX position. Should we expect that to continue or could you make any rebalancing in your hedging positions depending on the conditions?
Fulya Surucu: Our hedging position will not change. We set a policy that stays very clearly that minimum 60% of the open balance sheet position needs to be hedged. So we will continue with that policy and with that positioning. And I think for the last 2 to 3 years, that ratio did not go below 60% every quarter and this will continue.
Operator: Our next question is from Mehmet Gerz from Osmanl? Portfoy. What are terms of royalty payments to you this holding for the use of Ulker brand, which for some reason, belongs to the parent company?
Fulya Surucu: So we do not disclose this number. And this is not -- and this is based on a relationship on every business there is a holder of the brand, then there are companies that are using that brand to operate to make their operations. We do not own the brands. We are operating on that brand and there is a company that holds that brand. It's the same everywhere in the world and there is a royalty relationship between these companies. And naturally, Yildiz Holding holds the Ulker brand and we are operating under Ulker brand. There is definitely a royalty relationship or a transaction between these 2, but we do not disclose any numbers regarding on that. But I can assure you that the number is no different than any number that is -- I mean, this is an example in other companies in the world.
Operator: Our next question is from Gustavo Campos from Jefferies.
Gustavo Campos: I have a few questions here. Firstly, I'm trying to understand a little bit more. It seems like your international EBITDA was quite mixed when you break it up by regions. It seems like Central Asia, like Kazakhstan was a bit weaker there, while in the Middle East it was a little bit better. Could you please like explain a little bit on what's happening on the underlying backdrop to justify this? And I'm also trying to understand for your exports, it seems like there was a significant recovery in EBITDA in the third quarter when you look at it year-over-year growth. Was it this only due to higher volumes that were allocated to being exported or was there like actual improvement in the underlying pricing? That would be my first couple of questions here.
Fulya Surucu: Thank you. Let me start with your last question. Yes, we achieved a good turnaround in Q3 in our international business. A recovery in demand in Q3, our medical volumes grew by a very strong 15% year-over-year. Turkiye export volumes also returned to a positive growth of 2.8%. So this volume recovery also translated directly into a top line growth with net sales increasing 41% in Turkiye exports and 14% in Middle East, North Africa and Central Asia year-over-year. So there is also a sharp improvement in profitability compared to Q2 '24 and '25. We are actively and successfully managing the cost and pricing environment. In International segment, EBITDA margin also recovered from Q2 to Q3. So when we come to Central Asia numbers on a specific basis, on a year-to-date basis, there is a sales decline of 16.5% on a year-to-date basis. But in Q3, there is also a very good recovery in Q3 on our volume, delivering 7.6% volume growth versus prior year. There are strategic shifts from margin production -- protection to aggressively securing top line growth. We achieved a 7.6% year-over-year increase in sales volume and this also reflected to our margin reaching to 30.5%. I hope that helps. Let me know if you have any other questions.
Gustavo Campos: Yes. No, I was just trying to understand like did you have like better pricing in your exports? Was there any price recovery or was it just higher volumes that were exported?
Fulya Surucu: It's mainly the volume increase that impacted the numbers.
Gustavo Campos: Understood. And in Central Asia, is it correct to assume that backdrop in Kazakhstan remained somewhat weak and that's what explains the weakness in your Central Asia segment?
Fulya Surucu: Yes, mainly Kazakhstan, yes.
Gustavo Campos: Okay, understood. I'm also trying to understand a little bit about your working capital. I think we covered inventories, but on your receivables, it seems like your receivable days they increased significantly, not only in second quarter and third quarter due to seasonality, but when I compare it to previous years, it also looks like we are at highs, like multiyear highs, if I'm not mistaken here. Do you have like any perspective on whether your receivables position will start improving moving forward? Do you have any targets? And I'm trying to understand what is driving the significant increase in your receivables position.
Fulya Surucu: Thank you for the question. We believe that -- I believe that the increase in receivables is mainly a temporary fluctuation directly linked to a high volume of sales activity with our primary distribution companies during the third quarter. There is no collection issue at all. I can assure you that. The pattern is there is -- I mean, the seasonality and pattern is consistent with our business cycle. The balance was higher at the end of Q1, decreased in Q2 following collections and now has risen again in Q3 after Q3 sales. And we expect the receivable balance to normalize to stabilize in the fourth quarter as collections for these Q3 will come through in Q4 and will be realized. And we do not disclose any, I mean, DSO target number or a working capital number. Our objective here is always to optimize it.
Gustavo Campos: Understood. So my understanding here is that it was mainly due to the strong top line and EBITDA growth and this is also partially seasonal and you expect -- in 2026, do you expect any normalization from -- compared to current levels or it may be too soon to tell?
Fulya Surucu: Yes. No, we expect the normalization starting in Q4 2025 and then to continue the momentum in 2026. Does that help?
Gustavo Campos: Understood Yes, very helpful. Last couple of questions here. Could you please confirm you repaid the 2025 remaining outstanding bond amount with cash in your balance? And do you expect to raise any debt to offset this decrease in your cash balance for this?
Fulya Surucu: Let me answer your question in 2 phases. The first one is, yes, we paid the remaining outstanding Eurobond balance as cash by the end of October from our cash balance. The second one is we raised debt in order to refinance our current outstanding loan, which was going to mature in 2026 April. So we kind of early refinanced it, but it was a 3-year syndication loan. Now we refinanced it with a 5-year bullet structure. So it is also completed. And the loan with EBRD part is also completed. So to your both questions, yes and yes.
Gustavo Campos: Understood. What was the rate that you are paying for this new syndicated loan?
Fulya Surucu: Of course, much lower than the prior syndication. And you will be -- you should be able to see some more numbers when we complete or announce our Q4 numbers, annual numbers. But much lower rates than we had in prior syndication and very stable...
Gustavo Campos: Understood. And then you still have like roughly, I think, like $550 million worth of short-term debt. If I exclude the bond and I exclude this EBRD syndicated loans that you refinanced, you still have roughly $550 million worth of short-term debt, rough estimation here. How are you planning to refinance those?
Fulya Surucu: We do not have a short-term debt. So the Eurobond was refinanced last year in July 2024. This debt had a 7-year maturity. So $550 million Eurobond was refinanced in July of 2024 with 7-year maturity, which matures in 2031. The current syndication, which was going to mature in April 2026 is also refinanced by the end of October with a 5-year bullet structure. So we are going to pay it in 2030, so in 5 years. So all of them will be transferred to long-term when we issue our Q4 -- most of them will be transferred to long-term when we share our full year numbers. But $250 million Eurobond is also repaid by the end of October this year, outstanding with our cash. So all the loans that are outstanding right now have a long-term maturity, 2031, 2030.
Gustavo Campos: Okay, yes. I just see like, for example, you still have roughly $350 million of short-term letter of credits, if I'm not mistaken. Do you plan to continue to roll over this balance or are you planning to refinance this in some other way?
Fulya Surucu: So because this is -- this report is as of September year-to-date, you do not see that it is closed, but the closed outstanding Eurobond that was coming from 2020, which was going to mature this October 2025 is already paid. So this report states September year-to-date, but I tell you that by the end of October 2025, all the outstanding Eurobond debt from the year 2020 is already paid with cash. And you should be able to see that by the end of December when we issue our full year numbers, I mean, beginning of 2026. So it is already paid. And 2 of the refinances are already done and their maturity is 2030 and 2031. So all of them are long-term. The short-term you see right now is already paid with cash by the end of October 2025. The reason why you don't see it is because you had a report stating the situation by the end of September 30, 2025. I hope it makes sense?
Operator: Our next question is from Evgeniya Bystrova from Barclays.
Evgeniya Bystrova: I have several questions. So first of all, on your working capital, do you expect the same inventories inflow in first half of 2026 as it happened this year? Then my second question is regarding the Romanian IFC loan maturing in 2026. What is your strategy to address that? And finally, I guess it's also kind of a follow-up to a question by my previous colleague. So like you refinanced obviously, most of your short-term debt, extended the maturity profile. So what would be your strategy going forward? Are you expecting any M&As in the pipeline? And finally, I guess, to clarify the previous question, I agree that you do have like letters of credit debt on your balance sheet, which was considered to be short-term. And it's not part of previous Eurobond or any syndication loan. So it was separate as a short-term debt. And at least at the end of H1, it was around $350 million. So I guess the question was, how are you planning to address that? Because we do see that on the balance sheet even at the end of September. And if we exclude Eurobonds and other bank loans that were extended, there would still be part of letters of credit on your balance sheet, it seems. I hope it clarifies.
Fulya Surucu: Okay. Thank you for your questions. So let me start. I kind of noted them one by one. If I miss something, please remind me. So let me start with IFC loan, which is going to mature in April 2026. So we have a great progress on that. And hopefully, you should be hearing the news and updates with IFC very soon. So -- but I can assure you that with 5-year bullets that we closed with our commercial banks, which is the first time since 2020 in the Turkish private sector. We had a lot of demand. It is successfully completed with EBRD. It is successfully completed with commercial banks and you will see the update soon with IFC as well. But I can tell you that the progresses are all in the right track and progressing in the right direction. So that's one. Regarding the inventory, so we -- as I have also shared in the prior quarters, we do not have an exact working capital number or target, because -- I mean, depending on the conditions, depending on the changing environment volatilities and so on, our target for working capital is optimizing the working capital, okay? So some things might change, I mean, in order to reach this number of DI or this number of DSO. So what I can tell you that this focus on optimization of working capital will continue throughout 2026 as well. We'll make sure that we close -- we will have the optimized inventory and cocoa levels in 2026 and throughout 2025 as well. And we'll continue to focus on that. That's all I can share. And we expect, as I have also shared in the prior questions that we expect a normalization throughout 2025 and 2026 as well. So this was inventory and working capital. M&A, yes, let me share with you also. Yes, we have also -- we closed 2 very important financings very, very successfully last year Eurobond with 7-year maturity, very recently in October, 5-year bullets with commercial banks. So all of them are long term right now. There is not a -- I mean, M&A plan or pipeline that I can share or I can make public with you right now. But what I can tell you is our objective and our mission is to have Ulker's growth and growth ambition will continue and to make Ulker -- to strengthen Ulker's global presence in the markets that we operate will continue. We will see. That's all I can share with you right now. And regarding the LCs, the LCs are used in cocoa procurement. So short-term debt -- the short-term debt number you see is mainly LCs. LCs are used to procure cocoa and it will be based on our own resources. We generate adequate operating cash to pay our LCs. And they are very important -- one of the very important tools, first, to mitigate our risk and second, to optimize our working capital and to manage cash. So I think LCs, especially for our business where there is a very long cocoa cycle from end-to-end is very much needed. And I believe that we have done a great job here by increasing our LC limits with our very important finance partners. And this definitely contributes to our business on many perspectives very, very positively. Hope that helps?
Operator: [Operator Instructions] Okay. It looks like Gustavo from Jefferies has a follow-up.
Gustavo Campos: Yes. A very quick follow-up here. How does your average realized cost for cocoa compare -- in 2024 compares to 2025? Can you give us like some high-level idea of like how much higher were your cocoa costs incurred from 1 year to the other? That would be my last question.
Fulya Surucu: Thank you for your question, but we do not disclose these details unfortunately.
Operator: We would like to thank everyone for the participation today. I will now hand it back to the Ulker team for the closing remarks.
Fulya Surucu: Thank you for your attendance and for your great questions today. If you have any further questions, please reach out to me or my team. I believe that we delivered great results in Q3 and I believe that this momentum will continue in Q4 and we will meet our guidance. Thank you all and have a great day or evening.
Operator: That concludes the call for today. Thank you, and have a nice day.