DOAS TI: 4Q22 Review (Oyak Yatýrým)


Net profit missed expectations due to lower EBITDA
DOAS posted net profit of TL2.4bn in 4Q22, up 120% y/y (q/q: -12%), 6% below consensus. Although EBITDA was much lower than foreseen, contribution from subsidiaries and possibly FX gains resulted in a slight miss at the bottom line. Sales revenues rose by 174% y/y to TL16.1bn. On a volume basis, wholesale sales (excluding Skoda) increased by 38% y/y to 17.6k units in 4Q22. A robust gross margin, driven by the success in pricing, helped sustain the strong outlook in net profit.
Strong gross profitability achieved through pricing capability
Gross profit grew by 261% y/y (+34% q/q) to TL3.7bn and gross margin was up 5.6bp y/y to 23.3%. OpEx/sales ratio rose by 55bp y/y to 10.7%. As a reminder, there is a seasonal rise in personnel expenses for the Company in the last quarters of the year. EBITDA grew by 328% y/y (-11% q/q) to TL2.1bn which missed market expectation by 25%. On the other hand, EBITDA margin improved by 4.7bp y/y to 13.2%.
Healthy balance sheet outlook continues with growing net cash position
Net cash position increased from TL2bn in 3Q22 to TL2.8bn by the end of 2022. We see a considerable improvement in the company's financial structure despite its profitability-oriented business structure and market fluctuations in recent years.
2023 guidance to be announced at a future date
The company did not share any information about its 2023 expectations. On March 8, 2023, we believe that expectations might be shared at the meeting where financial results will be announced.
A proposal was made to distribute a gross dividend of TL9.09 per share
The Board of Directors proposed a dividend payment of 9.09TL per share to be distributed to shareholders for the approval of the general assembly. This amount corresponds to a dividend yield of 5.4% according to the last closing price of the share. As a reminder, the Company made a gross dividend advance payment of 4.1TL per share on November 14, 2022.
Rating maintained at "Outperform" & TP revision to TL224.00/share
Following its strong 4Q22 results, we reflected current net cash position, updated equity pick-up valuations and made an upward revision in our 2023E Sales, EBITDA and NI estimates by 3%, 3% and 3% respectively. We keep our "Outperform" rating with an upward revision in our target price from TL214.80/share to TL224.00/share. According to our 2023 forecasts, the share trades at very attractive 3.1x EV/EBITDA and 4.0x P/E.