Dear Stakeholders,

Despite the world adjusting to the new normal, the year we have left behind was still very much under the influence of the pandemic and other extraordinary developments. The ups and downs and the unexpected challenges in this period have reiterated the importance of agile and sustainable corporate governance. We've seen how companies that have successfully integrated agile practices into their operating models have done much better in coping with the negative effects of the pandemic. The pandemic has also shown how essential certain concepts are for corporate sustainability and accelerated their progression, including the emerging trends of resilience, re-learning, automation and digitalization.

The pandemic has created an opportunity for us to evaluate our current standing and plan our future by pursuing strategic renewal for our Group according to changing conditions. Drawing on its know-how, experience, deep-rooted values, strong reputation, and qualified human resources, Tekfen has the equipment and means to continue its success well into the future. However, today’s fast pace of change requires our company to embrace continuous learning for further development, foster sustainability in corporate governance as part of the new world order and reinvent itself accordingly.

For the first time in Tekfen’s 65-year history, the position of President of Tekfen Group Companies was entrusted to someone from outside the company and the industry. My assumption of this role in 2021 reflects the Group’s desire for renewal with a fresh perspective. With this change, the operational responsibilities in the company have been left to a team of experienced professionals, which I believe is a major milestone for the transition of Holding and Group Companies to sustainable corporate governance. Adding massive value to its industries, Tekfen is one of the major building blocks of our country’s economy. What we need to do now is to write a new story for Tekfen’s future while confidently elevating the company amid today’s major paradigm shift.

Accordingly, our main agenda item in 2021 was to ensure that our current operations continue safely in extremely volatile markets and that we are prepared for the change ahead. To that end, we have accelerated the ongoing efforts to establish a lean and agile organization. We have also embarked on an intensive planning process that highlights our strengths to establish the right business model that will allow us to rise above the competition. By building on the values, we have inherited from our founding partners, we have focused on how we can create new opportunities for our highly adaptable, hardworking, quality-oriented, talented, and creative organization that is open to learning and innovation with an established consensus culture, how we can diversify our portfolio, and how we can realize a more agile management approach.

Dear Stakeholders,

Digital transformation and the integration of our business processes with high technology, which is one of the most basic requirements of sustainability, have been our main areas of focus. As a group that takes its name from Technology (Teknoloji) and Science (Fen), we have extensively analyzed how we can harmonize this trait existing in our genes and our engineering skills with today’s innovation-oriented business approach and how we can use our resources more efficiently. We are aware of the competitive advantage we will achieve by successfully integrating groundbreaking technologies into our areas of activity. We also aim to be a company that develops and produces technology with our broad engineering know-how, R&D studies and venture capital portfolio.

I would like to take a moment to talk about Tekfen Ventures, our venture capital company headquartered in New York, the USA. Currently boasting 13 startups operating in different fields, Tekfen Ventures shows just how successful it has been with its investment choices in the five years of its existence. Demonstrating how profitable it can be to take the right steps in the world of venture capital, our company has also guided our Group Companies with its investments in technologies that will shape the future of our areas of activity. The synergy and various cooperation opportunities created between the startups that Tekfen Ventures invested in, and our Group Companies will provide us with major opportunities for expanding our business into new areas.

Our Engineering and Contracting Group has gone through a rather challenging period, as the pandemic has delayed new investments around the world and disrupted our existing projects. In this process, the Group, which mainly focuses on business development and bidding efforts, will support its portfolio with new projects as the world adjusts to the new normal. I believe that the efforts for process improvement, digital transformation, operational efficiency, and cost optimization, which continued intensively in 2021, will provide significant benefits in terms of resource efficiency in the coming period where profitability targets will come to the fore instead of the backlog.

Our Chemicals Group, which specializes in the production of an essential input in agriculture, namely fertilizers, and our Agriculture Group, which operates directly in agricultural production, were both exposed to the negative effects of the pandemic. But they also benefited from a positive outcome associated with COVID — the increased significance of global agricultural activities. Despite the difference in their operational areas, the fact that agriculture is a common factor for both our Groups requires close collaboration in terms of correct scaling and efficiency. With a synergistic approach, our organizational design processes continue to bring the two Groups together in common goals.

We have established our goals and plans for transitioning to a zero-carbon economy, which concerns all Group companies and therefore remains one of our top priorities. Our environmental sensitivity focuses on water management as well as greenhouse gasses. Water is critical for our operations, and given our presence in agriculture, it is also critical for our suppliers and customers. Our priorities in this regard include developing seeds and plant species that require less water at our Agripark R&D Center, inventing new formulations at our Toros R&D Center to eliminate the negative effects of fertilizers on water, providing farmers with different types of fertilizer that can be used with drip irrigation, raising their awareness of these issues, and using water in the most efficient way across our own agricultural lands.

As a leading and exemplary Group in its industries and regions and a top choice for global companies, Tekfen will take strength from these attributes and aim to achieve greater dreams and global-scale goals. Accordingly, the headlines of Tekfen’s new story will feature expanding our operations to the regions of global economic giants, such as the Far East and America, improving our global presence and representation, and most importantly, transforming our companies into world-class businesses. Our human resources are our most valuable asset on this exciting journey, and we believe that especially our young employees will become the inspiring protagonists of “Tekfen’s new story.”

Sincerely,

Ali A. Pandır