Borusan Group Targets TRY 12 Billion Investment

With a new roadmap unveiled to become a 200-year company, Borusan Group adopts a strategy opening to future economies while targeting growth in "core," "adjacent," and "new" business areas, with a focus on corporate venture capital investments in start-ups. Implementing inclusive projects in sustainability, digitalization, and talent management, Borusan Group invested TRY 790 million in digitalization during 2019-2021 and plans to double this amount over the next three years. Borusan Holding, announcing its 2021 financial statements, continues to strengthen its finances compared to the previous year. Net consolidated turnover, which stood at TRY 26 billion in 2020, rose to TRY 47 billion in the 2021 operating period. Raising EBITDA from TRY 2.6 billion to TRY 5.1 billion, Borusan plans investments of TRY 12 billion during 2022-2024. Emphasizing strong performance after successfully navigating a challenging period marked by uncertainties like the pandemic, Borusan Holding Group CEO Erkan Kafadar stated, "2021 was an important year in which we achieved strong financial results and established a new roadmap toward becoming a 200-year company." Kafadar said: "As we move toward this goal, we plan not only to keep pace with today but to anticipate and implement the business models, competencies, and working methods of the future. To achieve our targets, we have drawn a detailed roadmap for ourselves. On this roadmap opening to future economies, we will first transform and develop our core business areas. Our next direction will be growth in adjacent business areas. Our subsequent step will be to advance toward new business areas using our accumulated valuable experience. In the final phase of our growth approach, we will position corporate venture capital under a different structure. We will invest in operations with growth potential under this umbrella. The most important tools on the path to these objectives will be our approaches to digitalization, talent management, and sustainability," he said.

Four main focuses in growth approach

Borusan will prioritize transforming and developing its core business areas in its new roadmap, thereby building a solid foundation by adapting the Group to current needs. While Borusan's renewable energy and manufacturing growth investments continue at full pace, the company includes strategic objectives in its plans to prepare subsidiaries for the future. In this context, it targets growth by adding over 100 MW of new capacity in clean and renewable energy activities. Among manufacturing initiatives are pipe investments in the US and Romania. Borusan Mannesmann, a Group company, is preparing to expand its service areas in the US with a new investment. The new investment, initially estimated at approximately USD 50 million, will bring pipe production capacity of its US subsidiary Borusan Mannesmann Pipe US to 400,000 tonnes. Beyond these expansions, Borusan will further develop and expand the innovative field solutions it offers to customers in construction equipment while undertaking significant work in electric vehicles. Targeting growth in adjacent business areas, Borusan will leverage strong competencies in core operations to capture growth opportunities. Pursuing new business opportunities in the automotive sector, the Group integrates innovative business models offering high value-creation potential to investors. Automotive, used car, spare parts and service, rental, and next-generation component manufacturing present significant opportunities, with digital customer experience among prominent focus areas. In the energy sector today, opportunities exist to become a leading provider of energy solutions supporting Turkish industry's green transition. In these areas, work continues on business models supporting digitalization and decarbonization. Borusan will access new business areas using experience and knowledge accumulated in different sectors, evaluating opportunities in new business fields. Noting openness to new areas given the scale and strength of the core portfolio, the company analyzes investment targets, evaluating organic and inorganic investment opportunities in sustainable, differentiated, growth and export-focused, industry-based new sectors. Borusan also aims to develop a dynamic portfolio under a separate structure, benefiting from the external innovation ecosystem through corporate venture capital, comprising future-trend-aligned businesses with a different risk/return profile within the scale of today's portfolio. In pursuing this goal, Kafadar noted the Group will create value using its knowledge base, stating preparations in this area are complete. Kafadar announced that focus areas have been identified as mobility, supply chain and logistics, climate technologies, and energy, with investment work in start-ups to begin this year.

Future goals centered on climate, people, and innovation

Updating its sustainability work comprehensively in 2020, Borusan pursues integrated initiatives in climate, people, and innovation focus areas. Across the Group, climate-focused targets include carbon neutrality by 2030, reducing water consumption, while creating a clean and renewable energy portfolio while supporting terrestrial life. Additionally, a sustainable procurement policy has been introduced while targeting a 50 percent reduction in waste disposal rates. People-focused priorities include talent retention and development, preventing unwanted losses, becoming the most preferred employer, and increasing the proportion of female leaders and employees. Under innovation, creating innovative, sustainable business models is targeted while investments in start-ups are planned.

Digital investments doubled for 2022-2024 period

Borusan began investments in the digital field before the pandemic, increasing efficiency by integrating developing technology and digitalization into business processes. Having invested TRY 790 million in digitalization between 2019-2021, the organization aims to double this investment amount over the next three years. Focusing on customer and internal processes in digitalization, Borusan makes investments toward delivering exceptional customer experience. Evaluating opportunities presented by digital to improve developed business models and its own internal processes, the organization integrates all digital technologies serving these two objectives—artificial intelligence, robots, mobile applications, and augmented reality—into business processes.

Borusan Culture centered on people

Centering people for 78 years and believing in success through people, Borusan pursues the "Borusan Culture" project with the aim of creating value for generations to come. The organization embarked on developing and carrying forward the culture that brought Borusan to where it is today with current needs and future insights, expanding Borusan culture with an understanding of creating value for employees, customers, society, and the environment. In this context, Borusan transitioned to a new work model as of 1 January 2022, continuing operations under three different work models in the new order: On-site Work, Hybrid Work, and Remote Work, depending on job suitability and readiness for remote work.

Art's supporter from the first note

Maintaining its support for the arts for 78 years since its founding, Borusan crowns its support this year as main sponsor of the Istanbul Music Festival. Through Borusan Kocabıyık Foundation, Borusan Art, and Borusan Contemporary, the organization centers education, culture, and the arts, continuing uninterrupted support in these areas. Having stood alongside IKSV as a show and festival sponsor for 50 years, Borusan will provide significant support as main sponsor of the Istanbul Music Festival in its 50th year toward efforts bringing culture and arts to wider audiences.