Lila Kağıt’s Goal: Sustainable Growth Through New Investments
Lila Kağıt, one of Turkey’s leading hygienic tissue paper manufacturers, made statements about its financial results for the third quarter of 2024, ongoing investments, and developments following its public offering. Lila Kağıt CEO Alp Öğücü announced that they would continue to make groundbreaking investments in the new period.
As one of the largest players in the tissue paper industry globally, exporting to over 80 countries across five continents with its brands Sofia, Maylo, UltraBerrak, and Nua, Lila Kağıt’s CEO Alp Öğücü and CFO Işıl Tireli made statements about the company’s financial results for the third quarter of 2024, ongoing investments, and developments following its public offering. According to Lila Kağıt’s financial results for the third quarter of 2024, net profit after tax increased by 9.3 percentage points compared to the same period last year, reaching 981 million TL.
“We are a Manufacturer of Hygiene Products in Turkey and a Paper Manufacturer in the World”
Providing information about the company’s production structure and sales, Lila Kağıt CEO Alp Öğücü said:
“As Lila Kağıt, today we operate on a single campus spanning 300,000 m², achieving production capacity at a rarely seen scale with our four paper machines. In addition, our machine park, which includes 26 converting lines and 53 packaging machines, allows us to develop a wide variety of products. We export to over 80 countries, both to nearby and distant markets. While we operate in Turkey with our own brands, Sofia, Maylo, and UltraBerrak, we also sell jumbo rolls as raw material and converting products as complementary items to tissue paper manufacturers abroad. Despite the economic challenges experienced in national and international markets, we achieved 160,000 tons of sales in the first nine months of 2024, managing to increase our sales by 15% compared to the same period last year.”
“Our Erzurum Facility Will Bring a New Perspective to the Industry”
Following the public offering in May 2024, Öğücü stated that they have focused on new investments with the goal of sustainable growth in the tissue paper industry:
“Erzurum is an investment project we started researching in 2018 and completed the business plan for in 2022. We are establishing the first tissue paper production facility in Eastern Anatolia and the Black Sea regions. Unlike the tissue paper production strategy concentrated in Turkey’s western regions, we aim to deliver products faster and at lower logistics costs to markets with a population exceeding 30 million, including a large portion of Anatolia as well as nearby markets like Georgia, Iraq, and Azerbaijan. At the same time, we will significantly contribute to the development of industry and employment in the region. Construction of our facility began immediately after the public offering, and as long as weather conditions allow, we plan to work through the end of 2024. We aim to launch the converting section in the summer of 2025, and with the commencement of jumbo roll production in Erzurum in 2027, we will further expand our target markets.”
“We Activated Our Solar Power Project Covering an Area the Size of 16 Football Fields”
Highlighting that effective and efficient energy management and investments in renewable energy sources are key elements of their sustainability strategies, Öğücü continued:
“In this context, we first started producing solar energy with a capacity of 12.5 MW on the rooftops of our Tekirdağ Ergene factory. Our solar power plant, covering an area approximately the size of 16 football fields, is one of Turkey’s and the world’s leading solar projects in this respect and can generate electricity equivalent to the consumption of approximately 10,000 households.”
Emphasizing that this large-scale plant meets 8% of the facility’s energy consumption due to the heavy industrial nature of their operations, Öğücü added:
“By investing in solar power plants at different locations, we aim to first complete the 50 MW commitment we pledged and then scale up to exceed 50% of our consumption. Thanks to these investments, we will achieve an average annual electricity cost savings of $14 million. As the next step, we received approval for our connection letter and zoning permit for a land-based solar power plant in Bitlis, and we are currently in the environmental impact assessment approval phase. In Bitlis, we plan to quickly activate a 28.1 MW solar power plant covering an area approximately the size of 50 football fields.”
“We Achieved 9.3 Billion TRY in Net Sales Revenue”
Commenting on the financial results, Lila Kağıt CFO Işıl Tireli stated:
“In the nine-month period, we achieved consolidated net sales revenue of 9.3 billion TRY. Our net profit after tax increased by 9.3 percentage points compared to the same period last year, reaching 10.6%, with a net profit of 981 million TRY. For the nine-month period of 2024, we are among the top 100 most profitable publicly traded companies listed on Borsa Istanbul.”
“We Are in a Net Exporter Position”
Tireli continued:
“With an export model that has been at the core of our business since the company’s inception, we naturally hedge against exchange rate risks while maintaining a net exporter position that generates a foreign trade surplus. Within this scope, we achieved an export ratio of 73% during the nine-month period of 2024. Low financial leverage and equity exceeding 11 billion TRY are among the strongest financial indicators that define us.”
“We Aim to Continue Dividend Distribution”
Tireli concluded by stating:
“At our first regular general assembly held after the public offering, we distributed a gross dividend equivalent to 88.42% of the previous year’s profit on August 1, 2024. As a company that has consistently distributed dividends in 10 of the past 11 years, we aim to maintain this practice in alignment with our past performance, depending on our financial position, the funding needs of future investments, sector dynamics, and economic conditions.”
